RFE/RL Armenian Report – 06/06/2023

                                        Tuesday, June 7, 2023

Armenian Inflation Falls Sharply

        • Robert Zargarian

Armenia -- Shoppers at a supermarket in Yerevan.

Annual inflation in Armenia fell from 8.6 percent in 2022 to just 1.3 percent in 
May this year amid significant drops in the prices of some food products and 
fuel, according to government data.

The Armenian Statistical Committee said on Monday that the national food price 
index was 2.1 percent down from May 2022, reflecting a worldwide trend. The 
government agency recorded roughly 20 percent decreases in the prices of 
vegetables, wheat and cooking oil. Fuel prices in the country likewise plummeted 
by an average of 25 percent year on year, it said.

This was offset by further sizable rises in the cost of services, clothing and 
other consumer goods. The continuing robust growth of the Armenian economy 
suggests that consumer demand for them remains strong.

Most people randomly interviewed on the streets of Yerevan on Tuesday said that 
they have not yet felt the effects of falling inflation on their well-being.

“Things are still expensive, very expensive, compared with last year,” one of 
them told RFE/RL’s Armenian Service.

“The cost of living has gone up,” complained another Yerevan resident.

“Inflationary pressures remain … and I think this explains why the Central Bank 
is in no rush to soften its [monetary] policy,” said Narek Karapetian, an 
independent economist.

The Armenian Central Bank has raised its benchmark refinancing rate by a total 
of 625 basis points since December 2020 in an effort to curb rising inflation. 
Despite expecting the inflation rate to remain below its annual target of 4 
percent in the months ahead, the bank has so far indicated no plans to cut the 

Armenian Gold Mine ‘Partially Operational’ Despite Azeri Gunfire

ARMENIA -- An Armenian army post just outside the Sotk gold mine on the border 
with Azerbaijan, June 18, 2021.

A senior Armenian official said on Tuesday that the country’s largest gold mine 
has not been fully shut down despite the recent cessation of open-pit operations 
there blamed on cross-border fire from Azerbaijan.

The Sotk mine, which employs more than 700 people and is located on the volatile 
border with Azerbaijan, was seriously affected by an upsurge in skirmishes 
between Armenian and Azerbaijani forces in mid-April. Its employees say that 
they have since repeatedly come under fire and been evacuated after trying to 
return to work.

In a statement issued last week, the Russian-owned company GPM Gold operating 
the mine announced that due to the continuing gunfire it has decided to “stop 
the operation of the open-pit mine” and put many of its workers on unpaid leave.

“We all knew that the open-pit section of the Sotk mine is going to be closed in 
the coming months,” said Karen Sargsian, the governor of Armenia’s Geghakunik 
province encompassing Sotk. “But due to the recent security problems its 
operations there were halted [earlier than planned.] But the operations continue 
at the underground section.”

“The Sotk mine is partially working,” Sargsian told journalists in Yerevan. He 
did not say how many GPM Gold workers have retained their jobs.

The GPM Gold statement said nothing about the switch to underground mining at 
Sotk which was predicted by an Armenian deputy minister of local government and 
infrastructures earlier in May.

The company, which is part of Russia’s GeoProMining metals group, had already 
lost control over a large part of the mountainous area’s gold deposits following 
the 2020 war in Nagorno-Karabakh and the resulting Armenian withdrawal from the 
Kelbajar district bordering Sotk. This appears to explain why total taxes paid 
by it plummeted from 20.8 billion drams ($53 million) in 2021 to just 3.2 
billion drams in 2022.

U.S. To Host More Armenian-Azeri Talks

        • Ruzanna Stepanian

U.S. - U.S. Secretary of State Antony Blinken hosts talks betewen the Armenian 
and Azerbaijani foreign minsters in Arlington, May 4, 2023.

The Armenian and Azerbaijani foreign ministers will meet again in Washington 
next week for further U.S.-mediated talks on a peace treaty between their 

“We look forward to hosting another round of talks in Washington later this 
month as the parties continue to pursue a peaceful future for the South Caucasus 
region,” a U.S. State Department spokesman, Vedant Patel, said on Monday.

European Council President Charles Michel announced the Washington talks, 
scheduled for June 12, right after last Thursday’s meeting of Armenian Prime 
Minister Nikol Pashinian and Azerbaijani President Ilham Aliyev that took place 
in Moldova’s capital Chisinau. Michel indicated that their foreign ministers 
will prepare for another Armenian-Azerbaijani summit which he will host in 
Brussels on July 21.

Foreign Minister Ararat Mirzoyan and his Azerbaijani counterpart Jeyhun Bayramov 
reported major progress towards the Armenian-Azerbaijani peace treaty during 
four-day negotiations held outside Washington one month ago.

Aliyev and Pashinian tried to build on that progress when they held a trilateral 
meeting with Michel on May 14. The Armenian leader confirmed afterwards that he 
is ready to sign a peace deal that will uphold Azerbaijani sovereignty over 

The three men were joined by French President Emmanuel Macron and German 
Chancellor Olaf Scholz during the subsequent talks in Chisinau. They reported no 
concrete agreements.

The secretary of Armenia’s Security Council, Armen Grigorian, said over the 
weekend that the peace deal could be signed before the end of this year.

Hakob Badalian, a Yerevan-based political analyst, cautioned on Tuesday that 
despite Pashinian’s effective recognition of Karabakh as part of Azerbaijan the 
conflicting sides have yet to eliminate other sticking points. He argued that 
they still disagree on practical modalities of delimiting the 
Armenian-Azerbaijani border, an international framework for a dialogue between 
Baku and Karabakh’s leadership and international guarantees for the sides’ 
compliance with the peace treaty.

Baku’s approach to the border delimitation is very different from Yerevan’s, 
Badalian said, questioning Aliyev’s readiness to recognize Armenia’s territorial 

Mirzoyan admitted on Monday that Aliyev has still not publicly offered such 
recognition. “I hope that Azerbaijan’s leadership will come up with such words 
soon,” the foreign minister told the Armenian parliament.

Armenian opposition leaders say that Baku is reluctant to recognize Armenia’s 
existing borders even after Pashinian’s far-reaching concession on the status of 
Karabakh strongly condemned by them.

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