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ARMENIA

NEWS REPORT
  
  

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In-depth Business Intelligence

Key Economic Data 
 
  2002 2001 2000 Ranking(2002)
GDP
Millions of US $ 2,367 2,100 1,900 135
         
GNI per capita
 US $ 790 570 530 143
Ranking is given out of 208 nations - (data from the World Bank)

Books on Armenia

REPUBLICAN REFERENCE

Area (sq.km)
29,800

Population
3,326,448

Principal ethnic groups
Armenian 93.3%
Azeri 2.6%
Russian 2%

Capital
Yerevan

Currency
Dram

President
Robert Kocharian
 

 

Update No: 287 - (29/11/04)

Imminent policy revolution or a straw in the wind?
An important new shift of emphasis has entered into Armenia's policy towards Turkey. Turkey received a very interesting report from Yerevan in early November. The Armenian government, led by Robert Kocharian, in its budget proposal sent to the Armenian Parliament noted: "The recognition of the Armenian genocide by Turkey is not the government's primary foreign policy objective." The government said the repair of relations with Turkey was a priority. 
If Kocharian intends to implement such a serious policy shift, it will soon become apparent. Policies implemented will show whether this policy shift is sincere or just a false gesture. 
A Turkish observer and analyst, Mehmet Ali Birand, put the matter thus in the Turkish Daily News on 9th November: "I know Armenia and Kocharian. The word 'genocide' is such a mystical and accepted concept that no matter how much we refute or try to disprove it, we will not eradicate this belief. For an Armenian, the word 'genocide' will always remain in their national psyche. 
"For Turkey, it is just the opposite. Genocide is unacceptable. No matter how much pressure they put on us, no matter what the European Union tells us, a Turk will never accept it. Blood was spilt on both sides. Unspeakable horrors were committed and shameful things happened. We might exchange apologies because of what happened, but never recognize 'genocide.' 
"Armenia is a small and poor neighbour of ours. Turkey is a giant knocking on the EU's door. Should these two countries continue to wage this genocide battle and always remain enemies? Or should both sides preserve their beliefs, let the genocide issue drop from the top of the agenda and try to find ways to mend bilateral relations?"
The problem is that as far as the Turks are concerned Turkey has made a number of gestures in this respect and always been rebuffed. 
When Turgut Ozal was prime minister, the Kars border crossing was about to be opened. The Armenian invasion of Azerbaijan prevented this from happening. When Suleyman Demirel was prime minister, he came very close to signing a deal with the former Armenian President Levon TerPetrosyan. These meetings, in which even the Nationalist Movement Party (MHP) leader Alparslan Turkes took part, the motivation was always, "Let's freeze the past and look at today." 
Each time, it was the Armenians that withdrew. For Yerivan, the priority always remained with the insistence of the Diaspora making Turkey recognize the 'genocide.' 
Under the hard-line leadership of Kocharian, it would be surprising if a real policy reversal is about to take place. He was after all for years president of the enclave, Nagorno-Karabakh, at the heart of the modern dispute between Armenia with the two Moslem nations, who maintain a blockade on trade with Armenia with their frontiers closed. 

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CHEMICALS

Armenian company leads talks on chemical giant's future

The Armenian company, Flash, will now conduct talks with Russian investors on the sale of chemical giant, Nairit, Armenian Central Bank Chairman, Tigran Sarkisyan, said at a briefing in Yerevan, Mediamax News Agency reported. 
Tigran Sarkisyan recalled that Nairit's shares belong 100 per cent to Haykapbank [Armenian communications bank] and the Flash company is carrying out the programme to revive the bank. The programme to revive the bank is being supervised by the IMF, which is demanding that the process be finished by the end of this year.
Mediamax News Agency recalled that on April 16th this year an agreement was signed at the Armenian Central Bank on the sale of 100 per cent of Haykapbank's shares to Russia's Volgaburmash holding company. Addressing a briefing after the signing of the agreement, Volgaburmash representative, Mikhail Zavertyayev, said that the restoration of Nairit's position on the Russian synthetic rubber market was the priority for the holding company. For reasons of commercial confidentiality Zavertyayev refused to disclose the cost of the deal to acquire Nairit's shares. He said that Volgaburmash had worked out a draft project on the reconstruction of the enterprise, aimed at resuming the production of butadiene at Nairit. Mikhail Zavertyayev said that since 2003 Volgaburmash had invested US$3.5m in Nairit.
Tigran Sarkisyan said that the Russian holding company had demanded that the revival programme for Haykapbank be prolonged for four months, but, taking into account the commitments to the IMF, the Armenian side had not given its consent to this and had "decided to implement the revival programme with another investor, the Armenian Flash company."
The Central Bank chairman said that Flash had invested more than US$1m in the bank and had finished the revival process. Tigran Sarkisyan said that Flash was now conducting talks directly with the Russian side on Nairit's fate.
He said that for four months the Russian side would be studying Nairit's technical possibilities and would make a corresponding decision. Tigran Sarkisyan said that the 100 per cent of shares in Nairit were reflected in Haykapbank's balance sheet at the nominal price of US$14.2m. The bank has to realize these assets in the next six months, according to current Armenian legislation.

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ENERGY

Second Armenia-Iran power cable to be built end-2004 

Iranian energy company Sanir is to complete building a second high-voltage power cable between Armenia and Iran by the end of 2004, said Saak Abramian, director general of Armenia's ZAO High-Voltage Power Cables, Interfax News Agency reported.
He said the second line would make it possible to double the flow of electricity between Armenia and Iran. The cable is being constructed based on an energy cooperation memorandum between Iran and Armenia, signed in Yerevan in July 2002, he added.
Under this memorandum, Iran provided Armenia with a credit of 8.4m Euro to build the second power line, which would be repaid with electricity supplies from Armenia. During the summer, Armenia supplies electricity to Iran, and imports electricity from Iran in winter. Armenian Energy minister, Armen Movsisian, said that a third line might be built, along which Armenia could supply electricity to pay for gas supplied through the Iran-Armenia pipeline, which should start no later than January 2007.

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FOREIGN ECONOMIC COOPERATION

Armenian-Estonian forum to boost economic cooperation

The Armenian-Estonian business forum will present an excellent opportunity for the two countries' entrepreneurs to set up new business contacts, Estonian President, Arnold Ruutel, said at the opening of the forum, Arminfo News Agency reported. 
He said that a favourable economic atmosphere has been created in Estonia today, "a friendly tax system for entrepreneurs" has been set up and a high level of competitiveness ensured. Arnold Ruutel noted that, "According to the estimates of the World Economic Forum, Estonia occupies 20th place in terms of competitiveness among small economies, but in terms of innovative ability it is first amongst the new EU members." He said that, notwithstanding the considerable successes, Estonia has sufficient room for development. 
Touching upon Armenian-Estonian trade and economic cooperation, the head of the Estonian state stressed that at this stage commodity turnover between the two states is limited by contacts between individual entrepreneurs. At the same time the delegation of Estonian entrepreneurs arrived in Armenia with a distinct interest in cooperation, in particular, in the spheres of industrial electronics, telecommunications and information systems.

Armenian speaker discusses cooperation with French, German diplomats

The involvement of the South Caucasus in the Expanded Europe: New Neighbours programme opens promising prospects for the development of the whole region in terms of deepening democracy, overcoming conflicts and implementing economic projects, the speaker of the Armenian National Assembly, Artur Bagdasaryan, said this at a meeting with the political directors of the foreign ministries of France and Germany, Stanislas Lefebvre de Laboulaye and Michael Scheffer, on November 11th, Noyan Tapan News Agency reported.
The guests said that they were on a fact-finding tour of the South Caucasus to find out about future developments in the region to which the European Union attaches great importance.
The sides also discussed relations between Armenia and Turkey. It was noted that Armenia was not against Turkey's membership of the European Union but was against double standards in connection with the recognition of the genocide and the elimination of the blockade which was impeding Armenia's economic development.
The political directors of the German and French Foreign Ministries noted the importance of parliamentary diplomacy in developing the region and overcoming confrontation. The sides also noted the importance of contacts and discussions both within the framework of the Caucasus republics and Armenian-Turkish relations. 

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TELECOMMUNICATIONS

Armenia chooses second mobile operator

The K-Telecom company will become Armenia's second mobile operator, Mediamax News Agency reported.
This decision was taken on November 3rd by the tender committee set up by the Cabinet of Ministers, the government press service said. 
The tender committee was set up immediately after the ArmenTel company was deprived of its monopoly in the sphere of mobile services. The government press service is not saying how many companies took part in the tender, which gave preference to K-Telecom.
The K-Telecom closed-type joint-stock company belongs to Lebanese businessman Pierre Fattoush, who owns the Karabakh Telecom Company, which provides mobile communication services on the territory of the Nagornyy Karabakh Republic (NKR), Mediamax has learnt.

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TRANSPORT

Section of highway linking Karabakh to Armenia commissioned

Armenian President Robert Kocharian and the president of the Nagornyy Karabakh Republic [NKR], Arkadiy Gukasyan, attended a ceremony of opening a new section of the North-South highway which is of strategic importance for the NKR. The road is being constructed under the aegis of the All-Armenian Ayastan (Armenia) Fund, Arminfo reported.
Arminfo special correspondent in Stepanakert reported that the representatives of the NKR leadership and an official delegation from Armenia took part in the commissioning of a new 14 kilometre section in the village of Sarushen-Karmir Shuka. 
The construction of the Sarushen-Karmir Shuka section costing 646m drams [about US$1.2m] started in May 2003. The total length of North-South highway is about 170 km, the total construction cost of the highway is about US$25m. The project is being implemented with the financial assistance the Armenians world-wide.

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