New Minister Vows to Overhaul Energy Sector

YEREVAN (RFE/RL)–Armenia’s newly appointed energy minister–Armen Movsisian–on Thursday pledged to expedite sweeping changes in the troubled energy sector and stop it being a huge drain on the scarce state resources.

"Both the mechanisms and approaches for addressing its problems are going to change," Movsisian. "Reducing the financial losses is the number one point in our financial adjustment program."

Movsisian–who was deputy head of the government agency for water resources before the appointment–gave no details of the impending overhaul of his ministry. He said only that he will make staff changes there as part of the effort.

Movsisian was speaking to reporters after attending a cabinet meeting chaired by President Robert Kocharian. Kocharian repeated his order to top energy officials to "establish law and order" in the energy sector.

His harsh criticism of the sector is believed to be the main reason for the sacking on Tuesday of the previous minister–Karen Galustian. The Armenian ministry for state revenues has blamed power plants and distribution companies for a major shortfall in tax revenues in the third-quarter of the year. But Galustian and other energy officials counter that the sector is itself owed substantial sums by various government agencies.

On the subject of the privatization of Armenia’s energy distribution companies–Movsisian said he believes that it is still possible to sell them to foreign investors despite the failure of two international tenders.

"In my opinion–we should again try to privatize them," he said.

But Movsisian admitted that the government is likely to back a different option whereby the companies will be leased to private investors. Prime Minister Andranik Markarian indicated on Wednesday that a government decision to try to lease the networks is a forgone conclusion.


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