Current issues and development pathways of digital economy in Armenia: YSU PhD student Alisa Gevorgyan’s vision

One of the winners of the "Research Program for PhD Students and Young Applicants-2024" competition is Alisa Gevorgyan, a PhD student at YSU Faculty of Economics and Management. She has already begun working on her research project titled "Challenges of Digitalizing Economic Relations in the Republic of Armenia". Alisa believes that economic success is no longer driven by the abundance of raw materials, as it once was. Instead, intangible capital is emerging as a crucial source of competitive advantage. Her research aims to identify effective strategies for organizing and advancing the digitalization of economic relations in Armenia, proposing mechanisms to foster the development of a digital economy in the country.

Relevance and Importance of the Research in the Context of New Technological Approaches to Economic Development

"Digital technologies are key components of today’s economy, transforming the way goods and services are delivered. Freight transportation and trade have gone digital, requiring more flexible and efficient systems. Moreover, during the COVID-19 pandemic, many organizations quickly transitioned to digital platforms to sustain their operations and maintain business activity. This shift highlighted the need for digitalization across all sectors of the economy. Digital solutions enable small and medium-sized enterprises to remain competitive against larger companies with more resources," noted Alisa. 

According to her, the development of advanced technologies plays a decisive role in enhancing a state's competitiveness, security, and standard of living. Countries that create and develop advanced technologies experience significant changes in their competitive landscape and secure leading positions on the international stage. Digitalization boosts the efficiency of business processes, making automation possible. 

"As a result, human errors are minimized, and operating costs are reduced. These factors highlight that the digitalization of economic relations is becoming one of the key drivers of socio-economic development in Armenia and other countries," emphasized the YSU PhD student. 

As a result of the scientific research, it is planned to publish at least one article in international scientific databases (ISBs) and at least three articles in local scientific journals recognized by the RA Higher Education and Science Committee. Additionally, participation in one international conference and at least two local conferences is expected, where the main scientific findings of the research will be presented.

Current Challenges in the Digitalization of Economic Relations in Armenia

According to Alisa, there are several challenges in Armenia's digitalization process, as digital development in the public administration system has progressed unevenly so far.

"Along with digital development initiatives in the public administration sector, the private sector of the Armenian economy is also actively responding to global trends in the digital transformation of processes. Industries supporting the digital economy—such as electronic payment systems, postal infrastructure, digital banking services, and e-commerce-related services —are developing, but still lag behind in terms of competitiveness at both the global and regional levels," she noted, adding that although e-commerce is growing, its adoption among businesses and society remains low. 

Alisa emphasized that the financial technology market in Armenia is undergoing significant development, accompanied by substantial investments from private sector participants and the creation of their own high-tech products. The fastest-growing sectors of the market include digital banking services, digital wallets, digital lending platforms, and more.

"Studies show that there is a shortage of specialists with digital skills in both the private and public sectors. This gap is primarily due to the mismatch between current educational programs and the demands of the labor market. The challenges of business digitization are numerous; however, it is clear that ensuring development at both the institutional and technological levels, with a strong digital matrix, is imperative for all sectors of the economy," she said.

Digitalization as a Competitive Advantage           

The use of digital technologies can help organizations better adapt to economic changes and crises, thereby contributing to the overall stability of the economy. 

Together, these factors can significantly drive the modernization and development of Armenia's economy.

"Depending on the opportunities for applying new technologies in different sectors and the institutional characteristics of process organization, digitalization processes can vary significantly. In particular, the use of digital tools in education, healthcare, retail, and finance allows organizations to operate more efficiently, deliver higher-quality services, and increase profitability," emphasized the YSU PhD student.

As the young researcher emphasized, the state must ensure the successful implementation of the digitalization process by investing in the development of digital infrastructure, establishing an appropriate legal framework, and integrating new technologies into state institutions. Countries that develop digital technologies gain a competitive advantage and secure leading positions on the international stage. Digitalization also offers an opportunity to enhance the efficiency of governance. 

"It is necessary to study the policies of countries that have successfully advanced digitalization, such as Estonia and Denmark, and adapt them to the current context of Armenian economic relations. This will help outline potential methods for digital reforms, which is precisely the focus of my research," Alisa pointed out. 

According to her, a solution to several issues in Armenia's digitalization sector could be the creation and implementation of a unified systems development framework.

"YSU PhD student Alisa Gevorgyan has set the goal of pursuing a scientific career in the field of digitalization, engaging with specialists and researchers, publishing papers, and presenting reports on various aspects of e-commerce, e-business, and e-services, including innovations, trends, challenges, and practical solutions."

Currently, she works as a financier, a role closely related to her research, which will support the completion of her scientific work.