It is still too early to expect a major increase in U.S. investments in Armenia despite the new Armenian government’s efforts to improve the domestic business environment, U.S. Ambassador Richard Mills said on Wednesday.

Mills said that potential American investors are closely monitoring, among other things, the government’s treatment of a U.S.-based mining company which had won exclusive rights to develop a massive gold deposit in southeastern Armenia.

The company, Lydian International, is facing an uncertain future following the recent dramatic change of the country’s leadership. According to official Armenian statistics, Lydian was the main source of $246 million in foreign direct investment attracted by Armenia last year.

“The government’s actions to tackle the issue of corruption and ensure a level playing field are very welcome in the United States by the U.S. investment community,” Mills told RFE/RL’s Armenian service (Azatutyun.am). “But I think it’s still a little too early for new major investments to be announced or to begin here in Armenia.”

“We’re getting lots of expressions of interest from the business community in the United States about the opportunities here,” he said. “But these potential investors are waiting to see whether now the government will follow up with some concrete actions. They also want to see how the investigations that have been launched into credible allegations of corruption are carried out. Are they done in a fair manner, according to the rule of law and due process?”

“And they want to see how the government is treating U.S. foreign firms and even Armenian firms that are already operating here,” Mills went on. “Are they being treated fairly when there are investigations into their taxes? Is that being done in a fair manner?

“They are looking at the issues around Lydian, how the government is handling those very sensitive and controversial issues. Will Lydian be treated fairly as that process unfolds?”

All roads leading to the Amulsar gold deposit developed by Lydian have been blocked since June 23 by a group of residents of nearby communities protesting against gold mining operations which were due to start before the end of this year.

The blockage is continuing despite repeated appeals from Prime Minister Nikol Pashinian. He said late last month that Lydian must be allowed to resume its operations pending the findings of an ad hoc government task force that will start inspecting the company soon. The working group is expected to submit its recommendations to the government later this month.

The mining site located about 160 kilometers southeast of Yerevan remained blocked even after Pashinian visited it on July 6. The premier complained last week that Lydian executives did not display a “constructive” stance when he held a meeting with them and the protest leaders during the trip. He did not elaborate.

The company, which is registered in the British Channel Islands but headquartered in Colorado, maintains that it had obtained its mining licenses in accordance with Armenia’s laws and government regulations. It has dismissed concerns about the environmental impact of gold mining at Amulsar, saying that it will use modern and safe technology.

Lydian, which claims to have already invested more than $300 million in Amulsar, has condemned the disruption of its operations as illegal. It has not ruled out the possibility of international legal action against the Armenian state.

Mills expressed hope last week that the environmental audit of Lydian will be conducted objectively and “in strict accordance with the law.” He said the U.S. government also hopes that the authorities will carry out similar inspections of other mining companies operating in Armenia.

The envoy made clear on Wednesday that he believes Pashinian’s government is committed to “creating a good investment climate here.” “So looking ahead, I’m confident,” he said.

Mills also reiterated that Washington is now considering increasing U.S. government assistance to Armenia. “We are looking at what is possible, including changes in levels of our funding through the USAID and other U.S. government agencies,” he said.