By Emil Danielyan
Armenia and Russia are hammering out details of a far-reaching agreement that will give the financial management of the debt-ridden nuclear power station at Metsamor to a Russian energy company, officials told RFE/RL on Friday.A group of Russian energy officials arrived in Yerevan earlier this week for final talks on the deal which was initially expected to be signed in March. The spokeswoman for the Armenian Energy Ministry, Lusine Harutiunian, said they are now working out minor “technical and legal details” of the arrangement. A final agreement could be announced as early as next Tuesday, Harutiunian added.
Under the terms of the deal, tentatively approved by the two governments last February, Russia’s RAO Unified Energy Systems (UES) utility will repay $32 million in Metsamor’s outstanding debts to Russian nuclear fuel suppliers and provide $8 million needed for fresh fuel deliveries. In exchange for that, UES will manage Metsamor’s finances and obtain the ownership of six Armenian hydro-electric plants.
The deal will pave the way for the reactivation of Metsamor’s sole nuclear reactor halted for refueling a month ago. The facility generates about 40 percent of Armenia’s electricity. Its director, Gagik Markosian, said he expects that agreement on the shipment of Russian fuel will be reached “in the coming days.” He said the fuel could be delivered to Metsamor by the end of this month.
Metsamor’s planned transfer to UES is part of a series of equities-for-debt agreements between Moscow and Yerevan which will place Armenia’s energy sector under virtually full Russian control. Unlike other former Soviet republics that also owe substantial sums to Russia, Armenia has not sought to re-structure its Russian debts, deciding instead to repay them with strategic economic assets.
This policy is increasingly questioned by opposition politicians and economists who see it as a threat to the country’s independence. Some of them have accused President Robert Kocharian of buying Russia’s support for his continued hold on power.
“Why is it that Russia has restructured Georgia’s bigger debt on Georgian terms, but keeps strangling Armenia, its strategic ally?” said Eduard Aghajanov, an economist who had served in the administration of former President Levon Ter-Petrosian. “This only proves that they don’t view us as a serious partner.”
Aghajanov dismissed government arguments that the debt arrangements will lead to substantial Russian investments in the struggling Armenian economy. “The Russian economy is very underdeveloped and highly dependent on oil,” he said. “They themselves badly need investments from abroad.”
According to Aghajanian, Yerevan could have settled the debt by borrowing more loans from Western lending institutions, ending the energy sector’s huge financial losses and even tapping the Armenian Central Bank’s hard currency reserves that currently stand at $440 million.
Kocharian, however, has strongly defended the debt agreements with Russia personally negotiated by his closest associate, Defense Minister Serzh Sarkisian. He says they will lessen Armenia’s debt burden and bolster its already close ties with Russia.