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Ambassador of Kuwait: Armenia not open for investments

ArmInfo’s interview with Ambassador of Kuwait to Armenia Bassam Mohammed Al-Qabandi

  • by Marianna Mkrtchyan

  • Thursday, December 27, 19:34

Among the issues discussed during the recent visit by Armenian Foreign Minister Edward Nalbandian to Kuwait was possible visit of Emir of Kuwait, Sheikh Jaber III al-Ahmad al -Jaber al-Sabah to Armenia. At what stage is that issue at present?

 

Nalbandian’s visit was quite successful by all criteria, first of all, because it finally took place after several postponements by both Armenia and Kuwait due to some objective reasons in the political situation in both the countries. One of the positive arrangements made during that visit was cancellation of visas for the two countries’ diplomats and the invitation for the Emir of Kuwait to visit Armenia. Emir confirmed his desire to visit Armenia and I think the visit will take place in the near future.  In addition, among other achievements of the two countries were many agreements signed earlier. During their meeting the Kuwaiti Prime Minister and the Armenian Foreign Minister made an arrangement of economic cooperation. A meeting was held with the Finance Minister of Kuwait, who is also the Kuwaiti Co-Chair the Intergovernmental Commission.  The parties agreed to discuss the terms of a second business forum of the two countries within the coming 3 months.  I’d like to recall that the Armenian co-chair of the Armenian-Kuwaiti Intergovernmental Commission is the Minister of Territorial Administration.

 

Kuwait Fund For Arab Economic Development (KFAED) has announced an intention to implement projects in Armenia. What projects are in question and how much they will cost?

 

There are two funds, Kuwait Fund For Arab Economic Development (KFAED) and Kuwait Investment Authority (KIA). Nalbandian had a meeting with the head of KFAED. The two parties discussed an issue of repair of some 10-11 Armenian polyclinics. We have received a letter from the Healthcare Ministry of Armenia requesting assistance in repair of the above polyclinics, but KFAED has not studied the request, because it studies requests only from the finance ministries of countries. Since the procedure was not observed, the issue has not been discussed.  Nalbandian promised to tackle the issue on his return to Armenia and address the Fund from the Finance Ministry. I’d like to say that repair of medical establishments in the regions is a very important task because Armenia needs it.  Our Fund operates also in Africa and Asia and in some other countries, but there are procedural rules of KFAED that must be observed. 

 

Thus, the obstacles are of technical nature… Is it known what particular regions in Armenia will be involved in the project?

 

Surely, these are procedural and technical issues. Receiving a request from the Finance Ministry of Armenia, it will be possible to start studying the request that will contain also a cost estimate for the needs of regional polyclinics. Only after signing the given agreement it will become known what particular polyclinics will receive assistance of the Fund. I am sure that issue will be settled as Nalbandian himself promised to tackle it.

 

As for the KIA, I’d like to say that it is a separate structure that was founded in 60s of the last century. The state budget allocated quite a significant amount of sum to establish it. Some 10%-15% of profits from the oil recovery are directed to the given Fund annually. It is also called the Fund of the future generation. All the funds directed to KIA are spent on investment projects. In order the Fund makes investments in Armenia it is necessary to pave the way for it. First of all, I mean the infrastructures. Our countries lack air communication and a Kuwaiti investor is reluctant to arrive in Armenia via third countries losing over 8 hours in the way.  In the meanwhile, a direct flight to Armenia would take 1 hour and 50 minutes. The Fund cannot persuade a private investor to leave for Armenia unless there are relevant conditions for investing.  The two countries have an agreement on tourism development, which is not implemented also for the same reason. We hope Armenia will create all the conditions for direct air communication.

 

As far as I know during your meeting with Armenian Diaspora Minister Hranush Hakobyan you mentioned some technical reasons that impede direct flights. What reasons are these?  

 

The civil aviation departments of the two countries need an agreement wherein they must observe the parity principles in line of the rules of ICAO, and an opportunity should be provided for the use of the fifth freedom right. A question arises as to whether an investor will arrive in your country if it is not favorable for investments.

 

You are right, there has been such problem in the country for a long period of time already. This is because the Armenian aviation market is not only monopolized but also it has limited possibilities. Therefore, the parity principles cannot be observed with many countries. I’d like to know what contractual basis is there between Armenia and Kuwait? In what fields do the countries cooperate and in what fields do they plan to launch cooperation?

 

We have signed an agreement on mutual protection of investments, on abolition of double taxation, agreement on exchange of students. Every year 4 Armenian students receive education in Kuwait. Last year, 2 students arrived in Kuwait to study. Don’t forget that we have an Armenian community comprising nearly 6,000 people. There is an Armenian school that was established 50 years ago. The Kuwaiti people are familiar with the Armenian culture and traditions. During his meeting with Nalbandian, our Emir highly appreciated the Armenian community. The Armenians in Kuwait are very hardworking and honest. They have never complained during such long period of residence in our country.  The Armenian community is among the most respectful ones in Kuwait.

 

Have you got any statistics on Kuwait’s investments in Armenia? Official statistics keeps silence. In what fields may Kuwait’s investments be used most effectively? 

 

Unfortunately, no investments in Armenia from Kuwait and its citizens have been registered; everything is at a standstill. It is necessary to create relevant conditions for investments; a relevant ground is needed.

 

We also tried to learn the statistics on foreign trade turnover between our countries, but we have not found it either. 

 

I have already said that, unfortunately, there are no more or less developed trade and economic relations between our countries. If Armenia is not open for some reason, there are no basic conditions for development of any partner relations. Nobody will agree to waste time; Armenia is not open for Kuwait’s investments. Furthermore, I invited representatives of Kuwait’s civil aviation to Armenia, and we held a consultation that covered the issue of air communication. Some promises were given, but the issue did not get off the ground.

 

The Government of Kuwait has announced its intention to allocate 100,000 USD to support the Syrian Armenians. What stage is this issue at?

 

We are cooperating with the Armenian Diaspora Ministry. There is a Center for Coordination of Syrian-Armenians' Issues NGO that deals with distribution of the aid. The amount should be converted into coupons for the beneficiaries to make use of food and commodities. This program is underway. As soon as the coupons are printed, we will start distributing them. Due to these coupons, the beneficiaries will be able to acquire goods of first priority, except alcohol drinks and cigarettes. The whole amount will be distributed among 200 families. This money will supposedly be enough for 4 months.

 

As far as I remember, Armenian Diaspora Minister Hranush Hakobyan offered you to renovate a building consisting of 50 apartments for Syrian Armenians’ families. What stage is this offer at? 

 

We visited the building and saw that it really needs to be renovated. In order to implement the project, we photographed it and sent these photos to benevolent organizations of Kuwait. This building belongs to a Catholic church, and now we request them to provide us with documents giving a complete idea of the building and the scope of work. We are interested in implementation of this offer.

 

Does this building belong to a Catholic church? Why doesn’t the Diaspora Ministry apply to Vatican?

 

I do not know, but this building belongs to a Catholic church, it is a very good building, but needs to be renovated. The building is meant for Syrian Armenians and orphans. The fact that this activity is of charity nature is very important to us.   

 

Does the Kuwait Investment Authority (KIA) work on the basis of business mechanisms? What programs being implemented in other countries may later be implemented in Armenia? 

 

In this case, the country itself should present projects for investments. Armenia needs hotels, as well as projects for development of Lake Sevan. Jermuk also needs to be developed, but KIA investors will not come to Armenia for the sake of $30 mln, their business and interests start from at least $150 mln. Nobody will invest in small and medium business. The Kuwait Investment Authority has its programs in Europe. Your country itself should invite investors to make the investments and develop the infrastructures.

 

What would you say about the Armenian-Kuwaiti business forum? Where would it be reasonable to hold the forum?

 

We are working in this dimension. It is necessary to hold the forum jointly with the Chamber of Commerce and Industry. This year is already over and we hope that this plan will be carried out by mid 2013. However, first we hope for establishment of direct air communication, as we will hardly persuade our businessmen to spend a whole day on the trip. Armenia has a favorable investment potential, it has a lot of opportunities and the most important thing is that it is a very safe country. Here people are very amicable and nothing threatens the tourists.  

 

Have the Armenian tourists discovered Kuwait for themselves?  

 

I do not know. There is an agreement, but I do not know whether it works. I think there should be no obstacles in this matter.

 

Where can one receive a visa? At the Embassy of Kuwait or in the airport?

 

As the visa regime is not facilitated, it is possible to visit Kuwait if there is an invitation letter. Armenia needs tourists more than Kuwait does. If you remember, last year very few tourists visited Armenia during Novruz. The hotels, restaurants and markets were complaining of the few number of tourists.  

 

But if there are direct air flights between our countries, I won’t doubt the flow of tourists from Kuwait, who will visit Armenia 12 months a year, both in winter and in summer. The tourists will come to Armenia and spend money, and the Armenian market will only benefit from it. Now Kuwait has a new government, and new processes are expected. We hope that new mutually beneficial agreements will be signed in the course of the work of the Intergovernmental Commission. Certainly, much depends on the political situation in our countries, parliamentary elections in Kuwait and forthcoming presidential elections in Armenia. I have been in Armenia for a year already, and a lot of things have been done over that period. I hope that even more various and useful projects will be implemented.

 

And, finally, I would like to wish a Happy New Year and a Merry Christmas to Armenian people, especially given that Christmas is of special importance to you. All the best to Armenian people!

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