June 2002 Events
June 1-7  Citizens of Armenia have little trust in government bureaucracy and rarely contact officials, but when they do, they are likely to get help, a study recently released by the International Foundation for Electoral Systems (IFES) reported. IFES is a U.S. government-funded organization that provides advice and technical assistance on democracy in about one hundred countries around the world. Its "Citizen's Awareness and Participation Survey 2001" was conducted among 1,500 adults randomly selected throughout Armenia.
When asked to name the branches of government or organizations for which they have a "great deal" or "fair amount" of confidence, respondents ranked the President first, at just over 51 percent. Respondents to another poll commissioned by the Radio Free Europe / Radio Liberty last year identified a similar split in public approval of the President's performance. IFES survey found the following levels of confidence for other entities (percentages are rounded): local governments (48), provincial governors (41), international organizations (41), non-government organizations (40), the National Assembly (32) and Courts (26). 
Job creation, emigration and regular water supply (primarily for rural areas) and other services top the list of concerns that the respondents want the government to address. Only about 17 percent of all respondents have ever contacted their elected officials. The majority of them contacted their local elected leaders (63 percent); contact with parliament members came a distant second (19 percent). In most cases (86 percent), elected officials replied to constituents' requests and in just over half the cases (51 percent) the response was considered "somewhat" or "very" satisfactory. Response and satisfaction rates were somewhat lower with appointed officials: 80 and 44 percent respectively.
In terms of access to information, the majority of respondents said they have better than adequate information about national events, but very little in terms of local news. Armenian Public Television remains a primary source of news for nearly two-thirds of the respondents, even though the vast majority of Armenians have free access to dozens of local and foreign channels. Print media is not a popular choice, with the most popular newspaper, Iravunk weekly, read by only 6.5 percent of respondents. Only about 7 percent say they have ever used the Internet, and only half of them use it "often" or "sometimes." 

June 1-7

Foreign Minister Vartan Oskanian this week visited European Union (EU) and Council of Europe (CE) headquarters, two regional organizations with which Armenia maintains close relations. While in Brussels, Oskanian met with the EU's High Representative for Common Foreign and Security Policy Javier Solana and External Relations Commissioner Chris Patten. Their talks focused on Armenia's energy security and ways to further improve Armenian companies' access to the European markets. EU countries already account for the largest share of Armenia's exports. The officials also discussed "steps aimed at the improvement of Armenian-Turkish relations" and ways to speed the Karabakh peace process. EU backs Armenia's view that chances for the conflict's settlement would significantly improve, should Azerbaijan agree to a series of economic confidence-building measures, something which its president, Heydar Aliyev, continues to oppose. Oskanian also met with leaders of the European Parliament and Brussels-based Armenian organizations.
On his visit to Strasbourg, France, Oskanian met with the secretaries-general of the CE and its Parliamentary Assembly (PACE). Their talks focused on Armenia's progress towards reaching standards of human-rights set by the organization, which Armenia joined in early 2000. Meanwhile, the head of the Armenian delegation to PACE, Chairman of the Parliament's Foreign Relations Committee Hovanes Hovanisian noted that Azerbaijan is continuing to stall the appointment of the organization's Rapporteur (Envoy) on Nagorno Karabakh. Last year, NKR's President Arkady Ghoukasian invited PACE officials to send a fact-finding group, following a series of libelous accusations made against Karabakh by the Azerbaijani delegation to PACE. Hovanisian also mentioned that a recent PACE report on migration notes that Azerbaijan continues to seriously exaggerate the number of its refugees. 
June 1-7 The Armenian Government is reportedly planning to disband the Soviet-era Ministry of Internal Affairs (NGN), a body that deals with issues as wide-ranging as fire-fighting and criminal investigations, according to reports in two opposition-leaning newspapers this week. The reports said that a soon-to-be-introduced law on police will devolve much of its public order authorities to local governments, while two new entities - an investigations bureau and the national guard - will replace NGN's Investigations and Interior Forces directorates. The reports cited sources "close to the government" as saying that the changes are in line with the ongoing Civil Service reform. As a first step in this reform and as part of Armenia's obligations to the Council of Europe, control over prisons has already been transferred from NGN to the Ministry of Justice. 
The newspapers themselves claim that the reforms are politically significant as they are expected to resolve what they describe as the ongoing tug of war between pro-government factions for control of the powerful ministry. They also believe that NGN's reorganization would harm the country's law-enforcement capabilities and result in an increase in crime. At the same time, if the reports prove accurate, Armenia would become one of the first countries of the region to move from a highly centralized Soviet-style police organization to a more Western-like system.
June 1-7 Two of Armenia's largest chemical enterprises will begin production this month, the Trade and Economic Development Ministry reported. Yerevan's Nairit Chemical Plant managed by the Ransat Group, an Indian-owned company registered in the United Kingdom, will begin producing chloroprene rubber. Ransat Group is expected to buy Nairit, after clearing its multi-million dollar debt to a bank, which it is also buying. The company is beginning to eliminate wage arrears for some of its 2,750 employees and hopes to reach its maximum production capacity by 2005. Another company long-plagued by stoppages, but expected to resume work this month is the Vanadzor Chemical Complex. At one time the Complex was the largest employer in Armenia's third largest city and is again expected to provide thousands of jobs once it reaches full capacity. Privatized by a Russian company in 1999, the Complex has not been able to fully return to work due to high prices for imported natural gas. That problem is now said to be resolved.
June 1-7 The European Bank for Reconstruction and Development (EBRD) and the World Bank's International Finance Corporation (IFC) are likely to provide up to 70 percent of financing for the proposed plan to bring oil from off-shore Azerbaijan to Turkey via Georgia. The rest of the financing, last estimated to total $2.9 billion, will be covered by the BP-led Baku-Tbilisi-Ceyhan consortium. The project has long been criticized as politically and economically flawed. Less expensive ways to export the oil without further polarizing the countries of the region have been ignored. Doubts persist that there will be sufficient oil in the parts of Caspian Sea claimed by Azerbaijan to fill the pipeline. In the last several years, eleven international consortia led by companies such as Exxon-Mobil, Chevron-Texaco, TotalFinaElf and others, abandoned their projects after sinking tens of millions of dollars into drilling holes that came up dry.
June 7-14 Armenian and Turkish foreign ministries are quietly preparing for another round of talks, Turkish and Azerbaijani newspapers reported this week. Foreign Ministers Vartan Oskanian and Ismail Cem are scheduled to meet on June 25 in Istanbul during the annual session of the Black Sea Economic Cooperation (BSEC), a group that aims to foster regional integration. According to Turkish press, at stake is the possible reopening of the Armenian-Turkish border and use of the Kars-Gyumri rail road, both of which have remained closed since Turkey introduced its blockade of Armenia in 1993. President Robert Kocharian this week reiterated Armenia's readiness "to establish relations with Turkey without any preconditions." However, it is not yet clear if establishment of full-fledged diplomatic relations will be discussed.
Prior to the Istanbul meeting, senior officials from the two ministries, Karen Mirzoyan and Ertan Tezgor, will meet in "one of the central European capitals" early next week to prepare for the upcoming summit. A spokeswoman for the Armenian Foreign Ministry was quoted as saying that such a meeting was "very likely." An Azerbaijani report this week said Tezgor was paying a "secret visit" to Azerbaijan in order to "coordinate positions of Baku and Ankara." Turkey has so far conditioned normal relations with Armenia on the latter's concessions in the Karabagh conflict. Numerous Turkish commentators have recently urged revision of this approach, citing, in particular, the two countries' partnership in the U.S.-led anti-terrorist coalition.
Meanwhile, Hakob Chakrian, an Armenian commentator on Turkish affairs, wrote this week in Azg that Turkish press reports merely create the impression of ongoing "secret talks" between Armenia and Turkey. The commentator further claims that Turkey needs this impression to deflect the international community's calls for normalization of relations with Armenia and to stave off further affirmation of the Armenian Genocide.
June 7-14 The Nagorno Karabagh Republic is ready to resume supplies of irrigation water to adjacent Azerbaijani districts, NKR Foreign Minister Naira Melkumian said this week. She said the measure would serve as an example of much needed confidence-building measures (CBM's) and show average Azerbaijanis that NKR bears no ill intent towards them. Melkumian was speaking at a Radio Free Europe/Radio Liberty briefing during her week-long visit to Washington, DC. Her visit included detailed discussions on possible CBM's with conflict management experts at the Council on Foreign Relations and the International Crisis Group.
During the visit, Melkumian met with U.S. State Department officials, Members of Congress, think tanks and media. Meeting with the Congressional Caucus on Armenian Issues, she praised its co-chairs Frank Pallone, Jr. (D-NJ) and Joe Knollenberg (R-MI) for their leadership in strengthening U.S.-Armenia and U.S.-Nagorno Karabagh relations. Members of Senate Appropriations, Armed Services and Foreign Relations Committees pledged to exercise strict oversight over the use of U.S. military assistance to Azerbaijan. Melkumian also spoke at American University and met with leaders of the Armenian-American community.
June 7-14 Speaker Armen Khachatrian called the National Assembly into recess this week without finishing its legislative business. This action followed a disruption of the proceedings by several members of the political opposition. For three days, activists of the Republic, People's and Communist parties physically occupied the podium and prevented government officials or other parliamentarians to address the Assembly. This followed Khachatrian's refusal to include on the legislative agenda the opposition's measure for debate on presidential impeachment. Political parties and groups opposed to President Robert Kocharian have repeatedly tried to raise the issue since shortly after his election in 1998. Normally, support of one-third of all the deputies is needed for Parliament to debate whether or not the President has violated the Constitution and may be considered for impeachment. Parliamentarian Grigor Harutiunian from the People's Party conceded that the opposition was acting in violation of regulations, but he also blamed the parliamentary majority for blocking the impeachment debate.
Commentators described the most recent efforts by the opposition (that included both legislative measures and several rallies) as a kind of "psychological attack" on Kocharian in the run-up to presidential elections slated for early next year. One opposition leader, former Prime Minister Aram Sargsian promised to resume the campaign after summer holidays. But another opposition figure, former Interior Minister Levon Galstian, who is deputy chairman of the recently established Homeland and Honor Party, urged his colleagues in opposition to begin a dialogue with the government. Major pro-government groups, such as the Republican Party and Armenian Revolutionary Federation, condemned the opposition's tactics.
June 7-14 With higher taxes for the wealthy and a crackdown on large cash payments announced this week, the Armenian Government is hoping to increase state revenue and to spread the benefit of the strong economic growth of recent years. According to the country's State Revenue Minister Yervand Zakharian, much of last year's growth came in agriculture, construction and export-oriented industries. However, all of these sectors work under a preferential tax arrangement and their contribution to state treasury is therefore insignificant.
Meanwhile, the new government proposals call for an increased property tax on real estate valued at over $52,000 in exchange for the current flat tax levied on properties worth over $5,200. The new measures envisage an even greater increase in taxes for owners of Western-made luxury cars. They also introduced a limit on corporate transactions in cash to $865. The government hopes that these measures will help in the ongoing crackdown on untaxed incomes and respond to concerns over the widening income gap. The National Assembly must approve the proposed new regulations.
June 7-14 The Armenian Government this week transferred Zvartnots International Airport, one of Armenia's main outlets to the outside world, to the management of Eduardo Eurnekian's Corporaci?udamericana of Argentina for thirty years. The deal is expected to bring $35 million in investments in the first five years and as much as $100 million over the total period. It comes shortly after the passage of a new law on aviation, which grants considerable tax privileges to the airport. Some of the projects planned by Eurnekian's company include a new terminal, runway repairs, creation of a free trade zone and entertainment center next to the airport.
Armenia's opposition parties have criticized the deal as a "sale" of state sovereignty. They charge that investment and employment commitments are not clearly identified. They have also protested Eurnekian's plan to buy plots of land from nearby villages to expand the would-be trade zone outside the airport. Government officials defended the deal as capable of turning Zvartnots into a regional trade hub.
Eurnekian, described as a "hard-charging visionary" runs one of the largest businesses in Argentina. He reportedly built a $1 billion fortune in mass media in the 1990s. He has since expanded into tourism and agriculture. In 1998, backed by U.S. and Italian investors, his corporation won a thirty-year concession for most of Argentina's airports, including its main international airport of Ezeiza. With a pledge to invest a total of $2.2 billion in that airport system, Eurnekian has succeeded in improving quality of service and bolstered tourism. During Argentina's most recent financial crisis in late 2001-early 2002, Eurnekian's corporation stayed afloat and was one of the few major companies to avoid default on debts.
June 7-14 President Robert Kocharian this week hailed the privatization of the Yerevan Brandy Plant (YBC) as a "successful deal." France's Pernod Ricard bought the company for $30 million in 1998. At the time, the deal was criticized as disadvantageous for the country. Since the acquisition, the company has fixed its finances, improved the quality of brandy and found new markets. Its production volume has grown steadily and the YBC president Pierre Larretche expects it to reach pre-privatization levels this year. In 2001 the company contributed $2.7 million in taxes and other fees to the state budget. YBC employs 480 people and provides stable income for some 3,000 families in Armenia's grape-growing regions.
June 14-28 Foreign Minister Vartan Oskanian reiterated this week Armenia's call for establishment of normal bilateral relations with Turkey without preconditions. He was speaking at the Economic and Social Studies Foundation (TESEV), a leading Turkish think tank, at the end of a three-day visit to Istanbul. The visit, described as "historic" by the Turkish press, focused on bilateral talks with Oskanian's Turkish counterpart Ismail Cem and the work of the Black Sea Economic Cooperation (BSEC) summit. The Armenian-Turkish talks produced no apparent breakthroughs, but both sides described them as "positive" and pledged to continue meeting. However, Oskanian predicted that establishment of relations "is going to be a long processİ with numerous hurdles."
Speaking at TESEV, Oskanian said that "it was not too soon for [Turkey and Azerbaijan] to realize that the last decade's politics of pressure, discrimination and blockades have not achieved their intended goals." He was referring to the blockades imposed by the two countries against Armenia in the early 1990s and Turkish assistance in Azerbaijan's military effort in Nagorno Karabakh. He added that, in spite of Azerbaijan's hopes to the contrary, Armenia is far from being on the verge of economic collapse or capitulation on the Karabakh issue. Oskanian went on to say that Azerbaijan has so far succeeded only in making Armenian-Turkish relations a hostage of its own misguided policies. 
This week, Turkey's Cem publicly reassured Azerbaijani President Heydar Aliyev, who was also visiting Istanbul, that Armenia-Turkish relations will not be normalized until a Karabakh settlement is achieved. Aliyev expressed confidence that "no third country can damage Azerbaijani-Turkish relations."
Turning to the impact of the Armenian Genocide on bilateral relations, the Armenian Foreign Minister welcomed the noticeable changes in Turkish public attitudes towards the issue that has for so long been held as taboo in Turkey. He urged "solid steps to seriously address challenges borne out of historically rooted conflicts." At the same time, Oskanian said that normalization of ties cannot wait for Turkey's recognition of the Genocide.
Meanwhile, former advisor to the ex-President of Turkey Suleiman Demirel Ilnur Cevik said that Turkey must establish relations with Armenia in order to avoid being further drawn into the Karabakh conflict on the side of Azerbaijan. Cevik, who is the Editor-in-Chief of the Turkish Daily News, was speaking with a group of Armenian journalists visiting Ankara last week. The visit was part of the ongoing Track Two efforts between the two neighboring countries, which have in recent days also included contacts between members of parliaments, women's groups, intellectuals and businessmen.
Cevik further argued that establishment of economic relations with Turkey would decrease the influence of the Diaspora over Armenia, implying that the former is the driving force behind the international efforts to affirm the Armenian Genocide. He also criticized Turkish foreign policy as "always trailing after the events." He expressed particular anxiety that improvements in U.S.-Russian relations decrease the value of Turkey as a U.S. ally. 
June 14-28 Azerbaijan's demand for control over the Armenian southern-most Meghri district is now the main stumbling block in the Karabakh peace process, an anonymous senior source close to the negotiating process told Radio Liberty this week. According to the source, Azerbaijani President Heydar Aliyev agreed to recognize Armenian control over Nagorno Karabakh and Lachin during talks with President Robert Kocharian in France and the United States over a year ago. In exchange, Karabakh Armenian forces were to withdraw from districts they hold south and east of Nagorno Karabakh. According to the alleged agreement, known as the "Paris Principles," Azerbaijan would also get unfettered access via Meghri, which would remain a sovereign Armenian territory.
However, Aliyev toughened his position shortly after he reportedly shared the content of the "Paris principles" with Turkish leaders in March 2001. Since then Aliyev has made acquiescence to the reunification of Armenia and Karabakh conditional on Azerbaijani sovereignty over Meghri. That would give Azerbaijan a direct ground route to Nakhichevan and from there to Turkey. The Armenian Government has categorically rejected this new demand. This week, an indication of Meghri's strategic importance, Armenia's Defense Minister Serge Sargsian told an Armenian daily that the Armenian town can not be traded even for a "half of Azerbaijan." Speaking to a local television station NKR President Arkady Ghoukasian also expressed strong opposition to a "settlement of the Karabakh conflict at Armenia's expense."
The latest spate of revelations about the content of what were until recently secret negotiations came after Aliyev publicly violated their confidentiality two weeks ago. Meanwhile, the two Presidents' envoys on Karabakh are reportedly planning to meet again some time next month. 
June 14-28 A senior NATO officer this week praised two dozen Armenian soldiers and officers for their performance in the "Cooperative Best Effort - 2002" exercises under the NATO Partnership for Peace (PfP) program. The officer, a Turkish four-star General, Oktar Ataman, is the commander of the Izmir-based NATO's Joint Headquarters Southeast, which oversaw the exercises. The Armenian unit joined hundreds of other troops from six NATO and eight partner countries in two-week exercises held at the former Russian military base in Vaziani, Georgia. In the first joint exercises with Turkish and Azerbaijan forces, the troops from a recently established Armenian peacekeeping detachment practiced patrolling, organizing checkpoints and crowd control.
Armenia's Deputy Defense Minister General Artur Aghabekian, who joined the troops in the final days of the exercises, said Armenia attached great significance to cooperation under the PfP program. He called Armenia's participation in the Georgia exercises a step towards closer Armenia-NATO relations. Armenia is planning to host similar exercises next year and may deploy peacekeeping forces abroad in the near future. 
June 14-28 President Robert Kocharian paid first-ever official visits to Lithuania, Latvia and Estonia this week for talks with the countries' leaders. While in Lithuania's capital of Vilnius, Kocharian said that Armenia was interested in studying the experience of democratic and economic reforms in the Baltic States and integration with the European Union (EU). The three former republics of the ex-USSR have been most successful in reforms and are currently candidates for EU membership. Kocharian also expressed "understanding" for the countries' drive to join the North Atlantic Treaty Organization (NATO), something that Russia has long opposed. 
As part of the tour, Kocharian visited several Baltic Sea ports and discussed ways to strengthen commercial links with the three countries. Kocharian also signed an agreement on military cooperation with Lithuania. (In the past, both countries served as important centers for the former Soviet military electronics industry.) Armenia together with Estonia, Latvia and Lithuania stood at the forefront of the Soviet reform movement in the late 1980s - early 1990s. 
June 14-28 Armenia's Defense Minister Serge Sargsian this week denied media speculation that he may not support incumbent President Robert Kocharian's reelection bid next year. Sargsian said by spreading such rumors, the opposition groups were in fact trying to drive a wedge between Kocharian and him and generally weaken the pro-presidential camp. "It is ruled out that I could ever take any step against President Robert Kocharian," he said. While acknowledging that he may not always agree with the President's views, he said nothing could shatter their 20-year friendship, tested by the Karabakh war.
Reprinted, by permission, from Armenian Assembly of AmericaArmenian International Magazine , Armenian National Committee of America , Armenian National Institute ,Groong. Armenian News Network  
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