Month: February 2015

ARMENIAN PRESIDENT AND MINSK GROUP CO-CHAIRS DISCUSS KARABAKH PEACE PROCESS

YEREVAN, February 17. / ARKA /. Armenian President Serzh Sargsyan met
Tuesday with visiting OSCE Minsk Group co-chairs Igor Popov (Russia),
James Warlick (USA) and Pierre Andre (France), as well as with personal
representative of the OSCE chairman-in-office Andrzej Kasprzyk.

Sargsyan’s press office said the co-chairs shared their impressions
of the meetings they had in Azerbaijan. It said the president and the
peace brokers discussed then a set of issues related to the current
status of the Nagorno-Karabakh peace process.

It said president Sargsyan welcomed the statement the co-chairs
issued on January 27 in Krakow that was different from their previous
statements calling on Azerbaijan to observe its commitments to the
peaceful settlement of the conflict and expressing also their serious
concern about reported incursions across the line of contact and the
Armenia-Azerbaijan border, resulting in casualties.

The Nagorno-Karabakh conflict erupted into armed clashes after the
collapse of the Soviet Union in the early 1990s as the predominantly
Armenian-populated enclave of Azerbaijan sought to secede from
Azerbaijan and declared its independence backed by succeeding
referendum. A truce was brokered by Russia in 1994, although no
permanent peace agreement has been signed.

Since then, Nagorno-Karabakh and several adjacent regions have been
under the control of Armenian forces of Karabakh. Nagorno-Karabakh
is the longest-running post-Soviet era conflict and has continued
to simmer despite the relative peace of the past two decades, with
snipers causing tens of deaths a year. – 0-

ARMENIAN PRESIDENT MEETS OSCE MINSK GROUP CO-CHAIRS

18:41, 17 Feb 2015
Siranush Ghazanchyan

President Serzh Sargsyan received today OSCE Minsk Group Co-Chairs Igor
Popov, James Warlick and Pierre Andrieu and the Personal Representative
of the OSCE Chairman-in-Office Andrzej Kasprzyk.

The mediators briefed the Armenian President on the impressions
from the meetings in Baku. The concerns existing in the current
stage of settlement of the Karabakh conflict and the future steps
were discussed.

President Serzjh Sargsyan welcomed the statement of the OSCE Minsk
Group Co-Chairs issued on January 27, which, he said, considerably
differs from all previous statements, as it finally calls on Azerbaijan
to observe its commitments to a peaceful resolution of the conflict.

CHESS IS A WONDERFUL GAME, BUT IT’S NO LIFE COACH

Stephen Moss
Spain is making chess compulsory in schools but even as an avid player,
I can’t quite endorse the lofty claims made for it Eight-year-old
David Ayrapetyan plays a game of chess at school in Yerevan, Armenia,
after the country made chess mandatory in schools.

Photograph: Tigran Mehrabyan/AP

Contact author

@StephenMossGdn

Tuesday 17 February 2015 11.27 GMT Last modified on Tuesday 17 February
2015 11.50 GMT

Chess is to be made a compulsory subject in Spanish schools. There is
cross-party agreement that the move is a good one, with the Socialist
party MP who proposed it claiming the game “improves memory and
strategic capacity, teaches students to make decisions under high
pressure and develops concentration”.

Spain will not be the first country to build chess into the
curriculum. Armenia long ago made it a core subject, with startling
results for its national chess strength – they have won three of the
past five Olympiads, an amazing result for so small a nation pitted
against the might of chess superpowers such as Russia, China and
the US.

Former world champion Garry Kasparov wrote a book, How Life Imitates
Chess, arguing that chess is an “ideal instrument” for developing
effective decision-making. “What am I lacking? What are my strengths?

What types of challenges do I tend to avoid and why?” These are the
questions you have to answer in life, as in chess, he insisted. We
will for the moment ignore the fact that Kasparov has largely failed
to transfer his chess genius to the greater (and far more dangerous)
game of Russian politics.

Jonathan Rowson, the former British champion and an immensely
thoughtful writer on chess (and much else besides), has gone even
further than Kasparov, describing chess as the rock on which he
founded his early life. “I don’t want to pour out too much of my soul,”
he wrote in his column (now sadly defunct) in the Herald newspaper,
“but things happened in my childhood that I was too young to make
sense of at the time, and recently it has become clear to me just
how essential chess was to my survival. Sublimation is the technical
psychological term. Chess gave me a way to channel difficult emotions
into something creative and constructive.”

The forerunner of all this chess-for-life thinking was the 18th-century
American writer, inventor and statesman Benjamin Franklin, a keen
(though by all accounts not very capable) player, who in his essay The
Morals of Chess argued that the game was good for the soul. “Chess
is not merely an idle amusement,” he wrote. “Several very valuable
qualities of the mind, useful in the course of human life, are to
be acquired or strengthened by it, so as to become habits, ready on
all occasions. For life is a kind of chess, in which we have often
points to gain, and competitors or adversaries to contend with, and
in which there is a vast variety of good and ill events that are,
in some degree, the effects of prudence or the want of it.”

Facebook Twitter Pinterest Anatoly Karpov, left, defending world chess
champion, and challenger Garry Kasparov, both of the Soviet Union,
at the World Chess finals in Moscow, 1984. Photograph: Anonymous/AP

Plenty of distinguished observers have, however, reached the opposite
conclusion, contending that chess, a quietly vicious game in which you
are trying to obliterate your opponent, can produce monsters. Mostly,
they were thinking about Bobby Fischer, the American genius who quit
school at 16 to concentrate on chess and became world champion at 29.

“Chess is war over the board,” said Fischer. “The object is to crush
the opponent’s mind. I like the moment when I break a man’s ego.”

These are not pleasant lessons, yet they created a player who has
claims to be called the greatest of all time.

Arthur Koestler, who admitted he was a “passionate duffer” where
chess was concerned, reported for the Sunday Times on the great match
between Fischer and the then reigning world champion Boris Spassky
in Reykjavik in 1972. He was struck by the double-sidedness of chess,
calling it the “perfect paradigm for both the glory and the bloodiness
of the human mind”.

George Steiner was in Reykjavik, too, covering the match for the
New Yorker. His verdict was even less generous than Koestler’s. Not
content merely to conclude that chess was ultimately pointless, he
argued that devoting one’s formidable mental attributes to a pastime
was almost guaranteed to lead to insanity. “A chess genius is a human
being who focuses vast, little-understood mental gifts and labours on
an ultimately trivial human enterprise,” he wrote. “Almost inevitably,
this focus produces pathological symptoms of nervous stress and
unreality.” The irascible, unpredictable, at times out-of-control
Fischer was of course uppermost in his mind.

I have been studying chess (and chess players) for the past three
years, for a book to be published in 2016. I can see both points of
view. The game does force you to think, analyse, rationalise, apply
logic. But it also drives you a little bit crazy. The deeper you go
into it, the more you realise your limitations. The “truth”, as chess
players like to term it, of a position is all too often elusive. After
playing a game (especially if I lose), I will sometimes lie awake in
bed for hours playing through the game in my head. The pain of chess
generally outweighs the pleasure.

Facebook Twitter Pinterest Bobby Fischer at the US chess championship
tournament in New York in 1965. Photograph: JK/AP

Many claims are made for chess – that it is art, science and sport all
rolled into one. Well, maybe. We players who devote thousands of hours
to it have to believe we are engaged in some higher endeavour. But
again I’m not sure it’s really true. I like it mainly because it’s
a glorious waste of time, a way of cocking a snook at the workaday
world. Some chess professionals in the UK get by on £12,000 a year
– grandmasters earning less for creating beautiful games than they
would make stacking shelves. But they reason that they are beating
the system. Many chess players are loners, outsiders, rebels. The
board is their world; the place they are most at home.

For me the Dutch grandmaster and chess columnist Hein Donner –
the model for the character of Onno Quist in Harry Mulisch’s novel
The Discovery of Heaven – came closest to getting to the essence
(or perhaps non-essence) of chess. He addressed the art v game,
profound endeavour v complete waste of time question in a column
published in 1959. “A chess player produces nothing, creates nothing,”
Donner concluded in his usual emphatic style. “He only has one aim:
the destruction of his opponent.”

Chess, Donner insisted, is a struggle, a fight to the death. “When
one of the two players has imposed his will on the other and can
at last begin to be freely creative, the game is over. That is the
moment when, among masters, the opponent resigns. That is why chess is
not art. No, chess cannot be compared with anything. Many things can
be compared with chess, but chess is only chess.” A wonderful game,
but a most peculiar preparation for life, whatever Benjamin Franklin,
Garry Kasparov and Spanish parliamentarians might tell you.

SERZH SARGSYAN, GAGIK TSARUKYAN HOLD A MEETING

19:12, 17 Feb 2015
Siranush Ghazanchyan

Armenian President Serzh Sargsyan and leader of Prosperous Armenia
Party Gagik Tsarukyan had a meeting earlier today, head of the ARF
faction Armen Rustamyan told 168.am.

“We’re glad the meeting finally took place. The ice is melting,”
Rustamyan said.

WHEN CHARLIE CHAPLIN ATTENDED THE OPENING OF AREMNIAN HOTEL IN SOUTHEAST ASIA

19:01, 17 Feb 2015
Siranush Ghazanchyan

The Jakarta Globe presents the story of Armenians, who opened a chain
of hotels in Southeast Asia. The article reads:

As long as there has been cross-border trade there have been expats.

Be they Chinese from poor coastal villages in search of a better life,
or unskilled laborers from India dragooned by colonial overlords;
soldiers of fortune from the Japan or sons of the British Empire
brought up on boys’ own tales of pomp and riches, people have bid
farewell to their own shores and traveled in search of a brave
new world.

Expats come and expats go, but their legacy varies. Jakarta’s historic
Old Town is a testament to centuries of Dutch colonialism, India’s tea
plantations legacy to Europeans love of tea. And the Chinese influence
lives on in boardrooms of some of the wealthiest conglomerates in
the region.

And then we have the Armenians. As trade opened up the East and brought
yet more opportunities for the opportunistic, others followed in
the footsteps of the hardy pioneers, including people from an often
overlooked nation sitting at the crossroads of Europe and Asia.

Little remains of the Armenian presence in Southeast Asia beyond the
odd church, road name and hotel. But what hotels?

Tigran Sarkies was his name, a precocious 23-year-old, and in 1882
he was working as an auctioneer in Georgetown, Penang. He must have
tired of banging the gavel because a couple of years later he opened
the Eastern Hotel and two years after he launched the Oriental Hotel
with his brother, Martin.

Another brother, Aviet, was brought in to manage the Eastern, while
Tigran and Martin extended the Oriental, which they reopened in 1889 —
renamed as the Eastern & Oriental, or E&O as it was know by generations
of planters and officials during those colonial times.

In just a few short years the name Sarkies became so synonymous with
hotels that Sir Frank Swettenham, who has more than left his own
imprint on the peninsula, first related an oft-told joke.

“A little boy at school was asked by his teacher who the Sakais
[indigenous Malay peoples] were, and he replied they were people who
kept hotels!”

In 1891 a fourth brother, Arshak, arrived on the scene and his industry
led to the constant reinvention of the E&O until it acquired its
moniker of the premier hotel east of Suez. Quite a character was
Arshak who could often be seen waltzing round the ballroom of his
hotel with a whiskey soda on his head.

Buoyed by the early success of the island-based hotel, Tigran and
Martin looked into opening a hotel in Singapore. A suitable premise
was found on the corner of Beach Rd. and Bras Brasah Rd.

The bungalow had been a boarding house for students at the Raffles
Institution and needed little renovation. By December 1887, Tigran
opened Raffles with the guarantee of “great care and attention the
comfort of boarders and visitors.”

Again the brothers had backed a winner. Extensions in 1889 increased
the capacity but the demand was still outstripping supply.

Martin returned to Persia in 1890, leaving Tigran to oversee the
construction of Palm Court Wing in 1894, which brought the total
numbers of rooms to 75.

Another wing was opened in November 1899, which led the somewhat stuffy
Straits Times to gush “palatial building with excellent ventilation,
and the vast airy dining room would make Raffles one of the largest
and handsomest hotels in the East.”

Now, with 100 suites, Raffles also was the only hotel in the area
lit by electricity and with a 10,000 gallon water tank!

The last tiger to be killed in Singapore was taken out in the Bar &
Billiard Room. I’m not sure what the patrons’ reaction was to having
their game interrupted by a great cat taking refuge under their feet.

As was common in many buildings at that time, the bar was raised off
the ground to prevent flooding and the tiger had hidden in the recess.

Given the popularity of tiger hunting, no doubt a few of the worthies
would have been disappointed they hadn’t pulled the trigger.

Today it is peaceful and makes for a nice stroll, taking in Chinese
temples and a house used by Dr. Sun Yat Sen as he plotted to
overthrow the Chinese government but in the past has been the scene
for disturbances between various secret societies.

Further south in Singapore stands the Armenian Church, the oldest in
the country. Today it is surrounded by high rises, while a busy road
provides a non-stop symphony of sounds; hardly the place of relaxation
and contemplation.

The neatly manicured gardens have a handful of tombstones, many
featuring the name Sarkie. It is tempting to try and lose yourself in
the moment and imagine Martin and Tigran taking time out from running
a hostelry and seeking solace within the walls of the small church,
but the 21st century is just too close, as is a busy intersection
and a bus stop.

Closer to home Lucas, son of Martin, eschewed the Sarkies successful
practice of setting up in the wake of the British colonials and headed
south east, to Surabaya, a city famous on the maritime maps of the
day but also home to a fair-sized Armenian community.

He opened the Oranje Hotel in 1910, named after the Dutch colonials
in the East Indies. That the Sarkies had opened a hotel was enough
to tempt people to visit the hot and sweaty town in East Java.

Charlie Chaplin, a familiar figure on the screen and at Raffles
attended the opening ceremonies of a refurbishment in 1936.

The Japanese arrived with the invasion of Java and used the hotel as
a barracks, changing the name to Hotel Yamoto.

The Indonesians declared their independence after the war on Aug. 17
but that didn’t stop the Anglo Dutch Country Section Office moving
into the hotel, room number 33 to be precise. On Sept. 19 at 6 a.m.

the officials raised the Dutch flag atop the hotel.

The Surabayans, angered by this arrogance, attacked the hotel, climbed
on to the roof and pulled down the symbol of oppression. They tore
off the blue band on the flag leaving just the red and white, merah
putih, the colors of the independent Indonesia.

From: A. Papazian

POLITICAL EXPERT: AUTHORITIES OF ARMENIA FEAR POSSIBLE CONSEQUENCES OF OPPOSITION RALLY

by Marianna Lazarian

Tuesday, February 17, 15:08

Yerevan Municipality’s refusal to provide area for the upcoming
rally of the opposition three parties shows that the Authorities of
Armenia fear the possible consequences of the rally, Deputy Head of
the Caucasus Institute Sergey Minasyan told reporters, Tuesday.

The expert believes that the ruling Republican Party of Armenia fears
consolidation the first president of Armenia Levon Ter-Petrosyan,
Leader of the Prosperous Armenia Party Gagik Tsarukyan, and Leader
of Heritage Party Raffi Hovannisian in one square.

Yerevan Municipality did not consider the above opposition parties’
notification about their upcoming rally in the Liberty Square, as
it did not meet the Law On Freedom of Assemblies. “This request is
contrary to the law on freedom of assembly – this rally cannot be
classified as urgent, so, it cannot be held earlier than stipulated by
the law: no earlier than eight days after a request,” the Municipality
said.

The parliamentary opposition expressed wish to hold an urgent rally
after the Armenian President’s order to inquire into the activities
of the leader of Prosperous Armenia Gagik Tsarukyan and to exclude him
from the National Security Council and the Parliament. The opposition
parties submitted a new application to the Municipality today.

WHO NEEDS A MAIDAN IN ARMENIA TODAY?

Mirror Spectator
Editorial 2-21 Feb 2015

By Edmond Y. Azadian

The Orange Revolution and the Rose Revolution brought regime changes
in Ukraine and Georgia, respectively, but Armenia was spared during
both cases and maintained its stability throughout those stormy
periods. But rumors, forecasts and political analyses always pointed
to the possibility of a color revolution in Armenia as well.

President Serge Sargisian’s administration weathered successfully the
tides of unrest fomented by the opposition, and taking the initiative,
it also deflated the opposition.

Levon Ter-Petrosian’s National Congress Party, which fed on the
popular discontent, could not use its ammunition to the fullest.

Therefore, although the opposition was cut to size and contained,
popular discontent remained as a latent force for any future
politician to explore and explode. The economy continued in stagnation,
emigration reached dangerous proportions and Armenia’s dependence on
Russia compromised its sovereignty. It seemed that those social and
political problems had not eroded the power of the ruling elite. But
recent developments indicate that challenges are on their way and
the administration is under constant pressure. Those pressures yield
result when coupled with outside factors.

In recent days, dramatic changes have taken place in Armenia’s domestic
political landscape. But to view and analyze the developments within
the context of internal political life may be too simplistic and
inconclusive. Currently, Russia is under siege because of the turmoil
in Ukraine; Moscow blames the US and the West for NATO creeping closer
and closer to Russian borders and the West’s countercharge is that
Moscow is fomenting turmoil in former Soviet Republics. No matter
where the truth stands, ensuing problems will impact Armenia as well,
since the country is so integrated with Russia socially, economically,
politically and militarily.

On February 12, 2015, the US House Foreign Affairs Committee held
hearings on US-Azerbaijan relations. Testimony was given by Dr. Svante
E. Cornell, director of Central Asia-Caucasus Institute at Johns
Hopkins University.

Outlining the US policy regarding the region, Dr. Cornell’s
recommendation was to overlook Azerbaijan’s human rights abuses and
base US policy on more pragmatic aspects, namely oil and regional
security. Further broadening the focus, the director stated: “The
task of countering [President Vladimir] Putin’s Russian imperialism
goes beyond Ukraine and requires a firm strategy to bolster the
states on Russia’s periphery, and especially to maintain the crucial
east-west corridor to Central Asia open. But the Caucasus and Central
Asia include fully one half of secular Muslim majority states in
the world…

Thus the Caucasus (and Central Asia) should be seen as bulwarks
against both Moscow and the Islamic radicalism of the Middle East.”

The implication is that since Russia has its hands full in a border
war in next-door Ukraine, it would be helpful for West’s containment
policy to trigger another flashpoint on Russia’s periphery, and
Armenia is one of those peripheral states.

It is no surprise, therefore, that as soon as the Serge Sargisian-Gagik
Tsaroukian controversy broke out, news outlets financed and directed by
Western countries unanimously took a very critical position vis-a-vis
the president’s statements.

It was indeed a political bombshell which President Sargisian lobbed
at the oligarch, who is the head of the Prosperous Armenia Party. He
portrayed Tsaroukian as “evil” and incompetent in Armenia’s political
life.

This development was in the making for a long time. Mr. Tsaroukian
is the titular head of the Prosperous Armenia Party, but actually,
the party was founded by the former president, Robert Kocharian,
and has been manipulated constantly by him in the background.

Sargisian’s Republican Party and the Prosperous Armenia Party formed
the ruling coalition initially, with the understanding that the
Putin-style transition would be implemented in Armenia, with Sargisian
serving out his term and paving the way for a Kocharian’s return.

Relations began souring when the plan did not work the way it was
supposed to; Sargisian did not relinquish the reins of power and the
coalition began to splinter. For a long time, Levon Ter-Petrosian
courted Tsaroukian to no avail. Now that Tsaroukian has become a
target of the president’s criticism threw the gauntlet and rallied
the opposition parties around him and called for a nationwide rally
on February 20, calling for he president’s resignation. Prosperous
Armenia joined the Armenian National Congress and Raffi Hovannisian’s
Heritage Party to use all means, including “civil disobedience” to
bring down Mr. Sargisian. The rally will prove to be a litmus test
of the opposition’s power.

Politics in Armenia are the mirror-image of those in Russia. Putin
jailed oligarch Mikhail Khodorkovski, who had opposed him politically,
usurped his assets worth over $10 billion and let him leave the
country almost penniless after 20 years of incarceration.

The same tactics are replayed in Armenia now. Tsaroukian was removed
from the National Security Council, he was stripped of his presidency
of the National Sports Agency and now the president has sent a formal
letter to the speaker of parliament, Galust Sahakian, to take away Mr.

Tsaroukian’s protection as a member of parliament. Meanwhile, all of
his businesses have been investigated for potential tax evasion. Thus
far, Mr. Tsaroukian has conducted his businesses in Armenia, employing
some 20,000 people, now all of a sudden, he has become a suspect upon
a fallout with the president.

The current administration has been able to destroy more sophisticated
oligarchs, like Khacahdour Soukiasyan, who left the country with his
huge capital, instead doing business in Europe and the Gulf states,
to the detriment of Armenia’s economy.

But despite his macho image, Mr. Tsaroukian thus far is behaving
smartly. It is apparent that he is being coached by much more
experienced political minds in the opposition. For example, in his
response to the president’s criticism, he said that he is not a
politician in the classic sense, but that he wishes to help his people.

Tsaroukian has crossed the Rubicon and with his help, the opposition
will fight the administration with renewed vigor.

Observers and the general public are stunned at this conflict taking
place at this time, which may lead to a new Maidan which, Mr.

Tsaroukian, has said he has avoided thus far.

Why is the president so emboldened when the country’s problem persist?

Emigration is continuing on a dangerous scale, the economy is
staggering and above all, the border with Azerbaijan is again becoming
a war zone.

The president’s domestic challenges are coupled with a foreign
relations challenge, when he suddenly decided to withdraw the Protocols
from the Parliament’s agenda. He took the last initiative the moment
Mr. Davutolgu had adopted a more conciliatory tone toward Armenia. The
Turkish prime minister reiterated his previous offer of relinquishing
one region in Karabagh to open the border with Armenia.

It is a different matter that the offer would not be a starter because
the give and take are not equivalent. Swapping territory for lifting
the blockade could prove to be an illusion, because the borders can
be closed at will any time, but land could be taken “only by blood,”
as noted Turkish dictator Kenan Evren.

This crisis is ill-timed, when the entire diaspora will be converging
to Armenia, too for the centennial commemoration of the Genocide. Not
only the diaspora, but also many dignitaries like President Francois
Hollande and others will arrive at a crisis-ridden country.

We do not want to see another Maidan reenacted. But who needed this
crisis at this time?

ARMENIAN NUKE STATION TO BE READY FOR RECONSTRUCTION STOP BY SPRING 2017 – MINISTER

YEREVAN, February 18. /ARKA/. Preparations for ceasing operations at
the Armenian Metsamor nuclear power plant for reconstruction purposes
will be completed by spring 2017, minister of energy and natural
resources Yervand Zakharyan said at a meeting in the nuke station
on Tuesday.

Under the respective loan agreements between the Russian and the
Armenian governments, Armenia is obliged to ensure smooth suspension
by spring 2017, the minister said.

According to the agreement signed in Moscow on February 5,
Russia extends a $270 million loan and a grant of $30 million for
reconstruction and extension of the service live of the nuke station.

The loan will be provided under soft terms for 15 years and at a 3%
per annum rate.

The preparatory works will be carried out mainly by Rusatom Service
closed joint stock company, the minister said as cited by the press
office. The respective framework agreement with the company is to be
signed soon.

During the meeting, the nuke station management reported about measures
implemented so far and the action plan for 2015. Measures to raise
safety level at the nuclear power unit were presented in detail.

Armenia plans also to build a new power unit at the nuke station
with capacity of 1,000 megawatt. The start of the construction is
scheduled for 2018-2019. Russia says it is ready to meet part of the
construction expenditures and provide the so-called ‘nuclear island’
in particular. Other costs are expected to be paid from support funds
from various countries.

The Metsamor plant located some 30 kilometers west of Yerevan, was
built in the 1970s but was closed following a devastating earthquake
in 1988 that killed some 25,000 people and devastated much of northern
Armenia.

One of the plant’s two VVER 440-V230 light-water reactors was
reactivated in 1995. The Armenian government said earlier it wants
to build a new facility that is supposed to operate at twice the
capacity of the Soviet-constructed facility. Metsamor currently
generates some 40 percent of Armenia’s electricity. The construction
of the new facility is estimated as much as $5 billion.-0-

From: A. Papazian

ARMENIA’S BUSINESS ENVIRONMENT INDEX DOWN TO 51.8 IN Q 4

YEREVAN, February 18. /ARKA/. Armenia’s business environment index
for the fourth quarter of 2014 fell by 0.8 percentage points to
51.8 compared to Q3, the press office of the Central Bank of Armenia
reports.

At the same time, the index dropped by 0.4 percentage points compared
to the same period of the year before.

The central bank says the index is within the stable range, and
positive sentiments are maintained in almost all economic fields,
according to the report.

The index was influenced by changes of the respective indicators,
including industry, trade and services. In particular, industry
indicator fell by 2.8 percentage points to 55.5; trade index dropped
by 11.4p.p to 48.8 and the services index rose by 9.6 p.p. to 63.8.

The lowest index was recorded for the construction sector – 34.6,
a negligible increase of 0.5 p.p., still below the stable range.

Business environment index is calculated based on averaged assessments
of economic condition and risk changes by organizations.

In 2014 the central bank reviewed the methodology of the calculation
and merged business environment and business activity indices together
into one index of business environment.

Since the beginning of 2005 the central bank has been conducting
quarterly polls among non-financial and financial organizations and
households. -0–

COGNAC ARMENIAN BRAND ONLY IN RUSSIA – EXPERTS SUGGEST ALTERNAIVES

11:31 * 18.02.15

Cognac is recognized as an Armenian brand only in Russia, as all
other countries use the term brandy to name the Armenian product,
says the president of the Armenian Association of Winemakers.

Speaking to Tert.am, Avag Harutyunyan explained that the term
“brandy”, as a beverage name, is a class lower than cognac, which is
internationally known to be typically French brand. “Though on the
Russian market, the Armenian cognac is perceived as an Armenian brand,
that market is little by little growing smaller in size, losing its
attractiveness,” he said.

Harutyunyan noted that despite its high quality and competitiveness,
the Armenian product falls short of meeting the criteria of what is
termed as cognac. He said that while the French cognac represents a
mix of different varieties of grape (that also influences the aroma),
the Armenian brandy is made of distilled spring water. “There are
specificities that ensure the Armenian brandy’s higher quality,
and its place on market. Armenian brandy is sun-smelling; it has a
richer aroma with a chocolate-vanilla flavor, but the whole problem
has to do with the name,” he added.

Harutyunyan noted that Armenia’s EU Association Agreement contained a
provision allowing the use of “Armenian cognac” for maximum ten years.

He added that the question would be problematic again in case Armenia
had chosen to sign the association deal with Europe. “It is a great
pity for us that we didn’t manage to replace the word in the course
of 70 years [of the Soviet rule],” he added.

As for the beverage’s marketability in the Eurasian Economic Union
(EEU), the expert said he knows that cognac is still acceptable in
that trade zone, but he didn’t rule out the possibility of the term’s
future usage also in the EU.

Harutyunyan said he finds cognac to be more a typical Armenian
phenomenon rather than an international cultural value.

“With its sale volumes, it is the world’s twentieth [most popular]
drink. It has a potential, so if we find the right name, it will gain
advantage, having its worthy place in the ranks of gin, rum, whiskey
and cognac,” he said, noting that 90% of the Armenian beverage is
consumed in the post-Soviet area.

Harutyunyan said the right word is difficult to find especially because
the names traditionally perceived as a national brands (Araratm Masis,
Sevan) were long ago handed over to the private sector’s monopoly,
becoming the property of individual entrepreneurs.

“It may be a term characterizing the territory and nation, which
specialists are not able to find,” he said, proposing even a contest
for selecting an appropriate brand.

Avetik Galstyan, a deputy director at the Proshyan Brandy Factory,
also agrees that a possible ban on “cognac” may cause problems in the
industry. According to him, “brandy”, as a term, can potentially work
on the market.

“It is due to Russia now that we are able make exports also to the EEU
countries, labeling our product as ‘cognac’,” he said, adding that
“Armenian brandy” comes to replace the term whenever the drink is
exported to the EU.

Gasparyan said he knows that the Armenian cognac or brandy is the
preferred product on the EEU market ,which is very well familiar with
the drink but noted in the meantime that it is also exported to the
Baltic republics, as well as Poland and Bulgaria. “There are more
opportunities in the countries of Eastern Europe,” he added.

Admitting that the Armenian brandy is widely popular in the Diaspora,
Gasparyan said he doesn’t think that the factor alone is enough for
ensuring the product’s marketability.

“There are price-related issues, so we must try to sell cheaper
to attract the European consumer into preferring the Armenian
[product],” he said, noting that equal prices will still keep the
European consumer’s interest high in French cognac.