RFE/RL Armenian Report – 12/31/2021

                                        Friday, January 31, 2021


Firms Linked To Armenian Officials Win Government Contracts

        • Nane Sahakian

Armenia -- Workers rebuild a road in Gegharkunik province, Juy 4, 2020.


Companies owned by or linked otherwise to at least three senior Armenian 
officials, including Prime Minister Nikol Pashinian’s deputy chief of staff, won 
dozens of government contracts in 2021, raising suspicions of a conflict of 
interest and even corruption.

Pashinian insisted last week that they did not exploit their government 
connections to win tenders for road construction and procurements. Opposition 
figures and civil society members remain unconvinced by these assurances.

As an outspoken opposition politician, Pashinian had for years alleged corrupt 
practices in the administration of tenders won by individuals connected to 
Armenia’s former governments. He claimed to have eliminated “systemic 
corruption” in the country after coming to power in 2018.

Critics now question the integrity of some procurements handled by Pashinian’s 
administration.

A road design company belonging to Bagrat Badalian, the deputy chief of the 
government staff, is a case in point. Badalian joined the government shortly 
after the 2018 “velvet revolution,” first as a deputy minister for local 
government and later as chief of Deputy Prime Minister Tigran Avinian’s staff.

The company called Channakhagits Institut had been founded by his father Samvel 
in 1995. The latter handed over his 88 percent share in it to Bagrat in 2020.

The most recent official records available show that Channakhagits won four 
government contracts in 2017. Its fortunes improved dramatically in 2020.

Over the past two years the company has secured highway design services worth a 
combined 677 million drams ($1.4 million). It won 21 government tenders in 2021 
alone.

Speaking at a December 24 news conference, Pashinian denied that Channakhagits 
enjoys privileged treatment because of Badalian’s government positions. He said 
that it is one of the most qualified firms of its kind in Armenia.


Armenia - Speaker Alen Simonian speaks during a parliament session, September 
13, 2021.

Pashinian also ruled out privileged treatment of a road construction company 
which is run by the brother of Alen Simonian, the Armenian parliament speaker 
and a leading member of the ruling Civil Contract party.

The company called Euroasphalt had an authorized capital of just over $100 when 
it was founded by two little-known individuals less than two years ago. It won 
in 2021 three government contracts for rural road construction worth a total of 
748 million drams ($1.5 million).

Speaking with journalists in September, then Deputy Prime Minister Suren 
Papikian insisted that the contracts resulted from fair and transparent tenders. 
Simonian afterwards condemned media outlets for questioning the integrity of 
those deals.

Pashinian said, for his part, that the speaker’s brother Karlen is only the 
chief executive of Euroasphalt and does not own it.

It emerged in October that one of the company’s two officially registered 
addresses is the same as that of a Yerevan apartment where Simonian’s mother 
currently lives. The other address could not be located.

Karlen Simonian is also the deputy director of another firm that supplies 
concrete to builders. An Armenian civic group revealed recently that it donated 
over $10,000 to Pashinian’s party in the run-up to the June 2021 parliamentary 
elections.


Armenia -- The parliament building in Yerevan, January 14, 2019.

Alen Simonian raised eyebrows when he appointed a businessman and friend of his 
as chief of the Armenian parliament staff days after becoming its speaker in 
August. The businessman, Vahan Naribekian, owns the Argavand Kahuyk company 
supplying furniture to the National Assembly and various government and 
law-enforcement agencies.

Argavand Kahuyk has earned 250 million drams ($520,000) from 152 supply 
contracts secured since the 2018 regime change. Nineteen of them were signed 
after Naribekian became the chief of the parliament staff.

In a recent interview with the Hetq.am investigative publication, Naribekian 
claimed that his company has done much better since Pashinian’s rise to power 
because the current authorities handle the procurement process more fairly.

Varuzhan Hoktanian, the program coordinator at the Armenian affiliate of the 
anti-corruption watchdog Transparency International, said, however, that the 
authorities lack the “political will” to substantiate such claims with more 
detailed information. Pashinian’s comments on the issue did not dispel concerns 
about possible government corruption, Hoktanian told RFE/RL’s Armenian Service.


Armenia - Businessman Khachatur Suqiasian speaks at the inaugural session of the 
new National Assembly,, August 26, 2021.

Pashinian also pledged to separate business from politics when he swept to power 
during the 2018 mass protests. He stated shortly afterwards that Armenian 
entrepreneurs no longer need to hold parliament seats in order to protect and 
increase their assets.

Two wealthy businessmen, Khachatur Sukiasian and Gurgen Arsenian, were elected 
to the current National Assembly on the ruling party’s ticket in June. Sukiasian 
and his extended family have reportedly expanded their business interests since 
2018.

Hetq.am reported in October that a fuel importing company linked to Sukiasian 
has signed with the Armenian Defense Ministry supply contracts worth $14 million 
since being set up in early 2020.


Reprinted on ANN/Armenian News with permission from RFE/RL
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