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The Armenian government may be considering selling its stake in the Zangezur Copper Molybdenum Combine (ZCMC), Pastinfo reports.

In late 2022, the government decided to hand over its 21.9% stake in the mining giant to the State Property Management Committee of the Ministry of Territorial Administration and Infrastructures for management, without giving any reason. The shares were previously managed by the Armenian National Interests Fund (ANIF).

According to Pastinfo’s sources, members of the ruling team have different approaches to the government’s stake in ZCMC “acquired as a result of a deal causing corruption allegations”, and the sale of the shares is widely discussed.

On September 30, 2021, the Industrial Company, a wholly owned subsidiary of Russian billionaire Roman Trotsenko’s GeoProMining Gold, acquired 60% of ZCMC and immediately donated a quarter of that stake to the Armenian government.

The 15% stake was first managed by Prime Minister Nikol Pashinyan’s office. Later on 5 January 2022, it was handed over to ANIF for trust management.

At a weekly cabinet meeting on 24 August 2022, Pashinyan revealed that the firm called AMP Holding had secretly donated its 6.8% stake in ZCMC to the government. The premier said AMP asked the government at the time not to publicize the transfer due to “commercial issues.” The 6.8% stake was also handed over to ANIF for management.

“In December 2022, the Armenian government again changed the body managing its shares. Apparently, there were disagreements in ANIF, whose Board of Directors includes foreign members, regarding the stake management, and its chairman Tigran Avinyan did not succeed in concealing the corruption allegations concerning the transaction. Thus, the government decided to hand over its 21.9% stake in ZCMC to the State Property Management Committee of the Ministry of Territorial Administration and Infrastructures,” Pastinfo writes.

The media outlet undoctors that the committee is also entitled to wholly or partially sell the state-owned shares of commercial organizations.

“This means the government can and will most likely put up its stake for sale, especially when the idea is backed by many government members. It’s worth noting that the EU or the US Embassy, which have always talked about the fight against corruption, democracy, freedom of speech and protection of fundamental human rights, have recently turned a blind eye to the incumbent authorities’ corrupt practices, bringing the political element to the foreground. That is, as long as Nikol Pashinyan's administration pursues the expected foreign policy, its corruption offences will be "forgiven". However, the stance of leading international organizations on the matter is a bit different. While showing loyalty, they cannot turn a blind eye to the scandalous cases and have eventually recorded Armenia’s retreat in the fight against corruption under the current government,” Pastinfo says.

Transparency International downgraded Armenia’s position in its annual survey of corruption perceptions around the world, pointing to “worrying signs” in the country.

Armenia ranks 63th out of 180 countries and territories evaluated in the watchdog’s 2022 Corruption Perception Index (CPI) released in January. It occupied 58th place in the previous CPI released a year ago.

“Experts believe the retreat in international rating is attributed, among other things, to the ZCMC deal and the secret donation of its shares to the government. Some government members have expressed deep concern that the stake sale may trigger greater criticism from international non-governmental organizations, although there are already potential buyers, including one of the pro-government oligarchs, who may help in a possible redistribution of the shares among Civil Contract members,” the report adds.