Enhancing economic risk management mechanisms in Armenia: Research by YSU Associate Professor Nonna Khachatryan

Nonna Khachatryan’s scientific project, titled "Improvement of Armenia's Economic Risk Management Mechanisms in the Context of Regional Developments", has been approved for funding through MoESCS's "Scientific Efficiency Enhancement Grant Program-2025." 

Author of over 60 scientific articles and five academic textbooks, Associate Professor Nonna Khachatryan notes that in the context of regional developments, the Armenian economy is highly sensitive to emerging economic risks due to its vulnerabilities, such as the unblocking of transport routes, the expansion of foreign capital, the disintegration of accumulated human capital, the risks of sustainable development, and the loss of economic autonomy. Therefore, the improvement of Armenia’s economic risk management mechanism in light of regional developments becomes crucial. 

"We emphasize the development of a management model that will enable the adoption of flexible management decisions in the country's economic security system and mitigate both internal and external risks related to regional developments," says Nonna Khachatryan.

- Ms Khachatryan, when did you begin studying this topic?

- I have been actively engaged in this research over the past three years. I would especially like to emphasize that winning the competition was largely due to our team’s collaborative efforts. My teammates—Narine Mirzoyan, Grigor Hayrapetyan, Ani Khalatyan, and Alisa Gevorgyan—are experienced specialists in various fields of management, such as international economics and modeling, whose recent scientific work aligns with the challenges of our project. I am convinced that with such a team, the project will be successfully implemented.

- What models could be useful in improving the risk management system, especially in the context of regional developments?

- Since gaining independence, the Republic of Armenia underwent an economic blockade, losing many of its previously established economic ties. Currently, there are new opportunities for the development of Armenia’s economy amidst rapid global and regional changes. Specifically, Armenia has proposed the Crossroads of Peace project, and there are active geopolitical discussions regarding the unblocking of the economy and the revision of economic relations with regional countries. The macroeconomic management of economic risks is directly tied to national security interests. Armenia currently stands at the crossroads of geopolitical interests, and in such conditions, the importance of ensuring the country’s economic security and managing related risks becomes even more important. The focus of our research is to model security risks, conditioned by regional developments, which will allow not only for the prediction of potential socio-economic consequences but also for the making of managerial decisions aimed at preventing or mitigating these risks.  

- What is the impact of regional economic factors on Armenia's risk management strategy?

- A potential threat to Armenia's economic security could be the intensive inflow of capital from regional countries in the case of open borders. Armenia, with its limited economic potential in the region, may struggle to withstand such foreign capital inflows, which could result in a loss of economic autonomy. Therefore, the research will propose economic 'security buffers' to withstand the pressures from regional capital flows.

- How important is it to consider global economic trends when developing regional economic risk management mechanisms? What challenges could arise in this regard?

- A threat to economic security could be the dispersion of accumulated human capital in Armenia as a result of regional developments. Armenia stands out for its quality human capital, and its potential outflow could intensify with the liberalization of regional economic relations. In this regard, the research will assess the risks of human capital outflow and dispersion, incorporating them into the proposed management model. Additionally, risks related to logistical disruptions will play a significant role in the economic security model. After regional unblocking, logistical limitations could resurface, and these will also be considered in the study and integrated into the management model. Disruptions in sustainable development are also considered a risk for the country's economic security system. 

The research will provide clarifications on how ESG (Environmental, Social, and Governance) conceptual approaches will be maintained in Armenia during regional developments, and how manageable the risks of sustainable development will be.

- What outcomes do you expect from this project?

- As a result of implementing the research program, scientific seminars and workshops will be organized for state agencies and academic stakeholders, articles will be published in internationally recognized journals, and the findings will be presented at international conferences, including those organized by the Regional Science Association International (RSAI) and the European Regional Science Association (ERSA).