By Ruzanna Khachatrian
The Hellenic Telecommunications Organization (OTE) has invested in Armenia less than half of what it claims, according to an Armenian government report leaked to RFE/RL over the weekend.
The report drawn up by an inter-ministerial commission accuses OTE’s Armenian subsidiary, ArmenTel, of large-scale financial fraud and is likely to lead to further deterioration of the government’s relations with the telecom monopoly. The commission is demanding a criminal inquiry into its findings and is recommending the government to seek an international third-party audit of ArmenTel.
The 60-page report was presented to a group of lawmakers on Friday at a meeting held behind the closed doors. It will be officially publicized after a response from ArmenTel.
The company said on Monday it is now looking into the allegations. An OTE spokesman in Athens, George Relis, also declined to comment on the conclusions drawn by the commission, but stressed that the Greek telecom giant has honored all investment commitments stemming from its 1998 purchase of ArmenTel.
OTE claims to have invested $127 million in Armenia by March 2001, more than the $100 million minimum set under the terms of the deal.
However, the government commission has painted a different picture, putting the investment total at only $52.5 million. The report says the Greeks have inflated the figure mainly by importing “artificially expensive equipment.” It also accuses them of an “arbitrary selection” of suppliers.
The commission headed by Transport and Communications Minister Andranik Manukian, claims that most tenders held by ArmenTel were unfair and non-transparent. On one such occasion in 1999, the report says, ArmenTel rejected more lucrative offers from leading telecom giants like Alcatel, Lucent and Siemens to grant contracts to two Greek firms on far less favorable terms. According to it, ArmenTel’s then chief executive, Iannis Lambrionis, and financial director received $15,000 each as a reward for what their parent company found to be a successful deal.
“ArmenTel, acting at the behest of OTE, has placed supply orders with mainly Greek companies, especially the ones in which OTE itself holds stakes,” the report says.
The commission also blames the ArmenTel management for the telecom operator’s falling revenues accompanied by mounting expenditures, implying that it is now less efficient than it was before its takeover by OTE.