Under an agreement signed by Air Arabia and the Armenian National Interests Fund (ANIF) on Wednesday, the new airline will operate as their joint venture and use Yerevan’s Zvartnots international airport as its base.
“The new company will adopt the low-cost business model operated by Air Arabia,” the two sides said in a joint statement.
“Work on securing the Air Operating Certificate (AOC) – which allows the airline to start operating – will commence shortly. More details about the launch date, fleet, and destination network will be announced in due course,” added the statement.
“We see tremendous potential for Armenia in building its airline sector, which will add sustained value to the economy through job creation and the development of travel and tourism sector,” it quoted Air Arabia’s chief executive, Adel Al Ali, as saying.
Tatevik Revazian, the head of the Armenian government’s Civil Aviation Committee, also stressed the economic significance of the deal when she spoke with RFE/RL’s Armenian Service on Thursday.
“The benefits of this project are very clear,” she said. “A large number of jobs will be created directly and indirectly. Aviation is an engine of economic development. We will have a very serious instrument for developing our economy.”
Armenia has had no major domestic airlines ever since the state-backed Armavia carrier went bankrupt in 2013. The bankruptcy led the then Armenian government to liberalize the country’s aviation sector.
The decision allowed local and foreign carriers meeting safety standards to carry out flights to and from Armenia without any restrictions. The South Caucasus country’s air traffic with the outside world grew rapidly in the following years.
Revazian insisted that the new national airline will not be in a privileged position vis-à-vis small private carriers currently operating in Armenia. Nor will it prevent more foreign airlines from launching flights to Armenia, she said.
“Competition is a healthy thing for everyone,” said the official. “It makes everyone work better.”
Air Arabia already operates a regular flight service between the Emirati city of Sharjah and Yerevan. Its chairman, Sheikh Abdullah Bin Mohammed Al Thani, attended Wednesday’s signing ceremony in Yerevan.
Al Thani also held separate meetings with President Armen Sarkissian and Prime Minister Nikol Pashinian.
"Armenia is currently going through a rather difficult period,” Sarkissian told Al Thani. “We appreciate our friends who are by our side, especially at this stage, starting new cooperation with a new project in Armenia.”