Arzrun Hovhannisyan Clarifies Cement Purchase by Armenian Minister of Defence

12.09.2019 12:24

The spokesperson for the Armenian Minister of Defence, Arzrun Hovhannisyan, provided clarifications via his Facebook page regarding the price of cement acquired by the Ministry of Defence, in response to a question raised in the Armenian National Assembly.

“In the spring of 2019, a Member of Parliament announced in the National Assembly that the import price of cement in Armenia was reduced from 50,000 drams to 40,000 drams as the first step of economic revolution. However, based on procedural adjustments, it was found that until December 31, 2018, the import price of cement was 54,000 drams per ton, and since January 1, 2019, it has been 44,000 drams per ton.

In the 2019 procurement plan of the Ministry of Defence, the method for purchasing cement was planned to be through an electronic auction. However, in February 2019, the electronic auction system was completely disrupted, making it impossible to organize the purchase process for cement. As a result, a change in the procurement plan was initiated, and due to the urgency of the purchase, it was decided to conduct the purchase through a single source.

It is important to note that in this method of procurement, the purchase will still be organized through the electronic procurement system, which is open to all interested parties. In other words, this purchasing method is also competitive but with much shorter timelines, allowing any person to participate.

Following the changes to the procurement plan, the purchasing process was organized in April 2019, with three organizations participating. A contract for the purchase of cement was signed with the participant who submitted the lowest price offer on May 15, 2019, at a rate of 48,000 drams per ton. Moreover, the manufacturing company could also have participated in this purchase; however, it did not.

Regarding the question of storing cement in Ararat, it is clarified that in the invitation to the procurement process, which is also published on www.procurement.am, such a requirement was not established. Instead, it was indicated that the supplier must specify their warehouse address so that the orderer, the Ministry of Defence, is informed about where the cement will be collected from and how it will be transported to the respective military units, considering that it was stated in the invitation that the transportation of cement to military units would be carried out by the Ministry of Defence.

In response to the query about the supplier company having only two employees, it is noted that given the restrictions prescribed by the Armenian legislation on procurement, no requirement was set for a minimum number of employees in the invitation to the procurement procedure. Furthermore, since the transportation of cement to military units is carried out by the Ministry of Defence, there is no need to verify the number of employees of the supplier at all.

Attached is also a comparative analysis of cement purchases by the Ministry of Defence over the past three years: