YEREVAN, September 25. /ARKA/. A Grant Thornton study has found that the demand for equity investment in Armenia in the next five years may range from $7.5 to $9 billion. These numbers were announced by David Manukian, a senior consultant from Grant Thornton Company in Armenia, when presenting the study’s findings at a conference on facilitating access to capital for competitive businesses.
"Equity investment is not an alternative to traditional sources of funding, but it is able to supplement them,» he said. According to him, the annual demand for equity investments in the Armenian market is $1.5-$1.8 billion.
"The amount of available resources for investment in private equity, according to our estimates, is $50 million, 95% of which is provided by international financial institutions," he said, , adding that according to Grant Thornton, the total capital and credit investments of international financial institutions in Armenia in 2012 amounted to $150 million.
Manukian pointed out pension funds, global equity funds, insurance companies and local and international organizations as potential sources of equity investment.
He unveiled also figures which were obtained as a result of creating a model investment fund with a capital investment of $20 million and a 10 year operation. According to him, under the baseline scenario, 50 % of the investment would be successfully implemented bringing income, 20% would be returned without income and the remaining 30 % will be unprofitable.
"As a result of the study we concluded that creation of investment funds in Armenia will have a tangible effect on the economy and contribute to the development of its capital market ", he concluded.
Grant Thornton, a member of Grant Thornton International, was founded in Armenia in the early 90's. The company provides its customers with a wide range of auditing, consulting services, as well as advice to enterprises, commercial banks, financial institutions, government, local and international organizations.
Among its clients are more than 20 banks, dozens of credit institutions and insurance companies and foundations in Armenia, Georgia, Tajikistan and Kyrgyzstan.
The conference on facilitating access to capital for competitive business was organized by the U.S. Agency for International Development with the support of Small Enterprise Assistance Fund. -0--0 -