First published in October 18, 2008 Armenian Reporter.
Prime Minister: Armenia's economy is "facing very serious dangers”
Focus of government is small and medium business
by Emil Sanamyan
Prime Minister Tigran Sarkisian in Washington. Lusine Sarkisyan for the Armenian Reporter
Washington - In an interview on October 14 with the Armenian Reporter's Washington Editor Emil Sanamyan, Prime Minister Tigran Sarkisian of Armenia spoke about the impact of the global financial crisis and unresolved conflicts on Armenia. What follows is an English translation of most of that conversation.
Armenian Reporter: In your meeting with Vice President Dick Cheney on October 10, you referred to the recent tendency by U.S. officials to prioritize Azerbaijan's territorial integrity; you called it "extremely dangerous." What was the vice president's reaction to that?
Tigran Sarkisian: I thought the reaction was a positive one and that the vice president agreed that the peace process that is taking place in the Minsk Group framework [co-mediated by France, Russia and the United States] is the way for the problem's resolution.
I also focused on the dangerous statements made by Azerbaijan's foreign minister [Elmar Mammadyarov] at the United Nations last month. [Mr. Mammadyarov said] that they view the Karabakh settlement within the framework of the [nonbinding] UN General Assembly resolution [adopted last March], which certainly does not help us move forward toward a settlement.
[In the meeting with Vice President Cheney,] I once again noted that we have a constructive position. Azerbaijan is aware of this, as are the mediators, and we hope that after Azerbaijan's [presidential] election [on October 15], there will be a new stage of constructive dialogue.
In our meeting earlier today, Secretary of State Condoleezza Rice also said she expects new momentum in the negotiations after these elections.
AR: But could this momentum be built on this new American policy language that prioritizes Azerbaijan's territorial integrity?
TS: If territorial integrity is prioritized, the peace process - all of the work the mediators have done - becomes meaningless, since negotiators should take into account the positions of both sides. And this also provokes [Azerbaijan] toward war.
Monitoring Azerbaijan's arms buildup
AR: Does Armenia seek to expand the peace process from the current efforts to develop "settlement principles" to other measures such as strengthening of the cease-fire, a nonaggression pact, and disarmament?
TS: We raise these concerns in various organizations. We are concerned that Azerbaijan is intensively and aggressively arming itself. They are spending unjustifiably huge amounts on their military, and this undermines the peace process. And certainly we have brought this to the attention of our American and European colleagues, as well as NATO experts.
Moreover, international arms treaties must be respected. [Under the Conventional Forces in Europe Treaty], there is a verification mechanism in which Armenia takes part. Our officials visit Turkey, and Turkish colleagues visit Armenia to monitor our forces.
And Azerbaijan too should participate in this monitoring. It is clear that they are in violation of [CFE] agreements and we are certainly worried by this.
At the same time, I would note that before the recent fighting [in South Ossetia] there was more militant rhetoric from Azerbaijan that it would use force. To an extent, the events in Georgia have had a cooling effect on our Azerbaijani colleagues. Although just yesterday [on October 13], the Azerbaijani president again talked about his efforts to isolate Armenia.
AR: Countries supplying especially deadly weapons - tactical ballistic missiles, multiple-launch rocket systems - to Azerbaijan are well known. They are Ukraine, and to a lesser extent Turkey and Israel. Has this issue been raised with these countries? Specifically, when President Serge Sargsian met with his Ukrainian counterpart Viktor Yuschenko relatively recently?
TS: I cannot respond to these questions at this time.
Toward a shared vision of the future - with Turkey
AR: On Armenia's Turkey initiative: following the meetings in New York last month, the sides appear to have gone back to their original positions, Armenia to its "no preconditions," and Turkey to its preconditions. Do you anticipate any change in this dynamic?
TS: Today Secretary Rice expressed a thought that I fully share. [She said] that countries that have problems and wish to establish relations should focus on the future rather than the past. If we are going to continue to stir up the past, we do indeed have a lot of issues, and that would mean we will never come to an agreement.
But if we are to focus on the future, our shared vision of the future, it will also become easier for us to reassess the past. We support [developing] such a vision, and for this reason we say that we have no preconditions.
If our Turkish colleagues talk about preconditions, that means they are still looking into the past. And if we go into the past, then certainly the Genocide issue would be central and it would demand explanations. But this would be a road to nowhere.
If we want to build a new Armenia, we cannot do so using old methods. And Turkey too has no alternative if it wants to be a part of the European Union; it must change its approaches, implement serious reforms, and look to the future. This is a very difficult and painful process, both in Armenia and even more so in Turkey, so we should be patient.
At the same time we should acknowledge that the president's invitation to his Turkish colleague has been criticized both in Armenia and Turkey, as well as in Azerbaijan. In Armenia, the criticism is that we are pulling back, showing weakness, [people are wondering,] "What does that give us?"
First of all, this is a catalyst that helps reassess the existing situation, and as a result of this visit something that seemed unexpected or even unrealistic has now become an established fact. This means that future steps are also possible.
As Secretary Rice noted after [Turkish President Abdullah Gül]'s visit to Armenia expectations have been heightened that everything would change quickly [in relations.] But no one can expect that normalization of relations with Turkey is an easy process, and it will have its ups and downs. But one obvious thing is that the Armenian president has shown political will in this matter.
Another question is where we would be had Mr. Gül declined to visit Armenia.
Damages from the war in Georgia
AR: In your meeting with the vice president you also mentioned the $670 million in damages that Armenian economy suffered as a result of the fighting in Georgia. Is there a specific conversation taking place about specific U.S. assistance in that regard?
TS: Yes and not just with American colleagues but also our colleagues at the World Bank and IMF. We have made the point that economic consequences of this conflict have been regional and particularly acute for Armenia, which relies on Georgia for most of its trade.
And our calculations - the $670 million - were done in accordance with the same methods used by our Georgian colleagues. I also mentioned this in my meeting with the Georgian prime minister [Vladimir Gurgenidze], who is also now in Washington.
The global financial crisis and Armenia
AR: What impact do you anticipate from the current financial crisis on Armenia's development?
TS: We are facing very serious dangers, both in terms of [decline in the growth] of remittances and other financial transfers. And we are looking for ways to soften the impact.
First of all, we are looking to increase credit for medium and small businesses. We spoke about projects with the World Bank and IMF that could soften the impact on small businesses.
AR: Is the issue of the new nuclear power plant still on the U.S.-Armenia agenda? Is the United States interested in taking part in this project beyond the recently concluded feasibility study?
TS: Yes we are open to this and believe that this could be a joint project, with participation from the United States, France, and Russia.
A precedent for such cooperation was recently created in Bulgaria, [where the French Areva conglomerate is in a joint contract with Russia's Atomstroyexport to build a new nuclear plant].
Handling conflicts of interest
AR: Last April, my colleagues in our Yerevan bureau asked you about the government's conflict of interest policy. In particular, your health minister is also a stakeholder in private hospitals. Has there been any progress on this issue?
TS: We have prepared a concept paper that outlines the disclosures that government officials would be mandated to make. The point of this concept is to acknowledge the existence of conflicts of interest, as well as impossibility of their full elimination - since it is hard to find anyone who has no personal business interests. At the same time, these conflicts should be known and transparent to the public, and regulated.
Various countries have different models for this and we have developed our own. There will be a special entity that would consider and monitor these conflicts among the members of government and the National Assembly.
This concept paper has been submitted to the president and if it is approved by the coalition government, there will be legislation that will help enforce our constitutional provisions that prohibit business activity by government officials.
AR: My colleagues in Yerevan recently spoke to a number of CEOs in the information technology (IT) sector in Armenia. [See last week's edition of this newspaper.] The CEOs continue to complain of the same problems as in the past: lack of skilled specialists, inferior infrastructure - in particular high Internet costs - and government officials who are not sufficiently educated to be able to regulate the sector. Are you planning any major initiatives in that regard?
TS: Yes, we have agreed with the World Bank that we will have a comprehensive project that would help develop the IT sphere. This would include e-governance and infrastructure improvements. I would note that prices for Internet access are already falling. We want this to become a comprehensive program on IT development and are looking to receive the World Bank's technical expertise to implement it.