ARMENIA THIS WEEK
Monday, August 23, 2004
REFORMIST CANDIDATE PREVAILS IN STEPANAKERT MAYORAL ELECTION
In a development hailed as an important step towards full-fledged democracy,
Stepanakert voters rewarded a candidate running on a reform platform in a
run-off election held last Sunday. Non-partisan parliamentarian Eduard
Aghabekian collected nearly 55 percent of the vote scoring an upset victory
over the ruling party’s favorite, Pavel Najarian. The two mayoral candidates
went into the run-off election after none of the five candidates collected
more than 50 percent of the vote in Nagorno Karabakh Republic’s (NKR) local
self-government poll held on August 8.
Following the first round of elections, observers from the Stepanakert Press
Club and Artsakh Association for Defense of Human Rights praised the overall
conduct of the poll as fair and transparent. They credited the authorities
with creating a generally positive election atmosphere, while criticizing
instances of pressure on the media, unfair use of administrative resources
and inaccuracies in voter lists. In the second round, the authorities
campaigned hard for Najarian, but did not interfere with the vote count.
Najarian led in the first round with 43 percent, while Aghabekian was a
strong second with 35 percent. But Aghabekian’s supporters rallied before
the second round, receiving endorsements from other mayoral candidates,
including the outgoing incumbent Hamik Avanesian, the Armenian Revolutionary
Federation (HHD) and several other groups. Over 50 percent of Stepanakert’s
eligible voters came to the polls, up from 40 percent in the first round.
Aghabekian’s victory is the first major upset for the Democratic Artsakh
Union (ZhAM), which is the main political support base of President Arkady
Ghoukasian. Ghoukasian, himself, did not publicly endorse any of the
candidates.
In other municipal races, 134 out of 179 incumbent town and village heads
held their posts. Some 50 of these officials belong to ZhAM, 20 to HHD and
10 to Communist Party. While most of the rest are officially non-partisan,
observers saw a trend in favor of opposition groups, even before
Aghabekian’s second round victory. These observers suggest that gains in the
municipal elections have improved the local opposition’s chances at the
parliamentary elections due next spring.
In 1997, NKR became a first entity in the Caucasus to elect its local
administration officials and is the only regional entity, where the
capital’s mayor is chosen through elections. In a report last week, the
London-based Economist compared Karabakh favorably to other unrecognized
republics in the former Soviet Union. The newspaper noted that despite a
devastating war, Karabakh is close to being a normal society, with law and
order, a budding civil society, foreign economic investment and de-facto
unification with Armenia. The Economist sees a “decent future” for Karabakh
as long as the conflict with Azerbaijan is settled and points to the 2001
deal, when the late President Heydar Aliyev came close to agreeing to
de-jure unification of Armenia and Karabakh. (Sources: Arminfo 8-13, 21;
8-14, 23; Armenia This Week 8-9; The Economist 8-19;
Noyan Tapan 8-20, 21)
GOVERNMENT RENEWS PLEDGE TO END COMMUNICATIONS MONOPOLY
The Armenian government is determined to break Armentel’s monopoly on
communications, the official in charge of negotiations on the matter,
Justice Minister David Harutiunian said last Thursday. The government had
earlier planned to abolish the monopoly rights of the Greek-owned company on
cellular and Internet communications by June, but postponed the decision due
to ongoing litigation with the company.
Armenian officials have long accused Armentel of “abusing” its monopoly
rights by setting unusually high tariffs and failing to significantly
improve services it provides. Armentel had in turn claimed that state
regulators were “violating” the terms of the company’s 1998 privatization.
Both sides have now apparently agreed to reach an out-of-court settlement.
According to a report by an Armenian opposition daily, Armentel has already
agreed to competition in cellular communications, but in exchange it wants
to increase tariffs for fixed-line phone service. Government regulators had
blocked a similar hike last January.
According to a study conducted by Yerevan’s Armenian-European Policy and
Legal Advice Center (AEPLAC), Armentel is one of the largest companies in
Armenia. Armentel reported $35 million in profits in the first four months
of the year. In terms of sales and employment, it is second only to the
Electric Power Networks (EPN), another monopoly privatized last year.
AEPLAC surveyed trends in the Armenian economy in 2003, focusing on EPN,
Armentel, and eight other largest Armenian companies: Armenian Aluminum,
Yerevan Brandy Plant, Flash (fuel imports), Apaven (cargo), Armenian Copper
Program, Yerevan Jewelry Factory, Ararat Cement and Diamond Company of
Armenia. The study noted the fast pace of development of the private sector
in Armenia in terms of output and export (primarily to Europe). But it also
pointed to significant staff cuts in EPN and other companies, following
their privatization.
The European Bank for Reconstruction and Development (EBRD) estimates that
60 percent of the Gross Domestic Product and more than 70 percent of all
jobs in Armenia are provided for by the private sector. (Sources: Armenia
This Week 1-16, 3-5; Noyan Tapan 6-11, 7-21; Arminfo 6-28, 29, 7-10, 8-19;
RFE/RL Armenia Report 6-21, 7-28, 8-19; 8-5)
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