By Shakeh AvoyanArmenia has begun servicing its remaining $11 million debt to Turkmenistan and will fully repay it within the next two months, officials said on Monday.
The process followed the signing earlier this month of a bilateral agreement restructuring the debts incurred by Armenia during imports of Turkmen natural gas in the mid-1990s. Under that agreement, the Armenian government is to repay it with domestically manufactured goods.
“Armenian business entities have begun supplying goods and services to the Turkmen side in payment of our inter-state debt,” Arshaluys Markarian, chief of the debt management department at the Finance Ministry, told RFE/RL. He said Yerevan will meet all debt repayments in “one or two months.”
According to him, Armenia will supply the gas-rich Central Asian state with “virtually everything” that is manufactured on its territory, including machines, chemicals and an unspecified production of its military-industrial sector.
The deal with Turkmenistan, which will reduce Armenia’s overall external debt to $960 million, came a month after an assets-for-debt settlement with Russia. Markarian said the agreements have considerably eased the country’s debt burden as the bulk of its remaining financial obligations results from low-interest Western loans that will fall due many years later.
Turkmenistan was Armenia’s main supplier of natural gas until 1998 when it was replaced by Russia’s Gazprom monopoly. The two governments have been discussing the possibility of renewed Turkmen gas imports through a planned Iran-Armenia pipeline.