Armenia: THE COGNAC REPUBLIC
Kommersant, Russia
Dec 7 2004
Little Armenia has a whole set of brands that have become symbols of
the country: brandy, Ararat, Radio Armenia, and finally Armenians
themselves. Ironically, cognac recently turned out to be brandy,
Ararat is outside the country, and so are most Armenians. And it
turns out there never was a Radio Armenia.
Three Great Nations
Photo:
This cask is laid down in honor of Boris Yeltsin. He could ask to
have it sent to his home at any time, but it keeps better here
Here is a Radio Armenia joke: ” How many great nations are there in
the world?” Answer: “Just three-Russians, non-Russians, and
Armenians.” It’s true that Armenians never hesitate to talk about
themselves in superlatives. Residents of Yerevan invariably remind
visitors to the capital that their city is 300 years older than Rome.
They also do not forget to mention that Armenians became Christians
before Byzantium; two years ago (2001), the republic celebrated the
1700th anniversary of the adoption of Christianity as the national
religion. Armenia was not always so small either. Under Tigran the
Great, its possessions stretched from the Caspian Sea to the
Mediterranean Sea and the country was called Greater Armenia.
Then Armenia endured several difficult centuries and shrank
dramatically in size. Today, twin-peaked Ararat (Sis and Masis in
Armenian), Armenia’s national symbol, which literally hangs over
Yerevan in clear weather, is located in Turkish territory, just like
Armenia’s ancient capital, Ani.
However, none of this affects Armenians’ national pride. They have
recently taken to calling their capital “little Paris”; and Armenians
actually have warm feelings toward France. This may be because they
resemble the French in their lively nature, but it is more likely
because France is home to the world’s second-largest Armenian
community, which has given the world such celebrities as Charles
Aznavour and Cher.
The world’s largest Armenian community lives in California and is no
less of a market for Armenian goods than Russia. Armenians are
weighed down by their isolation from the rest of the world, which is
the result of a closed border with Azerbaijan, difficult relations
with Turkey, and deteriorating relations with Russia and Georgia.
Armenians resent the inaccessibility of the Russian market,
especially since Armenia is Russia’s main partner in the
Transcaucasus: the country’s entire antiaircraft defense system, as
well as protection of the border with Turkey, the power industry, and
many large companies (in repayment of debts to Russia), have been
turned over to Russia.
At the same time, the worldwide Armenian diaspora helps Armenia; for
example, billionaire Kirk Kirkorian has given $180 million for road
reconstruction. Yerevan is probably the only capital whose roads
resemble the aftermath of a bombardment: holes half a wheel diameter
deep lie in wait everywhere and there is no way around them. Yerevan
residents compare driving around the city to figure skating.
One of the worst road incidents is connected with a romantic story.
One day, they brought a female elephant to Vova, a male elephant
living in the Yerevan zoo. Vova was charmed by the lady, and when the
time came to part, he was deeply distressed. In his confusion, Vova
broke out of the zoo, overturned several trolleybuses, trampled a
large number of cars, and headed resolutely for the city center to
let them have it. As he approached the center, he got into a battle
with a police detachment that tried unsuccessfully to shoot him; he
was finally killed by an armored troop carrier. As experts in amorous
affairs, Yerevanites still recall Vova’s tragedy with sympathy.
Photo:
The Dengi correspondents were lucky enough to be able to photograph
the president of Armenia while he was skiing at Tsakhadzor. Despite
the dark glasses, the president was easy to recognize by the size of
his entourage
For Russians, Armenia remains a set of stereotypes. Two hundred years
ago, a great poet expressively described a scene thus: “The Armenian
kissed the young Greek woman.” However, the story ended badly. Later,
Armenians, like Georgians, were identified with market vendors,
although it is not they – Azerbaijanis who control Moscow’s markets.
Without a doubt, the most outstanding Armenian brand is cognac. The
appearance of a bottle of Ararat, Ani, Nairi, Akhtamar, or
Vaspourakan on a holiday table added prestige to the occasion. Doubts
about the legitimacy of the expression “Armenian cognac” have arisen
only in the last ten years. However, even after French owners arrived
at the Yerevan Cognac Factory, its products continued to be called
cognac in Russia, and not brandy.
Another important brand is also called Ararat, but it is not cognac
but rather a football team that was champion of the USSR in 1973. It
is no longer a very important team; the Grand Tobacco Co. Ltd.
Factory team has become the leader of the Armenian football
championship instead. There were also Yerevan cigarettes with a black
filter that were called Akhtamar, like the cognac.
What else comes to mind? Tsakhadzor, a mountain resort and the USSR’s
main Olympic center, of course. Then there are mineral waters like
Bjni, Jermuk, and Arzni. And shoes. In the time of the famous “Soviet
quality”, shoes made by the Masis and Nairi factories in Yerevan were
in great demand, although these factories are no longer in operation.
On the other hand, many small companies in Armenia successfully make
“real Italian-style” shoes and Armenians take pride in their high
quality.
Jewelry is another ancient Armenian specialty. Foreign sales of cut
diamonds that Armenia obtains through an agreement with Diamonds of
Russia-Sakha (ALROSA) are an important source of income. Specialists
of the old Soviet school remember the “mailboxes”, the local
radioelectronics industry [called “mailboxes” because the factories
or offices were secret and were identified only by a mailbox address]
that labored hard and long for the good of the Soviet defense
industry and ordinary citizens.
There is also no forgetting YerAZ minibuses, Armenia’s answer to the
Latvian RAF model. Unlike RAF, the Yerevan Automobile Plant (YerAZ)
is still in operation. If this is still not enough, let’s return to
the brand we started with, Radio Armenia.
How Armenians Fired the Director of the CIA
Photo:
Grand Tobacco has some unique equipment for testing cigarettes. This
machine lights up by itself and inhales
Radio Armenia was asked: “Why did they fire the director of the CIA.”
Answer: “Because he couldn’t give Kuzkin’s mother’s address or Radio
Armenia’s wavelength or figure out what the Voluntary Society for
Collaboration with the Army, Air Force, and Navy (DOSAAF) did.” On
arriving in Armenia, the Dengi correspondents conducted their own
journalistic investigation into Radio Armenia.
At first, it seemed fairly straightforward to locate a radio outlet
where a group of specially trained wits sat splitting their sides
with their own jokes and transmitting them around the world. However,
in answer to our questions about Radio Armenia, Armenians only
shrugged their shoulders enigmatically.
After some in-depth intelligence work, we came up with several
versions. The first is obvious: “All our radio is Armenian.” In
Armenia, as in Russia, everyone listens to FM radio stations today;
but there is no station called Radio Armenia that is capable of
broadcasting outside the republic. The second version is that Radio
Armenia is not located in Armenia at all, but is an invention of
Moscow wits. However, only one Moscow radio station in the late 1980s
ventured to call itself Radio Armenia and it did not last long.
The third version attributes the start of Radio Armenia to members of
a Joviality and Wit Club (KVN); but the Yerevan team called the New
Armenians clearly has nothing to do with it, because the name Radio
Armenia was around long before any of them were born.
In our search for the truth, we turned to the management of Armenian
Public Radio, who gave us a more conspiratorial version of the origin
of Radio Armenia.
Amasi Oganessian, deputy general director of Armenian Public Radio:
This invention has nothing to do with either Armenia or Russia. Radio
Armenia appeared in the 1960s during the Cold War as the creation of
a special section of the CIA. The jokes had a political nature, and
their objectives included anti-Soviet propaganda and undermining the
political regime of the USSR. The first collection of Radio Armenia
jokes was published in West Germany in 1980.
Incidentally, the version of the secret-service origin of Radio
Armenia is discussed on the Internet as well. In one of these forums,
they talk about the reasons why the special Armenian joke sections in
Western secret service agencies were eliminated. Once, at a congress
of All-Union Broadcasting workers the chairman announced, ” I now
give the floor to the representatives of Radio Armenia…”, and the
whole room roared with laughter. The spies realized that the weapon
of special propaganda had turned into a means of amusement for the
whole country and turned the spies themselves into clowns.
However, Radio Armenia itself gives a different reason on the
Internet for its closure: “It’s just that Jew who thought up all the
jokes left for Israel.” Today, Armenians listen with pleasure to
Russian Radio, and not Radio Armenia.
How Armenians Fought Against Aging in Iron
Photo:
The management of the tobacco factory is trying to promote a healthy
lifestyle among its workers
Armenians were insulted when their cognac started being called brandy
following the example of the French. Anyone will tell you that
“brandy is made by another process, but we’ve always used the cognac
process.” The industrialist Nerses Tairiants brought the technology
from France and founded the Yerevan Cognac Factory in 1887. Twelve
years later, his company was bought by Nikolai Shustov’s trading
house, purveyor to the court of His Imperial Majesty. Shustov’s
personal cask has been stored in the aging room since 1902, and only
three people have drunk from it: Marshal of the Soviet Union Hovaness
Bagramian, Boris Yeltsin, and President of Armenia Robert Kocharian.
Laying down personal casks has become a tradition at the factory. We
saw casks for Yeltsin, Ryzhkov, Putin, Kvasnevsky, and other
well-known politicians, each of whom (or their descendants) can send
a courier for them at any time. There is also a “peace cask”, which
they promise to share when there is peace between Armenia and
Azerbaijan. Finally, there is a whole lane of casks for Charles
Aznavour, Armenia’s favorite Frenchman.
There is also another custom of weighing important guests on the
factory floor for the purpose of giving them a gift. The guest is
seated on one pan of the scale, while the other pan is piled with
gift cases of cognac. They say Boris Yeltsin weighed in at five
cases. People at the factory have noticed that Western guests usually
immediately transfer the amount of the gift to charitable funds,
whereas guests from CIS countries instantly pack the cases into their
motorcades.
In June 1998, the factory passed to the hands of the French company
Pernod Ricard. According to Pierre Larretche, the factory’s president
and general director, Pernod Ricard wanted to strengthen its
positions on CIS markets. However, 1998 was the year of the Russian
default and within a year, output had decreased from 3.5 million
bottles to 1 million. Production was restored to previous volumes
only last year. On the other hand, the French owners took advantage
of the time to redesign production processes and reorganize the
management structure and sales system. It is shameful to admit that
the cognac had formerly been aged in metal vessels with chips of oak
bark thrown in. Now the cognac is properly aged in natural oak casks.
For this purpose, the art of cooperage, lost in the 19th century, had
to be revived in Armenia. Under an agreement with the Armles company,
Armles has committed to planting two new Armenian oaks for every
delivered tree.
Of course, the French are a long way from solving all local problems.
For example, up to 30% of the cognac on the Russian market (and even
in Armenia) is counterfeit. Russia accounts for 75% of the 93% of
production going to export, and another 10% goes to Ukraine and
Belarus. There are plans to increase exports by exporting to another
25 countries. However, expansion of production is hampered by a
shortage of grapes, because the vineyards cannot satisfy market
demand.
The Battle Against Smoking, Armenian Style
Photo:
Producers of Bjni mineral water are getting ready to conquer the
Russian market once again
Here is a curious fact. Viticulture has started losing out to the
rapidly growing tobacco industry, all because a lot of people in
Armenia smoke: more than 50% of the population (the world norm is
40%). Grand Tobacco Co. Ltd. Is the country’s largest taxpayer. The
company has begun financing farmers to grow tobacco, and today this
occupation is five to six times more profitable that any other
agricultural sector. However, when peasants in the Ararat Valley
(which is where cognac grapes are grown) went so far as to tear up
their vineyards in order to expand the area under tobacco, the
tobacco company’s management took pity on cognac and stopped buying
tobacco from Ararat peasants.
Tobacco has been cultivated in Armenia since the 17th century, but
cigarette production began in 1938 when a fermentation plant and a
workshop for producing papirosy [Russian cigarettes with a cardboard
mouthpiece] started operating. In 1946, they were merged with the
Armtabak company, which had 99% of the Armenian market and supplied
cigarettes to the entire USSR.
After the collapse of the USSR, Armtabak completely lost its market
and imported cigarettes filled its place. At that time, Grant
Vartanian, one of Armtabak’s managers, emigrated to Canada. Then in
1997, he got in touch with a former Armtabak colleague, Ruben
Airapetian, and came to an agreement on setting up a
Canadian-Armenian tobacco company. The partners interested farmers in
growing tobacco, set up a fermentation plant, started marketing,
bought a unique laboratory, and within a short time managed to win
back 75% of the Armenian market. Today Grand Tobacco produces about
60 name brand cigarettes with a volume of 4 billion cigarettes per
year, some of which are exported to the United States, Russia, and
Arab countries. The factory’s management is convinced that the
quality of their cigarettes is as good as that of international
brands.
David Galumian, executive director of Grand Tobacco Co.: We used to
produce five or six name brands. Think of Kosmos and Salyut in soft
packages without cellophane or foil, Prima, Astra… But these
cigarettes differed only in their packages; the blends were all the
same. Now about half of our production consists of elite cigarettes
made of fine tobacco that we buy abroad.
The factory still produces those very same Akhtamar cigarettes with
the black filter. The name comes from an Armenian legend poetically
recreated by the writer Hovhannes Toumanian: Once upon a time on an
island there lived a beautiful girl named Tamar, and every evening
she would light a fire to guide her lover who swam to her from the
mainland. One day, some wicked people put out the fire. The youth
lost his way in the sea and began to cry “Akhtamar! Akhtamar!” (Ah!
Tamara, Tamara!). The young man drowned, but the Akhtamar cigarette
and cognac brands live on.
If You Like Bjni, You’ll Love Noi
Any Armenian will tell you that Armenia has the best-tasting water in
the world. The stony, treeless mountains of Armenia heated by the hot
sun provide ideal conditions for keeping water pure and fresh. “You
always want ‘Evian’,” argued an acquaintance. “Fine, just so you
don’t think I’m boasting, even if our water is no better it’s no
worse. But it’s really even better.”
In the USSR, water from the Armenian Bjni, Jermuk, Dilijan, and Arzni
springs competed with Georgian Borjomi and Narzan from Kislovodsk.
Today, water production is only one-tenth of what it was in Soviet
times and it competes only with itself. About ten companies produce
only Jermuk (the leader in sales volumes) and their product varies in
quality (products with dark blue and black labels were recommended).
Bjni is in second place in sales volumes; it belongs to one of
Armenia’s largest companies, the SIL group owned by the Soukiassian
family.
Khachatur Soukiassian, president of SIL group: When there are a lot
of producers of one brand, that’s bad. One starts to advertise Jermuk
and the others profit from its advertising without investing a single
kopeck. And vice versa, if one produces a poor-quality product the
rest suffer.
Khachatur Soukiassian is a parliamentary deputy and one of the
richest people in Armenia. He founded his empire in 1989 with a car
wash, a service station, and a parts business. For a short time, he
was an owner of the Kotayk Brewery, one of the country’s largest.
Today more than 25 companies belong to the SIL group, including
Armekonombank, Hotel SIL, the Pizza di Roma fast food chain, a
construction company, and eight factories producing furniture, wood
products, lemonade, corrugated packaging, etc. Soukiassian bought the
Charynsavan Bjni plant in 1997 with the right to lease the spring for
25 years. Today the plant has 150 employees who produce more than 5
million bottles per year. America is the main export market, because
they began working with it earlier, but Russia will soon catch up in
sales volumes. In addition to Bjni, the factory has started producing
a successful new brand of noncarbonated drinking water called Noi
(Noah; Armenians believe that Noah was Armenian).
Khachatur Soukiassian: Along with water, we’ve started delivering
juices to Russia-mango, guava, rosehip-and even we’re surprised at
how successful we are. It’s too bad that deliveries to your country
are complicated by problems with transportation services and the
rigid dictates of sales networks.
Businessman and deputy Soukiassian sees some novel political
approaches to cooperation with Russia. “Imagine how easily Russia
could solve its problems with Georgia,” he says. “They show a meeting
with Putin on TV, and on the table you have Bjni instead of Borjomi!
Then how Borjomi producers would start cursing their president!”
by Vladimir Gendlin and Dmitry Lebedev (photos)
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