Armenia proposes pension fund reform for investments

PanARMENIAN.Net - The National Assembly is discussing a draft law on amendments and supplements to the pension system, which proposes to allow pension fund managers to also manage specialized investment funds.

Armenia’s Central Bank Deputy Governor Armen Nurbekyan stated that the pension system has been in operation for over a decade, and it is now necessary to broaden the capabilities of pension funds to encourage investment, Aravot reports.

“This draft solves several important issues. First, it eliminates paper-based communication between public funds and participants, transitioning the entire notification system to digital. Additionally, it proposes permitting pension fund managers to oversee more specialized investment funds. Previously, this was not allowed as the primary focus was ensuring effective management of Armenia's pension funds.

However, today, with managers having acquired sufficient experience and adapted to the market, it is crucial to utilize their potential more efficiently by enabling them to register and manage other specialized funds, which will significantly contribute to the development of the capital market,” Nurbekyan said.

MP Artur Khachatryan from the Armenia faction addressed the allocation of accumulated pension funds, asking how much of the funds are invested in the real economy versus the export-oriented economy.

Nurbekyan responded: “Around 65% of the funds are invested in Armenia. Of this, slightly more than half is invested in Armenian government bonds, meaning the funds are invested in the state. About 70% of the remainder is in bank deposits, with the rest in corporate bonds.”