RFE/RL Armenian Report – 07/26/2017


Israeli Minister Seeks Closer Ties With Armenia

 . Sargis Harutyunyan

Armenia - Armenian Foreign Minister Edward Nalbandian (R) and Israel's
Minister of Regional Cooperation Tzachi Hanegbi sign bilateral
agreements after talks in Yerevan, 25Jul2017.

An Israeli government minister spoke of a "breakthrough" in Israel's
uneasy relationship with Armenia on Wednesday during an official visit
to Yerevan that focused on ways of boosting bilateral economic

"The aim of my visit is to strengthen our relationship," Minister of
Regional Cooperation Tzachi Hanegbi told RFE/RL's Armenian service
(Azatutyun.am) shortly before meeting with Prime Minister Karen

"The friendship [between the two nations] has been there for many
years," said Hanegbi. "Diplomatic relations have existed for 25
years. But now we are thinking of more practical mutual fields to work
together and to make this friendship mutually beneficial in many

"I think that for more than ten years there have been no visits of an
Israeli minister [to Armenia.] So this is a new breakthrough, and I'm
happy to be part of it," he added.

Hanegbi, who is affiliated with Prime Minister Benjamin Netanyahu's
Likud party, began his trip on Tuesday with talks with Foreign
Minister Edward Nalbandian. "Minister Hanegbi noted that Israel wants
to develop friendly relations with Armenia and this is the main
message of his visit," the Armenian Foreign Ministry said in a

The two men signed agreements on avoidance of double taxation and
mutual lifting of visa requirements for holders of Armenian and
Israeli diplomatic passports. The Israeli cabinet member also signed a
separate document on bilateral cultural exchanges with Armenia Culture
Minister Armen Amirian.

Karapetian told Hanegbi that Yerevan too would like to boost
Armenian-Israeli ties when they met on Wednesday. "The interlocutors
exchanged views on the prospects of economic relations and business
contacts between Armenia and Israel," read a statement issued by the
prime minister's office.

Armenia - Prime Minister Karen Karapetian meets with Israel's Minister
of Regional Cooperation Tzachi Hanegbi in Yerevan, 26Jul2017.

Karapetian was also reported to say that his government is interested
in attracting Israeli investments in various sectors of the Armenian
economy and information technology (IT) in particular. Transport and
Communications Minister Vahan Martirosian said technology centers
operating in Armenia "would be happy to host Israeli IT companies"
during his separate talks with Hanegbi held earlier in the day.

According to official Armenian statistics, Armenia's trade with Israel
stood at a modest $8.5 million in 2016.

Relations between Armenia and Israel have been frosty ever since the
Soviet collapse, reflecting conflicting geopolitical priorities of the
two states. Armenia has maintained a warm rapport with Iran to ease
its geographic isolation, while Israel has pursued strategic
cooperation with Turkey and Azerbaijan.

Armenia has been particularly worried about Israel's large-scale arms
deals with its arch-foe, Azerbaijan. In 2012, Israeli defense
officials confirmed a reported deal to provide the Azerbaijani
military with more weapons worth a combined $1.6 billion. The
Azerbaijani army used some of these Israeli-made weapons, notably
sophisticated anti-tank rockets, during April 2016 hostilities in

Israel's current Defense Minister Avigdor Lieberman is a staunch
backer of close ties with Baku. Lieberman reportedly reaffirmed last
December his support for Azerbaijan's "territorial integrity and
inviolability of borders" in the Karabakh conflict.

Hanegbi, who held key security positions in the Israeli cabinet in
2003-2006, declined to comment on the Israeli arms supplies to
Baku. "My trip here is concentrated on positive sides of enhancing the
relationship between our countries," he said.

According to the Foreign Ministry statement, Hanegbi presented
"Israel's approaches to regional developments" at the talks with
Nalbandian. The latter briefed the Israeli minister on international
efforts to end the Karabakh conflict.

Nalbandian did not meet with any Israeli cabinet members when he
visited Israel in March 2015 to attend a concert by the Jerusalem
Symphony Orchestra dedicated to the 100th anniversary of the Armenian
genocide. Nalbandian again flew to Jerusalem in March this year to
take part in official ceremonies marking the completion of restoration
works at the Church of Holy Sepulcher. He held no talks with Israeli

Government Vows To Liberalize Armenian Energy Sector

 . Artak Hambardzumian

Armenia - Officials hold a ground-breaking ceremony for the
construction by an Italian company of a new power plant in Yerevan,

The government plans to liberalize Armenia's energy sector in hopes of
attracting large-scale investments from U.S. and other foreign
companies, a senior official in Yerevan said on Wednesday.

"The government has initiated a process of energy market
liberalization," Deputy Minister of Energy Infrastructures Hayk
Harutiunian told RFE/RL's Armenian service (Azatutyun.am). "We have
already presented a plan of actions which will ensure that the energy
sector switches to a new, liberal model by 2021."

The U.S. ambassador to Armenia, Richard Mills, stated last month that
U.S. energy firms could invest as much as $8 billion in the sector if
the authorities in Yerevan open it up to competition and remove all
obstacles to electricity exports to neighboring Georgia and Iran.

Harutiunian dismissed suggestions that Mills made a case for reducing
Armenia's heavy dependence on Russia for energy. "I believe that the
ambassador definitely meant the process of energy market
liberalization which we have initiated. The energy market is
completely regulated and there is no free competition there right

"The $8 billion figure was an estimate made by our ministry mainly
about the commercially viable potential in the area of solar energy,"
argued the official. "That potential can certainly be realized. But it
will be realized in a phased manner and that will greatly depend on
international prices."

"There are regular meetings with the U.S. ambassador and American
companies on finding formats for expanding American companies'
activities in Armenia's energy sector," he added.

Harutiunian noted that one U.S. company, ContourGlobal, already
privatized Armenia's largest hydroelectric complex two years ago in a
$250 million deal strongly backed by the U.S. government. Also, he
said, an Italian company started building a thermal power plant in
Yerevan in March.

Armenia - A hydroelectric plant in Syunik which is part of the Vorotan
Hydro Cascade, 11Nov2013.

Russian natural gas and nuclear fuel generate at least 60 percent of
Armenia's electricity. In addition, Russia's Gazprom monopoly owns the
country's gas distribution network. Another Kremlin-controlled energy
giant, Inter RAO, owned the Armenian national electric utility until
selling it to an Armenian-born billionaire in 2015.

And just last month, the RusHydro group also controlled by the Russian
government reaffirmed its intention to sell off Armenia's second most
important hydroelectric complex belonging to it.

The European Union is also supporting greater use of renewable energy
in Armenia. As part of that effort, the EU Delegation in Yerevan
installed two solar-powered bus stops in Yerevan earlier this
month. The delegation chief, Piotr Switalski, said the EU is thereby
"contributing to Armenia's energy independence."

Harutiunian insisted that Switalski did not seek to convey any
geopolitical messages to the Armenian government. "The development of
renewable energy must not be viewed only through the prism of energy
security," he said. "It should also be viewed in terms of cutting
prices and measures taken against climate change. So I don't think it
is appropriate to politicize such statements."

The official added that more than 100 small solar power plants are
already operating in Armenia.

Armenian Villagers Oppose Gold Mining Project

 . Karine Simonian

Armenia - Residents of Ardvi village protest against a private
company's plans to mine gold in the area, 26Jul2017.

Dozens of residents of a village in Armenia's northern Lori province
blocked a local road on Wednesday to protest against an obscure
private company's plans to mine gold near their community.

They fear that the project, if implemented, will wreak havoc on the
local ecosystem by contaminating forests and pastures surrounding
their village of Ardvi. They say that open-pit mining there will also
scare away tourists visiting 10th century shrines located Ardvi.

The company in question, called Miram, has so far divulged few details
of its plans to develop a gold deposit located in the mountainous
area. It has yet to secure government permission for the proposed
mining operation.

Armenian law requires companies seeking mining licenses, among other
things, to hold public hearings in communities that would be affected
by their operations. Miram planned to hold such a discussion on

The protesting villagers thwarted the procedure by blocking a road
leading to Ardvi and defying police officers' calls to unblock
it. "Our gold is our nature," said one of the angry protesters.

"Their aim is to destroy our village. We won't allow any hearing,"
cried another villager.

Representatives of Miram never showed up. The company's shareholders
until now included Arayik Zadoyan, the manager of a restaurant in the
provincial capital Vanadzor. The restaurant belongs to Vahram
Baghdasarian, the parliamentary leader of the ruling Republican Party
of Armenia (HHK).

Zadoyan claimed on Wednesday that he no longer holds a stake in
Miram. He said that the company is controlled by one of his friends
based in Russia.

Press Review

Margarit Yesayan, a parliament deputy from the ruling Republican Party
of Armenia (HHK), tells "Aravot" that only a handful of opposition
figures are calling for Armenia's withdrawal from the Russian-led
Eurasian Economic Union (EEU). "It would be unserious to change our
foreign policy just because of some proposal," she says. "It is too
early to summarize the results of our membership in the EEU. Let us
acknowledge that the organization is still establishing itself and
many issues are solved right now, with our participation." She also
points to Armenia's rising exports to Russia and other EEU member

"Hayots Ashkhar" says that this stage the U.S., Russian and French
co-chairs of the OSCE Minsk Group can reach a settlement acceptable to
all parties to the Nagorno-Karabakh conflict, impose a particular
solution on them or maintain the status quo. The paper believes that
the latter scenario is the most realistic one is the existing
circumstances, saying that Azerbaijan is not prepared for a compromise
solution and that the United States and Russia are too mistrustful of
each other to jointly force the parties to accept a peace accord.

"Government representatives themselves have rung alarm bells over the
demographic situation in Armenia of late, even though they had for
years countered experts and civil society activists who spoke about
the sad demographic situation in Armenia," writes "Hraparak." The
paper notes that President Serzh Sarkisian personally expressed
concern about the problem when he addressed the National Assembly in

(Tigran Avetisian)

Reprinted on ANN/Armenian News with permission from RFE/RL
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