More than $6.2 billion was siphoned out of Armenia from 2002 through 2011 as a result of government corruption, tax evasion and other illegal activity, according to an anti-graft group based in Washington.

The watchdog called Global Financial Integrity (GFI) cited the figure, worth nearly twice the Armenian foreign debt, in a report on illicit capital outflows around the world during that period. It claimed that developing countries lost almost $6 trillion in cash as a result.

The major reason is, according to the GFI report, the worst investment environment in Armenia and the second reason is the corrupt Armenian authorities, and foreign investors are well aware of that.

The GFI report released this month does not specify the source of its information about alleged capital flight from Armenia. It says that cash outflows from the country dramatically increased in 2007, averaging approximately $1 billion per annum through 2011.

The Armenian Finance Ministry, State Revenue Committee and Central Bank have not yet reacted to the GFI claims. Officials there said on Friday that they will comment after looking into the report.

Economists critical of the Armenian government consider the report’s findings credible. Vahagn Khachatrian, a senior member of the opposition Armenian National Congress (HAK), suggested that the large sums were taken out of the country by wealthy government officials and businesspeople evading taxes. He said their reluctance to invest that money in Armenia highlights widespread corruption and other problems with the rule of law.

“That has to do with the existing political situation and political system,” Khachatrian told RFE/RL’s Armenian service ( “People are not sure whether they will be able to preserve their money tomorrow.”

Another economist, Bagrat Asatrian, noted that illicit outflows from neighboring Georgia were estimated by GFI at only $4.5 billion. “Over the past decade Georgia has made substantial progress in fighting against the informal sector of the economy,” he said.

Asatrian claimed that Georgia has lost less capital than Armenia also because of its weaker financial ties with Russia. “For the past two decades Russia has been known for a high scale of shadowy financial turnovers and capital flight in particular,” he said. “A small part of those outflows have come out through Armenia.”

The GFI report rates Russia as the world’s second biggest loser of illicit capital after China. It says that as much $880 billion was taken out of the country from 2002-2011. According to the report, a total of $4.5 billion was siphoned from Georgia from 2002 to 2011. A total of $17 billion was siphoned from Azerbaijan.

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