Month: November 2009

CENTRAL BANK OF ARMENIA KEEPS INTEREST RATES STABLE IN NOVEMBER

World Market Research Centre
Global Insight
November 11, 2009

The Central Bank of Armenia (CBA) in its meeting yesterday decided
to keep its refinancing interest rate unchanged at 5%, Reuters reports.

The CBA had taken a similar decision also last month, while September
had seen it cut the rate by 25 basis points, in the seventh monthly
easing in a row (seeArmenia: 9 October 2009:). While announcing its
decision, the CBA expressed its confidence on Armenia’s ability to meet
the inflation target this year. The CBA’s monetary policy programme
specifies the planed end-year consumer price inflation at 4% plus/minus
1.5 percentage points. The central bank added that the current level
of interest rates was low enough to provide for support for economic
recovery. The latest inflation data put annual consumer price growth
in October at 3.5%, in some moderation from the September rate of 3.7%
(seeArmenia: 3 November 2009:).

Significance:Given the extremely severe economic contraction that has
gripped Armenia this year as foreign currency inflows have dried up,
demand-side inflation pressures remain very muted. On the other hand,
the same does not hold true for cost-side inflation. Indeed, strong
upward pressure on annual service price inflation has resulted from
the increase of Russian gas prices enacted earlier this year.

Moreover, imported inflation risks are posed by the vulnerability
of the dram exchange rate to the shock of the sharp reduction in
investment and remittance inflows, and the resultant wide external
financing gap. Indeed, ARKA News reports that the CBA again had to
defend the external value of the dram with foreign currency sales,
as the relative exchange rate stability that had resulted from the
CBA’s imposed limits on commercial banks’ hard currency holdings proved
only temporary, prompting even expectations that the CBA may have to
require commercial banks to sell their foreign currency reserves.

Thus, the CBA may soon again face the trade-off between supporting
growth on the one hand, and seeking to control inflation and
buttressing the dram on the other. Then again, due to the undeveloped
state of the financial sector, the role of Armenian refinancing
still remains mainly an indicator of the Central Bank’s inflation
expectations, rather than an effective policy tool that would have
a clear impact on market interest rates.

ARMENTEL PLANS TO DOUBLE 3G COVERAGE FOLLOWING "EXPLOSIVE DEMAND"

World Market Research Centre
Global Insight
November 11, 2009

Armenian mobile operator Armentel has indicated that it plans to double
its 3G coverage in the country by the end of 2009, reports ARKA,
citing company CEO Igor Klimko. The network expansion means that 3G
services will be made available in Gyumri, Vanadzor, Echmiadzin, and
Jermuk. Although Klimko indicated that it was too early to comment
on the "commercial success" of Armentel’s 3G offering, launched in
October 2008, he did state that the group was experiencing "explosive
demand" for USB modems in the country.

Significance:Klimko has highlighted that a slew of new Internet
backbone operators are entering the Armenian market, and these can
help to drive down prices for wholesalers and retail customers alike.

The growing maturity of the Armenian mobile sector also explains
why 3G is growing in popularity, as penetration begins to approach
triple-digit level, customers become more comfortable with products
and demand improved services, and the market adjusts to the presence
of a third operator, Orange, having launched operations earlier this
month (seeArmenia: 6 November 2009:). Armentel may lag behind GSM
market leader K-Telecom, with market shares of around 19% and 81%
respectively, but was the first operator to launch 3G services. It
also has the advantage of being the dominant fixed-line operator,
giving it increased exposure to a large subscriber base, and offering
cross-selling and up-selling opportunities.

AZERBAIJANI AND ARMENIAN PRESIDENTS TO MEET IN ONE OF EUROPEAN CITIES

RIA OREANDA
Nov 11 2009
Russia

Baku. OREANDA-NEWS . November 11, 2009. An agreement on another meeting
between presidents of Azerbaijan and Armenia, Ilham Aliyev and Serzh
Sargsyan respectively, at the end of this month has been reached.

The minister of foreign affairs of Azerbaijan, Elmar Mammadyarov,
says that both leaders consent on their meeting in one of the European
cities has been already received.

The precise venue of the upcoming meeting will be known only in
several days. The OSCE Minsk Group co-chairs are working over that,
the FM said.

In addition, there were made no new proposals within the framework
of the Madrid principles of Armenian-Azerbaijani Nagorno Garabagh
conflict.

There are not any fresh proposals. We have been discussing these
issues for the last five years. Conflict settlement is hampered as
the Armenian party started returning again to discussion of earlier
achieved arrangements.

Under such conditions it is difficult to conduct negotiations,
and that is why when the MG co-chairs were visiting the region,
Baku in particular, we informed them again that official Baku does
not intend to continue high-level meetings for the sake of imitation
of the negotiation process, the minister said.

Since 1994 the parties have been applying ceasefire regime. Following
the conflict Armenia has occupied 20% of Azerbaijani territory and
evicted 1 million people from their residence sites.

ARMENIAN OPPOSITION MEMBER BLAMES AUTHORITIES FOR ECONOMIC DOWNTURN

Mediamax
Nov 10 2009
Armenia

Yerevan, 10 November: A coordinator of the opposition Armenian National
Congress (ANC) has stated that Armenia is the "world leader" in terms
of economic downturn.

Speaking at a news conference in Yerevan today [10 November], Levon
Zurabyan said that "the main explanation for the critical economic
situation in the country is the presence of a vicious system, which
is serving the interests of few oligarchs," Mediamax reports. The ANC
coordinator expressed confidence that "99 per cent of the economic
downturn is caused by domestic problems".

The former chairman of the Armenian Central Bank, Bagrat Asatryan, said
that he has elaborated an alternative anti-crisis programme for the
ANC, which will be presented to public discussion in the near future.

PHILIP GORDON PAYS PREPARATORY VISIT TO ANKARA PRIOR TO ERDOGAN-OBAMA MEETING

/PanARMENIAN.Net/
12.11.2009 20:11 GMT+04:00

/PanARMENIAN.Net/ U.S. Assistant Secretary of State for European
and Eurasian Affairs Philip Gordon paid his first official visit to
Ankara on Thursday to discuss common interests and the possibilities
for cooperation in light of regional developments.

Foreign Minister Ahmet Davutoglu and Undersecretary Feridun Sinirlioglu
received Gordon. Diplomatic sources said it was a preparatory meeting
as Prime Minister Recep Tayyip Erdogan would go to Washington to meet
President Barack Obama in early December. The reconciliation process
between Ankara and Yerevan was Philip Gordon also discussed during
his visits, Hurriyet Daily News reported.

INITIATION OF XENOPHOBIA PREVENTION DIGITIZING ARCHIVES OF "SUMGAIT CASE"

/PanARMENIAN.Net/
12.11.2009 20:31 GMT+04:00

/PanARMENIAN.Net/ The "Initiation of prevention of xenophobia" in
Yerevan carries out activities for spreading objective information
concerning the existing interethnic conflicts in the region. The
organization with support of "Information and PR Center" (IPRC)
of Armenian President’s Administration, prevents circulation of
materials having xenophobic nature in the world wide web.

"Initiation of prevention of xenophobia" continues digitization of
"Sumgait case" archives with support of IPRC and Prosecutor General’s
Office. At present more than 200 evidences of massacres implemented
of 1988 in Azerbaijani Sumgait city against the Armenians have already
been digitized.

"Initiation of prevention of xenophobia" has implemented a number of
measures and more than 2000 xenophobic, anti-Armenian, anti-Semitic,
anti-Kurdish, anti-Greek, and anti-Georgian videos in youtube, rutube,
facebook and mail.ru have already been blocked.

"Initiation of prevention of xenophobia" has initiated digitization
and distribution of literature concerning the interethnic conflicts
and ethnic intolerance through internet libraries. The initiation
projects to create a private net library.

PROCESS OF CONSOLIDATION OF ARMENIAN BANKS INEVITABLE

/PanARMENIAN.Net/
12.11.2009 20:42 GMT+04:00

/PanARMENIAN.Net/ Process of consolidation of Armenian banks
inevitable, Chairman of the Board of Directors of Ameriabank and the
Board of Directors of Troika Dialog Ruben Vardanyan told journalists
in Yerevan. The process of bank agglomeration is inevitable, he said.

According to him the process of consolidation of banks will take place
in Armenia. That process is objective and aimed at internationalization
of Armenia’s banks. "Armenia’s banking system gradually becomes
international in terms of ownership, " Ruben Vardanyan said.

However, he mentioned, that there has not been any agreement yet
between Ameriabank and other bank in Armenia.

AMERIABANK PROJECTS TO BUILD BOARDING SCHOOL OF WORLD CLASS IN DILIJAN

/PanARMENIAN.Net/
12.11.2009 20:50 GMT+04:00

/PanARMENIAN.Net/ Ameriabank projects to start construction of a
boarding school in Dilijan in 2010, Ruben Vardanyan , Chairman of
the Board of Directors of Ameriabank and the Board of Directors of
Troika Dialog told journalists in Yerevan.

According to him, school construction projects are underway. "This is
a very ambitious goal – to build a world-class school, where children
would learn not only from Armenia, but also from other countries.

Let’s see how we can make it happen, but we are planning to start
its construction in 2010, " he said.

Ruben Vardanyan stressed that the future of the 21st century will
belong to educated people.

"If we do not improve the education system, we will lose many
competitive advantages we have and had," Ruben Vardanyan said.

From: Emil Lazarian | Ararat NewsPress

INTEREST RATES OF ARMENIA’S BANKING SYSTEM CONTINUE TO REDUCE

/PanARMENIAN.Net/
12.11.2009 20:55 GMT+04:00

/PanARMENIAN.Net/ Interest rates for credits and deposits in Armenia’s
banking system continue to reduce, Chairman of the Board of Directors
of Ameriabank and the Board of Directors of Troika Dialog Ruben
Vardanyan told journalists in Yerevan. This is a normal reaction
of any financial institution given the availability of such a great
amount of spare cash, Ruben Vardanyan said.

From: Emil Lazarian | Ararat NewsPress

ARMENIAN SEISMOLOGISTS RECORDED EARTHQUAKE AT 3.5 MAGNITUDE IN IRAN

/PanARMENIAN.Net/
13.11.2009 10:33 GMT+04:00

/PanARMENIAN.Net/ Yesterday, at 20:36 local time on the territory
of Iran, in 19-km north-west of Hoy, an earthquake with 3.5. points
magnitude was recorded. As the National Service of Seismic Protection
of Armenia told a PanARMENIAN.Net reporter, the force of the earthquake
in the epicenter was 5 points.