Balkans and Italy.

The South Caucasus is situated at the
crossroad of the Russia, Turkey, Iran, Europe, and Central Asia. The gas and oil
reserves in the Central Asia and Caspian Sea and the pipelines to Europe
through the South Caucasus make clear the geopolitical importance of the
region. The rotation from the Soviet system to diverse democratic societies and
functioning market economies have been going through with political and social
disruption, governance deficits, wars, occupation, and conflicts in different
regions. For the last two decades the three South Caucasus countries has practiced
social troubles, some armed conflicts, and territorial disputes, namely with
regard to Nagorno-Karabakh, Abkhazia and South Ossetia/Tskinvali Region and war
against Russian Federation. Today there are still around 1.2 million internally
displaced persons (IDPs) and refugees in the three countries. Despite
international mediation, the conflicts are still frozen. Armenia stands
completely isolated mainly because its borders are closed with Turkey and
Azerbaijan. The country has friendly relations with Iran and after joining to
the Eurasian Economic Union, continues to depend economically and politically
on the Russian Federation. Due to regulatory reforms, an improved business
environment and higher exports of commodities, Armenia’s economy is slowly
recovering. According to World Bank GDP (2015) is 10.561 $billion. However,
poverty and unemployment remain high, particularly in rural areas and have
further increased over the last few years. Remittances from working migrants
and the Armenian diaspora play an important role for family income support and
investments in the country. Subsistence agriculture remains the major
employment sector, accounting for 45% of the working population. Market
liberalization has placed large constraints on the once heavily subsidized
agricultural sector and colluding interests pose threats to fair competition. 

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