Armenian Reporter - 7/21/2007 - front section

[Dabaghian Diana]

ARMENIAN REPORTER
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July 21, 2007 -- From the front section

To see the printed version of the newspaper, complete with photographs
and additional content, visit www.reporter.am and download the pdf
files. It's free.

1. Bako Sahakian is elected president of Karabakh (by Emil Sanamyan)
* Election marked by high turnout, judged "free and fair"

2. Alex and Marie Manoogian laid to rest at Holy Etchmiadzin (by Vincent
Lima)
* An unprecedented honor

3. Many Armenians leave Baghdad for northern Iraq -- or Armenia (by
Armen Hakobyan)
* Relief Fund helps families move to Armenia

4. Turkey to hold parliamentary elections on July 22 (by Talin Suciyan)

5. Man in the News: Bako Sahakian
* A decent family man with street smarts and a knack for justice and
keeping his word

6. Man in the News: Masis Mayilian

7. Artsakh elects a new president (by Armen Hakobyan)
* Here they are convinced that democracy is not optional

8. From Armenia, in brief
* Royal Armenia executives set free
* Armenia has a new chief tax collector
* USAID and EBRD assist small and medium enterprises in Armenia

9. Two sides of Yerevan urbanism (by Karen Mikaelian)
* Construction at Tamanyan Park and by Swan Lake

10. Market update by Haik Papian

11. Living in Armenia: With home ownership comes a sense of belonging
(by Maria Titizian)

12. Commentary: Doublespeak and double standards -- over democracy in
Karabakh (by Tatul Hakobyan)

13. Editorial: Karabakh votes (again)

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1. Bako Sahakian is elected president of Karabakh

* Election marked by high turnout, judged "free and fair"

by Emil Sanamyan

STEPANAKERT, Karabakh -- According to preliminary results released in
the morning of July 20 by the Central Electoral Commission (CEC) of
the Nagorno-Karabakh Republic, Bako Sahakian is on his way to being
certified as the victor in the July 19 election for the next president
of Karabakh.

With 67,695 votes counted for all candidates, NKR CEC chair Sergei
Nasibian reported that Mr. Sahakian led with 57,828 votes or 85.42%,
followed by Masis Mayilian with 8,270 votes (12.21%), Armen Abgarian
with 856 votes (1.26%), Hrant Melkumian with 532 votes (0.8%), and
Vania Avanesian with 202 votes (0.3%).

Of the 92,152 registered voters in NKR, 71,285 (or more than 77
percent) turned out to vote in the election. The voters were most
active in the Askeran (82 percent) and New Shahumian (80 percent)
regions, with the turnout lowest in Stepanakert (55 percent).

The report of the Independent American Monitoring Delegation
released on July 20 described the elections as "conducted freely and
in a transparent way according to both the laws of Nagorno-Karabakh
and international standards."

The American monitors were led by retired ambassador Vladimir Matic,
a former senior Yugoslav diplomat now teaching international relations
at Clemson University, and Paul Williams, a former State Department
lawyer and director of the Public International Law & Policy Group.

Both Mr. Matic and Mr. Williams have monitored Karabakh elections in
the past, and they pointed to "steady progress in building democratic
institutions and developing the practice of participation in the
political process."

Other observers from Europe, Russia, Armenia, and other former
Soviet republics largely concurred with the view of the American
delegation.

This correspondent was able to visit several polling stations in
Stepanakert and Shushi, and observed an orderly and transparent voting
process.

As the voting concluded at 8 p.m. on July 19, local public
television aired the counting process live from a number of precincts
around Karabakh. Mr. Sahakian, who has held cabinet-level positions in
security and law-enforcement since 2001, and was backed both by the
incumbent government and the parliamentary opposition, took an early
commanding lead.

The campaign of Mr. Sahakian's main opponent Mr. Mayilian filed more
than a dozen complaints to the CEC claiming procedural violations
during voting. The CEC's Mr. Nasibian said that about half of these
complaints were addressed on July 19, with the rest still under review
as of press time.

Mr. Mayilian, speaking at a press conference in the afternoon of
July 20 said that it would be "fair to note that [violations] had no
decisive impact on the final results." He said he will congratulate
Mr. Sahakian for his victory as soon as the final results are
published. "The most important thing," he said, "is that the supremacy
of law won in this country and that means a victory for our country."

********************************** *****************************************

2. Alex and Marie Manoogian laid to rest at Holy Etchmiadzin

* An unprecedented honor

by Vincent Lima

VAGHARSHAPAT, Armenia -- The remains of the legendary benefactors Alex
and Marie Manoogian, which last week had been moved to Armenia from
the Evergreen Cemetery in Detroit, were buried on July 17 in the
hallowed grounds of Holy Etchmiadzin.

"We understand that only the remains of Catholicoses are enshrined
in this holy site and the addition of my parents is an exception,"
Richard Manoogian said in a speech on the occasion. "This is a very
special honor bestowed upon them by the Armenian Church."

During the second half of the 20th century, Alex Manoogian, as
president and then life president of the Armenian General Benevolent
Union, endowed dozens of Armenian schools and cultural centers around
the globe. He endowed chairs in Armenian studies. He was instrumental
in the construction of the St. John Armenian Church in Southfield,
Mich., and the St. Vartan Cathedral in New York City. Among the
projects he supported in Armenia was the Treasury Museum at
Etchmiadzin, in front of which his remains and those of his wife are
now interred.

Catholicos of All Armenians Karekin II presided over the ceremony.
President Robert Kocharian attended, as did Speaker Tigran Torosian,
Prime Minister Serge Sargsian, Foreign Minister Vartan Oskanian, and
Defense Minister Mikael Harutiunian. Alex Manoogian had been awarded
the title of "National Hero of the Republic of Armenia" in 1993.

President Arkady Ghoukasian of Karabakh was also present, as were
members of the Manoogian family.

* Where their hearts were

Born in 1901 in Kasaba, near Smyrna, Alex Manoogian arrived in Ellis
Island in 1920 with $50 in his pocket. He moved to Detroit in 1927.
Two years later, he purchased used machinery and formed MASCO,
producing parts for the automotive industry.

"MASCO grew from a little machine shop into the biggest building
products company in the world," Manoogian's daughter Louise Simone
said in a speech. "But his heart was always with Armenians."

As was the heart of Marie Manoogian, who died in 1993. "What she
loved the most was to travel the world," Chris Simone remembered of
her grandmother. "That was her joy. She got to see so many different
Armenians in different parts of the world, and how they were living."

"In those days when life in Armenia and the diaspora was separated
by an iron curtain, Alex Manoogian, as the native son of his people,
was always connected to the concerns of the homeland and lived with
its hopes," the Catholicos said in a speech. "He lived and toiled with
the belief in the unity of our people, the liberty of our homeland,
and the renaissance of Armenian life.

"Generation upon generation of our children will visit the Treasury
Museum built through the patronage of Alex and Marie Manoogian and
come to pay respects to their final resting place. They will pray
within the churches constructed and renovated by their donations;
learn in educational institutions operating under their sponsorship;
and be inspired by their good works and their patriotic and
church-loving spirit and example, for although 'born as mortals,
[they] bequeathed an immortal memory.' It is in this manner that a
people endure -- through devotion, service, noble and valiant deeds
and an appreciation and evaluation thereof -- from generation to
generation. This is the path and life of a blessed people," the
Catholicos continued.

In his speech, Richard Manoogian said that his father "always
remembered fondly his time spent in Armenia, and especially the day
the Alex and Marie Manoogian Museum here was dedicated. He expressed
his deep feelings by stating: 'Every person has a dream in life. For
me it had always been a dream to be able to add my own brick to the
edifice of our ancestral homeland.... I feel rewarded that I have had
the opportunity to place a stone on the hallowed soil of the homeland
at the most sacred site of Holy Etchmiadzin.'"

It was Marie Manoogian who came to Armenia first, in 1955. The
occasion was the election of a new catholicos.

Alex Manoogian followed some 16 years later. "In September 1971, the
three M's -- Manoogian, Mardigian, and Mugar -- visited Armenia," Fr.
Dajad Davidian, former pastor of the St. James Armenian Church in
Watertown, Mass., remembered. "They dedicated the renovation of the
Geghard Monastery. And they went to see Anoush at the Opera House."

* An ongoing legacy

In an address on behalf of the assembled officials, Speaker Torosian
said, "Alex Manoogian's life and work was a remarkable embodiment of
love and dedication -- for his family, his people and our homeland.
And this is why, even after his earthly life has come to an end, his
work is being continued by his children, Louise Manoogian Simone and
Richard Manoogian."

Ms. Simone succeeded her father as president of the AGBU in 1989,
just after Armenia had been devastated by an earthquake and soon
before it achieved independence. Inside and outside the AGBU, she has
been a leader in Armenian philanthropy. Richard Manoogian continued to
run MASCO and has made significant donations to Armenian causes
through the Manoogian foundations.

"This was like a dream for my parents," Richard Manoogian said. "You
cannot imagine how pleased they'd be."

In her speech, Louise Simone said, "Today, I can feel my parents
smiling in heaven, amazed that a new era has begun in their lives; and
grateful to His Holiness that they will now rest eternally on this
blessed earth of Holy Etchmiadzin, the heart and soul of every
Armenian, past, present, and future.

"President Robert Kocharian, our family thanks you for all you've
done. We will never forget the impressive reception upon my parents'
arrival and today's emotional interment. Even my father, with all his
dreams, could not have imagined these last few days. We would also
like to express our deep appreciation to the President of
Nagorno-Karabakh, Arkady Ghoukassian, for joining us today, the
President of the Parliament Tigran Torosian, and Prime Minister Serge
Sargsian, for their presence, both at the airport and today at Holy
Etchmiadzin," Ms. Simone continued.

The police escort that brought the Manoogian family to Etchmiadzin
reminded Richard Manoogian, Jr., of the police lining the streets
during his grandfather's funeral in Detroit in 1996. Alex Manoogian
was a legend for many Armenians, his grandson acknowledged, "but for
us he was grandpa. He took us to baseball games, he played cards with
us. He was a great bridge player." Richard Manoogian recalled that his
grandfather had set up a bridge club. "We'd go and play. It was a
great way to spend time with him."

"So many memories," said Berge Setrakian, president of the AGBU. "In
his last speech before leaving the presidency of the AGBU, he
remembered Gen. McArthur's statement that old soldiers do not die;
they just fade away. 'If I were to be born again,' he said, 'I'd like
to be born as an Armenian.' Those were such memorable words."

Nishan Atinizian of the Eastern Diocese said, "This is a great honor
and quite appropriate for a man who dedicated 50 years of his life to
benefaction of the Armenian nation. It will serve as an example to
others, who should aspire to be so worthy."

Being an example was important to Alex Manoogian. Artemis Nazarian
of Englewood, N.J., remembered Alex Manoogian coming to dinner at
their house. The subject of conversation turned to anonymous
donations. "He did not believe in anonymous donations, he said. He
believed that putting his name to a donation inspired others to give
as well."

Fr. Davidian said that Mr. Manoogian had sponsored him for seven
years, first at the seminary in Antelias, Lebanon, and then for four
years at General Theological Seminary in New York. "He paid my
educational expenses and more. And he never pressured me. He really
did not seek honors. He did not expect thank-you letters." On the
contrary, "he would occasionally write a note saying he was proud of
me."

************************************ ***************************************

3. Many Armenians leave Baghdad for northern Iraq -- or Armenia

* Relief Fund helps families move to Armenia

by Armen Hakobyan

YEREVAN -- The number of Armenians in Baghdad in recent years has
dropped to 15 thousand from 20 thousand, according to Dr. Vehooni
Minasian, vice-chair of the Armenian Diocesan Council of Iraq. The
ongoing fighting, the periodic acts of terrorism, and kidnappings for
ransom have had their toll on all who make Iraq their home.
Iraqi-Armenians have been no exception.

The presence of Armenian peacekeepers in Iraq may have added to the
vulnerability of Iraqi-Armenians. The sixth contingent of
peacekeepers, comprising 46 soldiers, left for Iraq on July 18,
replacing the fifth contingent that was there since February 2.
Meanwhile, citing the Beirut Armenian daily Aztag, panarmenian.net
reports that a car bomb exploded in front of the Armenian Embassy in
Baghdad on July 16. According to the same source, the car belonged to
the Iraqi police. The embassy has not been operating since the
beginning of the war, and the staff are not in Iraq.

Dr. Minasian responded to the Armenian Reporter's written questions this
week.

"Everywhere community life is practically paralyzed. There are four
churches in Baghdad, one each in Basra, Kirkuk, Zakho, and the
Armenian village of Avzrug, and two in Mosul, one of which is newly
built and was subjected to a terrorist attack in 2004. While it is
hard to attend church in some areas, nonetheless our community last
year laid the foundation for a new church in [the northern city of]
Duhok."

The Mother See at Holy Etchmiadzin is in constant contact with the
diocese, Dr. Minassian reports. Many Armenian communities responded
generously to an appeal by the Catholicos to help the Iraqi-Armenian
community. "We understand that our compatriots who have taken refuge
in Armenia did not having difficulties relocating there. In the United
States, in Los Angeles, alumni of Iraqi-Armenian schools have been
sending money to the community and have been supporting the schools
here."

Dr. Minasian confirms reports that many Armenian families are moving
to the north of Iraq, where life is safer. Erbil and the former
Armenian village of Havrezk have received the bulk of the Armenian
refugees, about 100 families in each location, he says. The diocese
has established committees to address the spiritual, cultural, and
educational needs of the new communities. Erbil will have a new
Armenian center soon, he adds.

The north of Iraq may be relatively peaceful now, but hundreds of
Turkish soldiers crossed the border on June 6, allegedly in hot
pursuit of Kurdish guerrillas. They are said to have returned to
Turkey the same day. Turkish generals are said to be eager to have
troops cross the border and stay there. Dr. Minasian is concerned
especially for Armenians living in the villages of Avzrug and Havrezk,
which are 10-25 km (6-15 mi) from the border.

* Refugees in Armenia

According to various sources, there are between 300 and 500
Iraqi-Armenians in Armenia today.

Since 2004, a group of Iraqi-Armenians in Los Angeles have
established the Iraqi Armenian Relief Fund to assist Iraqi-Armenians
resettle in Armenia. Gayane Muradian, the fund's representative in
Yerevan, says, "To help Iraqi-Armenians adversely affected by the war,
some patriots, namely Sarkis Tertsakian, who is the president of the
fund, Raffi Garabedian, Khachig Janoyan, Krikor Diramerian, and
others, formed the fund."

Many Armenians gave generously to the fund, Ms. Muradian says. The
Catholicos, the president of Armenia, and the government have welcomed
the fund's activities and have been helpful, especially through the
Migration Agency, she added.

A waiting list of Iraqi-Armenian families has been established. So
far about 70 families are on the list. On November 1, 2005, four
families, and on September 28, 2006, three families made the move. The
seven families comprised 31 individuals. The fund chose families most
adversely affected by the war.

The families reached Aleppo on their own. The Armenian consulate
there helped them with visa formalities at no charge. Then the fund
flew them to Armenia. A plane ticket costs $160.

But that was just the beginning. For the first four families, the
fund rented four apartments in the Arabkir district of Yerevan. They
made sure the families were located close to each other, at least
initially, as they acclimatized. They disbursed $1,000 to each family
for the first year, in monthly installments. They helped them look for
work so they could make it on their own in the second year and
thereafter. The allocation has been raised to $1,200 because of the
weakness of the dollar.

The contingent that arrived in 2005 has already been granted
Armenian citizenship. The Migration Agency has registered them as
refugees, Ms. Muradian says, and the Armenian Red Cross helps them
with much-needed pharmaceuticals as well as food.

The Iraqi Armenian Relief Fund has also arranged for the relocated
Iraqi-Armenians, who are native speakers of Western Armenian, to
attend free classes in Eastern Armenian, which is spoken in Armenia.

Another ten families are expected very soon. And the president of
the fund, Mr. Tertsakian, will come from the United States to greet
them personally.

connect:
www.IraqiArmenianReliefFund. com

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4. Turkey to hold parliamentary elections on July 22

by Talin Suciyan

ISTANBUL -- Turkey is living through a very dull pre-election period.
Although 14 parties and independent candidates are competing with one
another in the parliamentary elections set for Sunday, July 22, anyone
coming from abroad will think that the colorful flags adorning the
streets are just for decoration. Had meetings in Istanbul not been
organized during the past weekend, no one would have guessed that the
country is about to elect a new parliament. This election will most
likely alter the political landscape that was established over the
past four years.

The experts I have been talking to during the last few weeks about
the elections agree on some major points. According to their
predictions, a larger number of parties than before will be
represented in the next parliament. The parties that have the most
chances of securing seats are: the governing Justice and Development
Party (JDP/AK Party), the opposition Republican People's Party
(RPP/CHP), and the Nationalist Movement Party (NMP/MHP). According to
opinion polls and experts, JDP will form around 40 percent of the
parliament, 25 percent will go to RPP, and NMP will secure 12-18
percent of the seats. NMP will be entering parliament for the first
time.

Another big difference will be the presence of independent
candidates. Independents are expected to form fully 20 percent of
parliament. Most of the independent candidates are supported by the
Democratic Society Party (DSP/DTP) whose main electorate is the
Kurdish population. DSP decided to participate in the election through
independent candidates in order avoid the 10 percent threshold parties
must overcome to win seats. If there are 20 independent candidates in
the parliament then they can form a group.

One independent candidate is Professor Baskin Oran, a very
well-known figure in both Turkish and Armenian society. For the past
ten years, Mr. Oran has been writing a column for Agos, the
Turkish-Armenian weekly. He is well known for his studies on minority
rights and issues concerning the Lausanne Treaty of 1923.

Professor Fuat Keyman of Koc University's International Relations
Department says, "In this election there is no left. There are parties
in various forms of right, but the only left we have is couple of
independent candidates." Indeed JDP, which took an important step
forward with democratizing reforms, is identifying itself as
center-right.

Gulgun Erdogan Tosun, a professor at Ege University, underlines the
same point, saying that although JDP is a center-right party, it is
the most liberal party at the moment and the only party which sees EU
accession as crucial for Turkey's democratization and development.
According to her, there is almost no other choice for liberal,
democratic citizens who view the European Union dynamic as necessary
for Turkey.

There are hardly any differences between RPP and NMP, the former
proclaiming itself to be a social-democratic party and the latter
identifying as a nationalist party. Tanju Tosun, a professor at Ege
University, identifies RPP as a nationalist, militarist, and
conservative party. Ironically, RPP is a member of the Socialist
International.

There is evidence for such an assertion. It was, for example, Bayram
Meral of RPP, commenting on a law aimed at ending the confiscation of
properties belonging primarily to minority foundations, who said "I
congratulate you. You put everything aside, you put the problems of
workers aside, and you deal with Agop's property now."

During the election campaign it was the same RPP that used a map
showing Erzurum as part of Armenia, and claimed that in the framework
of reshaping the Middle East, Erzurum will be handed over to Armenia.
The slogan was, "Did you know that Erzurum will be given to Armenia?"

The only plank on NMP's platform is to bring back the death penalty
and execute Abdullah Ocalan, who has been in prison since his arrest
in 1999. NMP is building its entire political discourse on this issue.

Experts say that RPP will lose its electorate to NMP, which is most
likely to create more of a consensus between the two parties against
JDP.

Gulgun Erdogan Tosun says that this election is seen as a
confrontation between secular republican ideals and antisecularism.
RPP has a claim on the former, while the latter is a characteristic of
JDP. Turkish democracy will again have to pass a crucial exam. If the
governing party JDP comes back to parliament with 40 percent or more,
the electorate will have given an important signal to those who want
to underestimate JDP's acceptance by society and are ready to sidestep
democratic methods. JDP tries to attain its position by showing its
persistence in the existing democratic political order.

Gulgun Erdogan Tosun mentions that Turkey is a country that develops
through crises. And after each crisis, the electorate passes judgment
and gives its response to the politicians by voting for the ones who
didn't cause the crisis. By July 23, we will know what the response
will be and how the will of the people will unfold.

***************************************** **********************************

5. Man in the News: Bako Sahakian

* A decent family man with street smarts and a knack for justice and
keeping his word

STEPANAKERT, Karabakh -- As journalists and observers entered Karabakh
this week through the winding mountain road, they were met by
unusually cool and rainy weather and a banner, "Bako Sahakian is our
candidate" straddling the main road through the Kashatagh district.

And on July 19, as voters flocked to polling stations around
Karabakh to vote for their next president, the 46-year-old Mr.
Sahakian had the biggest advantage any candidate could wish for: a
widespread public belief in his inevitable victory.

***

This expectation began to take shape last spring after Mr. Sahakian,
the director of Karabakh's National Security Service, was nominated on
a civic initiative and soon received endorsements from leaders of all
four political parties represented in Karabakh's parliament; the war
veterans' association, Karabakh's most important nongovernmental
group; and most recently President Arkady Ghoukassian.

Still, in a July 17 interview with the Armenian Reporter, Mr.
Sahakian said that he is "not a pro-establishment candidate," and that
he sees both "achievements and shortcomings" in Mr. Ghoukassian's
presidency.

When asked to name some of the shortcomings, however, Mr. Sahakian
declined to go into specifics. He did note, however, that public
concerns with social and economic problems, such as availability of
well-paying jobs and state-funded infrastructure and services, are the
focus of his campaign.

Mr. Sahakian appeared able to win over the two main segments of the
Karabakh electorate -- those who are generally happy with the outgoing
president's policies and see Mr. Sahakian as a supporter of the status
quo, and those who seek a stepped-up government reform effort.

In the July 17 interview, Mr. Sahakian also argued for the
continuation of the government policy of insisting on Karabakh's
participation in negotiations on the future status of the republic.

Asked if Karabakh should take steps to seek unilateral recognition
of the republic, Mr. Sahakian said that he did "not think it was the
right approach" and held out hope that direct negotiations between
Karabakh and Azerbaijan would bring about a mutually agreeable result.

And when asked whether Karabakh should participate more actively in
the Russia-backed effort to coalesce the four unrecognized republics
in the former Soviet territory, and act through a joint platform, Mr.
Sahakian was noncommittal, adding that issues that "do not contradict
our interests can become a subject for discussion."

***

A Stepanakert native and graduate of one of the local high schools,
Mr. Sahakian did his mandatory military service and then began an
initially unremarkable career as a skilled worker and then a supplies
specialist for the local government.

But just as for other Karabakhis, for Mr. Sahakian things changed
radically in 1988 with the start of the movement for reunification
with Armenia. He joined the Karabakh self-defense forces in 1990 and
from 1992 and throughout the war was one of the key persons
responsible for supplying these forces with everything they needed,
from food to weapons. Mr. Sahakian was decorated with Karabakh's
highest medal for valor -- the Combat Cross, first degree.

From 1997 to 1999, Mr. Sahakian was seconded to Armenia's Ministry
of Interior and National Security (then headed by the current Prime
Minister Serge Sargsian).

Because that assignment involved a lengthy posting in Moscow, Mr.
Sahakian's opponents suggested that he may not fulfill the 10-year
residency requirement for presidential nominees. But the Central
Electoral Commission ruled that in those years Mr. Sahakian remained
in state service and therefore was qualified to run.

In 1999, Mr. Sahakian returned to Karabakh to serve first as the
Interior (Police) Minister and since 2001 as National Security Service
director, a position he resigned last month when he sought
registration as a candidate.

To those who observed him closely in Stepanakert, he is known as a
decent family man with street smarts and a knack for justice and
keeping his word. As minister and government service director Mr.
Sahakian was praised for his energy, leadership skills, and defense of
the small guy.

And even his current opponents have seen him as a potential ally for
reform.

-Emil Sanamyan

**************************************** ***********************************

6. Man in the News: Masis Mayilian

STEPANAKERT, Karabakh -- Here in Stepanakert at least, 39-year-old
presidential candidate Masis Mayilian appeared to be running a
campaign as prominent as that of frontrunner Bako Sahakian, at least
if judged by the availability of posters.

Outside the capital, however, the story was different and Mr.
Sahakian's visibility was clearly unrivaled. But even in Stepanakert,
Mr. Mayilian's sole campaign office was located in the office of an
electronics store located on a side street, while Mr. Sahakian's
campaign boasted nine offices.

Despite a clear mismatch in resources and financial support, Mr.
Mayilian himself insisted in a July 17 interview with the Armenian
Reporter that he was "only thinking of victory."

***

Mr. Mayilian announced his intention to run for president later than
the other four candidates, and just as the deadline for nominations
was approaching. Asked why he decided to run, Mr. Mayilian pointed to
15 years of experience in government, and expressed a conviction that
he was in a position to implement "a program of reforms in order to
strengthen our country and speed up its development tempo."

Mr. Mayilian also claimed that the political parties' decision not
to nominate their own candidates, but jointly endorse Mr. Sahakian put
the "conduct of elections under threat." He argued that "were it not
for my nomination, this would have become not an election, but an
appointment with no real alternative offered."

The focus of Mr. Mayilian's campaign has been on "real reform,
supremacy of the law, and international recognition of Artsakh." He
pointed to what he called "conservative forces that have united around
the [Sahakian] candidacy" and suggested that the current political
struggle transcends the traditional authorities-opposition divide and
pits reformers against supporters of the status quo in both camps.

And Mr. Mayilian continued, although leaders of all major political
forces have endorsed Mr. Sahakian, many rank-and-file members, as well
as many midlevel state officials are backing Mr. Mayilian, but are
reluctant to do so openly.

Mr. Mayilian's supporters have complained to the Central Election
Commission that local officials have been hampering his campaign and
supporting Mr. Sahakian. One Mayilian supporter in Mardakert region
was reportedly forced to retire from his job in the state natural gas
utility as he made his political preference public.

Mr. Mayilian also said that all seats on central and local electoral
commissions are controlled by appointees of the president and
parliamentary parties that have endorsed Mr. Sahakian, and that Mr.
Mayilian's campaign is only represented by observers.

"I only hope that [electoral commission members] would be guided by
state thinking and patriotism and would not approve of
falsifications," he said, adding that he hoped "the voting and
counting are conducted in a normal way without violations."

***

A native of Stepanakert, Mr. Mayilian graduated from the local high
school and, following mandatory army service, from the mathematics
faculty of the local pedagogic institute in 1991.

For about a year, Mr. Mayilian was enrolled at the Yerevan State
University graduate school studying social psychology, but then in
1992, as fighting raged throughout Karabakh, he decided to return to
his hometown to work in the State Defense Committee as media liaison.

Mr. Mayilian became one of the first staff members of Karabakh's
Ministry of Foreign Affairs, established in 1993, and rose through the
ranks to become deputy minister in 2001. Throughout his years at the
ministry he was one of the key individuals representing Karabakh in
international negotiations and is widely considered to be one of
Karabakh's most experienced diplomats.

Most local voters praise Mr. Mayilian as smart and incorruptible,
but many also point to his lack of experience in running domestic
affairs.

-Emil Sanamyan

**************************************** ***********************************

7. Artsakh elects a new president

* Here they are convinced that democracy is not optional

by Armen Hakobyan

STEPANAKERT, Karabakh -- Free from the aggression of Azerbaijan,
having won the right to live in freedom and independence, but not
recognized by the international community, the Armenians of Artsakh --
the Republic of Nagorno-Karabakh -- on July 19 elected their
third-ever president. According to the preliminary results posted by
the Central Electoral Commission, 87 percent of citizens voted for
Bako Sahakian. Massis Mayilian received almost 11 percent of the vote.
According to the chair of the Central Electoral Commission, Sergei
Nasibian, of 92,177 registered voters, 70,235 or 76.25 percent came
out to vote.

A 62-year resident of Stepanakert, Aram Melkumian is convinced that
elections, especially presidential elections, are akin to festivities.
To prove his conviction, Aram and his friend Alexander Aghabekian
created a rather large commotion outside polling station 4/1 at
Stepanakert's Number 5 Middle School. The two friends greeted voters
by playing traditional Armenian melodies on their traditional Armenian
instruments, the dhol and the zurna. They assured us that they had
come to play here of their own free will, without getting paid. Their
only objective was to transmit a festive mood to their fellow
Armenians through music. "We went to war with these instruments, why
shouldn't we play them today when we are voting for our new
president?" Aram asks honestly.

It was at this very same polling station that the frontrunner, Bako
Sahakian, came to vote. Of the other 4 candidates, Armen Abgarian,
Vania Avanesian, Hrant Melkumian, and Masis Mayilian, only Mr.
Mayilian was considered a contender against Mr. Sahakian.

Mr. Mayilian came to the same polling station an hour later to cast
his vote. During a conversation with reporters, he commented that he
had come to vote not only in high spirits, but in a victorious mood,
although the musicians had already gone. "I have come to vote with
high spirits and we are waiting for victory," he said.

* Observers give a positive assessment

The Council of Europe and some member states have said they do not
recognize elections in Karabakh and did not send observers. But over
100 observers, eight of them local, monitored the election, according
to the CEC. International observers had come from the United States,
Russia, Ukraine, Italy, Greece, France, Serbia, Germany, and other
countries, including Armenia.

Two international observer groups, the Trans-European Dialogue
Network and In the Name of Democracy and the Rights of Peoples (which
includes the unrecognized republics of Abkhazia, South Ossetia, and
Trandniesdr; Karabakh has observer status), on the evening of July 19
presented their preliminary assessment. These two missions stated that
they had visited 278 polling stations, which is about 20 percent of
all the precincts: "Based on the observations, the international
observers came to a general consensus that the July 19 presidential
elections in Nagorno-Karabakh comply with their national legislation
and adhere to international standards and principles of holding
democratic elections."

I had the opportunity at various polling stations to talk to some of
the observers. Grigory Marakutsa is with In the Name of Democracy and
the Rights of Peoples. He was speaker of the Transdniestr parliament
and has had the opportunity to observe many elections, including those
in Abkhazia and South Ossetia. "The most important thing is for the
people of the country to recognize the results of the elections," he
said.

South Ossetia's deputy speaker of parliament, Yuri Dzitsoity, said,
"First of all, my first impression of Karabakh has nothing to do with
the elections but rather with the all the construction going on, the
vibrant life here, and how decrepit buildings are being torn down to
make way for new buildings. This is a pleasant surprise for me, and
this is perhaps the only way that the Armenians of Karabakh can prove
their right to have an independent state.

"And with regard to what European bureaucrats say about not
recognizing the elections, I believe they are not being honest when
they state that they don't recognize the elections. Elections are the
expression of the opinion of the people, and it is not possible to
ignore the opinion of the people. And if you disregard the people's
opinion, then excuse me, those people have a right to disregard your
opinion. This is the first thing," Mr. Dzitsoity continued.

"The second point is as a result of the elections, there is an
elected president, parliament and I think I can say that when the
European Union, American members of Congress, and the president of the
Parliamentary Assembly of the Council of Europe come to have meetings,
they meet with elected representatives. If they don't accept the
elections, then how can they accept the results? Their statements have
been made to accommodate Azerbaijan and Georgia. In reality they work
with pleasure with those people who have been duly elected," Mr.
Dzitsoity concluded.

* The assessment of the leaders of Karabakh

"This electoral campaign illustrated that all the candidates had equal
opportunities," said Ashot Ghulian, Speaker of the Nagorno-Karabakh
parliament. "Everything depended upon the ability of the individual
candidate and how he presented his platform. As to the shortcomings of
these elections, I don't believe than any election can be completely
free of any shortcoming whatsoever. However these problems cannot
affect the final outcome of the elections themselves."

Mr. Ghulian added, "This is the path that the people of Karabakh
have chosen, one which we will not stray from and one which is a clear
message to the international community."

A BBC reporter asked the incumbent president of Karabakh, Arkady
Ghoukassian, why Karabakh bothered to hold elections that will not be
recognized by the international community. Mr. Ghoukassian said, "We
hold elections not for the international community, but first of all
for ourselves, to make the Nagorno-Karabakh Republic democratic and
thus realize the goals our people set forth in declaring independence.
As to whether the international community recognizes or doesn't
recognize these elections, then I wish that those who don't recognize
the elections would propose an alternative. What should we do if not
hold elections? What is the alternative to elections? If the people do
not vote, then what do you do? Arkady Ghoukassian should become a
Turkmenbashi and rule for fifty years? This is the alternative to
elections."

* The people's assessment

In polling stations in and around Stepanakert, from early in the
morning, citizens were actively coming out to vote.

One older resident of Stepanakert showed me her Armenian passport
and asked why a united Armenia and Artsakh needs two presidents.
Although the vast majority of voters were asking less provocative
questions, they were in fact concerned with the more pragmatic ones
having to do with pensions, increases in wages, the creation of jobs,
and solutions to other social problems. At the same time, many of the
voters I spoke with had hope that the during the term of the new
president, the Karabakh conflict would find its final resolution,
Karabakh would be recognized internationally, it would have its own
unique status, with a border linking it to Mother Armenia.

A 64-year-old resident of Stepanakert, Hrant Harutiunian said,
"Whether they recognize us or not, we are electing a leader for
ourselves." His fellow Stepanakertsi Grisha Mikaelian added, " I only
want my chosen candidate to be president."

I asked Aram the musician whether it is possible that the new leader
of Karabakh would concede any territory. "Don't you believe that
anyone would concede any territory! I fought in that war. I
participated till the end. I am disabled in the second degree. How can
we give back the blood that we shed and say, here, take it? How are we
going to answer to our martyrs that we conceded territory? We go to
mutual concessions only when we know that they [Azerbaijanis] have
withdrawn and will have nothing further to do with us." He was visibly
shaken afterward.

This is the overriding opinion. People have been living freely for a
long time now in Artsakh and not only are they sure in their right to
self-determination, they are ready to struggle till the end to protect
what they have achieved because what they have achieved has come at an
extremely high cost.

******************************************* ********************************

8. From Armenia, in brief

* Royal Armenia executives set free

YEREVAN -- After nearly two years in prison, two businesspeople were
acquitted of charges of customs fraud and have been set free. The two
men are Gagik Hakobian, co-owner of Royal Armenia coffee importers,
and Aram Ghazarian, who at the time of his arrest was director of
Royal Armenia.

The State Customs Service had filed a complaint against them after
they went public with complaints about corruption in the Customs
Service.

Royal Armenia in 2005 had complained that Customs had determined the
value of the coffee imported by them to be higher than it actually
was, and higher than the value of coffee imported by their
competitors. The higher value led to higher import duties. Royal
Armenia charged that top customs officials had offered to lower the
assessment if Royal Armenia would agree to share with them the
consequent savings in import duties.

Suddenly, the Customs Service announced that it had uncovered
customs fraud on the part of Royal Armenia. The charge was presenting
falsified invoices from supplier Vatche Petrossian, a citizen of the
United States.

This week, Yerevan's Kentron & Nork Marash district court found the
charges to be baseless, acquitted the two men on all accounts, and
ordered them freed on the spot. The court also ordered the prosecutor
general to institute criminal proceedings against Mr. Petrossian for
providing false testimony regarding the invoices.

Observers noted that acquittals are exceedingly rare in Armenia's courts.

* Armenia has a new chief tax collector

YEREVAN -- Vahram Barseghian is the new head of Armenia's State Tax
Service, the main tax-collection agency. He was appointed by President
Kocharian on July 16. Mr. Barseghian's former position was running the
president's Oversight Service, an agency whose responsibilities are to
track irregularities and corruption within different government
bodies. In this position he uncovered various problems, including
fraud in the earthquake zone and customs fraud relating to
mobile-phone imports.

Mr. Barseghian replaces Felix Tsolakian, who came to the job four
years ago from the same position as head of the Oversight Service. Mr.
Tsolakian will now serve as a presidential advisor.

The government recently launched a plan of legislative and
administrative measures aimed at raising tax revenues over the next
several years. Although Armenia's tax revenues have shown steady
growth, tax evasion is widespread.

* USAID and EBRD assist small and medium enterprises in Armenia

YEREVAN -- On July 16, Ambassador Rudolf Perina, charge d'affaires ad
interim at the U.S. Embassy in Armenia signed an agreement between the
U.S. Agency for International Development and the European Bank for
Reconstruction and Development. This agreement was signed in support
of EBRD's Turn Around Management and Business Advisory Services
(TAM/BAS) and will provide $1.64 million in funding.

USAID's contribution consists of 74 per cent of the funding; EBRD
will provide $0.5 million, or approximately 26 percent of the total.
Within the framework of this three-year program, it is expected that a
minimum of 180 projects will be undertaken, with the focus on
Armenia's rural and less-developed areas.

The main goals of this program are twofold: first, it is to assist
small and medium enterprises (SMEs) in their business development;
second, it is to support the professional development of local
business consulting companies. BAS has been functioning in Armenia
since May 2003 with the financial assistance of the European Union,
EBRD, Canada International Development Agency (CIDA), and Taiwan.

The regional director of BAS, Natalia Melyounas, informed the
Armenian Reporter that of those 389 small and medium businesses that
previously participated in the program, only 8 percent were deemed to
have had poor results, while 53 percent were considered to be
excellent, and the rest were qualified as satisfactory.

The private sector in Armenia is short on financial resources and
management, and BAS program can have a significant impact in this
area, Ms. Melyounas said. Turnover of enterprises is expected to rise
by 10 percent and jobs by 20 percent or 5-10 new jobs per enterprise.
An increase in production by 10-15 percent is also foreseen, as is the
introduction of new methods of market management, and the anticipated
positive effect of increased health and safety of employees.

Mr. Perina welcomed this new level of cooperation between USAID and
EBRD, emphasizing that this three-year program will help to increase
the number of SMEs in Armenia's rural and poor areas and will assist
in improving business productivity and turnover. "During the last
twenty years, 70 percent of jobs in the United Sates have been created
by SMEs. The same can be realized in Armenia because the best chance
Armenia has of creating jobs is through small and medium enterprises."

****************************** *********************************************

9. Two sides of Yerevan urbanism

* Construction at Tamanyan Park and by Swan Lake

by Karen Mikaelian (NOVOE VREMYA)

YEREVAN -- Construction started simultaneously in two popular
locations in Yerevan. Both building sites are hidden from curious
eyes. One is located at the foot of the Cascade and the other by the
Swan Lake. In both cases, the citizens of Yerevan are seriously
concerned.

A section of Tamanyan Park, from Moskovian Street to Isahakian
Street, is fenced in with aluminum plates. The well-groomed emerald
lawn was removed and digging is underway. Rumors are rampant that
there is going to be some sort of construction. However, the rumors do
not correspond to reality. The administration of the Cafesjian Museum
Foundation (CMF) is making improvements to the park although by
Yerevan (and not only Yerevan) standards, the park was already ideal.
Nowhere else in Yerevan can you find so many well-groomed flowerbeds
and lawns as in Tamanyan Park. Apparently this was not good enough for
the CMF. Along with the construction of the Cafesjian Center for the
Arts, Tamanyan Park and the whole Cascade will change gradually and a
new park will be built.

"There is no reason for residents of Yerevan to be concerned.
Tamanyan Park will be transformed into an even more attractive and
beautiful place," said Edward Balassanian, Executive Director of the
CMF. "It will become an organic part of the Cascade and of the future
museum. It will in a sense set the stage for ascending the steps, for
approaching the museum and the exhibition halls on the landings of the
Cascade. Construction will be carried out in two phases so as not to
prevent people from visiting the park. First we will renovate the
underground communications beneath the park -- storm sewages,
electrical cables, water pipes, etc. They are worn out and will be
totally replaced."

Architect David Hotson, the designer of the museum, proposed
construction of stone podiums and pedestals along both sides of the
park to support large sculptures from the Cafesjian collection. Some
of these sculptures are already on exhibit in various locations on the
Cascade. They will be gathered in one place, in the park. Comfortable
benches will be built from travertine stone with wooden seats. In
addition, steles will be erected to serve as billboards and
information guides to all events in the exhibition halls and the
museum, to advertise current programs, exhibitions, etc. The pools and
fountains will undergo fundamental reconstruction. According to Mr.
Balassanian, they will be fitted with colorful lights, and their
design, as well as the overall illumination of the park, will comply
with modern European and American standards and tastes.

Naturally, the greenery will also change. "No tree or bush will be
ruined. New ones will appear. And more flowers will be planted," Mr.
Balassanian promised. The most interesting and unexpected innovation
will be the total absence of commercial influences: no cafes and
tasteless music. There were two freestanding buildings on the park;
Gerard Cafesjian purchased them and had them dismantled, affording
people a unique opportunity to simply stroll and rest in the vicinity
of sculptures, in the green, the light, and the open air, and among
peaceful and urbane fellow citizens. The foundation intends to
complete the initial phase in October and start the reconstruction of
the central part of the park next year. It will become the largest
municipal improvement project in the city.

There is no reason to doubt that the job will be accomplished and,
as they said in the Soviet era, "in good time and quality." Mr.
Cafesjian has so far fulfilled all his promises. The Cascade has been
transformed as if by magic. It is pointless to recall the variety of
unfair arguments and accusations, invectives and reproaches about why
an "odar" should become the owner of the Cascade. Today it is
impossible to imagine what would have happened to the park and the
Cascade had Mr. Cafesjian not acquired the site. Most definitely, all
kinds of buildings would have been erected, music would be blaring,
the escalators would have rusted away, and numerous villas and
commercial enterprises would have appeared in the surroundings. And
there would be dirt, withered greenery, and dilapidated fountains.
Where are those critics today, and what do they think (if they ever
think) while strolling along Cafesjian's "estates"? As a result of an
actually profitable transaction, the Treasury got richer, people got
work, and people can enjoy blissful strolls in the park.

***

The second construction site is located by the Swan Lake, parallel
to Tumanian Street. In the past, there was a grass crocodile, made by
someone who liked to sculpt shrubbery. Then, all of a sudden a cafe
appeared, causing a storm of public protest. The cafe was overgrown
with climbing vines, which made the view a bit less dreadful. In the
spring the ownership changed and things began to take off. The cafe
with its picturesque climbing vines was dismantled and digging began.
In a couple of days, excavators dug a huge hole and then they simply
vanished. The hole, currently surrounded with plastic, is 5 to 6
meters deep; it is right by the statue of Arno Babajanian. No
information about the construction is posted for the public, and it is
unknown what is being built.

The name of the new owner is also a secret, but that is not the
point. The point is that Mister X most likely intends to build
something fundamental. The public, including the architectural
community is at a loss. The foundation pit is large and obviously for
the purpose of building something starting underground. What will be
on the surface? Most probably something monstrous. Even if it is a
glass cube or a different figure (which is totally unbelievable), it
will obviously mutilate the surroundings once and for all -- the lake,
the Northern Avenue block, etc.

There is no other obvious option. After all, if even the former
small cafe with abundant greenery blocked the view of the lake, what
should we expect from a six-meter deep ditch? Sources say that the
City Council has neither considered nor approved the project at all.
It appears that the long-lasting intensive talks and discussions with
regard to numerous building sites surrounding the Opera House were
just soap bubbles, a lot of hot air. We thought then -- that's it, let
bygones be bygones, we are starting a new life and no new construction
will appear around the long-suffering masterpiece of Alexander
Tamanyan [who drew up the plans for Yerevan in the 1920s]. But we were
mistaken.

So, on the one hand we have Gerard Cafesjian -- an American
philanthropist, who has undertaken to bring the Cascade and the park
into civilized shape and construct the Center for the Arts. On the
other hand we have a local tycoon who most probably lacks not only
civic consciousness and love toward the Armenian metropolis, but also
taste. Perhaps public indignation and resentment is baseless, and the
owner will build something invisible and subterranean, like a cavern
with a manhole entry and covered with grass? I wish I were mistaken.
However, even a most iniquitous ditch is never covered up in our city.
Therefore, it is hopeless. So, they will build whatever they wish:
another multifunctional object.

* * *

Originally published in NOVOE VREMYA on July 10, 2007. Reprinted with
permission.

******************************** *******************************************

10. Market update

by Haik Papian

A. Rates

The yield-to-maturity curve has an upward slope. The shape of the
curve has been almost the same for the last three months. In contrast,
the forward-rate curve shows volatility, especially in the
long-maturity segment, which can be explained by recent changes in
spot rates. Spot rates for bonds with 7-year maturity decreased (to
5.5220 from 6.0284) and for bonds with 10 year-maturity, spot rates
increased (to 6.2012 from 5.6521).

The diagram shows the exchange-rate fluctuations for AMD/USD and
AMD/EUR currency pairs. The base day is June 12.

The exchange-rate quotation is presented in European terms, and the
percentage decrease or increase in the diagram means appreciation or
depreciation of Armenian dram.

From June 12 to July 13, the Armenian dram was appreciating against
both the euro and the U.S. dollar. In the reporting period, the euro
appreciated about 0.78 percent and the dollar depreciated about 2.39
percent. As opposed to the last period (May 15-June 11) the pace of
Armenian dram appreciation against the euro went down from about 4
percent to almost zero, and against the dollar remained almost the
same.

B. Corporate securities

The spreads maintained on the exchange for corporate bonds remained
approximately the same on average:

* Ararat Bank (10 months before maturity): Bid 8.05%; Ask 7.90%

* Cascade Credit (3 months before maturity): Bid 5.20%; Ask 4.70%

Ararat Bank notes turnover exceeded 36 percent of the whole issue in
secondary trading.

C. Indexes

Cascade Business Sentiment Index (CBSI): The Cascade Business
Sentiment Index is our approach to forecasting sentiment about
Armenia's business trends. The Sentiment Index is based on a survey,
the respondents of which are a group of individuals who own or operate
stable and growing businesses in Armenia. The survey measures the
business owners' expectations for the near future by addressing to
them questions and calculating the weighted average of their replies
on a numerical scale (from 1, the most pessimistic, to 10, the most
optimistic). The Cascade Business Sentiment Index for the month of
July 2007 is 6.5, which is a 1.5 percent decrease over the last month.
This decrease can be explained by an anticipation of overall demand
decrease during the summer period. In addition because of Armenian
dram appreciation, many people prefer to spend their vacations outside
of Armenia, which puts additional pressure on service providers'
expectations.

Cascade Commodity Index (CCI): The index, which is the average
retail price in Armenia for certain commodities, has seen a monthly
increase in the last few months. The Cascade Commodity Index for
June-July 2007 is 15160. No increase was observed in the last month.
The commodities tracked by the index are (1) petroleum (20 liters);
(2) steel (100 kg); (3) pork (10 kg); (4) flour (10 kg); (5) corn oil
(10 liters).

D. Major Market Events

Cascade Investments placed 1 billion AMD of ArmRusgazprom CJSC coupon
bonds. This was the largest corporate fixed-income security placement
ever done in Armenia. Securities have semiannual 4.5 percent coupon
payments and mature after 18 months. Bonds were placed at par 10,000
AMD. A total of 31 investors bought the issue. The buyers were legal
entities and physical persons. ArmRusgazprom CJSC was founded in
December 1997. The owners of ArmRusgazprom are Gazprom OJSC, Russia,
57.59 percent of share capital; the Ministry of Energy of the
Republic of Armenia, 34.7 percent of share capital; and Itera
International, Ltd., a U.S.-based concern, 7.71 percent of share
capital.

ArmRusgazprom CJSC is engaged in the distribution of natural gas to
customers in Armenia. The company has monopolistic right to import
gas, to operate distribution system, and to sell gas to residential
and industrial customers. The company has 17 branches in Yerevan and
16 in the regions (marzes) of Armenia as well as an engineering center
branch in Yerevan. ArmRusgazprom CJSC has 5,546 employees.

* * *

Haik Papian, CFA, is CEO of Cascade Investments. He can be reached at
[email protected]. For charts, see the print version of
the newspaper or the pdf version at reporter.am

************************************* **************************************

11. Living in Armenia: With home ownership comes a sense of belonging

by Maria Titizian

Buying a home can be a daunting and emotional journey for most of us.
So many hopes and dreams are tied up into owning a home, especially
when it's your first one: "This is where we'll build a life for
ourselves, raise our children, plant a vegetable garden, and grow old
together." More than a real estate transaction, buying a house is a
commitment, not only to the bank, but to our concept of family. Owning
your own home is an intrinsic part of the American dream and according
to the U.S. Census Bureau almost 70 percent of Americans own their own
homes.

There's the minor issue of getting approved for a mortgage, however,
making sure monthly payments can be made, buying garden tools, patio
furniture, and for those living in the northern reaches of our
hemisphere, most definitely the purchase of shovels or snow blowers.

However for any real Armenian family, the most important and
critical piece of furniture is the barbecue. My husband comes from a
village, so a gas barbecue was out of the question. I was raised in
the city therefore a tonir was out of the question. We settled on a
large, custom-made wood-burning barbecue, which saw its share of
family get-togethers and quiet Saturday evenings when the sun was
setting, and the smell of the wood burning and the aroma of the food
would alleviate any or all of the previous week's angst and tension.

A sense of ownership is not enough, though. One needs to have a
sense of belonging as well. For most of my life, I always felt like I
never belonged. I never belonged among my blue-eyed, blonde-haired
friends, who used to live in pretty houses on even prettier streets in
neighborhoods where I could never have dreamed of living. Back in the
early 70s, Canada was not home to many immigrants, and the "visible
minorities" in my Grade 1 class were an Arab, a Jew, and me.

So there I was, a dark-eyed, dark-haired quiet little girl who lived
in an over-store apartment, usually infested with large black
cockroaches; my fair-skinned friends went to music class or dance
class and all lived in houses with neatly trimmed backyards, where
they could play. I recall walking home from school one day and seeing
a "For Sale" sign on the front garden of a brick bungalow. I stood
there gazing wistfully at that house and feeling like Francie Nolan
from A Tree Grows in Brooklyn. How I wanted to live in that house! I
ran home and told my mother excitedly about this wonderful fairytale
house that was for sale and could we please, please buy it. Only
decades later did I realize the pain I must have caused my mother back
then, an immigrant with no education, no family, and no money in the
bank. All I remember of her reaction is her face slowly turning away
from me.

So when I moved into my first house, modest as it was, my dream was
still the house on the street with the "For Sale" sign that I, as a
little girl of 8 or 9 had seen. The house we bought was the house
where we raised our children, planted a vegetable garden, had
barbecues, and eventually decided to sell to move to Armenia.

Home ownership in Armenia, however, has taken on a new meaning for
me. We bought a home here in Yerevan because we were going to be
living here. Lately many of our friends who live in different parts of
the world are buying homes in Armenia. I have had the privilege and
utter comic relief of watching these people that I love go through the
very difficult process of having a home in the homeland. Most of these
friends, I wish to make clear, will not be living in Armenia
permanently now or even in the foreseeable future.

Owning a home in Armenia allows them the freedom to come and go, to
have a foothold in a place they have claimed for themselves, to leave
perhaps a legacy to their children by enabling them to dig and
discover their roots. But with all this lovely imagery comes the
reality of dealing with builders who are constantly behind schedule,
contractors who don't show up, entire paint crews who are off the job
for days because their cousin's sister-in-law's 88-year-old mother
passed away in Gyumri and they must go to the funeral.

I hope the reader takes what I am about to say with a grain of salt,
but my American-Armenian friends are the funniest. One particular
friend, who will remain nameless, had this notion that there must be a
department store-like place which sells home supplies and that we
would have a cart and go aisle by aisle to find all the things he
needed for his newly finished apartment. On the way to this imaginary
place I was trying hard to control my laughter.

Where we were going in fact was a narrow, dusty street located just
behind the statue of Vartan Mamigonian on his horse, arms
outstretched, ready for battle. Not unlike the frame of mind we needed
to be in to survive this shopping expedition. The street, which is
overcrowded with cars and people, is home to about 10 or 12 small
shops lined together selling everything from light switches to laundry
detergent. There are no carts, no salespeople to assist you, and most
importantly no air conditioning in any of these specialty stores. We
ended up making 4 or 5 trips to the car to unload the stuff he bought,
and at the end of it we were both exhausted. Once in the car, with the
air conditioning on at maximum, I turned to him and said, "Welcome to
Armenia!" I don't think he was amused.

And then there's the issue of quality control in newly constructed
apartment buildings. Another friend, shortly after moving into his
apartment, discovered that two of his three sinks were leaking and a
rather large crack had formed on the wall that separated his two
bedrooms. In the laundry room, the crew that had tiled the walls had
failed to bring the tiles all the way down to the floor. When my
friend complained that there was a 3 inch space between the floor and
the tile on the walls, the varbed (master) said, "Well, just close the
door and you won't see it." This is the kind of answer you're likely
to get 9 out of 10 times.

Much as I find it humorous to see my friends in distress and
frustrated, I am sincerely happy for them because in Armenia with a
sense of ownership comes the sense of belonging. So whether their sink
is leaking or there's a crack in the wall, or the slim possibility
that the uneven flow of electricity might end up damaging all their
appliances (a piece of information I have yet to impart to them), I
hope that this sense of belonging will overshadow all the other
shortcomings of owning a home in Armenia.

**************************************** ***********************************

12. Commentary: Doublespeak and double standards -- over democracy in
Karabakh

by Tatul Hakobyan

YEREVAN -- The co-chairs of the OSCE Minsk Group on July 14 issued a
joint statement to give their "assessment of the emerging situation in
the settlement process for the Nagorno-Karabakh conflict in light of
the recent meeting" between President Robert Kocharian of Armenia and
Ilham Aliyev of Azerbaijan in St. Petersburg.

The mediators stated that the presidents could not overcome their
remaining differences. "Thus, the two sides are approaching 2008 -- a
year of presidential elections in both Armenia and Azerbaijan, when,
as past experience shows, chances for progress will likely be
overshadowed by the electoral campaigns. Without an endorsement of the
basic principles at the presidential level, it is impossible to start
drafting the text of an agreement on the peaceful settlement of the
conflict, or to secure the progress of the past three years of
negotiations in order not to re-open them from scratch whenever they
resume again," the statement reads.

Referring to the recent visit of a group of prominent figures, led
by the ambassadors of Armenia and Azerbaijan in Moscow, to Karabakh,
Armenia, and Azerbaijan, the co-chairs said "the conflicting sides
showed their ability to create more favorable conditions for preparing
their public opinion for peace."

The co-chairs went on to express concern about several current
developments that, in their view, "do not contribute to preparation of
the populations for peace." Obviously, and quite appropriately, they
specifically cited "militaristic statements threatening use of force
and creating the dangerous illusion that war is an option for
resolution of the conflict."

Such statements have been coming from Azerbaijan alone.

* Condemning democracy

Surprisingly, the statement by the co-chairs of the Minsk Group of the
Organization for Security and Cooperation in Europe also cites "the
upcoming so-called presidential elections in Nagorno-Karabakh," saying
that the elections "have already caused an increase in tensions." The
co-chairs continue: "Recalling their statements with respect to
previous votings in Nagorno-Karabakh, the co-chairs reiterate that,
like all other members of the international community, their countries
do not recognize Nagorno-Karabakh as an independent state, and such
'elections' should not have any impact on the peaceful settlement of
the Nagorno-Karabakh conflict."

All previous elections in Nagorno-Karabakh -- presidential,
parliamentary, or local -- have likewise gone unrecognized, and some
have even been condemned by OSCE and by other European organizations
like the European Union or Council of Europe. These multilateral
institutions have sometimes been joined by individual countries
including Azerbaijan and Turkey, the officials of Russia and the
United States, and sometimes Georgia, the Ukraine, and France.

Azerbaijan's and Turkey's position is obvious and does not lend
itself to further analysis. OSCE's position with respect to the
elections in Karabakh, however, is incomprehensible. On March 24,
1992, OSCE (at the time CSCE) drew up its first position paper on the
Karabakh conflict. This position paper clearly states that
negotiations were to take place between Armenia and Azerbaijan, but
also with the participation of elected officials and other authorities
from Nagorno-Karabakh.

By "elected officials," CSCE meant the first elected parliament of
Nagorno-Karabakh, whose president was Artur Mktchian. That body was
elected on December 28, 1991. By "other authorities" CSCE referred to
the Azerbaijani community whose leader was Shushi's mayor, Nizami
Bahmanov. At the time, CSCE was utilizing and clearly distinguishing
the terms "elected" and "other" because the government in
Nagorno-Karabakh was elected by the people, whereas Nizami Bahmanov,
who was representing the executive branch of his government, was
appointed to his position by Baku.

It was the same organization on whose behalf the Minsk Group was
formed, and whose then-president, Deputy Foreign Minister Mario
Rafaeli of Italy, insisted that the Karabakh delegation participate in
the negotiations that began in the summer of 1992 in Rome. The
Karabakh delegation did not participate in the first two meetings in
Rome out of protest: the delegates had been invited as the elected
officials of the Armenian community of Nagorno-Karabakh, but the
Azerbaijanis, who were appointed, were considered to have the same
status. It was only on Yerevan's insistence that the Karabakh
delegation -- comprised of members of parliament Boris Aroushanian,
Robert Kocharian, and Hrant Khachatrian -- finally participated in the
subsequent three negotiation meetings in Rome.

From that time until April 1997, Karabakh's elected officials have
participated in all the negotiations as a separate side, whereas the
Azerbaijani community of Nagorno-Karabakh has participated in the
negotiations only as part of Azerbaijan's delegation.

* "So called" logic

If the OSCE truly does not recognize the results of the elections, or
genuinely considers them "so-called," then why is it that the
co-chairs of the Minsk Group, the chairman-in-office of OSCE, and the
special representative of the European Union in the South Caucasus
have all met either in Stepanakert or in Yerevan with the
representatives of the elected leaders of Nagorno-Karabakh? Mario
Rafaeli in 1992 and 1993 visited Stepanakert at least 10 times and met
with Artur Mkrtchian and then Georgi Petrosian, because they were the
legally elected speakers of the parliament.

To label the elections as "so-called," or to outright denounce them
or refuse to recognize them, requires that one must also criticize the
May 1994 Bishkek peace agreement. Not only did the Speakers of
Armenia's and Azerbaijan's parliaments, Ararktsian and Guliev, sign
that agreement, but the speaker of Nagorno-Karabakh's parliament,
Karen Baburian, also signed it as an equal. A few days later in
Moscow, when the ceasefire agreement was drawn up, again the defense
ministers of the three sides, as equals, signed it: Serge Sargsian
from Armenia, Mamedrafi Mamedov from Azerbaijan, and Samvel Babayan
from Karabakh.

By the same logic, OSCE should criticize its own 1994 summit in
Budapest. That's right: OSCE should criticize an OSCE meeting, because
this summit recognized Nagorno-Karabakh as one of the sides in the
Karabakh conflict. And who represents this side? Obviously, its
elected officials, the parliament and the government. Alternatively,
with whom would the international community communicate?

Local warlords, perhaps? Luckily, there are no such warlords in
Nagorno-Karabakh.

At one time Moscow, through representatives of its foreign ministry,
would denounce the elections in Nagorno-Karabakh, while in the case of
Chechnya it would negotiate with Chechen warlords: Jokhar Dudayev,
Shamil Basayev, Aslan Maskhadov. It's true, however, that Russia later
labeled them as terrorists and eliminated them -- along with tens of
thousands of peaceful Chechens.

On the one hand, OSCE says it does not recognize Nagorno-Karabakh
and its duly elected government; and on the other hand it has
presented its three written proposals on the settlement of the
conflict to official Stepanakert. In the fall of 1997, the OSCE Minsk
Group presented to the three sides in the conflict the second "phased"
settlement proposal, because a few months earlier the Minsk Group's
first, "package" settlement proposal was refused by the elected
representatives of Nagorno-Karabakh.

The Minsk Group in late 1998 accepted with pleasure the documents
through which the Foreign Ministry of NKR gave its agreement to the
third written proposal, that of a "common state."

On some level, it might be understandable if the international
community were not to accept or recognize presidential or
parliamentary elections in Nagorno-Karabakh, on the grounds that
ethnic Azerbaijanis don't participate in them. There were 30,000
ethnic Azerbaijanis in Karabakh in 1992. It should be obvious to
everyone, however, that today it is impossible for the Azerbaijanis of
Nagorno-Karabakh to participate in the elections, just as it was
impossible for the 200,000 Armenians who were in Baku back then to
participate in Azerbaijan's presidential elections.

And the criticism would not be limited to presidential elections. It
should extend to parliamentary elections and even local ones. The
village of Talish in Martakert is more than a thousand years old and
has more residents than the Council of Europe or the OSCE have
members. By the critics' logic, they should not be able to choose a
village head to administer their collective affairs.

In criticizing Nagorno-Karabakh for holding elections, the
international community notes that the future status of
Nagorno-Karabakh has yet to be determined. But the status of
Nagorno-Karabakh has been undetermined for the last 20 years. I have
looked at the statements of the international community, and have not
seen a single proposal as to what Nagorno-Karabakh should do in that
20-year "meanwhile" leading up to official "determination."

* The priority of legitimacy

Until the status is determined, perhaps the international community
might avoid using the title "president" for the elected head of state
of Nagorno-Karabakh, and use a neutral title like "leader" instead.
But it would disgrace its own commitment to democracy to denounce the
act of choosing. In a broader sense, it's not important whether they
say "Leader" or "President"; what is important is that that the Leader
or President be recognized as legitimate -- and that requires fair and
free elections.

Recently, while in Strasbourg, I suggested to the Secretary General
of the Council of Europe, Terry Davis, and his deputy that the
Council's language about the values of democracy, when it comes to
unrecognized states, is more incomprehensible than the language used
by Georgia when it comes to Abkhazia. For example, the authorities in
Tbilisi and the Georgian media very often call the president of
Abkhazia, Sergei Bagapsh, the de facto president of Abkhazia -- a
relatively neutral designation despite their obvious animosity to that
position. Meanwhile, the Council of Europe and OSCE have labeled the
leader of Abkhazia a separatist, which has a clearly negative
connotation.

It was the same Council of Europe that in 1994 organized hearings on
the theme of a settlement for the Nagorno-Karabakh conflict and sent
formal invitations to the speakers of parliament of the three
countries, including Karen Baburian.

Democracy must be an absolute value, regardless of where it is
realized. For example, why should the elections held in Saudi Arabia
or Pakistan or Turkmenistan be considered legitimate when the
elections in those countries are farcical?

International organizations and countries condemn the fair and free
elections in Karabakh, but they use even more stern vocabulary when
elections in unrecognized countries are corrupt and criminal elements
come to power. For example, high-level Americans have announced that
in Southern Ossetia, Abkhazia, and Transdniestr criminal regimes have
come to power. The international community was tripping over itself
during the last presidential elections in Abkhazia, when it took them
two months to count a few thousand ballots, only so as to avoid having
Sergei Bagapsh become president.

* The most painful reality

Of course, there is the understanding in Nagorno-Karabakh that in the
modern world, values such as democracy, the protection of human
rights, the rule of law, legitimate statehood, free and fair
elections, and reforms are priorities. However, when Nagorno-Karabakh
constantly hears condemnations of its elections, and when elections
are the first and most important element of democracy, then the common
citizen becomes disillusioned with both democracy and with democratic
nations. This is the most painful reality of all.

Nagorno-Karabakh has almost always answered those organizations and
countries that condemn the elections. Foreign Minister Georgi
Petrosian analysed the announcements of high-level employees at the
Council of Europe in this way:

"It arouses regret that the representatives of the Council of Europe
-- the organization which is intended to protect and propagate the
ideals and principles of pluralistic democracy, human rights, and the
supremacy of law by means of integrative processes -- should censure
the holding of elections. In this way they cast doubt on the
institution of elections itself as an important element of democracy,
which contradicts the CoE charter. And if European officials don't
want to contribute to the democratic processes in the Nagorno-Karabakh
Republic, then we have the right to expect that they, at least, won't
impede the strengthening of democratic institutes in our republic. We
are deeply convinced that democratization is an important precondition
for the settlement of the Karabakh conflict, since democracy
presupposes the creation of mechanisms that allow solving any conflict
exclusively in a peaceful way. That is what the Nagorno-Karabakh
Republic is striving for. It would be natural if the representatives
of various European structures shared this aspiration."

Ashot Ghulian, the speaker of the parliament of Nagorno-Karabakh,
commenting on Terry Davis' recent statements, deemed them to be
unconstructive.

"We should be reminded that elections are a direct indication of a
people's will, and a basic manifestation of democracy," he commented.
"The people of NKR and the whole civilized world are interested in
developing democratic institutions, and the level of development,
fortunately, is not defined by the subjective opinion of Terry Davis.
Testimony to this lies in the experience of elections in the
Nagorno-Karabakh Republic -- which could serve as an example for some
countries that have seen changes of power in a manner inconsistent
with generally accepted international principles. Certain
representatives of international organizations and political circles,
according to their opinions, are apparently not concerned with the
development of positive processes in the region. But I do not think
that they would prefer chaos and illegality"

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13. Editorial: Karabakh votes (again)

On Thursday the people of Karabakh went to the polls and chose their
new president. The election was hard fought. Both the president-elect,
Bako Sahakian, and the runner-up, Masis Mayilian, were serious
contenders: competent, well-respected, and well-liked. They differed
in their approaches to significant socioeconomic and administrative
matters. But both of them, and indeed the people of Karabakh, are
unwavering in their commitment to their republic's security and
continued democratic existence.

Mr. Sahakian will take from President Arkady Ghoukassian the reins
of a stable state with a growing economy. Nonetheless, he will face
some difficult ongoing challenges.

First among the challenges is national security. Karabakh's eastern
neighbor, Azerbaijan, waged war against it and was defeated. Now
Karabakh lives with constant threats of renewed war from Azerbaijan.
It also lives with pressure to make dangerous concessions to
Azerbaijan.

The new president knows that he must resist concessions that will
endanger the people of Karabakh and their hard-won statehood, while
continuing to work in good faith and agreeing to compromises to
achieve an internationally recognized "final status" for Karabakh.
This he will no doubt do.

As we have argued in this space before, Karabakh's security requires
a concerted effort to see population growth across the republic. This
is the second of the great challenges facing the new president. This
effort requires educational and economic opportunities as well as a
campaign to attract Armenians to move to this beautiful land. We trust
that the new president will lead such a campaign.

Creating economic opportunities is the third of the great challenges
facing Mr. Sahakian. Good administration and avoiding corrupt
practices is the president's role and responsibility.

But Armenian-Americans have an essential role and responsibility as well.

Many of us are in a position to help bring income and investment to
Karabakh. Some Armenian-Americans will visit Karabakh; others will
invest directly in the country; others will arrange meetings between
Karabakh officials and foreign business leaders; yet others will
organize or attend events -- commercial, cultural, athletic, academic,
and political -- in the republic. Each of these steps, and others,
will help Karabakh realize its potential and flourish.

***

The right of the people to determine their own destiny, the right to
self-determination, has been the cornerstone of Karabakh's successful
independence movement. It is a right the people of Karabakh take very
seriously. Some newly formed states founder in their stated commitment
to democracy. Not so Karabakh, to the enormous credit of its people,
its war veterans, and its elected leaders.

The secretariat of the Council of Europe and the OSCE Minsk Group
co-chairs (the international mediators for the Karabakh conflict) have
quite bizarrely criticized Karabakh for holding elections.

"What am I supposed to do?" asked an exasperated President
Ghoukassian on Election Day. "Become a Turkmenbashi and rule for fifty
years?" he said referring to the late President for Life of
Turkmenistan.

"It arouses regret that the representatives of the Council of Europe
-- the organization which is intended to protect and propagate the
ideals and principles of pluralistic democracy, human rights, and the
supremacy of law by means of integrative processes -- should censure
the holding of elections," Karabakh's foreign minister, Georgi
Petrosian quite reasonably noted.

He added: "If European officials don't want to contribute to the
democratic processes in the NKR, then we have the right to expect that
they, at least, won't impede the strengthening of democratic
institutes in our republic. We are deeply convinced that
democratization is an important precondition for the settlement of the
Karabakh conflict, since democracy presupposes the creation of
mechanisms that allow solving any conflict exclusively in a peaceful
way. That is what the Nagorno-Karabakh Republic is striving for. It
would be natural if the representatives of various European structures
shared this aspiration."

It is sad that the leaders of Europe and the representatives of
France, Russia, and the United States who co-chair the Minsk Group
need Karabakh officials to remind them of the importance of democracy
-- just as it is pleasing that Karabakh has earned that right through
its steadfast commitment to democracy.

And it is not only logic that dictates that Karabakh should hold
elections. The Universal Declaration of Human Rights recognizes the
right of people to vote no matter "the political, jurisdictional or
international status of the country or territory to which a person
belongs, whether it be independent, trust, non-self-governing or under
any other limitation of sovereignty."

As we welcome Bako Sahakian to the presidency, we also thank Arkady
Ghoukassian for his ten years' stewardship of the Nagorno-Karabakh
Republic. Let us give Mr. Ghoukassian the last word on this matter:
"We hold elections not for the international community, but first of
all for ourselves, to make the Nagorno-Karabakh Republic democratic
and thus realize the goals our people set forth in declaring
independence."

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