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Armenians see Russian economic takeover

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  • Armenians see Russian economic takeover

    Myrtle Beach Sun News, SC
    Nov 26 2006

    Armenians see Russian economic takeover
    NAIRA MELKUMIAN

    YEREVAN, Armenia - The recent acquisition of Armenia's dominant
    telephone company by a Russian company is raising concerns here that
    Moscow is attempting to exert economic control over the republic it
    once controlled politically.

    The purchase of a 90 percent stake in ArmenTel, which holds a
    monopoly on telephone and Internet service in Armenia, by the Russian
    company Vympelkom only serves to strengthen Russia's economic hold on
    major economic assets in the republic.

    The sale was announced shortly after the return of Armenian President
    Robert Kocharian to Moscow.

    It was during that trip that Russian President Vladimir Putin
    announced that he considered Russia's position as only the
    third-largest investor in Armenia, behind Germany and Greece, as
    "shameful."

    The purchase, the latest in a series of Russian takeovers in key
    areas of the Armenian economy, comes as public attitudes toward
    Moscow are cooling because of the effect Moscow's economic blockade
    of neighboring Georgia is having on the Armenian economy.

    Many here are also becoming increasingly worried by signs of rising
    xenophobia in Russia toward Caucasians in general and Armenians in
    particular.

    Already, Russian companies own the major producers of electricity and
    natural gas, as well as the country's rail system.

    "Just take a look," said Aram Manukian, a leading opposition
    politician. "The energy sector, communications, and the railway
    system have all been given to Russia. All this essentially weakens
    Armenia's independence."

    But Defense Minister Serzh Sarkisian, considered by most to be the
    second most powerful figure in the government, has rejected such
    charges.

    "You won't find to this day any examples of how Russian capital in
    Armenia has been used as a tool for political pressure," he said at a
    recent news conference.

    Since the collapse of the Soviet Union in 1991, Russian companies
    have poured billions of dollars of investments into Armenia. Some
    contend it just makes good business sense.

    "Russia's desire to become established in Armenia as the most stable
    country in the South Caucasus is understandable, as the attitude
    toward Russian business is better here than in Georgia," said
    political analyst Anna Harutyunian.

    But Aram Sarkisian, head of the opposition Democratic Party, said the
    government should not have ceded control of a key industry so easily.

    "All power-generating operations are effectively in Russia's hands,"
    he said.

    "There are no problems with Russia. That country is our ally and I am
    in favor of deepening cooperation with it. But the government should
    control our strategic facilities."

    By and large, the average telephone user, who has long complained of
    poor service, doesn't seem to care who owns the company as long as
    service improves.

    "It doesn't matter to me who the operator will be," said Suren
    Minasian. "Ordinary consumers just need easy, high-quality
    communications."
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