Month: November 2006

EU COMMISSIONER URGES “CREDIBLE” ENTRY TALKS WITH TURKEY
Liberation , France (translated)
Nov 1 2006
European Enlargement Commissioner Olli Rehn has said “credible” EU
membership negotiations with Turkey mean support for the country’s
pro-reform forces. “Otherwise there is a major risk that these
tendencies will turn away from Europe, with all the dangers that this
would entail”, he said. If the EU suspended membership negotiations
with Turkey, it would be difficult to break of the “vicious circle”
of mutual disappointment, he said. The following is the text of
interview with Rehn by Jean Quatremer in Brussels “a fortnight ago”,
entitled “‘Our relations with Ankara are schizophrenic'”, published
by French newspaper Liberation website on 1 November; first paragraph
is Liberation editor’s note:
Brussels: Should we or should we not freeze membership negotiations
with Turkey, since the latter still denies Cypriot ships and aircraft
access to its ports and airports, in violation of the Ankara protocol,
despite being a signatory? The European Commission, which will be
submitting a report on the matter to the EU’s 25 member states at the
beginning of November, opposes it, though it criticizes the “slowness
of the reforms”. In an interview given to Liberation a fortnight ago,
Finland’s Olli Rehn, commissioner for enlargement, explained why:
[Quatremer] Should negotiations be suspended?
[Rehn] No, if Turkey does what it is supposed to do. Though we must
be strict with Ankara, we must also be fair.
On the one hand, we must demand strict observance of the criteria,
especially as regards fundamental freedoms such as freedom of
expression and religion, criminal law, and so forth. But on the other
hand, the EU must keep its word: We promised Turkey membership once
it is ready.
Our relations with this country are schizophrenic. Within the EU,
we underestimate its strategic importance, whereas, conversely,
Turkey places it at such a level that it considers it possible to
obtain a more lenient assessment of the criteria. This will not happen.
On top of this, there is the negative spiral that has recently begun:
There is a feeling of disappointment in Turkey because they think
that “the Europeans do not want us in the EU”. As for the EU, it is
disappointed with the slowness of the reforms, which lack sufficient
credibility, which prompts public suspicion. It is a real vicious
circle, which I want to break, and it will be difficult to do so if
we suspend membership negotiations.
[Quatremer] What is to be done to force Turkey to abide by the Ankara
protocol?
[Rehn] This is the key question this autumn. In September 2005 the
Twenty-Five declared that if Turkey did not implement the protocol
there would be negative consequences for the negotiation process.
However, the Turkish government forms a link between this issue and
that of direct trade between the EU and the Turkish Cypriot community,
which we have promised to authorize (but which Nicosia blocks –
Liberation editor’s note,) a link that we reject. The Finnish
presidency, backed by all its partners, is currently negotiating
with both Cypriot communities and with Turkey with a view to finding
a solution.
[Quatremer] The Turkish military have just made it known that, as
far as they are concerned, there can be no question of returning
to their barracks once and for all, as the EU requires. What do you
think about this?
[Rehn] The democratization of relations between civilians and the
military has made great progress. For instance, there is now a majority
of civilians in the National Security Council, and its chairman, also
the prime minister, and secretary-general are civilians. But it is
necessary to go further. I respect the Turkish Army’s responsibility
for defence matters, but the military clearly must submit to the
authority and supervision of the civil authorities.
[Quatremer] The army occupies a special position in Turkey because
it is the guarantor of democracy and secularism. By asking the army
to stay in its barracks, are you not playing into the Islamists’ hands?
[Rehn] The EU does not want to help the Islamists – I can assure you
of that. The guarantee that the army claims to provide is a false one;
for instance, whenever the army has intervened, it has not prevented
Islamist schools from developing.
People in Europe have an excessive tendency to forget that membership
negotiations are a support offered to the modernizing forces at work in
Turkey, whether within the Kemalist nationalist tendency (powerful in
the army, the judiciary and the administration – Liberation editor’s
note;) the post-Islamist tendency, currently in power, which sees the
EU as a guarantee against a military intervention; or the middle class,
who are probably the most pro-European at present, through they lack
their own political expression.
As long as the negotiations remain credible, the pro-reform forces will
be supported. Otherwise there is a major risk that these tendencies
will turn away from Europe, with all the dangers that this would
entail.
[Quatremer] Is Turkey’s recognition of the Armenian genocide a
precondition for membership?
[Rehn] It is not a membership criterion. However, it is absolutely
clear that reconciliation is a fundamental value in Europe, which
is why I have regularly called on Turkey to conduct an open debate,
without taboos, on this issue.
From: Emil Lazarian | Ararat NewsPress

THE US AND NATO APPLY ADDITIONAL PRESSURE TO ARMENIA
by Vadim Novikov
Agency WPS
DEFENSE and SECURITY (Russia)
Source: Severny Kavkaz (Nalchik), No 42, October 24 – 30, 2006, EV
November 1, 2006 Wednesday
Putting Armenia Under Pressure, The United States And Nato Are Out
To Weaken Its Ties With Russia
Official Yerevan has found itself under pressure from the United
States and NATO to abandon Russia.
Judging by the latest developments affecting the Caucasus directly
or indirectly, it seems that tension will continue to escalate in
the region. Needless to say, reference to the latest developments
includes the recent EU-Russia informal summit in Lahti, Finland,
and the hasty visit to Moscow paid by US State Secretary Condoleezza
Rice and State Undersecretary Daniel Freed right in the wake of their
“working tour” of the Caucasus that included a stopover in Georgia.
Freed is the official of the US Administration who made it plain right
after the Georgian provocation involving arrests of Russian officers
that Washington intended to side up with Tbilisi in its conflicts with
Abkhazia and South Ossetia and to deploy its military contingent on
the southern Russian borders.
President Vladimir Putin in Lahti silenced unwarranted advocates of
Mikhail Saakashvili’s anti-people’s regime with a few well chosen
words. It seems that Rice and Freed were given approximately the same
retort in Moscow afterwards. By the way, Freed and Grigori Karasin
(State Secretary and Deputy Foreign Minister) did not restrict their
conversation last Saturday to “pressing issues of the Russian-American
cooperation on international and regional issues” alone. Press Service
of the Russian Foreign Ministry announced that same day that “the
American diplomat on his own request was explained Russia’s vision
of the situation with the Russian-Georgian relations and prospects
of resolution of the conflicts in Abkhazia and South Ossetia.” Let us
hope that the US Department of State official received an exhaustive
answer to Washington’s aspirations to be the “prime controller”
of the Caucasus.
It wouldn’t have been like the Americans, however, to fail to try to
explode the Caucasus regardless of the ways and means. The Americans
and their “friends” (as Freed put it) are going active in Armenia now –
albeit using methods differing from what had been used in Georgia and
Azerbaijan. It is common knowledge that Armenia has been advancing
its relations with the Alliance on two levels at once: within the
framework of the so called Partnership for Peace NATO’s Program and
of the Individual Partnership Action Plan. The only problem is that
official Yerevan has never said it wants membership in the Alliance
while Tbilisi and Baku have been implying it since 1995-1996.
It is clear that Armenia as a member of the CIS Collective Security
Treaty Organization is in a delicate position indeed, made so by
its finding itself right on the frontier of the new line across the
Caucasus. If the majority of experts and observers are correct in
their belief that membership in NATO for Georgia and Azerbaijan is a
matter of time (and not so distant a future, at that), then Armenia
will soon find itself surrounded by the Alliance on three sides. The
border with Iran will remain its sole link with the rest of the world.
It is clear that once Armenia is surrounded by NATO bases and the
situation with the American-Iranian relations being what it is,
Washington will shortly put its “friend Armenia” under unprecedented
pressure. Only time will show if Armenian politicians and diplomats are
strong enough to withstand the pressure resembling arm-twisting more
than anything else. Americans and “their friends” are already doing
everything in their power to persuade the Armenian political and other
elites that the military alliance with Russia and cooperation with CIS
countries within the framework of the CIS Collective Security Treaty
Organization are not actually guarantees that Moscow and its partners
will respond in time to any threat to Armenia. That Armenia needs
membership in NATO to safeguard itself from aggressive encroachments
from Turkey or even Georgia.
What is that if not indirect action on the part of the external
players aiming to weaken Armenia’s ties with Russia? There can be no
other interpretation of US policy in the Caucasus nowadays.
Aware of quite natural and objective reasons compelling it to act in
this manner, the Armenian leadership keeps neutrality and silence. In
the meantime, Yerevan cannot help being aware of the fact that the
threat of direct pressure from the US and NATO may become a real
possibility after the Riga summit. President Robert Kocharjan’s
meeting with Robert Simmons of NATO on October 12 is also revealing
in its implications too. Kocharjan’s press service announced then
that Simmons and he had only discussed cooperation between Armenia
and the Alliance and NATO’s regional programs…
There is no need to talk of the Armenians’ sympathies and
antipathies. They are made quite clear even when the conversation
touches upon Turkey alone, a NATO member that keeps threatening Armenia
with this or that and that has not even lifted the land blockade of
Armenia yet. Neither the United States nor NATO put Turkey under any
pressure to force Ankara to stop its hostile action.
There are, however, some people in Armenia who would urge the country
to forget about Russia for the sake of Washington’s benevolence.
Worse than that, these people and forces they represent do not merely
talk. They act. Four political parties came up with veiled anti-Russian
statements between October 19 and 21.
The Americans never stop sending short messages to the authorities
and population of Armenia. Who will believe assurances of a Georgian
official that arrests of citizens of Armenia and Russian Armenians
for presence on the territories of Abkhazia or South Ossetia are
“not ethnic motivated”? In the meantime, more than twenty Armenians
are still in Georgian jails on these pretentious charges.
Everything shows that this is the “contribution” of the Georgian
authorities to the American propagandistic campaign aiming to “educate”
Armenia and the Armenians and to sever their contacts with Russia.
If that is not a factor of pressure applied to Armenia and the
Armenians, what is? Very many people in Abkhazia and South Ossetia
have relatives in Armenia. It follows that official Tbilisi interferes
with maintenance of Armenian families.
Another means of putting Armenia under pressure is used – speculations
that NATO troops may be used as peacekeepers once the Nagorno-Karabakh
conflict is finally resolved.
Armenia does not need any reminder of how NATO’s peacekeeping ended
for Yugoslavia or Iraq…
All these fragmented reports and facts nevertheless comprise a single
picture – that of the Alliance’s pressure applied to Armenia. The
weak link NATO is already using and determined to keep using is the
Nagorno-Karabakh conflict, the territory of Nagorno-Karabakh and
adjacent lands.
Left to its own devices, Armenia cannot be counted on to withstand
the combined pressure from the United States and NATO. Is there anyone
to help it?

THE EU SHOULD HELP RESOLVE THE TURKISH-ARMENIAN CONFLICT
by Nicolas Tavitian
EUobserver.com
November 1, 2006 Wednesday 8:44 AM GMT
EUOBSERVER / COMMENT – Turkey’s accession process provides a historic
opportunity to bring about a transformation of the country, and of
its relationship with its neighbours. But in embarking in this new
enlargement in 1999, the EU seems to have taken on more than it
initially believed.
A case in point: the recent vote in the French parliament in favour
of criminalising the denial of the Armenian genocide. The vote
generated an unprecedented interest in relations between Turkey and
the Armenians. It is the clearest demonstration yet that, by opening
enlargement negotiations with Turkey, the EU has unwittingly taken
on the Armenian issue as well.
This is a welcome crisis. In 2000, the European Commission and the
council [EU member states] both curtly dismissed the entire matter
as a “historical debate,”and left it off the agenda of enlargement
negotiations.
They should have known better. The issue is anything but historical.
The republic of Turkey – with 65 million inhabitants and the largest
NATO army in Europe – has blockaded the tiny Republic of Armenia –
3 million inhabitants – for more than 13 years now, and refused to
establish diplomatic relations with it.
The issue of the Armenian genocide is quite different: most of the
million or so Armenians in the EU are the descendants of the survivors
of the 1915 genocide, which happened on the territory of modern Turkey
but which is still being denied by Ankara. Without dwelling on the
point, let us note the incredibly dehumanising barbarity of the
event. It marked the survivors, and their descendents, for generations.
The current blockade of Armenia lends credibility to the notion that
Turkish politics are still driven by a strong anti-Armenian impulse –
or so Armenians generally see it. Little has happened in past decades
to prove them wrong. It is hardly surprising that Armenians in the
EU are not thrilled by the prospect of Turkish accession.
The Armenian government, by contrast, pins its hopes on the beneficial
transformation of Turkey which EU accession is bound to bring about.
Turkish-Armenian border
At the same time, a great many Turks – businessmen in particular –
would like to see the Armenian border opened. Many more aspire to
opening up Turkish society and rediscovering its past. But Turkish
leaders are unlikely to take the political risk of engaging with
Armenia or Armenians of their own accord without some encouragement.
The EU could help. Regrettably, over the past four years, the
commission not only ignored the whole problem, but helped it fester
on occasion.
In 2002, Guenter Verheugen, enlargement commissioner at the time,
persuaded the European Parliament not to include wording on the
closed border and the genocide in one of its Turkey resolutions,
arguing this would interfere with a dialogue which was ongoing in
the US-sponsored Turkish-Armenian Reconciliation Commission.
The Armenian members of this commission, who saw the dialogue was
being abused as an excuse for EU inaction, soon after withdrew from it.
Yet there is another way. By addressing the question of relations
between Turkey and the Armenians head on, the EU could help resolve a
conflict, contribute to Turkey’s transformation and generate support
for Turkey’s membership in the EU.
In the first place, the EU should contribute to the establishment of
two dialogues: one governmental and one between civil societies. The
first is to be conducted between the republics of Armenia and Turkey:
together, the two states must decide, with EU help, on the steps
required to establish diplomatic relations and open the border.
Two dialogues
The second dialogue should involve Turkish society and EU citizens of
Armenian descent – the Armenian Diaspora. That will be a more open
and diffuse process, but it is indispensable to Turkey’s successful
integration into Europe.
It must involve the rediscovery by Turkey of its own Armenian heritage,
and by Armenians of a changed Turkey. Most importantly, a successful
civil society dialogue will contribute to appeasing Turkey’s still
strident sense of national pride, open the way to rediscovering
history, and help anchor Anatolia to the European mainland.
The experience of the only existing Turkish-Armenian group, the
Turkish-Armenian Business Development Council, should be valuable
in this regard. Since 1997, against the odds, this non-governmental
network has helped establish links between Armenians and Turks at
all levels, and on several continents.
Both these dialogues must be sponsored and monitored by the EU.
Without a credible mediator, and publicity where possible, dialogues
are unlikely to produce results.
Secondly, the EU should lay down the rules with clarity. The
commission has indeed relentlessly and effectively fought for freedom
of expression. But Turkey is also already obliged in theory, under
the current customs union agreement which entered into force in 1995,
to entertain commercial relations with Armenia.
It should be made quite clear to the country that it will not join the
EU until those borders are opened and trade relations fully functional.
Finally, whatever else it does, the EU should not subsidise the
blockade of Armenia. The most destitute part of the Turkey is along
the closed Armenian border, just 50 km from the Armenian capital,
Yerevan, and its million consumers. But rather than opening the border
to trade with its neighbour, Turkey prefers to rely on subsidies from
Brussels – ¤40 million this year – to sustain the local economy.
Ultimately, the EU public opinion’s acceptance of Turkish membership
depends in large part on whether it feels that Europe is changing
Turkey or that Turkey is changing Europe. Turkey’s Armenian question
will help us find out whether the EU is still serious about its ideals.
Nicolas Tavitian is director of the Turkish Armenian Business
Development Council (TABDC) in the EU and also heads the Inside
Europe Resource Centre, a public policy centre dedicated to EU affairs
relating to Armenia.
–Boundary_(ID_UTdcmLc721L9lHpYwZxIVg)–
From: Emil Lazarian | Ararat NewsPress

GEORGIA, RUSSIA, THE UNITED STATES
by Nikolai Zlobin
Director of Russian Programs at the World Security Institute (Washington)
Source: Izvestia, November 1, 2006, p. 6
Translated by Elena Leonova
Agency WPS
What the Papers Say Part A (Russia)
November 1, 2006 Wednesday
Russia’s American-style treatment of Georgia; The crackdown on
Georgians seems to be an example of the Kremlin practising techniques
and methods for using a new array of tools in Russia’s foreign policy
arsenal. America has taught the current Russian leadership how to
operate in the international arena from a position of open cynicism.
One of Armenia’s leading politicians recently explained to me that
neither America nor Russia should delude themselves about their
influence on Armenia’s internal evolution, since its priorities
are largely determined by the attitudes and demands of the Armenian
diaspora worldwide. According to this politician, the diaspora will
never permit Armenia to be turned into a totalitarian state, since
money sent to Armenia from the diaspora (equivalent to Azerbaijan’s
entire energy export revenues) is the deciding factor in ensuring
the Armenian economy’s survival. Naturally, the money coming into
Armenia from abroad is accompanied by political messages which the
Armenian government cannot ignore if it wants to remain in power.
Apparently, Moscow has decided to take a similar approach to Georgia
– in reverse. A sweeping Russian-style crackdown on the Georgian
diaspora in Russia; luckily, this diaspora does indeed include
some crime bosses, illegal immigrants, and business owners whose
activities have nothing to do with morality and enlightenment. This
was supposed to result in Mikhail Saakashvili losing the support of
the Georgian community in Russia, and demonstrating to the rest of
the world, including Washington, that he’s completely incapable of
defending the interests of Georgian citizens. Naturally, this would
only provide further confirmation that Saakashvili’s regime is against
the Georgian people’s interests and Saakashvili himself is deficient
in personal ethics.
The crackdown on Georgians seems to be an example of the Kremlin
practising techniques and methods for using a new array of tools in
Russia’s foreign policy arsenal. As well as the power to cut off oil
and gas supplies, Moscow now has another way of putting pressure
on unsatisfactory regimes in the CIS: by using their diasporas in
Russia. It’s no secret that this form of leverage wasn’t invented
in Moscow; Washington has often used it in the past, and continues
to do so. America has taught the current Russian leadership how to
operate in the international arena from a position of open cynicism,
without indulging in melancholy reflections about morality and ethics,
using nothing but the vague term “realism in politics” as a cover.
The fact that the crackdown has only targeted Georgians shows that
the Kremlin has mastered another element from the arsenals of the US
elite: the ability to openly use double or triple standards in its
policies. This multi-standard approach in Putin’s foreign policy –
described as “multilateral,” or even “flexible,” by some embarrassed
Kremlin officials – actually does Vladimir Putin credit. Under his
influence, the Kremlin’s managers are gradually coming to realize
that any country aspiring to be a serious international player in
the world today must take a sophisticated (morally uninhibited, so
to speak) approach to foreign policy, in order to defend itself more
effectively while also separating other countries or bringing them
together. The more levels of standards foreign policy includes, the
more successful it will be. For a long time, Moscow didn’t understand
this. Now it’s Tbilisi that doesn’t understand it.
The irony is that Saakashvili has run up against exactly what the
White House taught the Kremlin in the process of supporting Georgia:
if anyone offends you, just beat them over the head with no hesitation
or regrets – rather than “clacking your beak to no purpose,” to
borrow the elegant expression used recently by Putin, who is said
to have a personal dislike for Saakashvili. Russia has adopted a
purely American style of behavior towards Georgia; meanwhile, the
Russia-Georgia relationship has taken on an even closer resemblance
to the decades-old relationship between the United States and small,
impoverished Cuba, which continually accuses Washington of having
aggressive intentions and uses any pretext to escalate tension and
point the finger at its large northern neighbor’s imperial ambitions.
However, it’s not all that simple. Russia certainly had a good
chance of not only emerging victorious from the current conflict with
Georgia, but also reinforcing its image as a country that thinks and
acts strategically and is capable of participating effectively in
solving important international problems. Some experts in Washington
even suspected Russia of provoking Georgia into this escalation,
in order to get the chance to demonstrate its own wise and tolerant
statesmanship. But then, as the world watched, Moscow got into a
dither over trivialities and lost the game – regardless of the actual
outcome of the conflict as such.
In order to operate like the Americans do, Russia either needs to
be equally strong or to use a much smarter and more sophisticated
approach. Gun control opponents in the US have a slogan: “Guns don’t
kill people – people kill people.” The same applies to politics. The
fact that Moscow wants to crack down on Georgians in Russia, and is
capable of doing so, doesn’t mean that it necessarily should do so.
Specific political methods are chosen by people, and these people
presumably calculate the potential effects. Actually, that’s what
they and their advisers are paid to do, with the money coming
from tax-payers. And that accounts for the widespread notion that a
government’s actions ought to benefit a country and its people. But in
this case, our country has shown itself to be extremly inhospitable
and the people have been taught another lesson in xenophobia and
intolerance.
But Moscow’s political recklessness is only partly to blame. The
primary cause concerns the fact that Saakashvili’s Dream Team has
turned into the region’s Nightmare Team. The Georgian president
continues to substantially – and groundlessly – exaggerate the
political support he has in the United States.
Two years ago, that support was almost absolute. Back then, Georgia
became the favorite country of ordinary Americans and President
George W. Bush. These days, however, that affection persists only
in the White House and the offices of a few senators, influential
as they may be. Bush has only two years left, and he won’t have time
for Georgia. The US political establishment is already showing signs
of skepticism and disillusionment, or even irritation, with regard
to the Saakashvili regime. America does indeed need Georgia – but
only as a democratic, stable, predictable country. In the event of a
serious conflict in Asia, Georgia could become an American airfield
or hospital, a workshop for repairing military hardware, a recreation
and redeployment base for the US Armed Forces, and so on. But will it?
The opinion in Washington is that the Georgian government’s major
mistake isn’t really its intention to reclaim the breakaway provinces
by means of armed force; rather, it’s Georgia’s demonstrative
reluctance or inability to work out a civilized relationship with
Russia. America won’t do that for Tbilisi. In the event of a military
conflict with Moscow, not a single American soldier would ever
be sent in to defend Georgia. NATO already has plenty of problems,
including problems with Russia, even without the addition of Georgia,
which is frantically trying to join NATO. As a result, Washington
is increasingly coming to doubt whether Saakashvili can deliver the
kind of Georgia that the United States needs. Consequently, unless
the situation in Georgia changes, Washington will have to choose
between withdrawing from Georgia, parting company with Saakashvili,
or a full-scale quarrel with Russia. It’s no exaggeration to say that
no one is seriously considering the last option.

INFLATION IN ARMENIA HITS 2.5% IN 10 M0NTH OF 2006
RIA Novosti, Russia
November 01, 2006
YEREVAN, November 1 (RIA Novosti) – Inflation in Armenia during the
first ten months of 2006 totaled 2.5%, the national statistics service
said Wednesday.
Prices in the South Caucasus state grew by an average 0.25% per month
in January-October, compared to a 0.35% decline in same period of 2005.
Consumer prices in October gained 0.4% month-on-month.
In Armenia’s state 2006 budget, inflation is forecast at 3%.

AZERI PARTY PICKETS FRENCH EMBASSY TO PROTEST “GENOCIDE” BILL
Azeri Press Agency
Oct 31 2006
Baku, 31 October: A group of members of the [minor pro-government]
Modern Musavat Party have staged a picket outside the French embassy
in Baku.
Yasamal district police prevented the pickets from approaching the
embassy building. But the protesters managed to voice their protest at
the French parliament bill that criminalizes denial of the “Armenian
genocide”.
Police allowed the protesters to hand over their statement to the
embassy.

GEORGIAN ARMENIAN ACTIVIST RELEASED
Regnum, Russia
Oct 30 2006
30 October: On 30 October, Armenia’s Court of Appeal made a decision
to change the measure of restraint regarding Vaagn Chakhalyan,
member of the [Georgian-based] United Javakhk democratic alliance,
and release him, our Regnum correspondent reports.
Earlier, the court of first instance sentenced Chakhalyan to two
months of preliminary confinement.

TV LOOKS AT BACKGROUND TO RUSSIAN-ARMENIAN ENERGY TALKS
RBK TV, Moscow,
30 Oct 06
“Gazprom will get everything it asked for in Armenia. Armenian
President Robert Kocharyan today assured Vladimir Putin that the
Russian holding company would remain a monopolist in the republic. It
has no competitors,” Russia’s RBK TV said on 30 October, following
reports of talks between the Russian and Armenian president in Moscow.
“Vladimir Putin, who most likely was quite well aware of what his
Armenian colleague was about to announce, immediately hinted: Russia
is ready to seriously increase investments in the republic,” the
presenter on the channel’s “Intrigue of the Day” evening round-up said.
Kocharyan will have made his trip to Moscow, RBK TV said, to discuss
the future of the Iran-Armenian gas pipeline. The 140-km gas pipeline,
which is to run from southern Armenia and join up with the gas pipeline
going through Georgia to Russia, is being built by the Armrosgazprom
Armenian-Russian enterprise. Gazprom and Armenia’s Energy Ministry have
45 per cent of shares each in this enterprise, and another 10 per cent
belongs to the Iter international group. “In April, after the turbulent
gas wars, Gazprom agreed to sell gas to Armenia at a fixed price for
another three years. In exchange, it demanded an extra emission of
Armrosgazprom shares. As a result, the Russian holding in the joint
enterprise was to increase substantially. Gazprom was thus to get
almost complete control on the Iran-Armenia gas pipeline,” RBK TV said.
“The opposition in Yerevan sees this as a transit pipeline, passing
not only from Armenia to Russia but from Iran to Europe, bypassing
Russia. For obvious reasons, Gazprom takes a dim view of this variant,
since with the right to a veto, it will be able to control the gas
network in the region,” the presenter went on.
Interviewed on the programme, investment company analyst Dmitriy
Mangilev said that Gazprom needed control over supplies of gas from
Iran in order to preserve its monopoly over gas supplies to Ukraine.
“Otherwise, Iranian gas could be sent through an upgraded gas pipeline
to Ukraine. From the political point of view, supplies of gas to
Armenia from Iran will make it possible to control supplies of gas
to Georgia from Russia. Because otherwise, gas supplies to Armenia
could only be made transiting through Georgia.”
This, the presenter said, would mean Gazprom could “as a minimum,
influence the cost of pumping and the final price of Iranian gas for
Europe, and as a maximum, control all the energy movements in the
Caucasus and the European Union”.
“The topic of gas as a method of exerting influence in the Caucasus,
analysts suggest, was a central one in the Kocharyan-Putin talks,
even thought the official reason for the visit was the end of the
Year of Armenia in Russia. But analysts reckon that behind closed
doors there will be discussion of how as soon as construction of
the gas pipeline is completed, Russia will calmly be able to close
off the valve to Georgia. Something may have to change in relations
between Tbilisi and Moscow very fast and very radically, for not for
nothing did Robert Kocharyan first of all assure Putin that Gazprom
would get what it had been promised,” the presenter said.
Tehran, the presenter commented, needs sales markets, and will be
looking to the gas pipeline as a transit pipeline to sell gas to
Europe. Gazprom currently supplies Armenia with as much gas as it
needs, so Armenia will be able to sell Iranian gas. “But if Iranian
gas does in fact go to Europe, it will be only under supervision,
and if it brings Russia not losses but profits; and what is more,
the money aspect is the least important thing.”
The programme then carried a clip showing the chairman of the
Duma committee for energy, transport and communications, Valeriy
Yazev, calling for Russia to lead an alliance of regional gas
producers. “We need to set up a gas alliance. Its format can be more
or less determined – at least Turkmenistan, Kazakhstan, Uzbekistan,
Russia, Ukraine, Belarus. And tomorrow – I’m speaking figuratively,
in brackets, here, if the problem of Iran’s nuclear programme is
removed – I see Iran in this alliance. Then this is more than 50 per
cent of the world’s gas, and of course, Russia and Gazprom should
emerge as the integrator of this gas alliance.”
Proposals like these “have not gone down well in Europe recently”,
the RBK TV presenter said. “European officials are openly accusing
the Kremlin of energy blackmail. The EU sees Moscow as demanding
Russian companies be allowed into the markets of the Old World,
otherwise it threatens to start sending supplies to other markets”.
The Kremlin denies this, “though it also makes it clear that it does
not like everything in European policy”. RBK TV said.

NEW VTB GROUP BRAND OFFICIALLY LAUNCHED IN ARMENIA
SKRIN Market & Corporate News
October 31, 2006 Tuesday 2:44 PM GMT
On October 27, within the framework of a visit of VTB Management
to Armenia, a press conference was held to mark the launch of a new
brand of the Bank Group – VTB.
Through developing its activities in Armenia, the VTB Group will
enhance the efficiency of servicing Russian customers business in
Armenia, effecting foreign trade settlement, and implementing foreign
trade cooperation programmes between Armenia and Russia.
To expand operations of the VTB Group in Armenia, VTB acquired in
2004 a 70% + one share interest in Armsberbank, which is currently
operating under the VTB Bank (Armenia) name. This financial institution
has gained solid positions in corporate business. As of 01.07.2006,
it is ranked 1st in the national banking system in terms of lending
volumes with a 14% share.
In the retail market, VTB Armenia is the second largest bank of the
country in terms of household deposits raised, with about a 10%
market share. The regional network of VTB Armenia is the largest
in the country; it consists of 100 branches and covers actually the
whole of the country territory.
Business development of VTB Armenia implies more finance to be
channelled into the national economy. The Bank plans to gain a
20% market share in lending to corporate customers and 15% – in
attracting new corporate customers. Moreover, a product line for
retail customers will also continue to develop, with simultaneous
efforts in SME servicing.
Citing Vassily Titov, Senior Vice President, Member of the Board,
transit of bank-members of the VTB Group in Russia, Europe, Asia,
Africa and the CIS to operating under a single brand is an important
step within the framework of further integration of VTB activities,
an instrument designed to strengthen competitive edge of the VTB
Group in national banking markets, including that of Armenia.

RF-ARMENIA TRADE IS HAMPERED BY TRANSPORT COMMUNICATION PROBLEMS
by Natalia Slavina
ITAR-TASS News Agency, Russia
October 31, 2006 Tuesday 06:01 AM EST
Russian-Armenian economic cooperation and bilateral trade are on
the rise, but this process is hampered by transport communication
problems, Armenian President Robert Kocharian said at a meeting with
Russian Prime Minister Mikhail Fradkov on Tuesday.
This problem “is compensated for by serious investment projects,”
he said.
“We witness the growth of investments in our cooperation, mainly in
processing, construction and electric power,” he said.
From: Emil Lazarian | Ararat NewsPress