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What Price Will Armenia Pay for Russian Loan?
Hakob Badalyan, Political Commentator
Business - 07 February 2015, 13:52
During Hovik Abrahamyan's visit to Moscow agreement on the Russian
loan of 270 million dollars to Armenia was signed. The money will be
spent on extending the operation of the Armenian nuclear plant by 10
years. Russia will also provide a grant of 30 million dollars.
Armenia needs this loan as water and air, at least to ensure financial
stability and prevent risks of collapse of the rate of the dram.
Practically, however, the activities aimed at extension of the term of
operation of the Armenian nuclear plant arouse questions. In
particularly, whether this work will not be used as an opportunity to
close the nuclear plant for a long time and leave Armenia heavily
reliant on electricity generated on Russian gas, which will boost
consumption of Russian gas in Armenia in implementation of the
notorious 2 December 2013 agreement with Gazprom.
The share of electricity generated on Russian gas has increased in the
energy sector of Armenia. Fears connected with the nuclear plant
intensified after the minister of energy Yervand Zakharyan announced
during the regular maintenance of the Nuclear Plant that problems have
come up, and there is a need for additional study.
And as electricity generated on gas increased, the price of
electricity increased accordingly. Of course, not only because of this
but also because of inefficient of management of energy companies, in
other words, corruption. And these companies belong to Russia.
Hence, on the one hand, the Russian loan of 270 million dollars is
important for ensuring the balance of currency. On the other hand, the
repair of the nuclear plant may be used for promoting the Russian
commercial interests in Armenia. By the way, Yervand Zakharyan has
announced recently that soon there may be a need to boost the price of
electricity.
It is possible that this is the price which Armenai will pay for the
Russian loan. Judging by information about the meeting of Hovik
Abrahamyan and Dmitry Medvedev, Armenia and Russia have not achieved
any other specific agreement.
And the government hopes to overcome the ongoing difficult period for
the economy of Armenia through foreign financial assistance. For this
purpose, new Eurobonds will be issued, though the falling rating of
the Armenian economy along with the falling rating of Russia and its
economy pose risks to selling them. In other words, the success of
Armenia's Eurobonds depends on the situation of the key sponsor of
Armenia's economy Russia. And its situation is not good hence the
Eurobonds seem to be a vague prospect.
http://www.lragir.am/index/eng/0/economy/view/33600#sthash.rUGj1W2N.dpuf
Hakob Badalyan, Political Commentator
Business - 07 February 2015, 13:52
During Hovik Abrahamyan's visit to Moscow agreement on the Russian
loan of 270 million dollars to Armenia was signed. The money will be
spent on extending the operation of the Armenian nuclear plant by 10
years. Russia will also provide a grant of 30 million dollars.
Armenia needs this loan as water and air, at least to ensure financial
stability and prevent risks of collapse of the rate of the dram.
Practically, however, the activities aimed at extension of the term of
operation of the Armenian nuclear plant arouse questions. In
particularly, whether this work will not be used as an opportunity to
close the nuclear plant for a long time and leave Armenia heavily
reliant on electricity generated on Russian gas, which will boost
consumption of Russian gas in Armenia in implementation of the
notorious 2 December 2013 agreement with Gazprom.
The share of electricity generated on Russian gas has increased in the
energy sector of Armenia. Fears connected with the nuclear plant
intensified after the minister of energy Yervand Zakharyan announced
during the regular maintenance of the Nuclear Plant that problems have
come up, and there is a need for additional study.
And as electricity generated on gas increased, the price of
electricity increased accordingly. Of course, not only because of this
but also because of inefficient of management of energy companies, in
other words, corruption. And these companies belong to Russia.
Hence, on the one hand, the Russian loan of 270 million dollars is
important for ensuring the balance of currency. On the other hand, the
repair of the nuclear plant may be used for promoting the Russian
commercial interests in Armenia. By the way, Yervand Zakharyan has
announced recently that soon there may be a need to boost the price of
electricity.
It is possible that this is the price which Armenai will pay for the
Russian loan. Judging by information about the meeting of Hovik
Abrahamyan and Dmitry Medvedev, Armenia and Russia have not achieved
any other specific agreement.
And the government hopes to overcome the ongoing difficult period for
the economy of Armenia through foreign financial assistance. For this
purpose, new Eurobonds will be issued, though the falling rating of
the Armenian economy along with the falling rating of Russia and its
economy pose risks to selling them. In other words, the success of
Armenia's Eurobonds depends on the situation of the key sponsor of
Armenia's economy Russia. And its situation is not good hence the
Eurobonds seem to be a vague prospect.
http://www.lragir.am/index/eng/0/economy/view/33600#sthash.rUGj1W2N.dpuf