Economic development of the Nagorno Karabakh Republic is characterized mainly by changes in the volume of production and services in the five main spheres of the republic's economy: industry, agriculture, construction, transport, and trade.
The GDP annual growth rate is 10,4 percent. The GDP per capita is estimated at 318 U.S. dollars.
The main goals of the economic policy of Nagorno Karabakh for the next five years are:
Economic reforms have been introduced to make a smooth transition from a command, state-run economy to a socially oriented, market economy with limited government regulation. Prices have been liberalized, which has in turn enriched the market with goods. Despite currency depreciation, the population receives an impetus for engaging in entrepreneurial activity. Many problems have been addressed during this transition to a market economy, namely: achievement of macroeconomic stability; structural modification of the economy; privatization, and creation of market infrastructure.
The privatization process began in 1995. The privatization of small and medium-size enterprises is now complete, while the privatization of larger enterprises continues. The government strongly encourages substantial foreign participation in these larger privatization ventures.
In the privatization process, the government is consistent in withdrawing the state from the economy. As a result, the activity of small and medium businesses, banks, and other trade enterprises has notably increased.