Armenia moves toward third international airport as government approves concession amendment

(Horizon Weekly) – At today’s cabinet session, the government approved a decision endorsing the fifth amendment to the concession agreement between the Republic of Armenia and Corporación América S.A., setting the stage for expanded airport capacity and infrastructure upgrades across the country.

According to the decision, the amendment aims to improve airport services, expand international airport throughput, and create the conditions needed for Kapan Syunik Airport to operate as an international airport. Once the amendment is signed, the airport may begin operating under international status.

The decision removes several financial and contractual provisions from the existing concession, including guaranteed internal rate-of-return mechanisms and the right to indefinite extension. The concession term is extended until December 31, 2067, and the restrictions on Kapan Airport are lifted. The concessionaire commits to approximately 425 million US dollars in capital investments, with a master plan and investment program to be coordinated with the government and inclusive of investments made since 2023.

The approved framework also establishes rules for annual tariff adjustments based on inflation indicators in Armenia, the United States, and Europe. It further outlines compensation mechanisms for prolonged declines in passenger traffic not attributable to the concessionaire, as well as procedures for additional investments, contract termination, and compliance with master plan obligations.

The master plan is expected to be submitted by the end of January, and the planned investments are to be completed by 2033. Armenia’s international airports recorded 5.754 million passengers in 2025, an increase of 7.5 percent compared to the previous year, underscoring the need for expanded infrastructure.

Under the decision, Deputy Prime Minister Mher Grigoryan is authorized to sign the amendment on behalf of the government within one month.