Tag Archives: Armenia

Armenia’s new constitution

APRIL 6 2017 (The Conway Bulletin) — >> Armenia has just held a parliamentary election that many observers have said is its most important since independence from the Soviet Union in 1991. Why?

>> The parliamentary election on April 2 was the first since a referendum in December 2015 that changed the constitution and shifted the balance of power away from the President to the PM and parliament. The constitutional changes don’t actually come into effect until President Serzh Sargysan finishes his second and final term in office next year, but the point is that the parliament elected this month will have more power than any other in Armenia’s independence.

>> What are the main changes in the constitution?

>> Whereas neighbouring Georgia shifted some power to parliament in constitutional changes in 2010, Armenia went the whole hog and will move from a presidential system to a parliamentary one. The president is to become a figurehead with no decision-making powers. Direct elections for the president will also be scrapped, parliament will instead pick him or her. Instead, the PM will be the head of the military, will appoint ministers and will set the various policies. Previously, the President had controlled all the major decisions, including appointing the PM.

>> So why were the changes controversial?

>> There the suspicion that Sargsyan and his allies were trying to tie up power for themselves. Sargsyan is obliged to stand down as President at the end of his second term. The opposition said that he would then try to become PM to retain all his power. We’ll have to wait and see on this. It was certainly convenient for Sargsyan that only his allies and appointees sat on the commission to draft the new constitution and also that it doesn’t come into force until the end of his second term.

>> How has Parliament changed with the new constitution?

>> The number of deputies is being cut to 101 directly elected, down from 131, with four seats being given to ethnic minorities. The 101 seats will also be elected wholly through a system of proportional representation. A second round vote has also been introduced to ensure that the winning party has a parliamentary majority. Opposition members have criticised the reforms as undemocratic but the Venice Commission, the Council of Europe’s constitutional watchdog, gave the changes a qualified thumbs up.

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(News report from Issue No. 323, published on April 6 2017)

Republican Party easily wins Armenian parliamentary election

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YEREVAN, APRIL 2/3 2017 (The Conway Bulletin) — Armenia’s ruling Republican Party won a parliamentary election that will shape the country’s politics for years to come, although its opponents complained of vote- rigging and monitors said that there had been irregularities.

Victory for the Republican Party, though, didn’t trigger the outpouring of frustration and resentment that some had predicted and a Conway Bulletin correspondent in the capital said it was calmer now than in any previous election over the past few years. In 2008, protests dragged on until clashes between demonstrators and soldiers killed at least 11 people.

Much of the Republican Party support came from people unwilling to take a risk with the opposition.

“I had to vote for Republicans as I am a teacher which means I work for the state and I am paid from state and this is kind of a payback,” said a Yerevan-based teacher after voting.

Only four groups won enough votes to enter parliament which will wield more power after a change to the constitution that shifts power from the president to parliament.

President Serzh Sargsyan’s Republican Party won 49% of the vote and will hold 55 seats of the 105-seat parliament. The Tsarukyan alliance led by oligarch Gagik Tsarukyan, generally considered to be sympathetic to the government, won 27% of the vote and will have 30 MPs. For the opposition, the Yelk (Way Out) bloc won 7% of the vote and Armenia’s Revolutionary Foundation party won 6%.

The assessment of the OSCE’s election monitoring unit, ODHIR, though, was less than flattering.

The elections were “tainted by credible information about vote-buy- ing, and pressure on civil servants and employees of private companies,” it said in a report.

The Conway Bulletin spoke to one person happy to take money in exchange for their vote.

“I wasn’t going to go at all, but my neighbour learned that they were buying votes,” said a 32-year-old man in Yerevan. “They paid 10,000 dram ($20.66) per person and explained how to vote.”

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(News report from Issue No. 323, published on April 6 2017)

Comment: The green shoots of a recovery are visible

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APRIL 6 2017 (The Conway Bulletin) — In Edinburgh, where The Conway Bulletin has its editorial HQ, the green shoots of a timid spring are finally beginning to breakthrough after a long, grey winter.

And it’s the same scenario for the economies of Central Asia and the South Caucasus. A deep, bleak winter has enveloped them since mid-2014 but now, finally, data suggests a revival is on the horizon.

In this week’s newspaper, we report that both the Kyrgyz and Armenian Central Banks have kept their key interest rates steady. This, in itself, is a victory. Armenia has been furiously cutting its rates from a high of 10.5% in 2015 to 6% to try to stimulate growth and beat deflation. Now it says this policy has gone far enough and that inflation of around 4% is predicted this year.

In Kyrgyzstan, the economic news is even more upbeat. In its statement explaining just why it had kept interest rates steady, the Central Bank said that it was no longer having to intervene in the money market to keep the som currency from sliding. It also said that the economy had grown by 5.4% in January and February compared to the same period in 2016.

Armenia and Kyrgyzstan are two of the smaller economies in the region but the larger economies are also reporting positive news.

In Georgia, the statistics agency said that the economy had grown by 4.8% in the first two months of the year, pushed up by a growth in exports and an all- important rise in remittances. Georgia may also be benefiting from several local factors. Improved relations with Russia have given exports a major boost, especially wine, and the scrapping of visa regulations for Iranians has encouraged a large rise in tourists and business trips.

For the region’s two major economies the data has been less flattering, although there are still signs of improvements. In Azerbaijan, there is disagreement between economists on whether its economy will grow or not after it shrank by 3.8% in 2016. It’s dependent on oil, and prices are currently hovering around $50/barrel, above the anticipated $40/barrel.

In Kazakhstan, the Central Bank last month cut its interest rate and gave its most upbeat assessment of the economy, pointing out that inflation was under control and growth was expected.

And if you’re still not convinced about those green shoots of economic recovery, and that’s understandable as, just like a Scottish spring, they are fragile, take a look at the Azerbaijani manat and the Kazakh tenge. They are both up against the US dollar by more than 5% this year.

By James Kilner, Editor, The Conway Bulletin

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(News report from Issue No. 323, published on April 6 2017)

Armenian PM visits Turkmenistan

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MARCH 28 2017 (The Conway Bulletin) — Armenian PM Karen Karapetyan flew to Ashgabat for a meeting with Turkmen president Kurbanguly Berdymukhamedov, his first visit to Turkmenistan since taking on the premiership in September last year. According to reports from the meeting, he pledged to boost bilateral cooperation.

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(News report from Issue No. 323, published on April 6 2017)

Investors set up club in Armenia

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MARCH 27 2017 (The Conway Bulletin) — In a major boost to Armenia’s business-friendly PM, Karen Karapetyan, 36 Armenian millionaires living in Russia said that they would chip into a new fund designed to kick-start business in Armenia. At a signing ceremony in Yerevan, Mr Karapetyan said that the Investors Club of Armenia would help to stimulate further economic growth. It will also have helped give Mr Karapetyan and his Republican Party a boost ahead of an election on April 2. The Investors Club has not yet named any target projects.

ENDS

(News report from Issue No. 323, published on April 6 2017)

Armenian fruit firms sign deal with the UAE

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MARCH 29 2017 (The Conway Bulletin) — Two fruit and vegetable companies in Armenia have signed supply deals with six luxury hotels in the UAE, media reported. The Armenian companies, Tamara Fruit and Natural Organic Healthy Food Company, signed the deals earlier in March at a UAE-Armenia trade meeting in the Dubai. This sort of deal is important for Armenia which is looking to boost its exports.

ENDS

(News report from Issue No. 323, published on April 6 2017)

Rates kept steady, prices rise in Armenia

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APRIL 6 2017 (The Conway Bulletin) — Armenia’s Central Bank kept its key interest rate unchanged at 6% because inflation was rebounding (March 28). It said that for the 12 months to the end of March inflation measured minus 0.2% but that it was confident that this would rise to plus 4% by the end of the year. The impact of a recent economic slowdown on Armenia has been to push prices down. In an interview with Reuters, Central Bank chief Arthur Javadyan said that it would simply be too risky for the Central Bank to cut interest rates any further. In August 2015, Armenia’s key interest rate had measured 10.5%.

ENDS

(News report from Issue No. 323, published on April 6 2017)

Armenian investors set up IT projects

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MARCH 29 2017 (The Conway Bulletin) — A group of Armenian investors have set up a fund to help kick-start IT projects, media reported, boosting Armenia’s reputation as the IT hub of the South Caucasus/Central Asia region. Reports said that the fund was looking to sponsor 10 start-ups with $200,000 each. Armenia’s government has been encouraging the development of an IT sector. It has made deals with Microsoft and an Armenian-US company produces smartphones and tablets in the country.

ENDS

(News report from Issue No. 323, published on April 6 2017)

Comment: Armenia is facing its most important election, says Bagdasaryan

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MARCH 27 2017 (The Conway Bulletin) — The April 2 parliamentary elections will define Armenia’s politics for the next five years, starting with the transformation from semi-presidential government to parliamentary republic even though this shift is not fully understood by the majority of society.

Armenia’s ruling Republican party is playing on society’s lack of understanding of the changes to try to retain a majority in parliament. But this is not a promising election for Republicans and for party leader, President Serzh Sargsyan.

The ruling party’s rating reached a historical low after years of economic stagnation, and accusations that corrupt officials were to blame for losses in a breakdown of a ceasefire with Azerbaijan around the disputed region of Nagorno-Karabakh in April last year. When 20 gunmen stormed a police station in Yerevan a few months later and took nine policemen hostage for two weeks, the violent action was not condemned by the public. Instead they were welcomed.

This seizure of the police station was used by the government as a trigger for reforms. The government changed some of the less-liked faces and Sargsyan invited former Yerevan mayor and Gazprom official Karen Karapetyan back from Moscow to become prime minister. Karapetyan promised to improve the government, root out corruption, improve the business environment and invest into the economy. His style of management was widely supported by the media and was positively greeted.

Karapetyan and his small team now lead Republicans’ election campaign, while the President, and party chairman, Serzh Sargsyan keeps himself in the shadows. Karapetyan’s popularity endures but there is still a job to do to win the election and that is where the Republican Party’s strategy comes into play. The Republican Party list of candidates is dominated by business and administrative heavyweights who’ll bring votes to the party.

The opposition fall short in this category. Almost all of them, with the exception of the pseudo-opposition Tsarukyan party, are fighting to enter parliament not through majoritan wins, but by passing the proportional representation threshold (5% for a party or 7% for a bloc).

The new parliament will take part in a power reshape between the president and the prime minister. A smooth election would legitimatise the new Constitution and parliamentary system.

By Eric Bagdasaryan is an independent analyst and executive secretary of Armenian Centre for Social Development and Public Policy

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(News report from Issue No. 322, published on March 27 2017)

Economic activity picks up in Armenia but deflation lingers

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YEREVAN, MARCH 27 2017 (The Conway Bulletin) — Armenia’s economic activity barometer, considered to be a key indicator of future growth, increased by 6.2% in the first two months of the year compared to the same period in 2016, the National Statistics Agency said (March 20).

The data comes at just the right time for the ruling Republican Party which is looking to increase it support among voters ahead of a parliamentary election on April 2.

The growth in economic activity, though, was uneven. The growth came in industry and services. Agri- culture was stagnant and the important construction sector fell by 13.8%.

Armenia’s economy has been limping along since 2015 and deflationary pressure has become a major concern for policy makers. Over January and February, the statistics agency said that deflation had measured 0.4%.

ENDS

(News report from Issue No. 322, published on March 27 2017)