Author: Chatinian Lara

BILL "ON FORMATION AND RESIGNATION OF GOVERNMENT" HAS MANY SHORTCOMINGS, RA NA SPEAKER CONSIDERS MEANWHILE PROPOSING ADOPTING IT IN FIRST READING

Noyan Tapan
Feb 06 2007

YEREVAN, FEBRUARY 6, NOYAN TAPAN. At the February 6 sitting RA
National Assembly in first reading discussed the bill "On Formation
and Resignation of Government." The adoption of the latter proceeds
from 2005 constitutional amendments.

As RA NA Speaker Tigran Torosian said in his speech, the bill presented
by the government contains only some parts from Constitution’s
provisions relating to the matter, while it should have contained the
constitutional approach rendering more concrete the mechanisms. In his
words, it is unacceptable that the principles and order of government’s
formation are not stipulated by the draft, but in consideration of
lack of time in connection with the May 12 parliamentary elections,
he proposed adopting in first reading "this draft having many
shortcomings" and revising it fundamentally until second reading.

According to the draft law, in case of government’s resignation the
government is formed by the President within 20 days’ term after
appointing a Prime Minister. While by the constitutional amendments
the President on the basis of distribution of deputy seats at NA
and consultations with deputy factions appoints as a Prime Minister
a person enjoying confidence among majority of MPs and if this is
impossible, a person having received simple majority of deputies’
votes.

According to another requirement of the Constitution, the Prime
Minister and Ministers should be RA citizens. But the main reporter of
the draft, RA Deputy Minister of Justice Gevorg Malkhasian stated that
the government proposed voting the draft without the above mentioned
provision until the law "On Citizenship" is adopted.

This proposal of government especially made indignant ULP faction
head Gurgen Arsenian who considered the above mentioned approach of
government to be strange, "containing undercurrent" and inadmissible
for him. In his words, exclusion of above mentioned provision from
the draft will become a subject of legal litigation in the future. He
threatened that he will vote against the bill if it is put to voting
in the above mentioned form.

Armenian Assembly of America
1140 19th Street, NW, Suite 600
Washington, DC 20036
Phone: 202-393-3434
Fax: 202-638-4904
Email: [email protected]
Web:

PRESS RELEASE
FOR IMMEDIATE RELEASE
February 5, 2007
CONTACT: Karoon Panosyan
E-mail: [email protected]

ADMINISTRATION BUDGET CALLS FOR $35 MILLION FOR ARMENIA
RENEWS MILITARY IMBALANCE WITH AZERBAIJAN

Assembly calls proposal fundamentally flawed

wASHington, DC – The Armenian Assembly today called the
Administration’s Fiscal Year (FY) 2008 budget request fundamentally
flawed with respect to funding levels for Armenia and Nagorno
Karabakh. It also protested the Administration’s renewed call for
military aid disparity between Armenia and Azerbaijan, which only
serves to undermine stability in the South Caucasus.

"The request for asymmetrical military assistance to Armenia and
Azerbaijan not only runs counter to what Congress has appropriated
in previous years, but also sends the wrong message to Armenia, an
important U.S. ally," said Bryan Ardouny, Executive Director of the
Armenian Assembly

Ardouny further stated that the Armenian Assembly will seek to
reverse this proposal and ensure parity. In its FY 2008 Budget,
the Administration proposed boosting Azerbaijan’s military financing
over Armenia’s by $2 million. In previous years, through the combined
efforts of the Armenian-American community and the Assembly, Congress
ultimately ensured security aid parity.

The Administration’s 2008 funding proposal for Foreign Military
Financing (FMF) calls for $4.3 million for Azerbaijan and only $3
million for Armenia. The proposed budget also suggests $1 million
for Azerbaijan versus $300,000 for Armenia in International Military
Education and Training (IMET) assistance.

The FY 2008 budget also recommended $35 million for Armenia in Freedom
Support Act (FSA) funding to "help implement economic and democratic
reform and fight corruption. FSA assistance will complement major
MCC resources for agricultural development."

"The House of Representatives last week approved FY 07 funding for
Armenia at the 06 level – nearly $75 million. This budget request
therefore represents more than a 50 percent reduction in assistance.
This is simply unacceptable," said Ardouny. "Further, despite
ongoing funding by Congress, the Administration fails to recommend
any assistance to Nagorno Karabakh. We will work with Congress to
correct the glaring deficiencies in the Administration’s request,"
Ardouny continued.

Today’s announcement is the first step in a lengthy process. The
next step is for the House and Senate to review the Administration’s
request through committee hearings, the first of which will take
place later this week when U.S. Secretary of State Condoleezza Rice
testifies before the Senate Foreign Relations Committee.

The Armenian Assembly is the largest Washington-based nationwide
organization promoting public understanding and awareness of Armenian
issues. It is a 501(c)(3) tax-exempt membership organization.

####

NR#2007-025

IN 2007 NON-OFFICIAL TRANSFERS WILL INCREASE BY 15-20%, CBA CHAIRMAN FORECASTS

Noyan Tapan
Feb 05 2007

YEREVAN, FEBRUARY 5, NOYAN TAPAN. According to the Central Bank of
Armenia (CBA), in 2006, the total amount of non-official transfers
(remittances by natural persons) from abroad to Armenia made 960 mln
USD, exceeding by 28% the 2005 index. The amount of such transfers
made through the banking system made 750 mln USD.

The CBA Chairman Tigran Sargsian said at the February 5 press
conference that it is forecast that the total amount of remittances
will increase by 15-20% in 2007 on 2006. These forecasts are based on
estamates about Russia’s high economic growth rate in 2007, as well
as on results of surveys in the US and Russia, according to which
Armenians working in these countries will increase their financial
transfers to relatives in Armenia.

In the opinion of T. Sargsian, the fact that the laws on migrant
workers were made stricter in Russia will not have an impact on the
amounts of remittances sent from this country to Armenia. He did not
rule out an inflow of remittances from Iran, Lebanon and Syria. He
mentioned that natural persons from these countries made non-regular
monetary transfers in 2005-2006 in connection with certain political
events.

According to T. Sargsian, the CBA will continue removing dollars from
the currency market in order to neutralize the effect of such an amount
of remittances (mainly of dollars) on inflation. The CBA will use the
dollars attracted to issue and place its own additional bonds. In his
words, in 2006, the price of removing excessive liquidity in this way
was 5% of the bonds’ value. "We pay this price for ensuring financial
stability," T. Sargsian said.

ARMENIAN DEPUTY MINISTER: ARMENIA NEVER POSED NATO MEMBERSHIP AS ITS TASK

Regnum, Russia
Feb 5 2007

Military reform is rife in Armenia, Armenia’s Deputy Defense Minister
Artur Agabekyan announced at a panel in Yerevan, called "Strengthening
of Civil Control over Security Sector."

According to him, reforming the defense system supposes first of
all changing the legislation, as the current legislation does not
correspond the reality and future putting limits on democratization
and modernization of the Armed Forces.

Meanwhile, talking to reporters, Agabekyan noted that Armenia
has never set as its task directing these reforms towards NATO
membership. Armenia pursues a complimentary policy and one of
manifestations of such policy is cooperation with NATO as well as
with CSTO and this cooperation is aimed at modernizing Armenia’s
defense system. He also noted that despite some statements there are
no concepts like "NATO weapons" or "NATO structure." "The country is
powerful that has its own standards and can do so that the standards
can be comparable with partners’ standards," he concluded.

ARMENIAN TRADE DEFICIT UP 44% IN 2006

Interfax News Agency
Russia & CIS Business and Financial Newswire
February 5, 2007 Monday 10:32 AM MSK

The Armenian trade deficit in 2006 amounted to $1.19 billion, up 44%
from 2005.

A source in the Armenian National Statistics Service told Interfax that
the republic’s foreign trade in the reporting period increased 15.2%
to $3.198 billion, including $2.194 billion in imports (up 21.8%),
and exports $1.004 billion (up 3.1%).

Trade with the European Union in 2006 increased 13.9% to $1.093
billion, and with the CIS – 28.4% to $911 million, with other countries
trade amounted to $1.194 billion.

The main buyers of Armenian products are Germany (14.7% of total
exports), the Netherlands (12.6%), Russia (12.1%), Belgium (10.8%),
Israel (10.6%), Switzerland (7.2%), the U.S. (6.5%), and Georgia
(5.4%).

The main importers into Armenia are Russia (13.9% of total imports),
Turkmenistan (7.7%), Ukraine (7.5%), Germany (6.6%), Belgium (5.5%),
Iran (5.2%), China (5.1%), the U.S. (4.9%), and Israel (4%).

Agency WPS
What the Papers Say Part B (Russia)
February 2, 2007 Friday

NATO MOVES IN ON ARMENIA

by Yuri Simonian

Armenia remains Russia’s ally in the southern Caucasus; A seminar on
Armenian Defense Ministry reforms, scheduled to take place in Yerevan
on February 5-7, will also discuss the prospects of NATO membership
for Armenia. This announcement implies that Russia is about to lose
its primary – if not its only – ally in the Caucasus.

BODY:

A seminar on Armenian Defense Ministry reforms, scheduled to take
place in Yerevan on February 5-7, will also discuss the prospects of
NATO membership for Armenia. This announcement from the George
Marshall European Center for Security Studies implies that Russia is
about to lose its primary – if not its only – ally in the Caucasus.

Official Yerevan responded to the news with a categorical denial. "It
doesn’t bear any resemblance to reality. Armenia’s foreign policy
agenda doesn’t include the issue of NATO membership," Defense
Ministry Press Secretary Colonel Sejran Shahsuvarian said. According
to Shahsuvarian, the seminar organized by the Marshall Center will
take place in Yerevan indeed. Those present will discuss the planned
amendments to the law "On defense" and employment of civilians by the
Defense Ministry. Moreover, NATO at the seminar is going to be
represented only by several Bulgarian, Estonian, and Latvian experts.
"We sent a note to the Marshall Center on Thursday morning demanding
an explanation of what is clearly a false information. We haven’t
received any answer so far," Shahsuvarian said. Chief of the Defense
Ministry PR Department Vrej Israelian hopes that the explanations
will be exhaustive. "No, I don’t know who might have needed this
false report made," he said.

However, there certainly must be something here because Russia’s
strategic partner in the southern part of the Caucasus has
intensified its dialogue with NATO. A NATO evaluation commission is
in Yerevan at present, inspecting compliance with Armenia’s IPAP
commitments. The fifth team of Armenian peacekeepers was dispatched
to Iraq in late January. At about the same time the government of
Armenia told the Defense Ministry to go ahead and discuss
organization of Joint Effort 2007, an international military exercise
on the territory of Armenia, with the US Defense Department and US
Army European Command. Last but not least, Armenia will join the
Ukrainian-American Sea Breeze 2007 exercise as an observer on March
13-15.

Nora Gevorkian, an expert in NATO activities in the southern part of
the Caucasus, ascribes the interests in reports on Armenia-NATO
contacts to their virtual absence until recently. "NATO was
associated with Turkey, Alliance member since 1952. Turkey’s policy
of the blockade was regarded as the policy of NATO itself," Gevorkian
wrote in her report. Everything changed in 2000 when Armenia found an
ally in NATO (Greece) which helped it form a battalion of
peacekeepers for UN operations. "NATO membership is not on the
agenda. Pragmatic as it is in evaluation of the regional security and
its shape, Armenia is advancing its relations with NATO step by step.
By and large, the republic is pursuing the policy of integration into
European structures. NATO is regarded as the leader in European
security," she said. Defense Minister Serj Sarkisian was quoted as
saying recently, "Relations with NATO will advance until appearance
of a collision between our commitments within the framework of the
CIS Collective Security Treaty Organization and NATO."

The canard the Marshall Center launched may be viewed as a message to
the Armenian authorities from the Western community, according to
Stepan Safarian, Director of the Center of National and Strategic
Studies. "With the elections coming up, the West a clear answer from
the Armenian authorities: does Yerevan aspire to NATO membership or
does it not? I don’t think that Yerevan will answer with a yes."
Parliament Speaker Arthur Bagdasarian’s statement in public that the
future of Armenia was inseparable from NATO cost him his job.
President Robert Kocharian is pro-Russian," Safarian said. On the
other hand, the Armenian authorities’ proclamation of the willingness
to join the European Union put Armenia in a tight corner in its
relations with NATO. The IPAP is something Yerevan was compelled to
launch. However, Georgia’s determination to join NATO (and its
potential entry in 2009) will certainly change things at the regional
level. "And yet, believing that Yerevan will necessarily turn in the
direction of Brussels in this eventuality is naive," Safarian added.

Source: Nezavisimaya Gazeta, February 2, 2007, pp. 1, 6

Translated by A. Ignatkin

Turkish Ambassador worried about discussion of the Genocide bill in
the US Congress

ArmRadio.am
02.02.2007 16:23

`If the US adopts a decision on the Armenian Genocide directed against
Turkey, it will cause great tension,’ Turkish Ambassador to Azerbaijan
Huseyin Avni Karslioglu said, Trend reports. He noted that `Turkey is
making necessary precautions to avoid such tension and believes it
will not occur.’ The Ambassador did not respond to the question
whether official Ankara will manage to suspend military and economic
relations with Washington if the US Congress recognizes the Armenian
Genocide.’

Petroleum Economist
February 1, 2007

PIPELINES; IRAN LISTENS FOR PIPES OF PEACE.

Tehran is hoping that its energy customers’ need for oil and gas will
override adverse circumstances – prices and politics are stalling
progress, reports James Gavin.

As far as Iran’s aspirations to become a significant gas exporter are
concerned, 2007 started inauspiciously. Blaming exceptionally cold
weather, the government had to apologise to neighbouring Turkey for
peremptorily curtailing piped gas exports for four days in early
January.

Iranian gas supplies to Turkey, the only country to which Iran
exports at present, have fluctuated in recent months and fell to just
7m cubic metres a day (cm/d) in December – well below the contracted
rate of 24m cm/d. If the Islamic Republic is finding it difficult to
keep up supplies to a long-standing customer such as Turkey, then
what chance would it have of meeting other export commitments? That
question has been thrown into sharp relief by the inclement political
climate; the US government has adopted an increasingly aggressive
tone towards Tehran in recent months.

It is little surprise that plans for a 2,700 km, 150m cm/d overland
pipeline to India, traversing Pakistan, are not proceeding smoothly.
The scheme has faced two serious political obstacles: first, India is
uncomfortable about the prospect of Pakistan, as a transit country,
being granted control over its gas supply.

Second, the US government, turning the political screws on Iran over
its alleged uranium-enrichment programme, has also taken against the
Iran-Pakistan-India gas pipeline scheme. In March 2006, President
George Bush offered India access to civilian nuclear-power technology
as an inducement to drop the pipeline scheme.

The political tide in India has also turned against the plan to
import Iranian gas, with the former oil minister, Mani Shankar Aiyar
– the foremost proponent of the pipeline – removed from office just
before Bush’s visit. An alternative, a 2,000 km offshore scheme that
would avoid Pakistani territory, has faced considerable technical
obstacles, given that water depths are up to 3,000 metres.

Disagreements over pricing have also presented an obstacle. In
August, Iran offered India a price linked to Dated Brent crude that
equated to about $8/m Btu. But India was prepared to go only as high
as $4.25/m Btu.

Iranian officials have become increasingly impatient with the lack of
progress in recent months. A new round of talks is planned between
Indian and Iranian officials, but Tehran is not optimistic. The
Iranian government has asked UK consultants Gaffney Cline to devise a
pricing mechanism for the project, but India and Pakistan have said
they will not accept the price that the consultancy puts forward,
according to Ali Arrehchi, an oil and gas analyst at Atieh Bahar, a
Tehran-based consultancy.

Iran is now threatening to abandon talks and use the gas allocated
for the India pipeline project for a liquefied natural gas (LNG)
export plant, or even for domestic consumption. But given India’s
urgent need for Iranian gas, this might force New Delhi to compromise
on price.

These setbacks have not reduced Iran’s interest in gas-export
schemes. The government has looked on enviously as Qatar and Oman
have won large shares of the east Asian gas market by developing
their LNG industries. However, while it would like to emulate their
success, Iran’s inability to use US-made liquefaction technology or
to work with US contractors is hampering its ability to roll out LNG
export projects – under the unilateral US sanctions, US companies are
unable to work or invest in the country.

Plenty of plans, no success

While Iran’s LNG plans have gone nowhere, it has also had very
limited success with gas-export pipelines. The most advanced proposal
is a 140 km link to neighbouring Armenia, which will pump just over
1m cm/y of Iranian gas from March, potentially rising to 5m cm/y. But
if Iran had any ambitions to use Armenia as a staging post for
forward exports to other countries, it has suffered a significant
setback: Gazprom, the Russian state-owned gas monopoly, has gained
control of the onward transmission system (PE 1/07 p4).

Other pipeline schemes have failed to make progress. The companies
hoping to develop the Nabucco route – from Turkey to Austria – which
envisages drawing Central Asian and Middle East gas to Europe, have
identified Iran as an important potential supplier. In 2004, OMV, the
Austrian oil and gas company, signed a memorandum of understanding
(MOU) with National Iranian Gas Export Company for the supply of up
to 25bn cm/y of gas to Europe through the proposed Nabucco pipeline.
But participating in this project appears to be beyond Iran’s
immediate capabilities.

Three possibilities for Iranian exports to Europe are being
discussed. These include: using the existing pipeline from the
northwestern city of Tabriz to Turkey; constructing a parallel
pipeline to Tabriz-Turkey route; or building an entirely new pipeline
based on reserves that are dedicated to the European market.

However, Iran itself appears uncertain that it will be able to meet
that commitment. In July, the deputy oil minister, Mohammad Hadi
Nejad-Husseinian, said that if the Iran-Pakistan-India gas pipeline
became operational, there would be no gas for export to western
Europe. In addition, the recent interruption in Iranian supplies to
Turkey, the proposed gateway for the Nabucco scheme, makes Iran
appear unreliable.

Plans for pipelines to Kuwait and the United Arab Emirates (UAE) have
also stalled, despite both projects, which would involve piping gas
through shallow waters close to existing production facilities, being
comparatively straightforward.

In March 2005, Iran and Kuwait signed an MOU for gas deliveries,
reaching 8.5m cm/d for 25 years starting this year. However, Kuwait’s
recent gas discoveries have reduced the country’s appetite for
Iranian imports (PE 12/06 p44); additionally, Kuwait, which has close
ties to the US, is under pressure not to strike deals with Iran.

A plan to supply the UAE with gas has also encountered problems. The
UAE’s Crescent Petroleum signed an MOU with Iran in 2001 to import
14.2m cm/d of gas by pipeline, but failed to agree a price. Six years
on, the two sides are still bickering. In December, the Iranian oil
minister, Kazem Vaziri Hamaneh, said his country would not export gas
to the UAE unless their proposed price was increased.

Embryonic schemes

There is also talk of gas exports to Oman and Bahrain, but these
schemes are embryonic and may well be derailed by the same obstacle –
price.

Tehran must also develop its own domestic Iranian Gas Trunkline
Network (Igat) in order to service the local market, which is growing
by 10% a year, and make various export schemes possible. The Igat
system consists of a series of pipeline links (see Table 1). Outside
Igat, a new 1,500 km pipeline link will send ethylene petrochemicals
produced at Assaluyeh and Bandar Abbas to the far north of the
country from 2007.

In June 2006, Khatam-ol-Anbia, the engineering unit of the Islamic
Revolutionary Guard was awarded a contract to build the Igat-7 link,
taking gas from Assaluyeh to Iranshahr and onward to Pakistan, using
gas from Phases 9 and 10 of the South Pars project. Ultimately, this
would service the Iran-Pakistan-India pipeline if it comes to
fruition.

However, the only realistic new gas-export schemes in the near future
are the pipeline projects to Armenia and Azerbaijan. The Armenia
route should be operational next month and bilateral talks with
Azerbaijan appear to be making progress – Baku recently said it has
accepted Iran’s price for gas supply.

PanARMENIAN.Net

Armenia capable to ensure Karabakhi people’s self-determination
31.01.2007 17:09 GMT+04:00

/PanARMENIAN.Net/ The Armenian side rates the proposals of the OSCE
Minsk Group as logical, Armenian Foreign Minister Vartan Oskanian said
in the Netherlands. In his words, the mediators’ proposals being
discussed at the moment are admissible for Armenia. `If the settlement
of the problem corresponds to the contents of the document we will
receive a solution not conflicting with our national interests,’ the
RA FM underscored. He also remarked that the Armenian authorities are
capable to ensure the self-determination of the people of Nagorno
Karabakh, its uninterrupted contact with Armenia and security. `These
three provisions are included in the document,’ Vartan Oskanian said,
reports the Armenian Public Television.

Arka News Agency, Armenia
Jan 30 2007

OSCE MG CO-CHAIRS SATISFIED WITH ARMENIAN, AZERBAIJANI PRESIDENTS’
STANCE ON KARABAKH PEACE PROCESS PRINCIPLES

YEREVAN, January 29. /ARKA/. The Co-Chairs of the OBeSE Minsk Group
are satisfied with the constructive stands of the Armenian and
Azerbaijani Presidents towards the main principles of the Karabakh
peace process says the joint statement of the Co-Chairs reported by
the U.S. Embassy to Armenia after the Co-Chairs’ visit to the region.

The Co-Chairs appreciated the efforts of all the interlocutors they
had met during the week.
"It is the responsibility of the presidents of Armenia and
Azerbaijan, with the assistance of the Co-Chairs, to find a lasting,
peaceful resolution of the Nagorno-Karabakh conflict. The presidents
are defending their national interests vigorously, and they are doing
so in a way that allows the peace process to continue moving
forward," says the statement.
The Co-Chairs urged all parties to sustain the momentum in the
negotiations and to prepare their publics for the necessary
compromises. At the same time, the Co-Chairs urged continued pursuit
of confidence-building measures and maintenance of the ceasefire to
increase the level of trust and understanding between the sides.
The Foreign Ministers of Azerbaijan and Armenia Vardan Oskanyan and
Elmar Mamediarov held negotiations on January 23 in the presence of
the Russian Foreign Minister Sergey Lavrov and facilitated by the
Co-Chairs of the OSCE Minsk Group Yuri Merzlyakov (Russia), Bernard
Fassier (France) and Matthew Bryza (United States)
The Co-Chairs met with Azerbaijani President Ilham Aliyev in Baku on
January 24. On January 25, they travelled to Nagorno-Karabakh to meet
with the leader of Nagorno-Karabakh Arkady Ghukasian. The Co-Chairs
met with the Armenian President Robert Kocharian in Yerevan on
January 26. N.V. -0–