Author: Tvankchian Parkev

IRAN’S BALANCED POSITION IMPORTANT FOR KARABAKH CONFLICT PEACEFUL RESOLUTION

PanARMENIAN.Net
23.12.2008 18:43 GMT+04:00

/PanARMENIAN.Net/ Armenian Defense Minister Seyran Ohanyan met Tuesday
with deputy secretary of Iran’s Supreme National Security Council Ali
Bagheri to discuss bilateral cooperation, the RA Minister’s spokesman,
col. Seyran Shahsuvaryan told PanARMENIAN.Net.

The officials exchanged views on regional security and stability
issues.

Touching on the Nagorno Karabakh conflict settlement process, the
two emphasized that Iran’s balanced position on the issue important
for peaceful resolution of the conflict.

Development of the Armenian-Iranian cooperation proceeds from the
interests of the two countries and has a positive influence of the
entire region, they said.

IRAN, ARMENIA PLAN OIL PIPELINE

United Press International (UPI)
Dec 23 2008

YEREVAN, Armenia, Dec. 23 (UPI) — The completion of a 186-mile oil
pipeline from Iran to Armenia is expected to help diversify regional
energy resources, Armenian energy officials said.

Armenian Energy Minister Armen Movsisyan spoke to reporters about
the progress of the $220 million pipeline expected to be completed
by 2011, the Iranian Press TV said.

"Armenia will receive petrol and diesel fuel from the oil refinery
located in the Iranian city of Tabriz through the pipeline,
construction of which starts next spring," he said.

Russian, Armenian and Iranian officials attended the inauguration of
a final state of a natural gas pipeline from Iran Dec. 2. Armenia
will convert gas from that pipeline to electricity, which it will
transfer back to Iran.

These developments follow statements from NATO officials that warned
Armenia in September it needed to take steps toward transparency to
counter high energy costs.

Azerbaijan, meanwhile, refuted reports that Armenia would host the
Western-backed Nabucco pipeline, in part because of territorial
disputes over the Nagorno-Karabakh region.

"In order to guarantee the country’s energy security we are moving
toward the diversification of energy supplies," Movsisyan said.

THE FOUNTAIN DISTRICT
by Anush Babajanyan

Transitions on Line
Dec 23 2008
Czech Republic

Twenty years after an earthquake devastated northwest Armenia,
thousands of displaced families are still waiting for a permanent
roof over their heads.

GYUMRI, Armenia | It’s a small structure in the middle of a field,
seemingly deserted. Only when you get close does it become clear that
someone lives here. Harutyun Gevorgyan moved to this makeshift house
six months ago after he married Manik, its owner.

Twenty years ago Gevorgyan lived with his first wife in an apartment
in Gyumri, Armenia’s second-largest city, but it was ruined in the
December 1988 earthquake that devastated the northwest corner of the
then-Soviet republic, killing 25,000 people and leaving hundreds of
thousands homeless.

Gevorgyan lived with a series of relatives until he met Manik, a
fellow street cleaner. Her family had not been offered a new home
after the earthquake. Like many in Gyumri, then called Leninakan,
they found shelter in domiks, small houses provided by the government
or built by the homeless themselves using wood, stones, or pieces
of metal found in the rubble of ruined buildings. These tnaks still
cover many parts of the city.

In the aftermath of the disaster the Soviet government promised that
the homeless would get new apartments within two years. Construction
began, but in 1991 the Soviet Union collapsed; Armenia became
independent and lost its main source of aid. Two decades on more than
4,000 families in Gyumri are still waiting their turn to get a home.

"One of the reasons was the fall of the Soviet Union, and another
was the government that came afterwards," City Hall spokesperson
Lilit Aghekyan says to the question of why so many displaced by the
earthquake still do not have permanent new homes. But 20 years after
the disaster, the national government this year launched a construction
effort designed to provide permanent shelter for Gyumri’s remaining
homeless.

THE WAR HITS HOME

Aghekyan refers to the "negligence" of independent Armenia’s first
leaders, who, preoccupied with fighting Azerbaijan over the disputed
territory of Nagorno-Karabakh, let restoration of the devastated
quake area languish. Then-President Levon Ter-Petrosian’s government
concentrated the country’s resources on the war, ushering in what
Armenians recall as the "dark years" of little or no electricity,
heat, or running water.

After the 1994 ceasefire, restoring the Armenian economy took
precedence over delayed earthquake relief. By this time still-displaced
families had largely settled into their domiks, and into a routine
of petitioning the local authorities for help.

There are about 300 such households in the Fountain District, a former
park not far from the center of Gyumri that hosts one of the city’s
main concentrations of domiks.

Harutyun and Manik Gevorgyan live in one of the haphazardly sited,
closely spaced structures. Their house is a patchwork of sheets
of steel, heated, like many in the Fountain District, by a stove
Harutyun stokes not just with wood but with anything he can find that
burns. Smoke fills the badly-ventilated structure, mixing with dust
from the items brought in to be burnt. Harutyun cooks on the same
stove while his wife is out on her daily job as a street cleaner.

There are two rooms, a kitchen where the fire fodder is piled and
a bedroom with a narrow, partly broken bed. "Our house is in bad
condition," Harutyun says, "but there are houses in this district
that are much worse off."

Unlike the Gevorgyans’, most of the houses here have electricity,
but none has running water or sewerage. People bring water from
nearby springs and dig holes, screened by walls, outside their houses
for toilets.

"We eat and do laundry in the same room," says Geghetsik Gevorgyan
(no relation to Harutyun), who has moved from one domik to another
since the earthquake ruined her apartment building. With a pension
of $80 a month and a little extra money she earns working in a local
farmer’s fields, she maintains the thin-walled house and takes care
of her ill son.

Chichak Petrosyan lives alone in a one-room house piled with scattered
clothes and cardboard, but family members are always coming by to
help, and as we talk her grandson plays in the heaps on the floor. She
keeps doves in the one-room house, as well as a dog and cat. Outside
her relatives are doing laundry in the open air.

Petrosyan found this onetime ice-cream stand shortly after she lost
her home in the earthquake. She’s been living here ever since. She
has petitioned City Hall for a new home, without success. "I have
applied several times but received no reply," she says. "By now I
have almost lost hope."

BUILDING BLOCKS

Since the quake an alliance of foundations and organizations headed by
the U.S. government aid agency USAID and including Armenian-American
billionaire Kirk Kerkorian’s Lincy Foundation has helped build 18,000
apartments for homeless families in Gyumri, but nothing has been built
by Armenian authorities since the collapse of the Soviet Union. Last
June, the national government announced an ambitious effort to resolve
the plight of the remaining homeless families within five years.

"Apartments for 3,000 families will be built in accordance with a
government program," City Hall’s Aghekyan says.

The first step was a contract with Yerevan-based developer
Glendale Hills to build at least 2,300 apartments in the Ani and
Mush 2 districts in the suburbs of Gyumri, where the Soviets built
apartments in first few years after the quake . Construction began on
the government-financed, 43 billion dram (100 million euro) project
in October and is slated for completion in 2010, with residents moving
in the following year.

The city received 4,284 applications from homeless families, and may
et get more if the government agrees to extend the 1 November deadline
for 140 qualified families that were unable to apply "because they
are out of the country or other reasons," Aghekyan says. Those who
do not get one of the newly constructed flats will be eligible for
vouchers to purchase existing apartments on the outskirts of the city.

The help may come too late for Lena Atoyan, who is almost 80. She
does not expect to live long enough to move out of the tnak she has
shared with her daughter, Susanna, since the earthquake. "I am weak
and ill from living in this cold house all these years," says Atoyan,
who has been bedridden for months with a leg problem.

"I hope that at least my daughter gets some help or an apartment from
the government," she says. "It has been 20 years since we moved here,
and there is still no help from anyone."

Armenian photojournalist Anush Babayanjan reported and took the photos
for this article.

AZERBAIJAN’S LOBBYIST LEAVING KNESSET

PanARMENIAN.Net
23.12.2008 14:58 GMT+04:00

Yosef Shagal, Russian-speaking lobbyist of the Israeli-Turkic strategic
alliance announced that he gives up politics and returns to journalism.

A Baku native, Shagal became leader of the Azerbaijan-Israel
International Association in April 2007 to "cement ties between the
two states."

In spring 2008, Yosef Shagal opposed discussion of the Armenian
Genocide in Knesset, describing it as a threat to relations with
Turkey and Azerbaijan.

Shagal will not enter the history of Israeli parliamentarianism but
his activities were significant for Israeli presence in the post-soviet
area and for the development of the South Caucasus vector to neutralize
the Iranian threat, Turtsia.ru reports.

EUROPEAN COURT DEMANDS TO RELEASE ALEXANYAN

Panorama.am
20:56 22/12/2008

The European Court of Human Rights in Strasbourg has demanded to
release the ex-head of YUKOS Vasily Alexanyan.

Remind that V. Alexanyan is accused of stealing and legalizing monetary
funds. He was arrested in April of 2006. Alexanyan suffers AIDS and
cancer of lymphocyte.

According to Russian media, Russian authorities have broken four
articles of the European Court. In particular it is mentioned that
Alexanyan who suffers serious diseases was not cured during his arrest.

ARMENIAN FOREIGN MINISTER: "THERE IS NO OTHER WAY TO SOLUTION OF THE KARABAKH CONFLICT EXCEPT FOR THE DIPLOMATIC ONE"

Today.Az
ics/49729.html
Dec 22 2008
Azerbaijan

"The Karabakh conflict must be settled only peacefully by way of
talks", said Armenian Foreign Minister Edward Nalbandyan.

He said there is no other way to solution of the conflict, except
for diplomatic.

"The importance of the direct participation of the Karabakh side
in the negotiation process is especially noted and we respect the
position of the Karabakh leadership. The resolution of the Karabakh
conflict is impossible without participation of Nagorno Karabakh",
noted Nalbandyan.

The Armenian Foreign Minister said that all issues must be settled
by way of talks and the conflict can be settled only considering the
right of the Karabakh people for self-determination.

At the same time, he noted that though the trilateral declaration,
adopted in Meindorf, said that the problem must be settled by way of
peace and the declaration was undersigned by President of Azerbaijan,
it is unclear why Ilham Aliyev states that the adoption of the
document does not mean that Azerbaijan assumes the responsibility
not to apply force.

STAR: THE STATE PLAYS AN IMPORTANT ROLE IN DEVELOPMENT OF ARMENIAN PRODUCTION AND MAINTENANCE OF FAIR PRICES FOR IMPORTED COMMODITIES

ArmInfo
2008-12-22 15:02:00

The state plays an important role in development of Armenian production
and maintenance of fair prices for imported commodities, Vahan
Kerobyan, the executive director of the network of STAR supermarkets,
told ArmInfo correspondent.

He said that over the last month the import of foodstuff has been
steadily growing, and that of non-food items has been falling to some
extent. The foodstuff import rates will be maintained, but the state
should exert certain efforts to present the commodities to consumers at
"correct" prices, Kerobyan stressed.

He also added that in the year 2009, which will pass in the network
under the slogan "STAR-save more!", the company is going to decrease
prices even more, but not at the expense of quality. "The price
decline will be ensured due to liquidation of excessive expenditures
from the prime cost of commodities. This will by no means affect the
tax payment",- Kerobyan said.

To recall, the Central Bank of Armenia has recently announced that
despite the maintenance of import growth in Armenia, nevertheless,
its rates are expected to decelerate because of diminution in demand
in the domestic market.

Georgia, West and Russia in information war

en.fondsk.ruÐ?rbis Terrarum
21.12.2008
Nikolai DIMLEVICH

As the military confrontation in the Caucasus stopped after the tragedy
in South Ossetia in early August, the information war between the
opposing sides has only stirred up. The West is still trapped in
stereotypes about Russia`s policy in Georgia: the world sees Russia as
Georgia`s enemy and aggressor, trying to violate sovereignty and
territorial integrity of the neighboring state.

With start of the war in South Ossetia, the West and Georgia launched a
large-scale information and propaganda campaign, using any means and
resources to impose their view of the conflict. On 9 August at the
decree of President Mikhail Saakashvili, Georgia`s Security Council
banned the broadcasting of all Russian TV and radio channels and cut
off access to Russian Internet domains. The people of Georgia found
themselves in an information blockade: all TV and radio broadcasters
offered only an official stance of the Georgian leadership and true
coverage of the events.

Reference: Georgia banned RTVi channel owned by Vladimir Gusinsky. RTVi
had been the only Russian-language source of information in Georgia.
The RTVi was banned from broadcasting after it demonstrated an
interview with the Russian Foreign Minister Sergey Lavrov criticizing
Georgia`s actions in South Ossetia.

Since the very beginning of the military campaign on 7 August, a
press-center in Tbilisi was used by Saakashvili and other high-ranking
officials as a platform for brainwashing and propaganda. The leading
western TV channels showed Mr. Saakashvili addressing the nation in
order to warn about the oncoming threat from Russia.

Georgia’s media and the leading information outlets in the West had
been enjoying close cooperation- the fact that also contributed greatly
to the success of their propaganda. Saakashvili hired professional PR
managers and thus got an access not only to the `Russia Today’ but also
CNN, BBC, Sky News, Bloomberg and many other channels. During the first
five hours of the attack on Tskhinvali, Saakashvili appeared on TV for
20 times, while the journalists received about 200 press releases. As a
result, many channels did not send their people to Tskhinvali and
relied on the information from Tbilisi. The parliament of Georgia
regularly informed the NATO Parliamentary Assembly (PA) about `Russia’s
aggressive and inadequate actions, including its attacks on the
Georgian civil infrastructure, settlements and ports. Thus, on 11
August, after the President of the PA voiced his view on the situation
in Georgia, the PA vice president and the head of the German delegation
Karl Lamers supported an anti-Russian declaration suggested by a US
congressman J. Tanner, citing `reliable information sources in
Georgia’.

In this information war the Internet played a very active role ever.
BEFORE the military invasion began on 7 August, the Georgian
authorities had signed contracts with the western PR agencies
(including the one in Belgium), while Georgia`s Interior Ministry
officials were asked to prepare a video footage featuring the citizens
of Gori, Marneuli, Poti, Senaki and Zugdidi, testifying in Russian
about `atrocities of the Russian occupants and large-scale air attacks
on the Georgian cities’. These materials were due to be presented at
the International Criminal Court.

Now let us see how the military campaign in South Ossetia was covered
in the information outlets of the Georgian diaspora in Russia.

Since 1993 to 2008 in Russia there were registered 12 printed media
connected with the Georgian diaspora, 10 of which were Moscow-based
`Evening Tbilisi’, `Georgia’ and `Moscow-Tbilisi’ (in Armenian
language); `Georgia`s Revival’, `Multinational Georgia’, `Georgia.
Events. People’, `The new Caucasus newspaper’, `Sunny Mziuri’;
magazines `Bolshaya Gruzinskaya’ and `Tbilisi’. There also were two
outlets in the cities of Nizhny Novgorod (`The Nizhny Novgorod Empire’)
and Samara (`Samshoblo’ newspaper).

The leaders of the Georgian communities in the Voronezh and Saratov
regions critically condemned Saakashvili. The website of the All-Russia
public organization `The Union of Georgians in Russia’ provided regular
information from the conflict zone, and the reports contained the
opinions from both Georgia and Russia. `The Union¦’ urged the opposing
sides to achieve a ceasefire. The prominent cultural figures of
Georgian origin commented on the tragedy. Most of them did not welcome
Russia`s actions in South Ossetia and Georgia. The website of the
Moscow-based Georgian `Youth movement of Lazare’ () also
contained some anti-Russian statements.

***
Unlike Tbilisi with its well-coordinated and active propaganda
campaign, Russia has been engaged in rather defensive tactics. All the
words that violence against the peaceful civilians, murders of the
peacekeepers were nothing but a harsh violation of the international
legislation, and that Russia had to increase its presence in the
conflict zone only to provide assistance to the people of South Ossetia
and Russian citizens and stop the humanitarian catastrophe, came TOO
LATE.

Preoccupied with propaganda among the citizens, Russia paid too little
attention to cooperation with the western media. However, some attempts
were made to inform the colleagues abroad about what had really
happened in Georgia.

Some representatives of the Russian Embassy in US were interviewed by
Wolf Blitzer, who anchors a popular analytical program on CNN. During
the show President Mikhail Saakashvili was reached in Tbilisi to=2
0
comment on the situation once again but in view of the words said by
the Russian guests, his arguments were too weak and he had nothing but
empty accusations. The program was broadcast by the NPR national radio
and the Chile-based `AND’ international radio corporation, available in
19 countries and popular among the Hispanic audience in US. The `US
Today’ published an article revealing the essence of the Russian
operation to force Georgia to peace and the danger of conniving at
Tbilisi`s adventure. `The Washington Times’, `The Wall Street Journal’
and the UPI news agency cited some Russian officials denying Russia’s
involvement in the so-called cyber attacks on the Georgian websites.
Russia`s major ITAR-TASS and RIA News contributed much to the coverage
of the situation in South Ossetia abroad.

The website of the Russian Embassy in US provided a real-time reporting
from the press-conferences in Russia and was sending special
press-releases to more than 200 organizations, including the US
Administration, the Congress, some federal and educational
institutions, research centers, etc.

Guided by the officers from the 58th army, the groups of foreign
journalists visited Tskhinvali. Since 11 August, 86 foreign journalists
visited the conflict zone. The Russian side helped all foreign
journalists, including a CNN group, which arrived in Tskhinvali and
Vladikavkaz from Georgia. However, some TV companies, for example, FOX
NEWS, banned the demonstration of the footages their reporters made in
Tskhinvali.

Each day during the conflict Russia`s Senior Military Officer, Colonel
General Anatoly Nagovitsyn, held briefing session to tell the Russian
and foreign journalists the latest news from South Ossetia.

To repel disinformation, the latest news from the conflict zone reached
both Russia and global media agencies simultaneously as a scrolling
text. Thus, on 9 August, at 11 a.m Moscow time Foreign Minister Sergey
Lavrov held a briefing session with foreign correspondents. Lavrov`s
article published at the `Financial Times’ website on 13 August,
remained at the top of the most readable issues for 2 days.

All these efforts were not in vain since the American experts became
aware that nothing good would come of the confrontation with Moscow.
`Russia Today’ and `Vesti 24′ saw a sharp increase in ratings then.
Sometimes the programs published by `Russia Today’ on the independent
YouTube web portal were ranked 4th, with BBC reports falling behind on
the 43d position.

Most independent experts believe that Georgia would have never
succeeded in this information war unless active support of the US and
European media. (At the same time experts praise Moscow`s attempts to
control reporting from the conflict zone by holding regular briefing
sessions at the Russian Defense and Foreign Affairs Ministries and
demonstration of videos depicting the deliveries of humanitarian aid to
South Ossetia by the brigades of the Russian Emergency Situations
Ministry.

Russia is still viewed in Europe and overseas as a country with
unpredictable and aggressive foreign and home policies.

Reference: From 2000 to 2008 the world saw 450 issues of `The
Economist’ British magazine. Russia was mentioned on 13 covers, with
only one issue (in 2002) being positive about the country. The latest
cover showed Russian tanks and planes attacking South Ossetia and
Georgia.

Although most of the western media outlets were very negative about
Russia`s actions in the conflict zone, they happened to give quite
ambiguous remarks after traditional pacifist slogans. There were some
exceptions though. The Spanish `El Pais’ called Georgia`s invasion in
Tskhinvali as `tragic and wrong’.

The Georgian authorities paid much more attention to the coverage of
the events in the media, which certainly played a crucial role in
building public opinion. Only Russia`s permanent representative to the
UN Vitaly Churkin dared to comment on the war, though only as part of a
common briefing after the Security Council`s meeting. President
Saakashvili gave dozens of interviews to the leading media outlets,
especially CNN.

Only on 12 August, when western correspondents arrived in Tskhinvali,
the tone of reporting changed20a little bit.

***
The question is whether Moscow has enough means to influence the public
opinion in Georgia and the West? We believe currently Russia lacks an
ability to hold a successful information campaign.

Firstly, Russia yields to the West in terms of information outlets:
today we do not have any mass media that could be acknowledged as
authoritative in the West. The `Russian Profile’ magazine and `Russia
Today’ TV channel is not enough.

Reference: `Russia Today’ finds it hard to win the audience in most
Western countries, and currently the channel is popular only among
Russian political experts, students, teachers and some business
circles. Most of the Americans believe `RT’ is the source of Kremlin
propaganda. Apart from this, the channel has some technical problems
(the lack of prompt reporting and some others).

Secondly, Russia and Europe speak different languages.

Reference: An ordinary European has access to hundreds of cable TV
channels, where two-three are always in the English language. `RT’ is
not in the list and thus cannot win the audience there. As a rule,
people in Europe watch news blocks in their native languages, not in
English.

Still, Russia has everything to continue its fight for its place in
global media resources, especially since a shortage of objective
reporting on the Russia-Georgia conflict remains.

The internat
ional community yet has not been presented any official
document with the chronology of events since 8 August. Despite the
declared intentions to issue Georgia for the damage, the courts of
Russia and the Republic of South Ossetia yet have not done this. In the
meantime, Tbilisi has opened a case against Russia for `ethnic
cleansings in the period of 1993-2008′. Georgia continues to receive
active financial support from abroad.

To win audience in Georgia and the West, Russian leading TV channels
(First, RTR-planet, Vesti 24, NTV and TVC) should use scrolling text in
English during the news blocks.

`The Voice of Russia’ state radio company, launched in 1929 and
currently broadcasting in 38 languages, has increased the number of its
short-wave and mid-wave transmitters and is now available in Georgia
for 14 hours running. The VOR turned on its seven transmitters located
in Moscow, Saint Petersburg, Krasnodar and Samara. The VOR`s programs
are being rebroadcast in the Russian language in the capital of
Abkhazia on 107,9 FM (running time from 6 to 10 hours every day). Since
8 August the VOR`s `Commonwealth’ broadcasting service (for the CIS and
the Baltic states) has been working under 24-hour regime and was also
available in the Internet.

On 13 August `Vesti FM’ launched its broadcasting in Tskhinvali on
ultra short and middle waves. The first `Mayak’ call signals were heard
on 14 August. The `Rossiyskaya Gazeta’ presented its first special
issue.

***
Having analyzed the outcomes of the large-scale information
confrontation over the Russia-Georgia conflict, we can say Russia was
not ready to provide prompt reaction to Georgia’s propaganda due to the
lack of necessary state support to the Russian media outlets. The lack
of personnel and harmful money-saving measures lead to heavy political
consequences.

Hürriyet, Turkey
Dec 20 2008

Opposition figures on trial in Armenia

ISTANBUL – A former Armenian foreign minister and six other opposition
figures went on trial in Yerevan on Friday on charges of seeking to
overthrow the government during protests in March. Ten people died
when protests against the results of presidential elections in the
former Soviet republic turned violent.

Cries from supporters of "We are with you!" greeted the defendants as
they entered a courtroom in the capital Yerevan where they will face
charges of seeking to "usurp state power" when they organized mass
protests in February.

The opposition said the trial of former Foreign Minister Alexander
Arzumanian and his co-accused is politically motivated, and complained
the government has done little to investigate allegations of police
culpability. Rights groups and the Council of Europe voiced concern
after the government imposed a state of emergency and arrested over
100 people after the protests. The opposition said the vote, won by
Serge Sarkisian, was rigged.

Outside the courtroom, dozens of protesters chanted "Free political
prisoners!" and held pictures of the seven accused, reported Agence
France-Presse. Arzumanian, a foreign minister in the late 1990s, was
campaign chief for opposition presidential challenger Levon
Ter-Petrosian.

‘False case’
"The case is sufficiently proven by the evidence of 500 witnesses,
civilians as well as police officers," chief investigator Vahagn
Harutyunian told Reuters. "We have records of telephone conversations,
private video recordings and television footage, and public speeches
by opposition representatives." Ter-Petrosian has not been officially
charged with any connection to the unrest. Arzumanyan’s lawyer said
the case was "false".

"No one among those charged did anything to violate public order,"
Hovik Arsenyan told Reuters.

Armenia — a mountainous country of about three million people wedged
between Azerbaijan, Georgia, Iran and Turkey — has seen repeated
political violence and post-election protests since gaining
independence with the Soviet Union’s collapse in 1991.

ARMENIAN BUSINESS CONFIDENCE SINKS IN Q4
Venla Sipila

World Markets Research Centre
Dec 18 2008

The newest confidence survey by the Central Bank of Armenia (CBA)
signals weakening sentiment among the country’s producers. ARKA
News reports that the economic performance indicator, which measures
overall confidence on a 100-point scale, in the fourth quarter of the
year measured 40.7, falling by a fourth in annual comparison and by
around 38% from the third quarter of 2008. Meanwhile, the business
sentiment indicator slid by some 12% year-on-year (y/y) and 16%
quarter-on-quarter (q/q), standing at 41.5 in the fourth quarter. Only
the composite consumer confidence index managed to avoid an annual
fall, rising by a marginal rate of 0.3% y/y, but also this indicator
fell from the third quarter, its level of 48.7 marking a decrease of
5.6% q/q. The CBA has conducted quarterly confidence surveys since
2005. Over 800 industrial, construction and service companies and
nearly 1,900 households were surveyed.

Significance:While consumer confidence remained virtually stable
in annual comparison, all components of the survey signal weakening
sentiment. Moreover, the values of all three components stand below
the critical 50-point mark, signalling negative sentiment. The newest
official data put Armenian GDP growth in January-October 2008 at 9.2%
y/y (see Armenia: 24 November 2008: ). After growing at double-digit
rates for the past several years, the Armenian economy finally looks
set to cool, and the official growth projection of over 9% for 2009
seems overly optimistic to us, while we do not see recession likely
in Armenia as domestic demand, still rising from a relatively low
base, should still remain strong enough to support growth at positive
rates. The global financial crisis will not have any notable direct
impact on Armenia, due to the still-undeveloped and relatively isolated
nature of its financial sector. However, indirect negative effects
from the international crisis will likely be felt as moderating
investment and current transfer inflows, while the country’s already
meagre export prospects have also weakened further.