MIXED MEDIA VIEWS OF PROPOSED RUSSIAN VENTURES
by Haroutiun Khachatrian
Transitions on Line, Czech Rep.
Feb 20 2007
Russian proposals for major new investments arouse a flurry of
speculation in the Armenian press, some hopeful, some skeptical. From
EurasiaNet.
Several weeks after the announcement of ambitious plans for stepped-up
Russian investment in the Armenian economy, Armenian media outlets and
political analysts are still searching for details on the envisioned
projects. Speculation is centering on a plan to build a refinery in
Armenia that would process Iranian oil.
News of the investment plans first surfaced at an informal meeting
on 24 January between Russian President Vladimir Putin and Armenian
President Robert Kocharian at the Russian Black Sea resort town of
Sochi. Putin announced during the meeting that Russian companies were
ready to invest some $800 million over the next two years, an amount
equal to all Russian investment in Armenia for the past decade.
"Too bright to be feasible," commented the Russian-language Golos
Armenii (Voice of Armenia) newspaper on 1 February, summarizing
the general mood of most reporters and onlookers following the Sochi
summit. The bulk of information about this flood of investment came two
days later, via an article published in the Russian daily Kommersant,
a publication known to have well-placed Kremlin sources.
A plan to construct an oil refinery near the southern Armenian town
of Meghri that would process oil exported from Iran and then sell it
back is potentially the most controversial of the projects.
Kommersant argued that, though the project would be far from
commercially viable, Moscow is determined to implement it for
"political" reasons, including the need to establish backup oil
refineries in case refineries in Iran are destroyed in potential U.S.
military strikes.
On 5 February, the Arminfo news agency quoted Armenian Energy Minister
Armen Movsisian as saying that he expected to visit Tehran "in the
near future" to discuss the Meghri project, and that feasibility
studies for the project are underway in Armenia.
In a 29 January press conference, Armenian presidential press secretary
Viktor Soghomonian held a briefing to correct and comment on the
information published earlier by the Russian newspaper.
Soghomonian confirmed the existence of the refinery project, and
that Armenia will partner with Russia and Iran in the venture. Work,
however, remains in the early stages, he said. Soghomonian termed
"inflated" Kommersant estimates that the refinery would cost $1.7
billion to build, plus require another $1 billion for a pipeline and
railroad to connect Meghri with the Iranian city of Tabriz.
Russian companies have also expressed interest in atomic energy
development in Armenia, according to the newspaper. On 6 February,
Movsisian told the National Assembly that since Armenia is one of
the few countries in the world with excess uranium reserves, the
interest of Russia, which does not possess such stores, is "quite
natural," the newspaper Hayastani Hanrapetutiun reported. Soghomonian,
however, rushed to assure reporters that this interest does not mean
that Armenia will start uranium enrichment. Both countries, he said,
share an interest in starting uranium extraction in Armenia to produce
nuclear fuel for Armenia’s nuclear power plant.
Russian companies already in Armenia – telecommunications company
Vympelcom, energy giant Gazprom, and Russian Railroads – were
reportedly also geared to make large investments in the Caucasus
nation, but information about these or other investment plans remains
sketchy. Not surprisingly, local specialists are reluctant to comment
on the trend, while media analyses are dotted with references to
unnamed "sources" and "experts."
"It is evident that a complex bargain took place in Sochi, concerning,
among other things, future internal developments in Armenia," a former
highly-ranked government official, who did not want his name to be
disclosed, told EurasiaNet. "But it is impossible even to speculate
about the details."
Opposition-oriented media are inclined to treat these plans as mere
propaganda. In an article entitled "Another Fairy Tale," the newspaper
Haykakan Zhamanak wrote on 31 January that shocking projects like the
refinery for Iranian oil are simply used to bolster support for the
current Armenian leadership on the eve of the 12 May parliamentary
elections. The refinery project was first raised in 2002 by Mikhail
Kasyanov, the Russian prime minister at the time.
Coincidentally, Kasyanov’s comments on refinery possibilities came
during the run-up to general elections in Armenia, the newspaper
noted. Chorrord Ishkhanutiun, a newspaper close to the opposition
Armenian National Movement of former president Levon Ter-Petrossian,
wrote in its 30 January issue that the Russian promises are just
another enticement for Armenia to reject any compromise over the
disputed territory of Nagorno-Karabakh, and to remain a Russian
"outpost," isolated from all of its neighbors.
While certainly cautious, some opposition newspaper commentaries
contained elements of optimism. For example, in its 6 February issue,
Iravunk, also an opposition newspaper, argued that a long-term goal of
the Meghri project may be to stimulate construction of a north-south
transportation corridor to counter those running from east to west
(such as the Kars-Akhalkalaki-Tbilisi-Baku railway), which will
operate beyond Moscow’s control. The newspaper quotes Oleg Maksimov,
an analyst at the Russian investment firm Troika Dialogue, as saying
it is "too early" to see a political motive behind the Meghri refinery
since "[t]here is a shortage of oil refining capacities worldwide,
and they [may] all eventually become profitable."
For its part, Golos Armenii, in its 1 February commentary, implies
that holding a democratic vote on 12 May could prove the surest way
to overcome any outside objections and make the Meghri project a
reality. "If a fully democratic procedure is performed in Armenia, it
would ensure not only fulfillment of the [U.S.] ‘Millennium Challenge’
program, but would provide also missing political dividends needed
for having a breakthrough in Karabakh. … And then the idea of
constructing a refinery in Armenia may become quite realistic,"
the newspaper wrote.
Haroutiun Khachatrian is a Yerevan-based writer specializing in
economic and political affairs. This is a partner post from EurasiaNet.