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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
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Update No: 284 - (27/08/04)
Nagorno-Karabakh the key
Armenian President Robert Kocharian's administration is facing growing pressure
to moderate its hard-line position on the Nagorno-Karabakh issue. But any
suggestion that Armenia is prepared to explore the return of Azeri territory
seized during the Karabakh conflict is threatening to stir domestic political
trouble for Kocharian.
The United States is seeking to break the existing stalemate in Karabakh peace
talks and is pressing Armenia to agree to the return of regions captured during
the 1991-94 conflict. Armenia is being asked to return between three and six of
the seven areas seized from Azerbaijan. The only area that has not come up in
discussions is Lachin, the corridor of land that connects Karabakh with Armenia
proper. Kocharian has adamantly opposed giving back what Armenians describe as
"liberated territories" as a precondition to a comprehensive peace
settlement.
Turkish Foreign Minister Abdullah Gul has said that Yerevan was prepared to
discuss the return of the territories. Gul mentioned a meeting of the foreign
ministers of Armenia, Azerbaijan and Turkey, held on the sidelines of the June
28-29 NATO summit in Istanbul, saying that the Armenian participant, Vartan
Oskanian, declared: "We [Armenia] can withdraw from all territories except
Karabakh."
But Oskanian subsequently denied making any such statement during the meeting.
This shows the problem. All sides are prepared to be conciliatory in private,
but not in public.
Certain ambiguous comments of Kocharian's during a June 23 session of the
Council of Europe's Parliamentary Assembly (PACE) helped fuel speculation about
a possible deal. Kocharian stated at one point that the question of what
Azerbaijan insists are "occupied lands" could have been settled long
ago if Baku had implemented the so-called Key West principles, which mandated
that Armenia vacate captured Azeri territory. He also stressed that any
potential handover would have to be part of a general Karabakh settlement.
"We are ready for serious negotiations on a full-scale solution to the
conflict," Armenia Today reported Kocharian as telling PACE. "That is
exactly why we have accepted the last formula for resolution offered by
international mediators which, unfortunately, [was] rejected by
Azerbaijan."
Some Armenian observers have speculated that in making these remarks Kocharian
may have been seeking to prepare Armenian public opinion for a policy shift on
the territory handover issue. Azerbaijan has denied that any bargain was struck
during the Key West peace talks in 2001.
But this is all speculation without any firm confirmation from the facts Only
when a full-blown conference on the issue is announced will there be any real
grounds for optimism.
Delicate political situation
The speculation about the Karabakh issue comes at an awkward political moment
for Kocharian. Though opposition coalition protests that roiled Yerevan this
spring have been suspended, Kocharian critics remain committed to a six-month
boycott of the Armenian parliament. Many of them are to the right of even
Kocharian on the subject. Despite the coalition's relative weaknesses, any
effort to return Azeri territory could potentially give the opposition an issue,
with which it could inflict considerable damage on Kocharian's administration.
Kocharian is no doubt mindful of the circumstances that led to his rise to the
presidency. In 1998, the willingness of then-president Levon Ter-Petrosian to
embrace a gradual approach to a Nagorno-Karabakh settlement sparked a chain of
events that led to his forced resignation.
A June 25 opinion poll, carried out by the Armenian Center for National and
International Studies, underscored the risks for Kocharian. It found that only 1
percent of the 1,950 respondents polled nationwide believed that the captured
territories should be returned to Azerbaijan. By contrast, 45.5 percent wanted
the lands to remain under Armenian control. Another 11.2 percent called for the
regions to be equally divided between Armenia and Azerbaijan, while just under a
third said that they should be made part of Nagorno-Karabakh. At the same time,
only 2.5 percent of the survey's respondents expressed trust in the Armenian
authorities to resolve the Karabakh stalemate.
Baku hardens its line
Meanwhile, there are indications coming out of Azerbaijan that Baku's
Karabakh negotiating position is hardening. In July 16 talks with the OSCE Minsk
Group, that oversees the Karabakh peace process, Azeri President Ilham Aliyev,
Foreign Minister Elmar Mammadyarov and Defense Minister Safar Abiyev maintained
that Armenia must meet four 1993 UN resolutions that call for the country's
unconditional withdrawal from land outside of Karabakh. During a public
appearance July 20, Aliyev vowed that Azerbaijan "would liberate its
occupied territories at any cost," the Turan news agency reported.
The Minsk Group's US, French and Russian co-chairmen -- Steven Mann, Henri
Jacolin and Yuri Merzlyakov -- cautioned that the two countries' failure to
compromise could lead to a resumption of hostilities over Karabakh. Concerns
about a renewed outbreak of fighting have risen in recent weeks.
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BANKING
Armenia to be home to new commercial bank
A new commercial bank with foreign capital is being set up in Armenia, Armenian
central bank Chairman, Tigran Sarkisian, said, Interfax News Agency reported.
He said the central bank has agreed to provide a licence to ArmSwiss Invest
& Trust Bank, founded by Swiss citizens of Armenian origin involved in
international finance and industry. Sarkisian said that the initial charter
capital of the bank amounts to €6m. He said, "The founders of ArmSwiss
Invest & Trust Bank plan to introduce new banking instruments that are not
used by the other 19 commercial banks in the republic."
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ENERGY
Iran sets up wind turbines in Armenia
According to the Tehran Times, the Managing Director of the Sanir Company,
Alireza Kadkhodai, said on August 2nd that Iran will start installing wind
turbines in Armenia as of next year.
Kadkhodai added that necessary studies have been carried out and a suitable
location has been selected. "Wind farms are usually built on a small scale
and with low capacity. The Armenian wind farm will compromise four units with
total capacity of 2.6MW which can be developed to 20MW," he noted.
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FINANCIAL NEWS
Foreign investment 20 per cent up in Armenia
According to preliminary information, foreign investment in Armenia's economy
has totalled US$90m, having grown by 20 per cent in comparison with the same
period of the last year, Armenian Trade and Economic Development Minister, Karen
Chshmarityan, said, Arminfo reported recently.
The volume of direct foreign investment in the country's economy grew by 39 per
cent in the reported period [first six months of 2004], having reached US$60m,
he said.
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FOREIGN ECONOMIC COOPERATION
Armenian premier, Syrian trade minister discuss cooperation
Stimulating multilateral Armenian-Syrian relations plays an important role in
Armenia's Middle East policy, Armenian Prime Minister, Andranik Markaryan, said
at a meeting with a Syrian delegation led by the trade minister and co-chairman
of the Syrian-Armenian intergovernment economic commission, Ghassan al-Rifa'i.
Markaryan added that although over the period of establishing diplomatic
relations the sides have made efforts to develop trade, economic, scientific and
cultural relations and bring economic relations in line with political
relations, the economic relations between the two countries, however, could not
have been regarded as satisfactory up till now, Noyan Tapan News Agency
reported.
Ghassan al-Rifa'i informed Markaryan about the second sitting of the
intergovernment economic commission. He said that a number of important
agreements on healthcare, communications, telecommunications, tourism etc. had
been signed as a result of the sitting. He spoke about Syria's plans to
establish a special working group to monitor the fulfilment of these agreements.
Noyan Tapan learnt from the government's press service that the sides hoped that
the forthcoming visit to Armenia by Syrian Prime Minister, Muhammad Naji al-Itri,
would give an extra impetus to the development of the bilateral relations.
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FOREIGN LOANS
WB offers Armenia €34.3m for 3 credit programmes
The Armenian government and World Bank signed 3 credit programmes on July 30th
for an overall €34.3m. At a briefing after the signing, Finance and Economics
Minister, Vardan Khachatrian, said that €10.15m will be utilised in
overhauling the state management system for the country and €19m for
modernising its healthcare system, Interfax News Agency reported.
The other credit of €5.15m will be used to finance the social security sphere.
The credits will be extended on easy International Development Association terms
for 40 years at an annual rate of 0.75% with a 10-year grace period.
Khachatrian said World Bank is the first to allocate money for the reformation
of Armenia's state management sector. The funds are slated for introducing an
electronic digital signature system, which will improve the state management
system's operation and the transparency of its actions. The healthcare credit
money will be used to repair medical institutions, buy new equipment, retrain
doctors and develop the institution of family doctors, an extra €1.25m grant
will be attached to this credit.
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