Strengthening of Armenian dram affects IT industry

20.06.2022 15:35
Strengthening of Armenian dram affects IT industry

YEREVAN, June 20. /ARKA/. The strengthening of the Armenian dram against the U.S. dollar has caused concern of many local IT sector companies. DataArt Director Arsen Baghdasaryan and AIST Global Founding Director Hrayr Shahbazyan called a press conference today to presented the ensuing risks.

According to Baghdasaryan, most Armenian IT companies work with foreign partners, hence the entire turnover and service contracts are in USD, while internal expenses, including payment of salaries, are made in Armenian drams. For this reason, companies bear losses because of exchange rate fluctuations.

"Over the past few months, if you look at the average exchange rate of the dram, these losses amount to 20%. For IT industry this is a very serious amount of money that affects the ability of companies to develop, invest and conduct correct salary policy," he said.

At the same time, he drew attention to the fact that despite the fluctuations of the dollar exchange rate, the cost of goods, the pricing of which is associated with that currency, does not change.

According to Baghdasaryan, there is a risky situation for the IT sector, because in order to maintain the current level of employee salaries, companies must earn more dollars.

"It's a risky situation, because about 90 percent of Armenian IT companies work for the outside market," he said.

Baghdasaryan said that if no measures are taken, in the worst case scenario, small companies may close down, which will harm the country's economy. He noted that there are altogether over 1000 IT companies in Armenia.

In his turn, Shahbazyan noted that the state should take measures to solve the issue. "If the situation continues to develop this way, many small and new IT companies will not endure and will close," he warned.

Earlier, Armenian Economy Minister Vahan Kerobyan suggested that the country's Central Bank use its tools to curb exchange rate fluctuations in the foreign exchange market caused by the influx of forex into the country.-0--

Tags: Новости Армении АМИ Новости-Армения

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