Press Releases

IFC Announces First Investment in Armenia

Ludi Joseph                
Phone:  (202) 489-3887

Fax:       (202) 974-4384

Adriana Gomez

Phone:  (202) 458-5204

Fax:       (202) 974-4384

New York, NY, May 10, 2001—The International Finance Corporation, the private sector arm of the World Bank Group, today announced its first investment in Armenia.  The initiative will support the Government of Armenia’s efforts to further develop a sound private sector and help attract foreign direct investment.

IFC has made an equity investment of US$3.6 million in the $39 million renovation of the historically and culturally significant Hotel Armenia located in the center of Yerevan.  The Overseas Private Investment Corporation (OPIC) is providing an $18 million loan, and the hotel operator, Marriott International, will provide $3 million of subordinated debt.

The sponsors—who are active members of the US-based Armenian business community and strong supporters of Armenia—have provided over $10 million in equity to the project.  They are a group of ten investors who own the hotel through a holding company, AK Development LLC.  The sponsors have various business interests and expertise, including real estate and ownership of several Marriott Hotels around the world.

Mr. Edward Nassim, IFC’s Director for Central and Eastern Europe, said that the project will have a significant demonstration effect and promote investor confidence in the wake of the country’s transition to a market economy in the early 1990’s.  Armenia’s significant resources of human capital, natural beauty, cultural traditions, and strong Diaspora should have the potential to attract more foreign investment, he added.

IFC’s investment will support the hotel’s reconstruction and refurbishment and introduce well-developed managerial techniques in marketing, engineering, hospitality, finance, and accounting.  The hotel will train and employ about 300 people.  At completion, Hotel Armenia under the Marriott brand, will have 223 modernized rooms and will make available the first modern accommodation to business travelers and tourists to the country.

The President of Armenia, Mr. Robert Kocharian; the President of the World Bank, Mr. James D. Wolfensohn; acting OPIC President, Kirk Robertson; Senior Vice President of Marriott International, Mr. Warren Chan; and Staples Executive, Mr. Paul Korian representing the sponsor group, participated in the signing ceremony that took place today in New York on the first day of the Armenia Investor Conference.  The conference is sponsored by IFC, the World Bank, and the U.S. Trade and Development Agency.

The mission of IFC ( , part of the World Bank Group, is to promote sustainable private sector investment in developing countries as a way to reduce poverty and improve people's lives. IFC finances private sector investments in emerging markets, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses.