Politics 15:34 23/05/2024 Armenia

Expert: ZCMC's donation of 270 million drams to My Step Foundation damages Armenia's rating

Zangezur Copper Molybdenum Combine (ZCMC) recently donated 70 million drams to the My Step Foundation run by Armenian Prime Minister Nikol Pashinyan’s spouse, Anna Hakobyan, stating that the sum was used to implement an educational program and ruling out any corruption risks associated with the donation deal.

Speaking to Panorama.am on Thursday, public and political activist Edgar Ghazaryan reiterated that back in 2019, ZCMC donated 200 million drams to the My Step Foundation.

"The foundation has numerous donors and the biggest of them are anonymous. Possibly, ZCMC gave more money to the fund and remained anonymous. The fund marked the 200 million drams as an anonymous donation, but I learned from another source that it was given by ZCMC. They wanted to keep ZCMC’s donation secret, but the information leaked out," Ghazaryan stated.

Asked whether Edgar Ghazaryan plans to apply to the competent law enforcement agencies to investigate corruption risks in the donation, the activist said: "At this point, it makes no sense because they will not take any action. When there is a change of power, I think that these issues will be discussed separately."

Panorama.am also reached out to Varuzhan Hoktanyan, programs director at the Transparency International's Armenian affiliate, the Anti-Corruption Center (ACC), to find out whether such a donation by ZCMC is considered a corruption offense according to international standards.

Varuzhan Hoktanyan: Internationally, any such transfer evidently poses corruption risks. I never approve donations to foundations somehow linked to government officials or their relatives by businessmen. This is an internationally accepted definition and is best described by the saying, "You scratch my back and I'll scratch yours."

It’s more common during elections, but it can also be observed in non-election periods, when an entrepreneur makes donations to the election campaign fund of an official or a party during election and non-election periods. Later, when the party comes to power, relevant laws are adopted to improve their business conditions. This naturally amounts to political corruption and is a common practice globally.

Panorama.am: Could this corruption phenomenon affect Armenia's international rating?

Varuzhan Hoktanyan: The Corruption Perception Index (CPI), which Transparency International calculates based on purely ethical norms, is not done by its Armenian affiliate, but by other organizations. The Transparency International HQ has a department which takes the data and processes it, thus calculating the CPI in our country. The research group of our organization does not look at all issues, and the World Economic Forum has a study of the kind. They conduct surveys among experts and businessmen and draw conclusions based on their outcomes.

Armenia’s slide in the global corruption rankings released in January 2023 was mainly attributed to it. It’s not only about the case involving Zangezur Copper Molybdenum Combine. Generally, they observed a phenomenon in which leading financial and economic groups influence the government decisions. Thus, there is also the problem of donations, because government would not do it for nothing.

The slide in 2022, compared to the previous years, was linked to it. If such cases are studied more comprehensively, I guess more will be discovered. Notably, Armenia did not improve its position in the corruption perceptions survey in 2023. Let's also not forget that corruption indices are considered in comparison, 180 countries are ranked and the situation in other countries may be much worse, it is moderate in our country. It’s beyond any doubt that a problem exists here.

Panorama.am: How do you view the fact that the government also owns a 25% stake in ZCMC?

Varuzhan Hoktanyan: Regardless of whether the state owns a share or not in the company, such a phenomenon includes corruption risks.

Source Panorama.am
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