ArmInfo.The management of the Fly Arna airline was not the responsibility of the Armenian National Interests Fund (ANIF) but of the operator, in this case Air Arabia. Minister of Finance of the Republic of Armenia Vahe Hovhannisyan stated on January 31 at the final press conference, commenting on the developments around the national carrier, as well as the efficiency and expediency of the public funds spent by ANIF.
According to the minister, last year the financial authorities of the Republic of Armenia together with the IMF studied the state policy pursued in the private sector, as well as the necessary share of state involvement. In particular, the activities of ANIF were reviewed. "We came to the conclusion that the range of tasks set for ANIF is too wide, they are not so specific, and the mandate of the Fund should be revised and clarified," Hovhannisyan noted.
According to the minister, today there are various comments regarding the salaries paid to the Fund's employees. "There are people who were paid high salaries and there are comments that these people provided high results. But there is also the opposite opinion. The issue is controversial, since the expected results of their activities are not clearly defined. Consequently, the government decided to specify the tasks assigned to ANIF, to make them measurable and consonant with the economic policy of the authorities," he explained, adding that as part of these works, the authorities initiated a change in the Fund's management model.
Touching upon the government's decision of October 2021 to allocate 4 billion 733 million 720 thousand drams (about $12 million) from the state treasury to increase the authorized capital of the ANIF fund (the state represented by ANIF became the owner of 49% of the shares of Fly Arna, ed. note), Vahe Hovhannisyan said that the funds were aimed at filling the gap, which was in the form of investment obligations of the Armenian side within the framework of the airline formation project. (at the beginning of January, ANIF announced that it had attracted a significant amount of foreign direct investment in the amount of 84.6 billion drams (at the exchange rate as of November 9, 2023) or $210 million. 10 million dollars of the total amount was allocated to support the Fly Arna project ( the national airline of Armenia - ed. note).
Fly Arna was founded in December 2021. However, a year and a half later, it encountered problems caused, according to available data, by the Armenian side's failure to comply with the terms of the agreement when creating the airline. 49% of the company's shares belong to the Armenian State Interest Fund (ANIF), and the same amount belongs to the Arab International Business Company, affiliated with Air Arabia. The remaining 2% of the shares are the property of Lebanese businessman of Armenian origin Varuzhan Nergizyan.
On January 30, 2024, Fly Arna officially announced the suspension of flights "due to the company's operational changes." ""The carrier is actively working on resuming its services and looks forward to welcoming passengers back onboard soon," the airline said in a statement. Earlier, ArmInfo reported about problems that had arisen with the air carrier. The agency, citing sources close to the airline, noted that the Armenian side did not fulfill a number of previously agreed conditions when creating the joint venture. The talk, among other things, was about subsidizing passenger transportation by the RA government.
The carrier ceased flights on January 10, when the last flight was operated. Prior to this, one of the carrier's main shareholders, Air Arabia, recalled one of its two aircraft. Now the fate of the airline must be decided by the Board of Directors, whose meeting will be held this week. After January 10, all airline employees had their salaries cut by 50%. ANIF was established in 2019 with a mandate to consolidate and effectively manage the ownership of Armenian state-owned enterprises, to promote export growth and investments in Armenia by providing co-financing in large-scale projects at their initial stage of development. The scope of its activities covers, in particular, renewable energy, agriculture, healthcare, services and tourism. During its existence, ANIF has implemented about a dozen joint investment projects with Armenian and foreign investors. As of December 31, 2022, ANIF's net accounting profit amounted to 1.76 billion drams (about $4.5 million).
