Government Type: republic

Capital: Yerevan Geographic Coordinates: 40 10 N, 44 30 E

Independence: 21 September 1991 (from the Soviet Union)

National holiday: Independence Day, 21 September (1991)

Constitution: adopted by nationwide referendum 5 July 1995; amendments adopted through a nationwide referendum 27 November 2005

Legal system: based on civil law system; has not accepted compulsory ICJ jurisdiction

Suffrage: 18 years of age; universal

Economy Overview: After several years of double-digit economic growth, Armenia is facing a severe economic recession with GDP declining at least 15% in 2009, despite large loans from multilateral institutions. Sharp declines in the construction sector and workers' remittances, particularly from Russia, are the main reasons for the downturn. Under the old Soviet central planning system, Armenia developed a modern industrial sector, supplying machine tools, textiles, and other manufactured goods to sister republics, in exchange for raw materials and energy. Armenia has since switched to small-scale agriculture and away from the large agroindustrial complexes of the Soviet era. Armenia has managed to reduce poverty, slash inflation, stabilize its currency, and privatize most small- and medium-sized enterprises. Since the breakup of the Soviet Union in 1991, Armenia had made progress in implementing some economic reforms, including privatization, price reforms, and prudent fiscal policies, but geographic isolation, a narrow export base, and pervasive monopolies in important business sectors have made Armenia particularly vulnerable to the sharp deterioration in the global economy and the economic downturn in Russia. The conflict with Azerbaijan over the ethnic Armenian-dominated region of Nagorno-Karabakh contributed to a severe economic decline in the early 1990s and Armenia's borders with Turkey and Azerbaijan remain closed. Armenia is particularly dependent on Russian commercial and governmental support and most key Armenian infrastructure is Russian-owned and/or managed, especially in the energy sector. The electricity distribution system was privatized in 2002 and bought by Russia's RAO-UES in 2005. Construction of a pipeline to deliver natural gas from Iran to Armenia was completed in December 2008 but it is unlikely significant quantities of gas will flow through it until the Yerevan Thermal Power Plant renovation is completed in 2010. Armenia has some mineral deposits (copper, gold, bauxite). Pig iron, unwrought copper, and other nonferrous metals are Armenia's highest valued exports. Armenia's severe trade imbalance has been offset somewhat by international aid, remittances from Armenians working abroad, and foreign direct investment. Armenia joined the WTO in January 2003. The government made some improvements in tax and customs administration in recent years, but anti-corruption measures have been ineffective and the current economic downturn has led to a sharp drop in tax revenue and forced the government to accept large loan packages from Russia, the IMF, and other international financial institutions. Armenia will need to pursue additional economic reforms in order to regain economic growth and improve economic competitiveness and employment opportunities, especially given its economic isolation from two of its nearest neighbors, Turkey and Azerbaijan.

International Disputes: Armenia supports ethnic Armenian secessionists in Nagorno-Karabakh and since the early 1990s, has militarily occupied 16% of Azerbaijan - Organization for Security and Cooperation in Europe (OSCE) continues to mediate dispute; over 800,000 mostly ethnic Azerbaijanis were driven from the occupied lands and Armenia; about 230,000 ethnic Armenians were driven from their homes in Azerbaijan into Armenia and Nagorno-Karabakh; Azerbaijan seeks transit route through Armenia to connect to Naxcivan exclave; border with Turkey remains closed over Nagorno-Karabakh dispute; ethnic Armenian groups in Javakheti region of Georgia seek greater autonomy; Armenians continue to emigrate, primarily to Russia, seeking employment

Refugees and internally displaced persons - refugees (country of origin): 113,295 (Azerbaijan)

International Displaced Persons: 8,400 (conflict with Azerbaijan over Nagorno-Karabakh, majority have returned home since 1994 ceasefire) (2007)