Author: Nalbandian Albert

GDP DOWN 18,5% FOR JAN-JULY 2009

ArmInfo
2009-08-20 20:39:00

ArmInfo. GDP in Armenia was down 18.5% over Jan-July 2009. In July
versus June, GDP was up by 6,3% to 1416 bln AMD ($4.043 bln), the
National Statistical Service of Armenia reported. The GDP index
deflator grew by 0.8% per year. By the end of July 2009 dollar/dram
exchange rate was fixed at 350,51 AMD/$1.

In Jan-July 2009 construction scales fell by 55.5% if compared with
the same period of 2008 (in July versus June construction grew 4,5%)
up to 178 bln drams ($507.4 mln). Retail trade turnover for Jan-July
2009 versus the same period of 2008 was up 0.1% (15,8% growth in July
versus June) up to 500.4 billion drams ($1.4 bln).

Electricity generation was down by 10.5% for Jan-July 2009 and up by
2.4% for July versus June and totaled 3268.5 mln kWh. Foreign turnover
was down by 32.7% over Jan-July 2009 as compared to Jan-July 2008
and up by 1.6% in July as against June, having amounted to $2013.4
mln or 707.9 bln drams. In the structure of foreign turnover, export
fell by 44,5% for Jan-July and grew by 15,6% for July. Import was
down by 29.5% for Jan-July and by 1.4% in July.

THE WALL STREET JOURNAL: KARABAKH DANGEROUS FOR EUROPE

News.am
19:44 / 08/21/2009

The geopolitical struggle for control over the energy carriers’ supply
to Europe is in a full swing, The Wall Street Journal daily writes:
"Tied to Russia’s Gazprom with a 25-year export agreement signed in
2003 and building a 40-billion-cubic-meter pipeline eastward to China,
Turkmenistan is unlikely to be in a position to produce additional
volumes by 2014. Even if this forecast is proved wrong, the unresolved
legal status of the Caspian Sea alongside Russia’s and Iran’s negative
stances on the issue mean the future of the Trans-Caspian pipeline
is rather blurry. This is why Azerbaijan began to be regarded as
the potential prime supplier of Nabucco by Brussels and Washington
earlier this year. However, even this option will present economic
and security challenges.

As the prime oil exporter in the Caspian region, Azerbaijan’s
production of this commodity will start falling from 2013-2014 and
there is a risk that by 2020 the country’s oil supply might not be
self-sufficient. If this happens, the use of gas in the domestic market
will increase significantly, especially in light of the government’s
goal of developing the non-energy sectors of the national economy,
which would leave smaller volumes available for Nabucco than currently
planned.

Ethno-political conflicts in the South Caucasus, such as the dispute
between Armenia and Azerbaijan over the Nagorno-Karabakh region,
pose fundamental risks to Europe’s efforts to diversify its energy
supply. With rapidly increased defense spending by Azerbaijan,
the intermediary powers-U.S., Russia, France and U.K.-are
trying to persuade the country not to resort to force under any
circumstances. This effort is rather futile. The Kosovo and Georgia
conflicts have already set a dangerous precedent. In today’s greater
Europe, successful self-determination may increasingly be achieved
through the use of force rather than principles of international
law or compromise. Therefore, with regard to Nagorno-Karabakh,
negotiators should focus on reconciling the principles of territorial
integrity and self-determination to achieve peace between Armenia and
Azerbaijan. This would open the doors for the former to participate
in transnational energy projects in the region."

THE RA PRESIDENT SEND A CONDOLENCE LETTER TO DMITRI MEDVEDEV

Aysor.am
TODAY, 12:23

The RA President Serzh Sargsyan sent a condolence letter to the
President of Russian Federation Dmitri Medvedev, the press office of
the RA president informs.

The letter reads: "I learnt with sorrow about the vandal blast in
Nazran on August 17, which became the reason of many innocent people’s
death and sufferings.

I condemn the realized terrorist act, which doesn’t have and can’t
have any justification."

President Sargsyan has expressed condolences on behalf of the Armenian
people and himself to the relatives and friends of the victims and
quick recovery to those who suffered because of the terrorist act.

CRISIS RECESSION IS NOT FOR ARMENIA

nomy&pid=14929
14:42:24 – 14/08/2009

The International Monetary Fund estimated the expenditures of the
states of the world on the struggle against the crisis in nearly 11
trillion. But despite the aid, the economic decline in Armenia in 2009
will be 15%. As noted on the official website of the international
rating agency Fitch , this is the third
worst expected result among the countries rated by the Agency.

As noted, the inflow of financial transfers into Armenia from abroad
(amounting to about 9% of GDP in 2008) drastically reduced. The
confluent of direct foreign investments in the first quarter of 2009
amounted to only 27 million, decreased by four times in relation to
the same period of the last year.

According to Fitch, as a result of the support from abroad the indexes
of the state and external debt of Armenia in 2009, sharply increased,
accompanied by a decline in GDP, exports and tax revenues.

In Russia, despite some increase in oil prices, the situation is
worsening. The outflow of capital increases, as the dollar, and a
new default is often spoken about.

The financier George Soros stated that the U.S. economy has reached
the lowest point, and in the current quarter, there will be positive
growth due to government incentive markets. Economic decline has
ceased in France and Germany. In the period from April to July,
the economy of both countries, the most industrialized in the EU,
showed growth of 0,3%, coming out of recession.

In the first half, the GDP in Karabakh increased by 16.2%. Moreover,
the volume of construction increased by 71.8%, compared to the same
period in last year.

ARMENIAN AND GREEK AGAINST TURKISH MASSACRES

News.com
12:37 / 08/14/2009

Greece and Cyprus intend to raise the question on 1974 massacres of
Greek war prisoners in Turkey on European Council agenda. The matter
concerns prisoners in Turkish captivity during the partial occupation
of the island by Turkish military troops.

The remains were found in Serdarli village of Turkish Republic of
Northern Cyprus. The Turkish Hurriyet daily reports: "Marios Karoyan
(President of Greek House of Representatives) and Dimitris Sioufas
(Greek Parliament Speaker) made a decision on joint cooperation for
drawing Europe’s attention to the issue." They intend to put the issue
on CoE agenda. Cyprus DISI Party MP Christos Pourgourides offered CoE
Secretary General Terri Davis to demand Turkey’s explanations on the
prisoners’ extermination. Greeks support their charges by showing
photos and presenting testimony of reporter Ergin Konukser who was
in Greek captivity in 1974. The latter stated that: "Greek prisoners
were killed by Turkish Mujahidins, not Turkish soldiers."

RUSSIAN AND GERMAN LEADERS TO DISCUSS KARABAKH ISSUE

News.com
13:07 / 08/14/2009

Russian and German leaders plan to discuss stimulation of peace process
in the Middle East, regional conflicts settlement, in particular
Nagorno-Karabakh and Russian-Georgian conflicts, Russian mass media
reports, referring to the governmental source.

August 14, Federal Chancellor of Germany Angela Merkel will arrive
in Russia on a working visit at the invitation of Russian President
Dmitry Medvedev. Russian-German informal summit will take place in
Sochi, Russia.

TALDF TAKES ACTION AGAINST OFFENSIVELY-NAMED PRODUCT
NEWELL RUBBERMAID INC. AGREES TO STOP USING ANTI-TURKISH TERMINOLOGY

Washington, DC, June 4, 2009 – Alerted by a Turkish American that
distributors of Rubbermaid Commercial Products were selling an item
called a "Turk’s Head Toilet Bowl Brush," on April 7 the TALDF
contacted the manufacturer, Newell Rubbermaid Inc., protesting the
product name and calling for it’s use to cease. In our letter, linked
below, we noted that such a product name, "evokes an image highly
unflattering to any person who may consider him or herself a Turk. The
slur is not subtle: a toilet bowl brush being named after any race or
ethnicity ought to be considered insulting." We added that such
terminology is not only, "infuriating and hurtful to Turkish
Americans," it also "encourages ethnic prejudices and bigotries that
ill-serve our diverse and democratic society."

Two weeks later, Newell Rubbermaid responded, largely agreeing with
the TALDF’s position and vowing to make amends. It pledged to,
"educate [its] marketing and sales associates of the potential
derogatory connotations associated with the terminology…." The TALDF
commends Newell Rubbermaid for its quick and sensible response. The
TALDF, acknowledging that the complete cessation of this term will not
occur overnight, will follow up with the company periodically to judge
whether its efforts have been sincere and result in the the withdrawal
of the insulting term.

TALDF’s Letter [ ] | Newell’s Response to TALDF [ ]

MOBILE OPERATORS SEEING DECLINES; MBT, VIP, DT, BT

Learning Markets
Tuesday, 11 August 2009 08:22

Mobile TeleSystems OJSC (MBT), the largest mobile phone operator in
Russia and the Commonwealth of Independent States, on Tuesday reported
a 14.6% year-over-year decline in profit for the second quarter
as quarterly revenues dropped 23.3%. The results for the latest
quarter were negatively impacted by operating results from four of
the company’s major operating regions Russia, Ukraine, Uzbekistan
and Turkmenistan.

In a statement, president and chief executive officer, Mikhail
Shamolin said, "The Company demonstrated sound results during the
quarter on the back of seasonal and organic growth. Despite continuing
macroeconomic volatility in Russia and the CIS, strong subscriber
additions, a seasonal increase in usage and on-going cost saving
initiatives facilitated quarter-on-quarter revenue growth and higher
operating margins."

Moscow, Russian Federation-based Mobile TeleSystems or MTS, which
provides GSM services in the regions of Russia, as well as Armenia,
Belarus, Turkmenistan, Ukraine, and Uzbekistan, reported consolidated
net income of $563.04 million or $0.30 per share for the second
quarter, lower than $659.20 million or $0.34 per share in the
prior-year quarter.

On average, analysts polled by Thomson Reuters expected earnings of
$1.32 per share for the second quarter. Analysts’ estimates typically
exclude special items.

Consolidated revenues for the quarter declined 23.3% to $2.02 billion
from $2.64 billion in the same quarter last year, and topped three
Wall Street analysts’ consensus estimate of $1.98 billion.

Amongst others in the industry, another Russian telecommunications
service provider Vimpel-Communications (VIP) is scheduled to announce
financial results for the second quarter on August 27.

Last Thursday, German telecommunications giant Deutsche Telekom AG
(DT) reported a 32.2% rise in second-quarter profit, reflecting strong
international revenue growth benefited mainly by contribution from the
Greek acquisition OTE. Meanwhile, domestic revenues declined 5.1% from
the previous year and mobile customer additions plunged 25.9%. Further,
Deutsche Telekom confirmed its forecast for fiscal 2009.

British communications solutions and services provider BT Group Plc
(BT, BT-A.L) last week reported that first-quarter profit declined
to GBP 214 million from the GBP 381 million last year, as BT Global
Services subsidiary posted an operating loss. On an adjusted basis,
profit fell to GBP 244 million from last year’s profit of GBP 400
million. Reported earnings per share decreased 43% to 2.8 pence
from 4.9 pence in the previous-year quarter, while adjusted earnings
per share declined 18% to 4.2 pence from 5.1 pence in the prior-year
quarter. For the quarter, revenue edged up 1% to GBP 5.24 billion from
GBP 5.18 billion including favorable foreign exchange movements and
impact of acquisitions. Excluding these, underlying revenue decreased
by 3% from last year.

Service revenue and connection fees for the second quarter dropped
to $1.96 billion from $2.63 billion in the year-ago quarter. Sales of
handsets and accessories soared to $64.27 million from $4.90 million
in the same quarter last year.

Segmental Details Operating income from Russian operations declined to
$463.6 million or 29.2% of revenues, from $701.4 million or 34.7% of
revenues, in the year-ago quarter. MTS added 2.3 million subscribers
in Russia and maintained its market share at 34%, with a churn rate
of 6.9%.

Operating income from Ukraine operations totaled $29.2 million or 11.3%
of revenues, sharply down from $91.4 million or 21.1% of revenues,
in the same quarter last year. During the quarter the company churned
155 thousand subscribers and market share was 33%, with a churn rate
of 9.7%.

At Uzbekistan operations, operating income for the quarter decreased
to $31.9 million or 32.8% of revenues, from $42.8 million or 46.0%
of revenues, in the prior-year quarter. The company added 0.6 million
customers and market share was 45%, with a churn rate of 7.1%.

Operating income from Turkmenistan operations declined to $14.3 million
or 37.9% of revenues, from $17.9 million or 52.1% of revenues, in the
corresponding quarter a year ago. The company added about 128 thousand
subscribers and market share was 85%, with a churn rate of 5.8%.

At Armenia operations, operating income was $9.2 million or 17.5% of
revenues, up from $3.8 million or 6.1% of revenues, in the year-ago
quarter. The company lost an insignificant number of subscribers and
market share was 81%, with a churn rate of 10.4%.

MTS added about 60 thousand subscribers at its Belarus operations
during the quarter, with a market share was 50%, and churn rate
of 5.6%. MTS owns a 49% stake in Mobile TeleSystems LLC, a mobile
operator in Belarus.

Other Metrics MTS’ net operating income for the second quarter
dropped 36.1% to $548.11 million or 27.1% of revenues, from $857.24
million or 32.5% of revenues, in the prior-year quarter. The company
organically added about 2.8 million new customers during the second
quarter. Total subscribers eop rose to 99.51 million from 90.97
million in the comparable quarter a year ago.

Sales and marketing expenses for the quarter decreased to $178.07
million from $227.13 million in the prior-year quarter, and general
and administrative expenses was $336.91 million, lower than $391.05
million in the year-ago quarter. However, cost of handsets and
accessories soared to $81.28 million from $28.60 million in the same
quarter last year.

Currency exchange and transaction gains for the quarter was
$197.65 million, sharply up from $30.76 million in the prior-year
quarter. Total other expenses increased to $45.10 million from
$16.56 million in the year-ago quarter. Provision for income taxes
for the quarter was $137.86 million, higher than $210.18 million in
the comparable quarter a year ago.

Capital expenditure from the second quarter totaled $489.8 million,
down from $545.0 million in the prior-year quarter. The company ended
the second quarter with cash and cash equivalents of $1.55 billion,
compared to $1.16 billion at end of the year-ago quarter.

The company also announced the appointment of Ron Sommer as the
chairman and Alexey Buyanov as the deputy chairman of the MTS Board
of Directors.

Further, the Boards of Directors of MTS and Sistema JSFC(SSA.L)
approved the acquisition of Sistema’s 50.91% stake in Comstar-United
TeleSystems (CMST.L), a supplier of integrated telecommunication
solutions, for $1.27 billion, or $5.98 per Global Depositary Receipt
or GDR, by a subsidiary of MTS. The deal was announced last week.

MTS also approved a dividend for fiscal year 2008 of RUB 20.15 per
ordinary share or $2.96 per ADR. This, the company said, amounted to
RUB 39.40 billion or $1.16 billion or 60% of US GAAP net income.

Half Yearly Highlights For the first six months, MTS reported
consolidated net income of $505.32 million or $0.27 per share, sharply
lower than $1.27 billion or $0.65 per share in the prior-year period.

Consolidated revenues for the year-to-date period dropped to $3.83
billion from $5.01 billion in the same period last year.

Looking Ahead…….

"As our markets are changing, we are adapting our strategic priorities
to meet new challenges and seize opportunities by developing our
monobrand retail channel and entering the broadband market to
deliver wider Internet access, integrated communications services
and innovative solutions to our customers," Shamolin added.

The company also noted that it continues to see sustained macroeconomic
volatility in its markets of operations that may impact the financial
and operational performance throughout the Group.

Stock Quote In Tuesday’s regular trading session, MBT is currently
trading at $43.88, up $0.25 or 0.57% on a volume of 0.38 million
shares. In the past 52-week period, the stock has been trading in a
range of $18.36 to $73.99.

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and helps for getting started.

Free trading ideas and analysis are always found at
LearningMarkets.com.

ARMENIA INVOLVED IN "BIG GAME" BETWEEN RUSSIA AND THE U.S.

/PanARMENIAN.Net/
11.08.2009 19:05 GMT+04:00

/PanARMENIAN.Net/ Armenia is involved in a bigger game than it seems
at first glance, Vardan Khachatryan , MP from the Heritage political
party told a press conference in Yerevan today. In his opinion,
the parties involved in this game, concerning the settlement of
the Karabakh conflict may reach such agreements behind the backs of
Armenia, which would contradict to the interests of the country. Vardan
Khachatryan explained that he speaks of Russia, Turkey and the United
States, which projected deals.

According to Vardan Khachatryan, the fact of the tense relations
between the countries is alarming, suddenly they started to develop
and improve, which could have serious consequences for Armenia. "The
fact that Russia has allowed the U.S. to transport humanitarian
goods and technical supplies for its army in Afghanistan, testifies
to something," Khachatryan said. The MP mentioned that everybody was
surprised at the last meeting of Russian and Turkish prime ministers,
resulted in a large number of agreements signed.

"Nagorno Karabakh is also involved in this game and the fate of
Armenia can become a token coin at the transition phase of that game
", Vardan Khachatryan said.

HUMAN ERROR BLAMED FOR IRAN AIR CRASH

PRESS TV
Mon, 10 Aug 2009 14:46:35 GMT

Iran’s Civil Aviation Organization (CAO) says pilot error and excessive
landing speed were the main causes of the Aria Qeshm plane crash in
the city of Mashhad on July 24.

Of the 153 passengers and 15 crew, 16 people were killed when a
Russian-built Ilyushin Il-62M, owned by a Kazakh company and leased
by Iran’s Aria Qeshm company, overshot the runway after touchdown
and smashed through a perimeter wall.

The incident also saw 31 people injured who were immediately taken
to nearby hospitals for treatment.

Faramarz Sarvi, the director of the CAO Flight Standards Department,
said that after more than 4,200 hours of investigation and based
on information retrieved from the plane’s black boxes, officials
found that human error, not equipment failure, had led to the tragic
incident.

"Because of the high-speed, the pilot apparently lost control of the
plane upon landing, causing it to run off the runway," said Sarvi,
adding that both the plane and its crew had passed all pre-flight
safety inspections before take-off.

Sarvi rejected reports suggesting that the crew were involved in a
heated argument at the time of the crash, although the cockpit voice
recorder indicated to distractive conversations between the pilot
and Mehdi Dadpey, the airline’s managing director, who was onboard.

He added that this was a breach of proper cockpit management and
played a significant role in the crash.

The incident was the second major airline catastrophe to have befallen
Iran in a period of 10 days.

On July 15, an airliner went down near Jannat-abad village, killing
all 168 people onboard. The plane, a Russian-made Tupolev Tu-154M
belonging to Iran’s Caspian Airlines, was flying from Tehran to
Yerevan in Armenia.