Finance, Trade, and Industry of the First Republic of Armenia

Finance, Trade, and Industry

In the fall of 1918, the commercial and industrial life in Armenia was dead, and state finances consisted of what the government had returned from Tiflis.

The Ministry of Finance was created on the basis of Transcaucasian bonds, as well as on the nationalization of cotton, taxes on real estate, brandy, wine, and other materials.

Armenian money was issued as well. Over 300 million banknotes were printed abroad. State treasuries were established in Yerevan and in different regions of the country. Customs was also established.

For trade and barter, a state of certainty was formed. In particular, certain laws were developed which would be reflected in the 1919 state budget. A budget for 1920 was developed and submitted to the Parliament as well. The foundation of the gold fund was also created and a $20 million loan was borrowed.

Since the second half of 1919, trade in Armenia has been being revived. Goods from Baku were imported from abroad. Cotton, brandy, wool, leather, fur, wine, and salt were exported from Armenia. Workshops and factories for the production of soap, leather, brandy, tobacco, etc. were established. At the end of 1919, 5 tobacco factories began to operate in Armenia.

Credit lines opened for cooperatives. A congress of cooperatives was convened and institutions were established to give out small loans. In 1920, 280 cooperatives with 111,957 members operated in Armenia, half of which were included in the network of the cooperative movement.

The principle of progressive tax was adopted. The Shustov Cognac Factory (now Ararat State Factory) was nationalized, and on its basis, the creation of the state brandy business began. State warehouses were approved in Yerevan and Armenian provinces, and financial and trade representatives were sent to Batumi and Tiflis.

An excerpt from the book “Wanderings” by the last Prime Minister of the First Republic of Armenia Simon Vratsian.

Read also: Education in the First Republic of Armenia


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