By Elen Muradyan
Armenian Prime Minister Nikol Pashinyan’s announcement that the government plans to nationalize the Electricity Networks of Armenia (ENA), is deeply concerning, say economists who warn the move could severely damage the country’s investment appeal and international reputation.
The statement Wednesday targets ENA, Armenia’s main power distribution company and a strategic asset ultimately owned by Russian-based Armenian billionaire Samvel Karapetyan. The company was acquired in 2015 by Karapetyan’s Tashir Group from the Russian state-owned Inter RAO.
Also read: Pashinyan calls to nationalize electricity network after arrest of billionaire critic
The timing of the nationalization proposal, coming just a day after Karapetyan publicly criticized the Armenian government for its attacks on the Armenian Apostolic Church, has raised suspicions that the move may be politically motivated.
Haykaz Fanyan, head of the Armenian Centre for Socio-Economic Studies, a Yerevan-based think tank, said the decision would undermine property rights and hurt investor trust.
“Initiating a process of forced re-nationalization, especially without compensation, will inevitably damage Armenia’s investment attractiveness,” Fanyan wrote on social media.
Fanyan also pointed out that ENA’s ownership structure includes entities registered in Cyprus, a country that has a bilateral investment protection agreement with Armenia. This might lead to Cyprus-based investors taking Armenia to international arbitration, potentially causing serious legal and financial consequences.
“This exposes Armenia to international legal risks that are entirely unjustified,” Fanyan said. “This isn’t just a business dispute as it sends a signal to all current and potential investors that private property and contracts may not be safe in Armenia,” Fanyan said.
Economist Suren Parsyan also criticized the move, calling it a “politically motivated” move made for short-term gain.
“Making announcements about nationalizing strategic assets for political or personal purposes is unacceptable,” Parsyan said. “Even minor instability in the electricity sector may bear a long-term negative impact on the entire economy.”
He dismissed the government’s suggestions that nationalization could help reduce electricity prices, pointing out that energy fees have increased under Pashinyan’s administration.
“If the government had the intention or the means to lower prices, they had seven years to do so,” Parsyan argued, adding that most of the price increases were linked to state obligations rather than ENA’s operations.
Tensions with Karapetyan escalate
The nationalization proposal came just one day after Samvel Karapetyan publicly condemned the government’s attacks on Catholicos Garegin II and the Armenian Church. On June 17, Karapetyan issued a statement expressing support for the Church and warning against the state’s efforts to undermine religious authority.
Pashinyan responded with a sharp rebuke, and later that day, law enforcement carried out what they described as “operative measures” at Karapetyan’s Yerevan residence. In the early hours of Wednesday, Karapetyan was seen being escorted to a police station by a deputy chief of police. He told reporters he stood firmly with the Church.The crackdown on Karapetyan follows weeks of government pressure on the Armenian Apostolic Church. Catholicos Garegin II had recently participated in a conference in Switzerland on the rights of the people of Artsakh, prompting a public backlash from Pashinyan, who accused him of breaking his monastic oath and later demanded his resignation.
Also read: Pashinyan targets billionaire Samvel Karapetyan following Church defense
