Governmental Corruption Endangers The Fast Growing Tree Project In A

GOVERNMENTAL CORRUPTION ENDANGERS THE FAST GROWING TREE PROJECT IN ARMENIA

Lragir, Armenia
Nov 18 2006

It has been now 15 years that Armenia is free and the Diaspora has
been actively supporting Armenia by sending money and initiating
projects to strengthen its independence and improve the economic
situation. It is unacceptable to see that some corrupt government
officials are taking advantage of the generosity and nationalistic
support for homeland of the Diaspora to fill their own pockets. This
write up provides background information regarding the Fast Growing
Tree Project in Armenia, its accomplishments, and the governmental
corruption issues that put some parts of the large plantations that
were developed as part of this project, in jeopardy of destruction.

BACKGROUND

Armenia is a mountainous country with approximately 8% forests in
its total territory. Up to the early 1990s forests in the country
were properly maintained and resources were utilized according to
environmental requirements. However, economic and energy blockade,
which resulted from political crisis with neighboring countries,
brought the country to an energy crisis. This crisis was the main
reason for massive deforestation of Armenia. About one million cubic
meter of wood was cut, which caused a terribly harmful damage to the
forests of the country.

In 1994, the Armenian Engineers and Scientists of America (AESA) of
Glendale, California and Institute of Botany of the Armenian Academy
of Sciences embarked on a project to introduce fast growing hybrid
poplar trees in Armenia, which can be used as fire wood or as soft
wood lumber. These trees then can be cut to satisfy the need for
wood instead of cutting old trees from established forests. A few
years later, the Armenian Forest Service (Hay Andar) also joined the
project team.

Approximately 130,000 US and Canadian hybrid poplar cuttings from
59 different hybrid poplar clones have been imported into Armenia
and planted in different sites in Armenia since 1994. The two major
plantations are in Armavier (Ararat Valley). Approximately 17,000
cuttings of selected six clones were planted on 24 hectares during
spring of 1998 and approximately 23,000 cuttings of selected five
clones were planted on 28 hectares in the spring of 1999.

These trees are planted using 10-inch long cuttings and they grow to
be 6-foot tall in about seven months. Trees that were planted in 1994
and 1995 in Armenia are now 45 to 55-foot high after 11 years.

Typically these trees become mature in 10 to 12 years. The main part
of these mature tree trunks could be used for producing lumber.

Branches and leftovers of the trunk can be used as a biomass source
or in production of particleboard.

Wood produced from the fast growing hybrid poplars could be used by
the furniture manufacturers in Armenia, who normally import almost all
the wood needed. The poplar wood can also be used in the construction
industry. Agro-forestry is a viable option for Armenia because Armenia
has very limited soil suitable for the agricultural use. Trees that
are planted for production on plantations are planted widely enough to
allow intercropping of traditional crops such as cabbages, tomatoes,
melons, alfalfa, etc. between the trees.

FINANCING

This project is financed by the AESA, and locally managed by the
Institute of Botany of the Armenian Academy of Sciences. AESA has
funded the planting and the maintenance expenses for all the test
plantations, as well as the purchase of a tractor, a mower, and two
submerged irrigation pumps. The Lincy Foundation has been one of the
major contributors to this project. In addition, ACDI/VOCA has financed
15 travel expenses to Armenia by the U.S. specialists. CRDF has also
given a grant for analyzing the heat content of the different hybrid
poplar clones. USDA office in Lancing, Michigan, has provided technical
support for this project and several thousand cuttings. University
of Washington and Washington State University have also provided
staff that has traveled to Armenia to provide assistance for this
project. Oakridge National Laboratories has supported this project by
sending one of their experts to Armenia to evaluate biomass potential
in Armenia.

IMPROVING SOIL SALINITY

Another objective of the Fast Growing Tree Project is to determine
the feasibility of large scale, short rotation plantations in parts
of the Ararat Valley which have saline soil. Several types of poplar
trees have shown encouraging growth rates in the saline soil, which
presently is not used for agricultural purposes. These salt tolerant
hybrid poplar plantations in conjunction with special halophytes
could lower salinity after several years by lowering the underground
water table. Besides hybrid poplars, various salt tolerant plants
(halophytes) have also been introduced to Armenia as part of this
project. It is estimated that more than 30,000 hectares of land in
the Ararat Valley could be used for commercial crops if salinity of
soil were reduced.

THE PROBLEM

Parts of the plantations in Armavier that were developed with a
large investment from the US private and governmental sources are
now in jeopardy due to the corruption in high levels of the Armenian
government. Land where these plantations are established belonged
to Armenian Forest Service (Hay Andar). In December of 2004 Armenian
Forest Service dissolved their organization in Armavier region because
there were no forests at that region. They had land that was leased
to the farmers, a small apricot plantation, and 52 hectares where
the fast growing hybrid poplars were planted. When the government
decided to dissolve the Armavier region of Forest Service, all the
land excluding the 52 hectares were given to the governor’s office
for distribution. Government’s decree 128 dated December 8, 2004
clearly indicates that the ownership of 52 hectares where the fast
growing trees are planted plus 3000 square meters of land where the
water well is should be given to the Armenian Institute of Botany to
continue the experiment of the fast growing hybrid poplars.

In early 2005, the governor of Armavier region appealed this decision
and claimed that this land should also be divided and sold to the
local farmers. Attempts were made to meet with the governor but he
was not willing to meet with the plantation project team members.

AESA, Armenian Forest Service, Ministry of Agricultural, Ministry
of the Environmental Protection, and National Academy of Sciences
protested against the governor’s request about destroying the
plantation and selling the land. They had written letters to the Prime
Minister requesting that the governor’s appeal to be denied and land
ownership to be given to the Institute of Botany. After consideration
of all the facts, the Armenian Government denied the governor’s request
and on firmed its previous decision of transferring the land to the
Institute of Botany.

After government’s confirmation of the land ownership, governor’s
office and the county recorder started to put different types of
hurdles about transferring the ownership of the land to the Institute
of Botany. First they were claiming that boundaries were not clear and
a new survey was needed. The Institute of Botany hired land surveyors
to draw the requested map. Then, there were some requests of payment
of $300 for expediting the transfer of ownership that was denied by
the Institute of Botany. Finally it became apparent that all of these
were smoke screens to sell big chunks of land released by the Forest
Service to some governmental officials.

Approximately 80 hectares of land has been sold to the minister of
finance at a ridiculously low price. However, the land deed was issued
under his mother-in-law’s name. A few months later, the land was sold
to a friend of the minister who lives in the City of Echmiatzin,
for $40,000. This means that the sale price of one hectare was
approximately $500 when the market price of this land is $1,500 per
hectare. Most probably he will turn around and sell the land in open
market and make a large profit. So much for the governor’s claim that
the land should not be given to the Institute of Botany but to the
farmers who need the land for their livelihood.

Approximately 9 hectares bearing the best trees in the fast growing
tree plantation and the nursery where Institute of Botany had planted
all 59 types of hybrid poplars for the future reproduction were part
of these 80 hectares that was sold to the Minister of Finance. When
the issue of this sale, which is in direct contradiction with the
government’s decision, was presented to the governor’s office, their
response was that "This is a fact now and if you do not like it,
then you can start legal proceedings against this issue". Another 3
hectares of the plantation with large nice trees were sold (or should
be said "given away") to the mayor of the City of Armavier as part
of another large parcel. These 3 hectares are also part of the 52
hectares that should have been given to Institute of Botany. Figure
1 shows a typical tree in September 2006.

This picture makes it obvious why people want this land. They can cut
these large trees and sell them by ignoring all the efforts that have
been made for this experimental project.

Destruction of the nursery where all 59 imported clones of the hybrid
fast growing trees are planted will especially be a major loss. This
nursery should be used to supply needs for establishing fast growing
tree plantations at different parts of Armenia. Cutting for these
59 types were sent to Armenia via airlift from the US and Canada
with major difficulties and expenses. This is a clear indication of
the level of corruption at the high levels of the Armenian government
where some officials take the ownership of the land virtually for free,
and then turn

around and sell it to their friends for a large profit, but still under
the market price. Then the farmers have to buy the land at the market
price. This happens despite the clear government decision that part
of the land should be given to the Institute of Botany to continue the

experimental fast growing tree project and the remainder should be
transferred to the farmers.

However, some government officials see an opportunity to make large
sums of money and help their friends make money at the expense of the
farmers. At the beginning of the fast growing tree project, it was
decided to lease 5 hectares of the land to a farmer for planting
cabbage and alfalfa within tree rows. The idea was to evaluate
viability and profitability of the concept of agro-forestry. Because
these trees were under private care, they are considered to be
best-maintained trees. Unfortunately these 5 hectares have been
divided between the land parcels that are given to the minister of
finance and the mayor of City of

Armavier. According to the information received, they are planning
to cut and sell these trees.

The farmer who was leasing the land claims that, he has the first
right to purchase this land if it is sold, but that he was fine if
the land was given to the Institute of Botany. He filed a claim first
with the local court and then with the appeals court, but both times
the court decisions were against him even though he was defending
his right under the law. According to reliable sources, the judges
of both courts were bribed.

This clear violation of the government’s formal decision, and the
evidence for obvious corruption, was reported by letters to the office
of the speaker of the Parliament, Mr. Tigran Torossyan; Land Governing
Minister, Mr. Hovik Abrahamyan; and Foreign Minister, Mr. Vardan
Oskanyan. The US Embassy and the Millennium Challenge Corporation
representatives in Yerevan were also notified about this situation.

Since protection of the trees are under the jurisdiction of Ministry
of Environmental Protection, they were also notified and warned about
the plans to cut trees on the land that is illegally occupied by some
government officials.

It should also be mentioned that the governor’s office has offered
to give the Institute of Figure 1 – Trees in Armavier Botany some
land nearby, instead of the illegally taken parts of the plantations.

However, the land that was offered is useless without any trees. Their
claim was "If you want 52 hectares of land, we will give you land
but from useless areas". This is another example of the level of
arrogance in governmental agencies and their attempt to cover-up
their illegal acts.

SUMMARY

The situation facing the Fast Growing Tree project could be applicable
to any other major project initiated and supported by the Armenian
Diaspora or the US Government. Typically there is not much of help or
assistance from governmental agencies at the beginning of any project,
but once some government officials see that there is a successful
project, they abuse their power to take over such project for their
own personal benefit.

During the Third Armenia-Diaspora Conference, Armenia’s Foreign
Minister was asking Diaspora to spend millions of dollars to renovate
50 villages near the boarders of Armenia. This request begs the
question of who will be benefiting from such a large investment –
villagers or some government officials. There was a governmental
decision to distribute land belonging to the Armavier division of
the Armenia’s Forest Service to local farmers. Instead of the farmers;

however, the mayor and the minister received big portions of land at
the original cheap price and then local farmers had to go to them to
purchase the land at the market value. Would this also be the fate
of the developments in those 50 villages?

The US government is planning to give Armenia $236 million grant
under the Millennium Challenge initiative. Basic requirements of
this large grant are governmental transparency and the elimination of
corruption. Grabbing land by governmental officials near the irrigation
canal that will be renovated as part of the Millennium Challenge grant
should be of concern to the Millennium Challenge Corporation. The US
taxpayers’ money is given to Armenia to help the general population
and not some governmental officials.

Armenia has enormous potential for advancement, but corruption could
seriously hinder such advancement and progress. This is of concern
to the Armenian Diaspora, which needs to pull all of its resources
to put pressure on the Armenian Government to eliminate corruption by

actions, not just by words, and to put the country on the right track
toward a prosperous future for ALL the Armenians.

We are asking your assistance in resolving this issue. Please call,
fax, and send your letters and e-mails to Armenian Government and
demand them to save the Fast Growing Tree Project. We suggest that
you send your correspondences to the Prime Minister and Armenian

Ambassador in your country. Let them know that Armenian Diaspora
will not accept such illegal acts by government officials. We did
not struggled hundreds of years for a free homeland to witness this
types of actions.

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