Armenian dram

(դրամ)
~ The currency of Armenia.

Introduction:
Coded in ISO 4217 Code as AMD, the Armenian Dram is the
official currency i.e. the monetary unit of Armenia, the
neighboring unrecognized Republic of Artsakh (Nagorno-
Karabakh). It is subdivided into 100 luma (Armenian: լումա).
The word "dram" in English means "money" and is analogy
with the Greek drachma and the Arabic dirham, as well as the
English weight unit dram. The first instance of a dram
currency was in the period from 1199 to 1375, when silver
coins called dram were issued.

History:
On 21 September 1991, a national referendum proclaimed Armenia as an independent republic
from the Soviet Union. The Central Bank of Armenia, established on 27 March 1993, was given
the exclusive right of issuing the national currency.
In the immediate aftermath of the collapse of the Soviet Union attempts were made to maintain a
common currency (the Russian ruble) among CIS states. Armenia joined this rublezone. However
it soon became clear that maintaining a currency union in the unstable political and economical
circumstances of the post-Soviet states would be very difficult. The rublezone effectively collapsed
with the unilateral monetary reform in Russia, 1993. As result the states that were still participating
(Kazakhstan, Uzbekistan, Turkmenistan, Moldova, Armenia and Georgia) were 'pushed out' and
forced to introduce separate currencies. Armenia was one of the last countries to do so when it
introduced the dram on 22 November 1993. The modern dram came into effect on 22 November
1993, at a rate of 200 rubles = 1 dram (1 USD : 404 AMD). The dram is not pegged to any currency
other than the Artsakh dram.

Armenian dram sign

In 1995 the currency sign for the Armenian dram was designed. The Armenian dram sign (֏,
image: ֏; Armenian: Դրամ; code: AMD) is the currency sign of the Armenian dram. In Unicode,
it is encoded at U+058F ֏ ARMENIAN DRAM SIGN.
After its proclamation of independence, Armenia put into circulation its own national currency –
Armenian Dram, the usage of which revealed the necessity for a monetary sign. As the result of
common business practice and the unique pattern of Armenian letters the shape of the sign and its
variations appeared in the business scratches (daybooks). Since that time and until the official
endorsement of the sign a number of artists and businessmen developed and offered various shapes
for it. Now the Sign (Dram symbol) is present in the Armenian standard for the national characters
and symbols and in the Armenian computer fonts.

Central Bank of Armenia:

Since 1996, one of the main roles of the Central Bank has been maintaining price stability.

In the meantime, during the period from 1996 to 2001, CBA spent considerable efforts for
launching the national payments and settlements system which would comply with international
standards. The result was ArCa (Armenian Card) system.

Some main tasks of the CBA include maintaining stability of the national currency, as well as
ensuring the cycle of it, fighting money laundering and terrorism financing and managing the
international reserves of the Republic of Armenia.

Coins
In 1994, a first series of aluminium coins was introduced in denominations of 10, 20 and 50 luma,
1, 3, 5 and 10 dram. In 2003 and 2004, a second series consisting of 10, 20, 50, 100, 200 and 500
dram coins was introduced to replace the first series.

The Central Bank has also issued a great number of commemorative coins intended for sale to
collectors. A listing can be found at the authorized central bank distributors.

First series (1994-2002):

In 1994, a first series of aluminium coins was introduced in denominations of 10-, 20- and 50
luma, 1-, 3-, 5 and 10 dram. At present only the 10 dram coin is still in use. The other coins are
officially in circulation but not really used because of their low nominal value.
Second series (2003-present):
In 2003 and 2004, a new series of coins was introduced in denominations of 10-, 20-, 50-, 100-,
200 and 500 dram.

Banknotes:

A first series of banknotes was issued in November 1993. It was withdrawn from circulation by
2005. A second series was issued from 1998 onwards which is still in use at present.

First series (1993-1995):

On 22 November 1993, banknotes of 10, 25, 50, 100, 200 and 500 dram were issued.[19] Notes
for 1,000 and 5,000 dram were put into circulation later.
Second series (1998-2017):
Banknotes of 50-, 100, and 500 dram are rarely seen in circulation. The 50, 100, and 500 dram
coins are used instead.
A commemorative 50,000 dram note was issued on 4 June 2001 in commemoration of the 1700th
anniversary of the adoption of Christianity in Armenia. A 500 dram commemorative note was
issued on 22 November 2017 to commemorate the story of Noah's Ark.
Third series (2018-present):
A third series of Armenian dram banknotes will be issued in 2018, to commemorate the 25th
anniversary of Armenia's national currency.[21] All denominations for this series are the same as
its previous issues, with the 2,000 dram banknote as a newly introduced denomination, the 50,000
dram banknote re-issued for this series and the omission of the 100,000 dram banknote for this
issue.

Tends in currency value:

Aremenian Timeline:
1992 - 1999
1992 May 9 - Armenian forces take control over Shushi
1992 Spring - Armenian forces occupy Lachin corridor linking Nagorno-Karabakh to Armenia.
1992 June - Abulfaz Elchibey elected president of Azerbaijan and forms first postcommunist
government there.
1992 June - Military coup deposes Elchibey in Azerbaijan; Aliyev returns to power.
1992 Fall - Multilateral negotiations seek settlement of Karabakh conflict, without result; fighting,
blockade, and international negotiation continue into 1994.
1992 October - Aliyev elected president of Azerbaijan.
1992 Karabakh declaration of Independence
1992 Armenia admitted to the United Nations
1994 May 12 - Karabakh cease-fire agreement.
1998 Feb - Levon Ter Petrosian resigns as president due to unpopular Karabakh conscessions he
wanted to make. PM Robert Kocharian takes his place.
1999 Fall - Parliament entered by former journalist Nairi Hunanian who shoots and kills Prime
Minister Vasgen Sarkissian, saying he has drank the blood of the nation, Karen Demirjian and a 5
others. Asks the people to come to Parliament and take back the country. Instead the people stay
home and discuss conspiracy theories.
2000 - present
2001 - Largescale celebration of 1700th anniversary of Armenia's adoption of Christianity
2001 - Pope John Paul II visit to Armenia.
2003 - Robert Kocharian re-elected president.
2004 April - Peaceful anti-government protests met with massive violent beatings and arrests of
protesters. No apologies made by government, nor arrests of those responsible for the beatings.
2005 August - Cilicia Ship reaches London
2006 May 3 - Crash of an Armenian airliner off the Russian Black Sea coast. All 113 people on
board the Airbus A-320 were killed in what was the worst air disaster in Armenia’s history.
2006 May 12 - The ouster of then parliament speaker Artur Baghdasarian’s Orinats Yerkir party
from the governing coalition.
2006 - The official disclosure in June of the international mediators’ most recent plan to resolve
the Nagorno-Karabakh conflict.
2006 July 18- The announcement of Defense Minister Serzh Sarkisian’s affiliation with the
governing Republican Party of Armenia (HHK). The move was widely construed as a confirmation
of Sarkisian’s intention to contest the next presidential election due in 2008.
2006 - The emergence and rapid expansion throughout the year of a new political party led by
Gagik Tsarukian, the most influential of Armenia’s government-connected tycoons. The
Prosperous Armenia party is now tipped to make a strong showing in the forthcoming
parliamentary elections.
2006 - The year saw more street protests by residents of Yerevan that were forcibly evicted from
their homes as a result of the ongoing massive redevelopment in the city center. The evictions were
declared unconstitutional by Armenia’s Constitutional Court.
2006 - A further strengthening of the national currency, the dram, that triggered fresh opposition
allegations about exchange rate manipulation. One U.S. dollar is now worth roughly 360 drams. It
traded at about 460 drams at the beginning of 2006.
2006 - An apparent rise in anti-Russian sentiment fuelled by continued racially motivated killings
of Armenians in Russia.
2006 - The year saw a number of high-profile cultural events such as Armenia’s first-ever
participation in the Eurovision song contest, an open-air concert given by Charles Aznavour and
other famous French singers, and the annual Golden Apricot film festival in Yerevan.
2006 - The Armenian team’s victory in the 2006 world Chess Olympiad.
2007 April - Defense Minister Serge Sargsyan appointed Prime Minister

The below mentioned graph shows how the value of Armenian Dram varied with years from
inception till 2017.

Below described picture also represents the variation of Dram relative to USD along with quartiles
The above trend in currency is a result of various contributing factors like export, import, cash
remittance etc.
According to the head of the Armenian Central Bank's (CBA) department for financial system
policies and analyses (Vahe Vardanyan) Armenian banks have no large asset concentrations in
foreign markets, particularly in capital markets. They nearly have no purchased securities (so-
called securitized packages). For this reason, Armenia was virtually unaffected by the Liquidity
crisis of September 2008.

Armenian banking assets are very low and made up only 25 percent of the gross domestic product
(GDP) in 2008.
As if two closed borders and an economy based on the oligarchal control of imports of goods
mainly paid for by remittances from abroad wasn’t enough, the Central Bank of Armenia (CBA)
yesterday devalued the national currency, the Armenian dram, as the global economic crisis finally
hit the country. During Sunday’s opposition rally to mark the first anniversary of the 1 March post-
election clashes, the first and former president, Levon Ter-Petrossian, warned of an imminent
economic crisis.

“I am deeply convinced that the country is simply descending into an abyss,” he said, predicting
an impending collapse of the Armenian dram, skyrocketing unemployment, price hikes, massive
cuts in government spending and other catastrophic socioeconomic consequences.

“The current crisis will most probably be more severe and more difficult to overcome than even
the crisis of the early 1990s, which occurred in a healthy global economic environment,” he added,
referring to the first years of his presidency that saw Armenia’s Gross Domestic Product shrink by
more than half amid the bloody wars in Nagorno-Karabakh and elsewhere in the region. link
Prior to the move by the CBA, mobs of people could be seen waiting outside banks last week to
exchange their drams into dollars before shops shut temporarily as owners reevaluated their pricing
policy and calculated future losses. Panic then set in with the population stockpiling essential
items imported from abroad before prices rose as the local currency collapsed.

Armenians rushed to buy bread, butter and other staples on Tuesday and stores shut down in panic
after the government announced it would let the currency fall and was seeking a bailout from the
International Monetary Fund. Banking authorities said the national currency, the dram, could lose
a quarter of its value, and prices for imported goods were expected to rise sharply. link

But if the government and the World Bank says there is nothing to worry about, the average citizen
doesn’t seem to be convinced. Indeed, many suggest the worst is yet to come. Time will tell who
is right, but for now there are concerns. While such a situation might benefit exporters, there is
little by way of a local manufacturing base in Armenia and transport routes are limited.

Armenia in news:
IMF: Effects of Armenian dram depreciation should be manageable
23:22, 05.12.2014
Effects of the depreciation of Armenian national currency (Dram) on the national economy should
be manageable, IMF Resident Representative in Armenia Teresa Daban said, Armenian News -
NEWS.am reports.
Speaking on Friday in Yerevan, Daban added that the capital adequacy ratio of the banking system
is within the bounds of the regulations of the Central Bank. According to her, this means that banks
have built up safety cushions enough to last them through a temporary shock.
The total ratio of past due loans and nonperforming loans in Armenian banking system, as of
August 2014, is 7,65% of the aggregated loan portfolio (according to data provided by the Central
Bank). This is well under coverage of the key financial soundness indicators, Daban added.
Accordingly, the capital adequacy ratio of the banking system, as of September 2014, is 16,3%,
staying almost flat for the last 12 months, and liquidity ratio is 26,7%, which has also been
relatively steady.
The Armenian dram has plunged 3,8% downwards to the US Dollar on November 24, reaching
AMD 433 /$1. As of Dec. 5, 2014, Armenian Dram has lost another 12 points, reaching AMD
447,86/$1 (official Central Bank rate).

Germany’s ambassador describes Armenian currency as stable:

YEREVAN, October 31,2018 /ARKA/. Germany’s Ambassador to Armenia Mathias Kiesler
praised today Armenia’s national currency, the dram, describing it as a stable currency, when
speaking at an event marking the World Savings Day. He said since the Armenian drama is quite
stable, the risks associated with investing in a local bank deposits is rather low

Dollar drops slightly in Armenia:

YEREVAN, 18:01, 28.11.2018 – The American dollar’s (USD) exchange rate against the
Armenian dram (AMD) comprised AMD 485.05/$1 in Armenia on Wednesday; this is down by
AMD 0.03 from Tuesday, the press service of the Central Bank of Armenia informed.
The exchange rate for one euro was AMD 547.18 (down by AMD 1.54), that of one British pound
totaled AMD 619.12 (up by AMD 0.40), and the rate of one Russian ruble made up AMD 7.20
(down by AMD 0.07) in the country.
In addition, one gram of silver, gold and platinum amounted to AMD 222.61, AMD 19,044.27 and
AMD 13,146.35 respectively.

References:
1. https://www.frontlineclub.com/the_armenian_dram_collapses/
2. https://jam-news.net/the-armenian-dram-celebrates-25th-anniversary-since-creation/
3. https://www.trtworld.com/europe/what-s-going-on-in-armenia--17146
4. https://en.wikipedia.org/wiki/Armenian_dram
5. https://en.wikipedia.org/wiki/Economy_of_Armenia
6. http://arka.am/en/news/business/germany_s_ambassador_describes_armenian_currency_
as_stable/
7. http://www.armeniapedia.org/wiki/Armenian_History_Timeline
8. https://news.am/eng/news/242736.html