Armenia loses billions because of Pashinyan’s economic policy

8 April 2019 15:47 (UTC+04:00)

By Abdul Kerimkhanov

The situation around the Lidian company with the British-American capital, licensed to operate the Amulsar field, is increasingly concerning the Armenian expert community and pro-Western politicians.

Obstacles caused to the company by the public with the connivance of the authorities, and Lidian’s intention to apply to Armenia in an international arbitration court can put an end to the Pashinyan government’s plans to attract major western investments to the country.

This situation is especially hard on the Armenian-American relations, consider analysts at armenianreport.com. The Armenian-American relations contain great opportunities for Armenia, which, however, may be put at risk as a result of inaction.

It is about relations with the Lidian company, which have reached such a level and quality as a result of problems encountered in the Armenian-American political relations.

Lidian announced its intention to start the process in international arbitration against the Armenian government. This is the largest company, the largest investor in the history of Armenia, having invested $400 million, which, in its steps, hardly calculated the political relations of the U.S. with Yerevan. In other words, in other conditions and the content of the Armenian-American relations, Lidian, perhaps, would have refrained from intending to turn to arbitration, assumes an Armenian edition.

Authors of the article noted that as long as Armenia continues to consider relations with Russia as the number one priority for Armenia, the country should not expect financial assistance from the United States. Due to lack of relevant work in the direction of Armenian-American relations, Armenia is losing money, which accounts to billions of dollars.

Earlier, the former U.S. ambassador Richard Mills pointed out to the inadmissibility of the oppression of companies with western capital. He openly said that western investors are closely monitoring the situation around Lidian and how the Armenian government will provide guarantees for them.

So far, PM Nikol Pashinyan stubbornly does not want to take into account his country's international obligations to partners. This is perhaps the only case where he really fulfills the wishes of the working people, already very soon a year as they impede the start of development at the fields. In all other cases, the wishes of citizens remain ignored.

What is the interest of the new government and why did it go to such a confrontation with the largest investor in the history of Armenia, which lost billions as a result of the protest actions? Will the “revolutionary” image of Pashinyan help in making a decision by international arbitration? Ultimately, this confrontation may cost Armenia the final loss of investor confidence and an even greater cooling in relations with the United States.

However, the tension of economic relations concerns not only Western companies.

Armenia asks Russia to postpone the payment of a loan for the modernization of the NPP, head of the Foreign Relations Department at the Ministry of Energy Infrastructures and Natural Resources of Armenia Tigran Melkonyan said at the 19th meeting of the Intergovernmental Commission on Economic Cooperation on April 4.

He raised an issue related to the delay in work on the project implementation to extend the life of the Armenian NPP.

"We have identified several reasons, both objective and subjective. To successfully complete the project, it is necessary to make a decision on extending the loan term, as well as postponing the start of loan repayment so far, the only source of annual loan payments are funds from the sale of electricity produced by the Armenian NPP," said Melkonyan.

The program of the Government of Armenia provides for the extension of the operating life of the existing NPP until 2026, as well as the phased commissioning of new units, although the service life of the reactors has long expired.

The Armenian NPP is located near the town of Metsamor and is based on the technologies of the Chernobyl NPP, which ceased operations in 1986 due to an accident at a nuclear reactor.

Ecologists and scientists consider the seismic activity of this region turns the NPP operation in Metsamor into a highly dangerous enterprise, even in the case of the construction of a new-type reactor, since the NPP has completed the service life and its continued operation can lead to catastrophic consequences for the entire region.

Earlier, the EU offered assistance in the amount of 100 million euros to close NPP, while Armenia refused and continue to manage NPP, putting at risk the lives of millions of people.

Armenia also does not attach importance to the proposals of the International Atomic Energy Agency (IAEA) regarding the closure of the Metsamor NPP.

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Abdul Kerimkhanov is AzerNews’ staff journalist, follow him on Twitter: @AbdulKerim94 

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