Germany to Provide 70 Million Mark Loan to Armenia

YEREVAN (Noyan Tapan)–As a result of intergovernmental Armenia-Germany negotiations held in 1997–the German government offered Armenia 40 million Deutsche Marks for development programs.

As reported by Marion Ramakers–Cultural Attach of the German Embassy to Armenia–38.5 German Marks of 40 million German Marks is a loan specifically for the restoration of electric substations and supply systems (27.5-million German Marks); development of private small and medium-sized enterprises (6 million German Marks); and–communal infrastructure–in particular–water supply and sewerage (5 million German Marks). The loan will be given under the low interest rate of 0.75 percent per annum for 40 years. The remaining 1.5 million German Marks will be provided as aid for the preparation of future programs.

According to Ramakers–through a technical cooperation program Germany will also provide 2.35 million German Marks–of which 0.85 million German Marks are offered to support small and medium-sized enterprises–and 1.57 million German Marks for the realization of a food program in Sisian. Within the framework of technical cooperation Germany has previously provided approximately 18.54 million German Marks to Armenia.

Through another program of financial cooperation–before 1997 the German government had planned to give Armenia 30 million German Marks. Five million German Marks have already been received as aid to be spent on temporary lodging in Armenia’s regions.

The remaining 25 million German Marks is a loan for the restoration of the hydro power station in Kanaker. The loans will be allocated after Armenia ratifies the loan agreemen’s.

According to Ramakers–a significant part of Germany’s financial assistance is also coming through the European Community–in particular–by way of the TACIS program–29 percent of which is sponsored by Germany.

"Armenia–being part of the regional market–today presents great interest for German investors," said Ramakers.

She added that foreign investment in Armenia is first of all impeded by foreign political conflicts–as well as an ineffective process of legislative reforms in state structures.

For example–the fact that foreigners are not allowed to purchase land in Armenia affect the inflow–or lack thereof–of investment in Armenia.

According to Ramakers–in order to attract German investment to Armenia–the embassy will continue working on establishment of direct ties between Armenian and German businessmen. Larger investmen’s will contribute to the development of cultural and tourist relations.

About 20 travel organizations in Armenia will attend an international travel conference in Berlin this March. According to Ramakers–it is impossible to force tourism in Armenia–but Armenia’s participation in an international tourism conference will benefit Armenian-German tourism–as will the Days of Armenian Culture in Germany to be held in September.

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