In my view, this is a long overdue and significant development.
_____________________________________________
American Investments To Increase In Armenia
WASHINGTON (Noyan Tapan)The Overseas Private Investment
Corporation is considering financing four American private investment projects in Armenia worth a total $300,000,000 within the next 2-3 years. Projects will be implemented in the energy, finance, agricultural and construction spheres, OPIC Director of Communications Lawrence
Spinelli said.
The OPIC is a US Federal Agency which provides investments, as well as insurance against political risks to small, medium, and large American companies.
Spinelli said that OPIC is considering the possibility of providing insurance against political risks to 13 private American investment projects worth a total of $300,000,000 that concern the energy, oil, gas, communications, tourism, production and mining industry.
Spinelli also said that within the next 2-3 months, a final agreement will be made on OPIC allocating a $18,000,000 credit to the American AK Development business group, which is the owner of the Armenia hotel in Yerevan. The credit is the first investment to be made by the OPIC in Armenia.
Investing in Armenia
Started by
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, Nov 14 2000 06:23 AM
9 replies to this topic
#2
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Posted 14 November 2000 - 06:39 AM
Armenia's top officials discuss airport management with Argentine entrepreneur
Snark
13 Nov 00
Yerevan, 13th November: Yerevan's international airport Zvartnots
might be handed over to the management under power of attorney of
the well-known Argentine entrepreneur Eduardo Eurnekyan.
According to Snark news agency information, preliminary talks with
the Armenian authorities on this started on 11th November, after
Eurnekyan's arrival in Yerevan. Foreign Minister Vardan Oskanyan
met the businessman at the airport, and on 12th November Armenian
President Robert Kocharyan met the entrepreneur.
Eduardo Eurnekyan is a well-known Argentine entrepreneur and
philanthropist of Armenian origin. He owns over three dozen
international airports in various corners of the world.
Snark
13 Nov 00
Yerevan, 13th November: Yerevan's international airport Zvartnots
might be handed over to the management under power of attorney of
the well-known Argentine entrepreneur Eduardo Eurnekyan.
According to Snark news agency information, preliminary talks with
the Armenian authorities on this started on 11th November, after
Eurnekyan's arrival in Yerevan. Foreign Minister Vardan Oskanyan
met the businessman at the airport, and on 12th November Armenian
President Robert Kocharyan met the entrepreneur.
Eduardo Eurnekyan is a well-known Argentine entrepreneur and
philanthropist of Armenian origin. He owns over three dozen
international airports in various corners of the world.
#3
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Posted 14 November 2000 - 07:25 AM
MJ, why would anyone invest in Armenia? Considering the history of bad investments, low purchasing power of local population, the political risks, corruption and inadequate regulations to protect investors makes Armenia less desirable for investment. The company that I work for invests in emerging markets, and I just closed a deal that has a lot of investments in CIS, but none in Armenia. Why? Because it has a high risk and low return profile. The country needs a direction, and the current government is only preoccupied with meeting the current budget crisis. The current account balance of Armenian economy is widening, and as we all know for the emerging market country that’s a big no-no. The only way Armenia can prosper is if it can have some direction that will utilize its resources and give it a competitive advantage. The only competitive advantages I can currently spot are in information systems and chemical industries. As the past decade has shown Armenian Diaspora cannot be counted on as a major investor, so we can’t follow the Israeli model of development, where most of the investments are made through diasporan connections. But what Armenia can do is follow the model of development of Asian tigers. The government chooses an industry, gives it special privileges, sponsors it, and then lets it become a multinational corporation, which has a majority of national exports. The bottom line is, a country with no clear path of development and without adequate legal field cannot expect a lot of foreign investments.
#4
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Posted 14 November 2000 - 07:43 AM
Alpha, I share all of your concerns and share your vision. I am just glad that OPIC is finally considering to provide the potential investors in Armenia with insurance. They have been doing this is Azerbaijan and other former Soviet Republics for few years, now. This is a good sign, if it materializes, of coarse.
I have no arguments with you.
I have no arguments with you.
#5
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Posted 14 November 2000 - 07:54 AM
Wow MJ, I guess we have common views on political and economic development of Armenia. The article below provides an interesting insight about diasporan investments.
Armenian President Meets Diaspora Businesmen
President Robert Kocharian and Armenian Foreign Minister Vartan
Oskanian met on 11 November with some 100 Armenian businessmen from
diaspora, who have been working in Armenia for several years. This is
the first meeting at such a level with Armenan businessmen from the
diaspora.
There are some 1000 Armenian families from the diaspora who are
engaged in business in Armenia. Although some of them, such as the
Hovnanian family, or the owners of "Ani" or "Armenia" hotels, are well
known in Armenian society, there are no clear statistics that show how
much the diaspora has invested in Armenia during the 10 years since
independence.
Addressing the guests at the ministry of foreign affairs, President
Kocharian stated that there some positive conditions exist for
supporting business and investments in Armenia. "I am ready to do
everything possible to support you in your business," the President
said.
But Sarkis Hacpanian, one of the businessmen present, who has lived in
Armenia for 10 years, told RFE/RL that conditions for doing business
in Armenia have become worse. "The laws which are supposed to support
business and investment do not work, they exist only on
paper. Sometimes even court decisions in favour of the investor do not
work," Hacpanian said. He dismissed the Armenian authorities'
assurances as "just words."
Armenian President Meets Diaspora Businesmen
President Robert Kocharian and Armenian Foreign Minister Vartan
Oskanian met on 11 November with some 100 Armenian businessmen from
diaspora, who have been working in Armenia for several years. This is
the first meeting at such a level with Armenan businessmen from the
diaspora.
There are some 1000 Armenian families from the diaspora who are
engaged in business in Armenia. Although some of them, such as the
Hovnanian family, or the owners of "Ani" or "Armenia" hotels, are well
known in Armenian society, there are no clear statistics that show how
much the diaspora has invested in Armenia during the 10 years since
independence.
Addressing the guests at the ministry of foreign affairs, President
Kocharian stated that there some positive conditions exist for
supporting business and investments in Armenia. "I am ready to do
everything possible to support you in your business," the President
said.
But Sarkis Hacpanian, one of the businessmen present, who has lived in
Armenia for 10 years, told RFE/RL that conditions for doing business
in Armenia have become worse. "The laws which are supposed to support
business and investment do not work, they exist only on
paper. Sometimes even court decisions in favour of the investor do not
work," Hacpanian said. He dismissed the Armenian authorities'
assurances as "just words."
#6
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Posted 14 November 2000 - 07:58 AM
Nothing wrong with having similar views, right?
I know about this meeting. Had seen it before.(:
I know about this meeting. Had seen it before.(:
#7
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Posted 17 November 2000 - 07:41 PM
ARMENIAN TRADE AND INDUSTRY MINISTER OPTIMISTIC ABOUT EXPECTED VOLUME OF INVESTMENTS IN 2001-2003
YEREVAN, NOVEMBER 17, ARMENPRESS:
Armenia's trade and industry minister Karen Chshmaritian was very optimistic regarding the volume of expected investments in the Armenian economy in the next three years.
Speaking to Armenpress, the minister said about $260 million are expected to enter the country in 2001-2003. The biggest portion of investments, $103 million, is expected to come from Lincy Foundation. The Armenian-Russian joint venture Armenal will get $50 million from Russia's giant Sibirskiy Aluminum, the US APG Labs will bring another $20 million to boost high technologies development.
Thirty-five millions are expected in hotel business, up to $40 million will be invested in Yerevan Physics Institute, $15 million in Shoghakn diamond processing plant. The minister said the new draft law on investments will be sent to parliament's consideration next month.
PRIVATIZATION OF BIG ENTERPRISES OPPOSED, SAYS STATE PROPERTY MINISTER
YEREVAN, NOVEMBER 17, ARMENPRESS:
According to state property minister David Vardanian, the government will face serious problems while trying to sell around 2,500 small and medium enterprises that have failed so far to find buyers. The minister also complained that the lack of appropriate information about these enterprises prolongs the process of their privatization. "There are four approaches towards evaluating their real prices, but all of them have shortcomings. However, the biggest problem is the absence of demand," he said.
Referring to the privatization program for 2001-2003, the minister said it is divided into three parts, the first one includs enterprises that were not involved in previous programs, the second includes enterprises with more than 50% of shares. The rest of shares are proposed to be sold off.
The third includes enterprises, chiefly building companies and hotels, the privatization of which is opposed by ministries, favoring for their remaining under state control. The program has to be yet approved by the government.
The private sector currently accounts for more than 75 percent of Armenia's GDP. Official figures show that 76 percent (1533) of large and medium-sized enterprises and 83 percent (6829) of small ones have been privatized over the past decade.
YEREVAN, NOVEMBER 17, ARMENPRESS:
Armenia's trade and industry minister Karen Chshmaritian was very optimistic regarding the volume of expected investments in the Armenian economy in the next three years.
Speaking to Armenpress, the minister said about $260 million are expected to enter the country in 2001-2003. The biggest portion of investments, $103 million, is expected to come from Lincy Foundation. The Armenian-Russian joint venture Armenal will get $50 million from Russia's giant Sibirskiy Aluminum, the US APG Labs will bring another $20 million to boost high technologies development.
Thirty-five millions are expected in hotel business, up to $40 million will be invested in Yerevan Physics Institute, $15 million in Shoghakn diamond processing plant. The minister said the new draft law on investments will be sent to parliament's consideration next month.
PRIVATIZATION OF BIG ENTERPRISES OPPOSED, SAYS STATE PROPERTY MINISTER
YEREVAN, NOVEMBER 17, ARMENPRESS:
According to state property minister David Vardanian, the government will face serious problems while trying to sell around 2,500 small and medium enterprises that have failed so far to find buyers. The minister also complained that the lack of appropriate information about these enterprises prolongs the process of their privatization. "There are four approaches towards evaluating their real prices, but all of them have shortcomings. However, the biggest problem is the absence of demand," he said.
Referring to the privatization program for 2001-2003, the minister said it is divided into three parts, the first one includs enterprises that were not involved in previous programs, the second includes enterprises with more than 50% of shares. The rest of shares are proposed to be sold off.
The third includes enterprises, chiefly building companies and hotels, the privatization of which is opposed by ministries, favoring for their remaining under state control. The program has to be yet approved by the government.
The private sector currently accounts for more than 75 percent of Armenia's GDP. Official figures show that 76 percent (1533) of large and medium-sized enterprises and 83 percent (6829) of small ones have been privatized over the past decade.
#8
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Posted 17 November 2000 - 07:43 PM
Armenian copper smelter escapes stoppage
YEREVAN, Nov 16 (Reuters) - Copper concentrate suppliers to
Armenia's sole copper smelter agreed to increase deliveries,
preventing an outright stoppage at the plant, its CEO Valery
Medzhlumyan said on Thursday.
The Manes and Vallex smelter will receive the 2,200 tonnes this
month it needs to maintain operations.
Medzhlumyan said the deal guaranteed production at the plant for
now.
"Now we have an agreement, which will help to alleviate the
situation," Medzhlumyan told Reuters.
"But the threat (of a stoppage) still remains due to our imperfect
legislation," he said, blaming the smelter's financial problems on
Armenia's tax legislation, which he said discriminated against
domestic industry.
Failure to pay for supplies has meant that over the past two months
the smelter has received only 500 tonnes of concentrate monthly.
Artsrun Avetisyan, deputy director of Zangezur Copper and
Molybdenum Combine, the smelter's main supplier, told Reuters that
the firm had agreed to supply the Manes and Vallex works with an
additional 1,700 tonnes of concentrate this month.
"They will get another 2,200 tonnes in December if they pay for
them," Avetisyan said.
Armenian national companies must pay a 20 percent value added tax
on raw materials that in theory should be offset when the finished
product is exported.
However, the state is frequently late in paying out VAT rebates,
and this has undermined the smelter's ability to pay suppliers,
Medzhlumyan said.
Foreign companies, he said, were exempt from VAT and export duties
when they export raw materials from Armenia, giving them a
competitive advantage.
The Armenian smelter has had a chequered history.
In 1989, when operating under the name Alaverdi, the smelter was
closed for causing serious environmental pollution.
But it won a new lease of life in 1997 when it was bought by
Lichtenstein firm Vallex F.M. Establishment and Armenian Manes.
In 1998 Manes sold its 46.3 percent stake in the smelter to Swiss
firm Elecom.
The plant, which was registered in Armenia, resumed work in January
1998 but supply problems again forced it to suspend production from
March 1999 until early 2000.
It plans to produce 4,700 tonnes of blister copper this year.
Currently Manes and Vallex can process 3,500 tonnes of concentrate
per month.
The works produce blister copper for export to Germany, Austria and
Italy,
14:56 11-16-00
YEREVAN, Nov 16 (Reuters) - Copper concentrate suppliers to
Armenia's sole copper smelter agreed to increase deliveries,
preventing an outright stoppage at the plant, its CEO Valery
Medzhlumyan said on Thursday.
The Manes and Vallex smelter will receive the 2,200 tonnes this
month it needs to maintain operations.
Medzhlumyan said the deal guaranteed production at the plant for
now.
"Now we have an agreement, which will help to alleviate the
situation," Medzhlumyan told Reuters.
"But the threat (of a stoppage) still remains due to our imperfect
legislation," he said, blaming the smelter's financial problems on
Armenia's tax legislation, which he said discriminated against
domestic industry.
Failure to pay for supplies has meant that over the past two months
the smelter has received only 500 tonnes of concentrate monthly.
Artsrun Avetisyan, deputy director of Zangezur Copper and
Molybdenum Combine, the smelter's main supplier, told Reuters that
the firm had agreed to supply the Manes and Vallex works with an
additional 1,700 tonnes of concentrate this month.
"They will get another 2,200 tonnes in December if they pay for
them," Avetisyan said.
Armenian national companies must pay a 20 percent value added tax
on raw materials that in theory should be offset when the finished
product is exported.
However, the state is frequently late in paying out VAT rebates,
and this has undermined the smelter's ability to pay suppliers,
Medzhlumyan said.
Foreign companies, he said, were exempt from VAT and export duties
when they export raw materials from Armenia, giving them a
competitive advantage.
The Armenian smelter has had a chequered history.
In 1989, when operating under the name Alaverdi, the smelter was
closed for causing serious environmental pollution.
But it won a new lease of life in 1997 when it was bought by
Lichtenstein firm Vallex F.M. Establishment and Armenian Manes.
In 1998 Manes sold its 46.3 percent stake in the smelter to Swiss
firm Elecom.
The plant, which was registered in Armenia, resumed work in January
1998 but supply problems again forced it to suspend production from
March 1999 until early 2000.
It plans to produce 4,700 tonnes of blister copper this year.
Currently Manes and Vallex can process 3,500 tonnes of concentrate
per month.
The works produce blister copper for export to Germany, Austria and
Italy,
14:56 11-16-00
#9
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Posted 14 May 2001 - 10:57 AM
"ARMENIA IS OUR FLAGSHIP PRODUCT IN CAUCASUS," WORLD BANK'S REPRESENTATIVE
SAYS
YEREVAN, May 14. /Mediamax/. "Armenia is our flagship product in the
Caucasus." This words belong to Owaise Saadat, World Bank's Representative in
Armenia are quoted by Financial Times paper, in an article on "Armenia
Investor" business-forum held in New York on May 9-12.
The paper says that the World Bank and other international agencies believe
Armenia's progress in both political and economic reform can be an example
for the rest of the region.
President Kocharian said in an interview to Financial Times that there was a
mutual recognition that direct investment into the private sector could push
the country forward.
"We need investment like we need air," says Finance and Economics Minister of
Armenia Vardan Khachatrian in his interview to the newspaper.
SAYS
YEREVAN, May 14. /Mediamax/. "Armenia is our flagship product in the
Caucasus." This words belong to Owaise Saadat, World Bank's Representative in
Armenia are quoted by Financial Times paper, in an article on "Armenia
Investor" business-forum held in New York on May 9-12.
The paper says that the World Bank and other international agencies believe
Armenia's progress in both political and economic reform can be an example
for the rest of the region.
President Kocharian said in an interview to Financial Times that there was a
mutual recognition that direct investment into the private sector could push
the country forward.
"We need investment like we need air," says Finance and Economics Minister of
Armenia Vardan Khachatrian in his interview to the newspaper.
#10
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Posted 16 May 2001 - 03:10 PM
Foreign Businessmen To Arrive In Armenia To Study Economic Situation
YEREVAN (Noyan Tapan)--Foreign businessmen who attended the recent Armenia
Investors Forum held in New York were mainly interested in Armenia's
information technologies and mining industry.
The forum, held May 9-11, was sponsored by the World Bank and its affiliate,
the International Finance Corporation (IFC), with additional support from the
US Trade and Development Agency (USTDA).
At a press conference on Tuesday, Minister of Industry and Trade Karen
Chshmaritian announced that the first group of foreign businessmen will arrive
in Yerevan this week to study the economic situation in Armenia and to hold
business negotiations. A second group will arrive in June.
Twenty-five business plans were submitted at the forum which was attended by
130 representatives of Armenian enterprises and organizations, 130 Armenians
from the Diaspora and 100 foreign businessmen. According to Chshmaritian, nine
of these proposals refer to industry and the food industry, five to tourism,
three to energy and three to information technologies. Other business plans
concern the development of the transport sphere and the production of building
materials.
The government itself submitted only two programs for development and
investment possibilities in the mining industry and energy sector. The other
programs were submitted by the country's private sector and international
organizations.
Chshmaritian stated that before the forum there were some concerns regarding
the presentation of Armenia's investment sector. However, the World Bank and
the IFC considered the material presented by the Armenian side as good as
those
of leading foreign companies.
According to the minister, both the Armenian government and private
entrepreneurs consider the available conditions for free competition and free
trade with CIS countries to be positive factors for investments. Among the
obstacles to economic development are high transportation rates and red tape.
An Armenian-Russian business forum will be held in September to stimulate
investments in various spheres of the Armenian economy.
YEREVAN (Noyan Tapan)--Foreign businessmen who attended the recent Armenia
Investors Forum held in New York were mainly interested in Armenia's
information technologies and mining industry.
The forum, held May 9-11, was sponsored by the World Bank and its affiliate,
the International Finance Corporation (IFC), with additional support from the
US Trade and Development Agency (USTDA).
At a press conference on Tuesday, Minister of Industry and Trade Karen
Chshmaritian announced that the first group of foreign businessmen will arrive
in Yerevan this week to study the economic situation in Armenia and to hold
business negotiations. A second group will arrive in June.
Twenty-five business plans were submitted at the forum which was attended by
130 representatives of Armenian enterprises and organizations, 130 Armenians
from the Diaspora and 100 foreign businessmen. According to Chshmaritian, nine
of these proposals refer to industry and the food industry, five to tourism,
three to energy and three to information technologies. Other business plans
concern the development of the transport sphere and the production of building
materials.
The government itself submitted only two programs for development and
investment possibilities in the mining industry and energy sector. The other
programs were submitted by the country's private sector and international
organizations.
Chshmaritian stated that before the forum there were some concerns regarding
the presentation of Armenia's investment sector. However, the World Bank and
the IFC considered the material presented by the Armenian side as good as
those
of leading foreign companies.
According to the minister, both the Armenian government and private
entrepreneurs consider the available conditions for free competition and free
trade with CIS countries to be positive factors for investments. Among the
obstacles to economic development are high transportation rates and red tape.
An Armenian-Russian business forum will be held in September to stimulate
investments in various spheres of the Armenian economy.
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