ECONOMIC LOSSES OF ARTSAKH DUE TO BLOCKADE. EVALUATION REPORT

Abstract

Since late 2022, the only "Road of Life" connecting The Republic of Artsakh with the rest of the world and feeding Artsakh's economy was closed by the selfproclaimed "Eco Activists" of Azerbaijan. This situation disrupts the normal socioeconomic life in Artsakh and brings considerable financial, economic and social losses. This research aims to implement assessment of those losses of Artsakh economy, including their primary, secondary and multiplier effects, as well as the size of social and fiscal impact. To increase the accuracy of the results, several methods have been used, (both computational and model-based) with the goal of reducing the vulnerability of the obtained results. Estimates show that because of the blockade, the Republic of Artsakh suffers significant socio-economic losses, in total at least 652 million drams (1.6 million US dollars) per day, including the loss of tax revenues, which amounts 81 million drams or about 205 thousand US dollars per day and additional primary minimum social expenses of about 36.4 million drams (92 thousand US dollars). The total socio-economic (including welfare) loss is estimated at a minimum of 753 million AMD or 1.9 million USD per day.