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AAA: Armenia This Week - 04/30/2004

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  • AAA: Armenia This Week - 04/30/2004

    ARMENIA THIS WEEK
    Friday, April 30, 2004

    U.S., ARMENIA SIGN MILITARY LOGISTICS AGREEMENT
    The United States and Armenian militaries this week took another step in an
    expanding partnership by signing an Acquisition and Cross-Servicing
    Agreement (ACSA). Deputy Commander of the U.S. forces in Europe General
    Charles Wald was in Armenia for a second visit in recent months to sign the
    agreement with the Chief of Staff of the Armenian Armed Forces, General
    Mikael Harutiunian. ACSA will facilitate logistics and purchases between the
    two militaries during joint deployments, such as the one Armenia is
    currently planning in Iraq. Earlier this year, U.S. and Armenia signed a
    reciprocal Article 98 agreement to prevent their troops from prosecution at
    the International Criminal Court, eliminating a potential hindrance to U.S.
    military assistance to Armenia.

    Harutiunian said that the agreement is part of the legal framework needed
    for the establishment of "allied partnership" between the two countries.
    Wald said that the agreement is evidence that "we are increasing and
    cementing our relationship and that Armenia is a participant of the war on
    terrorism." In his annual April 24 message released earlier this week,
    President George W. Bush noted that the United States "is grateful for
    Armenia's continuing cooperation in the war on terror." Bush also reaffirmed
    U.S. commitment to assist Armenia in expanding "strategic relations" with
    the West. According to a report last week, the Bush Administration is
    planning to commit about $660 million in the next five years to train and
    equip foreign forces to be used in peace operations around the world.

    While in Armenia, Wald again denied persistent media reports that the U.S.
    is planning to station forces at bases in either Armenia or Azerbaijan.
    Armenia's Ambassador Arman Kirakossian suggested last week that the U.S.
    would instead focus on upgrading military installations in the region for
    possible future deployments. Commenting on the Administration's request for
    higher military assistance to Azerbaijan than to Armenia, Kirakossian
    stressed that the U.S. policy of parity should continue so as not to alter
    the regional balance of forces.

    Meanwhile, Wald noted that Azeri President Ilham Aliyev has made a
    commitment to the U.S. not to hinder Armenia's participation in the upcoming
    NATO exercises in Azerbaijan. Last January, Armenian officers were not
    allowed to attend a planning conference for the exercises. Azeri reaction to
    the brutal murder of an Armenian officer by an Azeri serviceman at a NATO
    course in February further strained bilateral tensions. This week, Azeri
    officials pledged to provide security to Armenian participants. (Sources:
    Arm. This Week 4-2; Mediamax 4-16; Washington Post 4-19; The White House
    4-24; AP 4-26; RFE/RL Arm. Report 4-26)

    COUNCIL OF EUROPE BODY URGES POLITICAL DIALOGUE, REFORM IN ARMENIA
    The Parliamentary Assembly of the Council of Europe (PACE) this week adopted
    a resolution on the political standoff in Armenia calling for dialogue
    between the Armenian government and the opposition. While noting that last
    year's electoral irregularities were not substantial enough to affect the
    outcome of the vote, in which President Robert Kocharian was reelected, the
    PACE resolution criticized the Armenian government for its heavy-handed
    response to protests by the Armenian opposition, which is calling for
    Kocharian's resignation.

    PACE also refused to endorse the Armenian opposition delegates' calls for
    the so-called "referendum of confidence" in Kocharian. The resolution
    further called on the Armenian government to guarantee opposition supporters
    the freedom of assembly and movement, to investigate alleged violations of
    human rights during recent meetings and to reform the Code of Administrative
    Violations that allows it to detain opposition supporters during
    unsanctioned rallies. The Armenian government is expected to issue a
    preliminary report to PACE by June, and complete the necessary reforms by
    September. (Source: PACE resolution 4-28)

    ARMENIA POSTS FIRST QUARTER GROWTH
    Armenia's Gross Domestic Product (GDP) grew by 7.5 percent in the first
    three months of 2004, compared to the first quarter of last year, the
    National Statistics Agency reported this week. As anticipated earlier,
    following completion of major construction projects funded by the U.S.-based
    Lincy Foundation, the growth was slower than the double-digit increases
    registered between 2001-2003. The industrial growth was under 3 percent, due
    largely to lower output in the diamond-processing sector and stoppage of a
    major aluminum plant for modernization. Previously struggling chemical and
    light industry sectors reported the strongest rebounds and electricity
    generation grew by 7 percent. Agricultural output grew by 6 percent.

    The first quarter exports were up by 14 percent to $152 million. Major
    export destinations included Belgium (19 percent of all exports), United
    States (12), Russia (11), Israel (11), Germany (9), Italy (7) and
    Switzerland (4). Imports were up 9.5 percent to $281 million, with Russia
    (23), Belgium (11), Israel (10), the United States (8), United Arab Emirates
    (6) and Iran (5) as major sources of Armenia-bound goods.

    The government's internal and custom revenue agencies reported first quarter
    growth in incomes above budget targets. Customs Director Armen Avetisian
    suggested that political tensions resulting from the opposition's drive for
    power have so far had no major impact on business activity in Armenia. The
    agencies brought in $51 and $45 million in tax and tariff duties,
    respectively, and are on track to meet the annual plan of $460 million in
    state revenues. Major businesses paid more profit taxes following the
    introduction of stiffer penalties for non-payment last year.

    According to Tigran Jrbashian, director of the Sed Marsed consulting firm,
    higher state revenues have also contributed to strengthening Armenia's
    national currency. This week, the Dram traded at under 550 to $1, its
    highest exchange rate since October 2000. (Sources: Armenia This Week 2-6;
    Arminfo 4-20, 21; Noyan Tapan 4-20, 21; RFE/RL Armenia Report 4-20, 28)

    A WEEKLY NEWSLETTER PUBLISHED BY THE ARMENIAN ASSEMBLY OF AMERICA
    122 C Street, N.W., Suite 350, Washington, D.C. 20001 (202) 393-3434 FAX
    (202) 638-4904
    E-Mail [email protected] WEB http://www.aaainc.org
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