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EBRD WANTS MORE TRANSPARENCY WITH MINING LICENSES IN ARMENIA
news.am
Aram Gareginyan
July 09, 2012 | 10:17
In his interview to Armenian News - NEWS.am, the EBRD for the Caucasus,
Moldova and Belarus office Director Paul-Henri Forestier shares his
views on the potential of the mining sector in Armenia.
Do you think that the regulatory environment and access to credit
have been sufficient for the private sector in Armenia over the last
few years?
Small and medium sized enterprises (SMEs) are the backbone for a
healthy and well functioning economy and EBRD always supports the
development of the SMEs sector. Our direct involvement is predicated
upon financial transparency, which unfortunately is often lacking. We
also support this sector indirectly through SME credit lines with our
local partner banks. In natural resources area, one is not dealing
with SMEs, but large projects. For EBRD to finance such projects the
company has to meet both Armenian regulatory requirements and the
EBRD's corporate governance and environmental standards.
Do you think that the mining sector in Armenia is generally compliant
to the EBRD requirements?
I can talk only about the projects which we would consider financing.
On one such project, we are currently waiting for the Ministry of
Nature Protection to approve the Environmental Impact Assessment
(EIA) but we are surprised and somewhat disappointed with the recent
announcement that they require another 230 days to make a decision.
The Environmental and social impact assessment (ESIA), which is
required by the EBRD for financing this project should be finalized
in July and should enable us to assess whether this project meets our
very high standards. Delaying the start up of this project without
proper justifications can send wrong signals to the market with
negative implications on the FDI.
So far, you've had only one partner in the mining sector in Armenia -
Lydian International. Does the EBRD have any plans in increasing its
equity portfolio?
Currently Lydian is our only mining partner in Armenia. We are
confident that they would only operate under high environmental
standards. Should this be demonstrated, we would be prepared to
consider financing the Amulsar project. We do not currently have in
our pipeline more equity investments in the mining sector in Armenia.
Are you happy with the engagement of civil society? Are the NGO's
competent and adequate enough?
We always engage with NGO's and have a very healthy dialogue with
them. We also expect from NGOs to demonstrate the same transparency
which we expect from our clients.
Is EBRD planning to embark on other large-scale infrastructure
projects, after a major project of construction of a new terminal at
Zvartnots international airport?
The Bank recently has approved its new strategy
for Armenia, you can see the full strategy on
http://www.ebrd.com/downloads/country/strategy/armenia.pdf . The main
strategic priorities that Bank is going to focus are as follows:
Developing the financial sector and improving access to finance. The
Bank will focus on providing its traditional SME and micro-finance
lines targeting areas outside the capital city and facilitating access
to credit for SMEs in the rural areas. In rural areas, the EBRD will
launch agricultural credit lines in local currency.
Improving municipal and urban transport infrastructure. The Bank will
support the water and waste water sectors introducing cost-reflective
tariff structures, improving service availability, as well as urban and
municipal transport reforms including the introduction of integrated
transport management and ticketing systems, better parking management
and regulation of feeder bus and minibus services.
Developing agribusiness and high value-added, export-oriented
industrial companies. The Bank will identify investments in
industries with export potential, including in areas highlighted by
the authorities' recent program of export promotion. EBRD will aim
to support the agricultural sector by targeting investments along
the whole value chain.
Improving the regulatory and institutional framework for sustainable
energy and increasing value-added in the mining sector. The Bank
will support investments in financially viable renewable energy
projects and, through partner banks, continue to finance energy
efficiency credit lines for industrial and residential users. The
Bank will support power generation, particularly new entrants and
non-state participants, and will consider participating in regional
electricity infrastructure projects that strengthen competition in the
regional electricity market. The Bank will support bankable mining
operations with reputable investors who demonstrate high standards
of environmental and social protection.
Armenia's medium-term prospects depend to a large extent on
the authorities' ability to create conditions for investment and
productivity improvements. In the coming years, the Bank will continue
its policy dialogue with the authorities on improving the business
environment in Armenia. Through the Bank-funded Business Support
Office, the public-private dialogue will be strengthened and expanded
to deal effectively with various issues that impede doing business
in Armenia.
news.am
Aram Gareginyan
July 09, 2012 | 10:17
In his interview to Armenian News - NEWS.am, the EBRD for the Caucasus,
Moldova and Belarus office Director Paul-Henri Forestier shares his
views on the potential of the mining sector in Armenia.
Do you think that the regulatory environment and access to credit
have been sufficient for the private sector in Armenia over the last
few years?
Small and medium sized enterprises (SMEs) are the backbone for a
healthy and well functioning economy and EBRD always supports the
development of the SMEs sector. Our direct involvement is predicated
upon financial transparency, which unfortunately is often lacking. We
also support this sector indirectly through SME credit lines with our
local partner banks. In natural resources area, one is not dealing
with SMEs, but large projects. For EBRD to finance such projects the
company has to meet both Armenian regulatory requirements and the
EBRD's corporate governance and environmental standards.
Do you think that the mining sector in Armenia is generally compliant
to the EBRD requirements?
I can talk only about the projects which we would consider financing.
On one such project, we are currently waiting for the Ministry of
Nature Protection to approve the Environmental Impact Assessment
(EIA) but we are surprised and somewhat disappointed with the recent
announcement that they require another 230 days to make a decision.
The Environmental and social impact assessment (ESIA), which is
required by the EBRD for financing this project should be finalized
in July and should enable us to assess whether this project meets our
very high standards. Delaying the start up of this project without
proper justifications can send wrong signals to the market with
negative implications on the FDI.
So far, you've had only one partner in the mining sector in Armenia -
Lydian International. Does the EBRD have any plans in increasing its
equity portfolio?
Currently Lydian is our only mining partner in Armenia. We are
confident that they would only operate under high environmental
standards. Should this be demonstrated, we would be prepared to
consider financing the Amulsar project. We do not currently have in
our pipeline more equity investments in the mining sector in Armenia.
Are you happy with the engagement of civil society? Are the NGO's
competent and adequate enough?
We always engage with NGO's and have a very healthy dialogue with
them. We also expect from NGOs to demonstrate the same transparency
which we expect from our clients.
Is EBRD planning to embark on other large-scale infrastructure
projects, after a major project of construction of a new terminal at
Zvartnots international airport?
The Bank recently has approved its new strategy
for Armenia, you can see the full strategy on
http://www.ebrd.com/downloads/country/strategy/armenia.pdf . The main
strategic priorities that Bank is going to focus are as follows:
Developing the financial sector and improving access to finance. The
Bank will focus on providing its traditional SME and micro-finance
lines targeting areas outside the capital city and facilitating access
to credit for SMEs in the rural areas. In rural areas, the EBRD will
launch agricultural credit lines in local currency.
Improving municipal and urban transport infrastructure. The Bank will
support the water and waste water sectors introducing cost-reflective
tariff structures, improving service availability, as well as urban and
municipal transport reforms including the introduction of integrated
transport management and ticketing systems, better parking management
and regulation of feeder bus and minibus services.
Developing agribusiness and high value-added, export-oriented
industrial companies. The Bank will identify investments in
industries with export potential, including in areas highlighted by
the authorities' recent program of export promotion. EBRD will aim
to support the agricultural sector by targeting investments along
the whole value chain.
Improving the regulatory and institutional framework for sustainable
energy and increasing value-added in the mining sector. The Bank
will support investments in financially viable renewable energy
projects and, through partner banks, continue to finance energy
efficiency credit lines for industrial and residential users. The
Bank will support power generation, particularly new entrants and
non-state participants, and will consider participating in regional
electricity infrastructure projects that strengthen competition in the
regional electricity market. The Bank will support bankable mining
operations with reputable investors who demonstrate high standards
of environmental and social protection.
Armenia's medium-term prospects depend to a large extent on
the authorities' ability to create conditions for investment and
productivity improvements. In the coming years, the Bank will continue
its policy dialogue with the authorities on improving the business
environment in Armenia. Through the Bank-funded Business Support
Office, the public-private dialogue will be strengthened and expanded
to deal effectively with various issues that impede doing business
in Armenia.