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January 9, 2009,
1. Facing the Storm: Is Armenia ready for financial fallout?
2. Globalization in the Storefront: At least 10 "legitimate"
franchises entered Yerevan in 2008
3. Karabakh Borders: De jure, de facto, de TV
4. Frozen conflict, unfrozen issue: Red Cross launches project on
finding the missing of Nagorno Karabakh war
5. "Sorry" Seems to Be the Hardest Word: Turkish elites agonize
over apology campaign
6. Cash Still King: Paying bills by machine and without queues
remains a novel idea in Armenia
7. Art and Purpose: Family Care foundation school teaches beauty
and business
8. Hot line: A new center in Vanadzor prompts citizens to report
corruption cases
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1. FACING THE STORM: IS ARMENIA READY FOR FINANCIAL FALLOUT?
Richard Giragosian
Already weakened by a continuing domestic political crisis of
confidence, the Armenian government is facing a new challenge as the
global financial and economic crisis threatens to destabilize
Armenia's economy. The vulnerability of the Armenian economy, despite
the cushion of closed borders and limited links to the broader global
economy, is rooted in its inherent structural fragility.
This structural fragility is composed of three elements: a dangerous
dependence on the influx of remittances, or money from Armenians
working abroad, a weak and declining economy that is supported by the
superficial dominance of the country's service, commodity and
construction sectors, and, most distressing, a closed oligarchic
economic network centered on several commodity-based cartels or
monopolies.
But even more troubling is the Armenian government's rather
short-sighted refusal to even recognize the country's vulnerability to
the global economic crisis. Although government officials admit that
economic activity has already contracted considerably, they have
tended to downplay the significance of the downturn in construction
and the shortfall in the amount of remittance flows, the latter
providing an essential cash influx for most Armenians.
Such unfounded optimism was most recent expressed by Armenian Prime
Minister Tigran Sarkisian, whose recent year-end press interviews
reflected his desire to deflect criticism and reassure an already
worried public.
According to the prime minister, the Armenian government plans to
embark on large projects involving an "aggressive spending policy by
the state" to "neutralize" the impact of the global economic crisis by
creating jobs and proving expanded credit to small- and medium-sized
businesses.
Sarkisian asserted that the planned increase in public spending on
road and housing construction, which is to include some $250 million
for infrastructure projects in the earthquake damaged areas of
northern Armenia, will create more than 5,000 new jobs. In addition,
the government also plans to seek some $250 million in new loans from
the World Bank for the planned expansion of business credit.
Sarkisian also noted that Armenia would need more than $1 billion in
additional foreign funding to finance the construction of a new
nuclear power plant to replace the aging, Soviet-era Medzamor plant,
and for the planned railway link to Iran. But in the wake of a global
credit crunch, with lenders much more reluctant to take on such new
financing, it remains unclear from where Armenia can obtain such
foreign assistance.
Echoing the prime minister's optimism, Armenian Economy Minister
Nerses Yeritsyan argued that "Armenia overcame the first wave" of the
global financial-economic crisis because Armenia's banking system
remained untouched by the financial crisis and free from global risk.
He added that the Armenian government was taking "every measure to
over come the negative impacts of the crisis."
For his part, Finance Minister Tigran Davitian dismissed worries about
a subsequent reduction in the amount of tax revenue, arguing that the
"economic crisis has not affected tax collection in Armenia as yet."
Nevertheless, the Armenian government needs a minimum 20 percent
increase in tax collection simply to meet the recently adopted 2009
state budget. With an over-reliance on the value-added tax (VAT) as
the single largest source of budgetary revenue in the country, there
is a real danger that the state will be unable to meet its revenue
targets, especially given recent promises of a 40 percent rise in
salaries for customs and tax officials.
Despite these official claims, the Armenian public remains concerned,
however. As a recent public opinion survey conducted by the Armenian
Marketing Association revealed, some 47 percent of those polled felt
that the economic crisis will impact Armenia, with 43 percent
believing that the impact will financially harm their families.
Mounting Job Losses
The most significant demonstration of Armenia's vulnerability to the
global economic crisis has been in the sudden closure of several key
firms. Tied to the related downturn in global commodity markets, the
recent decline in prices for non-ferrous metals, Armenia's number one
export item, has sparked the loss of several hundred mining jobs and
the suspension of operations at Armenia's two largest chemical
enterprises, including the Nairit plant, which has forced almost three
thousand workers to be abruptly laid off.
In addition to the job losses from these closures, the budget
implications are also serious. For example, one of the largest mining
companies to downscale operations was the German-owned Zangezur Copper
and Molybdenum Plant, which is one of Armenia's leading corporate
taxpayers. According to the company's chief executive, Maxim
Hakobian, the firm now projects a 20 percent cut in its contributions
to the state budget in 2009.
The Link between Armenian Politics & Economics
Just as there are serious political repercussions to the impact of the
global economic crisis on Armenia, political considerations have also
played a role in the Armenian government's handling of its economic
reform program.
For one of the more obvious examples, the closure of several Armenian
businesses by tax officials was linked more to their owner's political
activities than to any overt tax violations. The inspection and
subsequent closure of the Bjni mineral water company, owned by
millionaire businessman Khachatur Sukiasian, an open supporter of the
opposition, raised questions over the government's arbitrary use of
the law, seemingly used more to punish than to regulate business
activity. The rare decision to close and auction the company for
allegedly engaging in tax evasion was additionally dubious due to the
obvious discrepancies with other even more notorious business
interests owned by other wealthy "businessmen" with openly close ties
to the government.
The closure of the Bjni bottling, one of the country's largest such
enterprises, also deals a serious blow to the local economy. Located
in Charentsavan, a generally impoverished and unemployment-ridden town
outside of Yerevan, the decision now threatens the livelihood of more
than 400 local employees.
Two other Sukiasian-owned firms, elements of his larger SIL Group,
were also targeted by the authorities, as the executives of both a
pizza restaurant chain and a printing house were arrested on tax
evasion charges. A third Sukiasian-owned firm, which held the
exclusive distribution rights for Phillip Morris cigarettes in
Armenia, was also forced out of business in 2008 after state customs
officials reportedly held up several large shipments of its imported
products.
The linkage between Armenia's domestic political instability and
economics was further demonstrated by the decision last month by the
U.S. Millennium Challenge Corporation (MCC) to maintain its suspension
of $236.5 million in economic assistance on the grounds that the
Armenian government has failed to address its concerns about "the
status of democratic governance" in the country. The decision
followed a similar move in May 2008, when the latest installment in
the five-year Millennium Challenge Account (MCA) program was frozen in
the wake of Armenia's post-election political crisis.
The most recent suspension was justified by the U.S. because of
"concerns" and unmet "expectations that the government of Armenia
fulfill commitments to implement substantive reforms." Commenting on
the freeze, U.S. Deputy Assistant Secretary of State Matthew Bryza
noted last month that Washington was "seriously worried" about the
continuing imprisonment of dozens of opposition members arrested
during the post-election crisis.
A Worrisome Prognosis
Beyond the limited parameters of the Armenian government's optimism
and public apprehension, a recent report by a leading diaspora group
has highlighted the dangers of the implications of the global crisis
for Armenia. In a report issued last month (available online at:
www.pf-armenia.org), the "Policy Forum Armenia" group warned that "the
ongoing financial crisis will have a deep and prolonged impact on a
wide range of economies" and noted that such a negative impact would
"also likely to be true for a peripheral economy like Armenia's,
regardless of how isolated its relevant sectors are from the rest of
the world."
As an independent professional non-profit association, the Policy
Forum Armenia group seeks to "strengthen discourse on Armenia's
economic development and national security and through that helping to
shape public policy," with a main objective of offering "alternative
views and professional analysis containing innovative and practical
recommendations for public policy design and implementation."
The Policy Forum Armenia report confirmed that "there is ample
evidence of a serious crisis in the making," and added that "in this
context, Armenia's economy is likely to be significantly affected."
The report provided a set of several policy recommendations, going
well beyond the limited scope of the Armenian government's seemingly
inadequate preparations and reflecting a more realistic recognition of
the need to take action now to better protect the Armenian economy for
the most severe effects of the economic crisis.
The report adds new policy recommendations that have been
disappointingly absent from public policy debate to date. And in this
light, the Armenian government should, most of all. incorporate the
report's call for an enhanced and expanded "social safety net" through
the adoption of measures to review poverty guidelines, targeting the
next layer of the country's socially vulnerable strata of population,
taking "credible steps" in eliminating corruption, and enhancing
existing unemployment insurance and providing assistance to employees
that have lost jobs due to crisis-related closures and downsizings."
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2. GLOBALIZATION IN THE STOREFRONT: AT LEAST 10 "LEGITIMATE"
FRANCHISES ENTERED YEREVAN IN 2008
Sara Khojoyan
ArmeniaNow reporter
When New Year fever shoppers hit Yerevan streets this recent holiday
season they found that more than 10 "brand name" shops now fill the
consumer menu as internationally-recognized names replace nameless or
meaningless storefronts. Brightly decorated and designed window
casings continue to displace the gloomy and usually unattractive
holdovers from a bygone era.
The opening of world known brand outlets in Armenia has increased the
confidence among people about the availability of clothing for
consumers with average and high purchasing capacity. But the
increasing appearance of notable names hardly discourages skepticism
over whether the product inside matches the reliability of the name on
the door. That is to say: Still in Yerevan, just because a store
appears to be a franchise, that doesn't mean it is legitimate.
A few years ago, for example, a shop opened claiming to be "IKEA". It
was later revealed that the store was not a legitimate franchise and
soon the name changed to "IDEA". And, more recently, a shop has opened
calling itself "The Disney Store" on its marquee, however, in
television promotion more quietly refers to itself as "The 'D' Store".
Legitimate franchises new to the streets, however, include MaxMara,
Max&Co, Mexx, Motivi, Next, Stefano Ricci and others. These companies
are represented in Armenia through franchising that gives a number of
advantages to both the shop-owners and the consumers in Armenia.
"Armenians in Yerevan can get the same clothes, as say, the British in
London. And, then, everything in this shop - the floor, the furniture,
the jars, are all the way they are in any of the Next shop around the
world," says Vahe Gemilyan, the director of the recently opened Next
shop, which moved into space previously held by Slavyanskaya
restaurant.
Naira Shahnazaryan, director of the Benetton shop operating by
franchise contract in Armenia says the increase in the number of
unibrand shops in Yerevan will result in the close up of multi-brand
ones.
"The franchising makes our work easier, as we get financing for
advertisement. They tell us even the way the shop windows should look.
For instance, the New Year window of Benetton is like any Benetton
shop's around the world," mentions Shahnazaryan.
The franchising - a novice method of doing business [in Armenia] -
implies the owner of the company allows another business to use his
brand on certain conditions passing on his technologies of running it.
The majority of franchising contracts in Armenia relate to the imports
and sells of garments. The franchiser defines the design of the shop,
the size of discounts and the dates [for the discounts], and also sets
the standards of quality for delivering the service. Franchisees in
Armenia are Mango, Stefanel, Orchestra, Cop.Copine, Olsen, Nugat, and
other shops.
In November 2008 the American Trade Chamber in Armenia organized a
conference on Franchising in Armenia to propagate franchising
ideologies in Armenia.
"We can see movement mostly in franchising for imports and sells of
outfit and hotel businesses. We have quite a serious work to do in the
sphere of food products to manage to present new brands," mentions the
chairman of the American Chamber of Commerce in Armenia Davit
Atanesyan.
Atanesyan says the legislative conditions for organizing franchising
activities in Armenia are perfect, though: "The law protects the brand
but there are many problems with implementation.
Directors of a number of brand shops underline some shops get clothes
of previous seasons for discount prices abroad and sell them for lower
prices than in the brand shop.
Gayane Zakaryan, director at the French Orchestra children's store
says they have the exclusive right to use the brand in the territory
of Armenia: "But the nimble traders at out bazaars manage to get the
goods for lower prices at the warehouses in Turkey and sell at the
bazaars."
Nerses Yeritsyan, RA Minister of Economy says development of
franchising is essential for Armenia.
"Its very important the idea of franchising spreads in our society. If
we lack the know-how internally, then we need to import it from
abroad. Franchising is the first serious and important step in that
regard. No less important is spreading the successful business all
over the country," the minister mentioned at the conference of the
American Chamber of Commerce in Armenia.
And while the number of new stores and their branches in Yerevan
grows, store managers, like the majority of businesspeople in the
world, worry of the possible consequences of the world financial
crisis on the volume of trades.
The representative of the Sela store that opened a couple of years ago
in Yerevan, said they are concerned with the crisis like anyone else:
"But we will try not to lose our customers, we will do our best - by
means of actions or other events, to try to stay within the focus of
our clients' attention."
Gemilyan, manager of the Next store said they have developed a special
strategy to gain customers and make them loyal to the brand:
"We are very careful about every customer; we have even softened our
price policy to have every shopper find something for himself/herself
here."
Some stores though do not think of the influence the financial crisis
may have, yet. Ruzanna Barseghyan, Basic House store manager, a brand
that has recently opened a new branch in the center of the capital,
said they already have their clients and have no worries in this
regard. "What regards the financial crisis, it has not touched upon us
yet and we have not thought about it yet."
With import of franchises, also comes import of foreign prices. "There
are people who go to Europe and buy goods of past seasons at 70-80
percent discount and say after they return the prices there are
lower," says procurement manager of the company representing Betty
Barclay, MaxMara and Max&Co, Tatevik Stepanyan. "I can tell for us,
the difference in price as compared to Europe is very small.
Everything should be viewed in comparison: there are things that are
10 percent more expensive here and things that are 10 percent more
expensive there."
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3. KARABAKH BORDERS: DE JURE, DE FACTO, DE TV
Naira Hairumyan
ArmeniaNow Karabakh reporter
In December of 2008 representatives of Karabakh's youth organizations
sent a letter to Armenian president Serjh Sargsyan asking him to use
his influence to have "weather forecasts" on Armenian TV channels quit
using maps in which Armenia and Karabakh are shown within the borders
they had in 1988. On these maps Nagorno Karabakh is presented within
the borders of former Autonomous Region of Nagorno Karabakh (ARNK, as
a part of Azerbaijani SSR) and Lachin corridor (connecting Armenia and
NKR) isn't there at all.
For 20 years Karabakh has had no connection to Azerbaijan, has been
building an independent - if unrecognized - statehood, establishing
interstate relations with Armenia, meanwhile Armenia hasn't decided
yet whether or not to recognize Karabakh's independence.
Despite the letter being actively circulated on the Internet, Armenian
TV channels, however, did not pay much attention to it (except for
Yerkir Media TV). Being unable to decide which map to use in their
weather forecast programs and in order to avoid any complications on
border issues they keep using the 1988 map as if the last 20 years
have not existed at all.
Does the government have a unanimous standpoint and conception on the
Karabakh issue settlement? On December 3, Heritage faction deputy
Larisa Alaverdyan raised the issue in the parliament of Armenia, to
which Prime-Minister Tigran Sargsyan responded by admitting that such
a problem does exist. Alaverdyan pointed out that during weather
forecast Armenian TV channels demonstrate a map on which there is no
linking line between Armenia and Karabakh, and Karabakh is shown
within the borders of former ARNK. Alaverdyan stated that it's not
simply a distortion of reality, but also a violation of NKR
Constitution and legislation, according to which NKR sovereignty
applies to its current administrative territory.
The letter by NKR youth organizations says that "the war crossed out
artificial and unviable borders of ARNK forced upon the Armenian
people", and that "the NKR Constitution adopted as a result of the
referendum held in 2006, consolidated sovereign borders of the
Armenian land liberated at the cost of blood of the best sons of our
nation".
"The fact of ignoring one way or another -be it ideologically or in
real politics- the victory of the Armenian nation and its results not
only disregards the memory of fallen heroes, but also encourages a new
armed aggression against the Armenian statehood," says the letter.
A few days later a number of Armenian NGOs and individuals joined the
statement of youth organizations by sending an open letter to the
heads of Armenian mass media.
The authors of the letter state that 14 years after calling a truce a
peculiar situation has formed: the objective reality of including
those regions into NKR, which once were a part of Azerbaijani SSR, is
not anyhow reflected in Armenian mass media, commercials or brochures.
NKR is either absent from maps or is shown within the borders of
former ARNK.
"Such maps are a violation of Article 142 of NKR Constitution
according to which 'until the integrity of the state territory of the
Republic of Nagorno Karabakh is restored and borders are precisely
defined public authority is implemented on the territory which is de
facto under the jurisdiction of the Republic of Nagorno Karabakh' ,"
quotes the letter.
The letter further calls upon mass media not to avoid showing the
acting real borders, actively cover life on the liberated lands and
inform citizens of Armenia about the strategic role of those lands
(the letter had 62 signatures).
The issue of maps has been important since the very beginning of the
Karabakh conflict, and ever since Internet came along it has become
urgent. Armenian websites demonstrate a surprising tolerance by
posting maps where Karabakh is a part of Azerbaijan. On brochure maps
produced by many tourism agencies printed in Armenia the borders of
Karabakh do not match today's reality.
Meanwhile, maps and catalogues produced abroad are more accurate, so
much that Azerbaijan is putting up a struggle against them. Day.az
site posted a list of travel SIM cards on which Karabakh is shown as a
part of Armenia or as a separate country. Those are: GSM-Travel,
SIMTRAVEL, Travel International SIM Card, produced by In Touch
company, Smart cards (USA), travel SIM cards produced by
telecommunication company Oneroam (Great Britain), GO-SIM' cards,
GLOBALSIM cards, produced by HBSGlobal and many others; the list was a
full 5 pages long.
So the situation arises in which Azerbaijani channels in their daily
weather forecast speak about Karabakh as their inseparable part, and
Armenian channels, by default, confirm.
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4. FROZEN CONFLICT, UNFROZEN ISSUE: RED CROSS LAUNCHES PROJECT ON
FINDING THE MISSING OF NAGORNO KARABAKH WAR
Marina Grigoryan
ArmeniaNow reporter
Almost fifteen years after calling a truce between Karabakh and
Azerbaijan, the International Committee of Red Cross (ICRC) is
planning to implement a project aimed at finding out what happened to
thousands of missing people.
According to ICRC data, the total number of people missing in the zone
of the Karabakh conflict (both Azeri and Armenians) is from 4-5,000,
the overwhelming majority of whom are servicemen.
James Reynolds, head of IRCR delegation in Armenia, says that
considering the time factor here, most of them are probably dead by
now.
"The project will enable us to draw a more precise and wide picture,
first of all, concerning the list of the missing about which [the
list] we already have certain information; it'll also help us to
obtain new information," Reynolds told ArmeniaNow.
In 2008, IRCR signed a framework agreement with state commissions on
the issues of Armenia's, Azerbaijan's and Nagorno Karabakh's war
prisoners, hostages and the missing. The agreement is envisaged to
regulate the search process of people's fates who went missing during
the conflict years.
According to that agreement, all records- among which there are
photos, description of the physical appearance of the missing,
description of what s/he was wearing or things s/he had right before
going missing- will be handed to the authorities for further
assistance in the identification process.
Larisa Alaverdyan, RA National Assembly deputy, member of Heritage
faction, who has been involved on an expert level in the issues of
hostages, war prisoners and the missing for many years, welcomes the
launch of the project, although she says that it should have started
much earlier.
"I am convinced that before Azerbaijan has been hindering that
process. The Armenian side has offered to start the process many
times. For example, in 2004, at an international conference in Geneva
devoted to the issue of the missing, I proposed signing an agreement
between Armenian and Azerbaijan at the end of the conference, on the
beginning of the search process of the missing. However, the
representative of Azerbaijan declared that he did not have such
authority. During the following years we never received an adequate
reaction from Baku," says Alaverdyan, who became Armenia's first Human
Rights Defender (Ombudsman) in late February of 2004.
According to the list by Fund "Against Violation of Law" NGO
(Alaverdyan was the Executive Director), about 1,000 Armenians are
missing.
"The difference in the numbers of the missing Armenians and Azeries
first of all reflects the total correlation of forces involved in the
hostilities," says Alaverdyan. "Besides that, there are many evidences
proving that after a certain battle was over Armenian field commanders
turned to the Azeris asking to take the bodies off the battlefield in
accordance with the Geneva convention. However, Azeri commanders did
not do that. Instead they would declare the dead soldiers and officers
as missing and captive, later (I can say even until now) using them
for political speculation."
Alaverdyan thinks that as a result of such approach there are many
nameless places of mass burial and that is why an identification
process of the buried remnants "isn't in Azerbaijan's best interest."
Data collection and recording within the project framework has already
started. As Reynolds says, the work is hard from a psychological point
of view, since ICRC representatives are dealing with people who,
during many years, have not received any news about their family
members. They are forced to stir up those people's memories making
them mentally return to the long gone days over and over again.
An appeal from a missing person's family member served as a ground to
ICRC for starting the search. Even if a corresponding state commission
informs about an episode in the course of which people went missing,
the incident is not recorded and a case isn't filed without an
appropriate conversation with family members.
"Period of limitation is not essential to us. I can say that until now
we come across cases of searching people who have been missing since
the World War II, Vietnam war, etc. We hope that during our project in
the process of interviews with relatives new details can come up about
already registered cases," Reynolds says.
As for exhumation of remnants buried in the conflict zone- which is
one of the search mechanisms- Reynolds says the process hasn't started
yet.
"We have to take into account that on top of all other factors,
exhumation is difficult in technical terms as well. There are also
issues of ethical and legal character, for example in regard of
digging mass graves or exhumation of citizens of other countries,
which will be inevitable in our case."
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5. "SORRY" SEEMS TO BE THE HARDEST WORD: TURKISH ELITES AGONIZE OVER
APOLOGY CAMPAIGN
A Commentary by Jirair Haratunian
Trustee, Armenian Assembly of America
www.aaainc.org
For the past few weeks Turkey has been agonizing over an internet
petition initiated by a group of Turkish intellectuals apologizing for
the 1915 "Great Catastrophe" that befell the Armenian population in
Anatolia. The campaign ignited a counter movement led by former
Turkish ambassadors and a sharp rebuke by Prime Minister Recep Tayyip
Erdogan. The Prime Minister said, "If there was a crime let those who
committed it apologize. My nation, my country has no such issue."
Curiously, President Abdullah Gul initially characterized the petition
as evidence that Turkey is committed to the democratic principle of
free expression, but on January 1, after much criticism for his
passive reaction to the apology campaign, he confessed that it was not
helpful in the process of negotiations with Armenia.
Remarkably, the latest reports say that 26,000 signatories have
registered their personal apology to the internet petition, and the
Turkish media has headlined the campaign as a major news story for
weeks. They also gave wide coverage to the Armenian Assembly of
America statement quoting its Executive Director, Bryan Ardouny, who
said, "An irreversible trend has commenced in Turkey. This public
apology is a first step in that direction and will inevitably lead
Turkey in coming to grips with its genocidal past."
The petition's authors carefully avoided using the "Genocide" label in
their apology statement. Instead they called the horrors of 1915 "The
Great Catastrophe," a term that in Armenian is called "Medz Yeghern."
This was widely used by Armenians before Raphael Lemkin coined the
word genocide. The petition also avoided asking the Turkish state to
recognize the Armenian Genocide in any way. The campaign, the authors
asserted, is a means for Turks to personally apologize for the horrors
Armenians endured at the hands of the Ottoman regime.
The opposition arguments range from denial of any crimes against
Armenians to the comparison of equivalent losses suffered by Turks at
the hands of Armenian insurgents. They also recalled the
assassination of Turkish diplomats by Armenian terrorists in the
1970s.
A most interesting phenomenon in Turkey took place on the 32nd day of
the apology petition when the Turkish State Television network
broadcast a debate between three advocates and three retired
ambassadors who opposed the petition.
The moderator opened the debate noting its objectives. He said, "At
the root of the issue lies what happened to the Armenians in 1915: was
it a catastrophe, genocide, or deportation? Should we apologize? To
whom and for what should we apologize?"
One of the authors of the apology petition, Dr. Cengiz Aktar,
explained, "We apologized for not being able to talk about this for
many years. We also apologize for not being able to share the pain of
our Armenian brothers and sisters to a sufficient extent."
In response, former Ambassador Sukru Elekdag said, in part, "First
they are referring to 'The Great Catastrophe' which is a synonym for
genocide." He complained that the petitioners were only telling part
of the story. "There was a deportation decision of course, but this
was done in legitimate self defense during conditions of war. The
Russian army was advancing and Armenians took up arms and joined that
army."
The moderator asked whether the apology petition makes a positive
contribution to solving the difficult issues between Turkey and
Armenia. Elekdag replied, "This campaign cannot serve a useful
purpose." He noted that secret negotiations exist between Ankara and
Yerevan and that the Turkish proposal for a joint historic commission
to examine the history of the period was part of the negotiations.
Opponents also declared that the petition strengthens the Armenian
position on the issue in international quarters where the Armenian
Diaspora campaigns for international recognition of genocide.
Dr. Aktar made a passionate defense of the petition. He said that the
petition involved individual and personal apologies and does not
address itself to either the Armenian or Turkish governments. He said
responses from Armenians were positive. "They are giving a positive
response with tears in their eyes because they are finally seeing a
compassionate response after 90 years."
He also addressed the assertions that it was only deportation that was
sanctioned by the Ottoman government. He said, "The truth of the
matter is that the deportations were one of the biggest calamities
that ever happened in Anatolia. The Anatolian economy collapsed
because of this irrational decision, and from that time until today
the economy has not been revived in eastern Anatolia."
This television debate was a watershed event in Turkey. It
illuminated the differing sides of the genocide issue at a time when
Ankara has indicated an interest in changing its rigid policy towards
Armenia. It is a step away from past positions that sought to isolate
Armenia politically and economically. Instead, despite opposition
from Azerbaijan, Turkey has offered a program to establish a stability
and security platform in the Caucasus that includes both Armenia and
Russia. This, in addition to bilateral negotiations with Armenia, are
positive but fragile developments that will hopefully ease tensions
and lead to a more normal and stable relationship between Armenia and
Turkey who, in the final analysis, are destined to remain permanent
neighbors.
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6. CASH STILL KING: PAYING BILLS BY MACHINE AND WITHOUT QUEUES REMAINS
A NOVEL IDEA IN ARMENIA
Sara Khojoyan
ArmeniaNow reporter
For already a year the streets in Yerevan as well as those in other
large towns have blomed with orange-blue machines a meter and half
high inviting passersby to bill-paying convenience.
Sidewalk terminals have brought electronic transactions as Automated
Teller Machines made banking more accessible a few years ago here.
Aram Barseghyan, a resident of Yerevan, has been making his utility
services and cell phone payments through such terminals since they
first showed up. Users can pay water, electricity, gas services, but
most use them to pay for cellphone use.
"You don't need to stand in line, or hear one telling you there is no
change, or express discontent. One other good thing is that you can
pay in parts. I do all the payments very quickly, in just 10 minutes,
and can do them at any time. The good thing is the terminals provide a
number of services and there is an opportunity to pay for
international cell calls and also pay loans," says Barseghyan.
Currently, there are five companies operating such kiosks: TellCell,
MegaPay, OSMP, MGPay, and Tandem, and as the representatives of the
sphere mention, the first two are on leading positions. TellCell has
325 of about 600 total devices across the republic.
Aram Azatyan, executive director of the TellCell says despite the
company has already positioned itself in the market and makes about
7,000 deals per day through the terminals, there are still problems in
the sphere: "We have overcome the major difficulty, people have got
used to paying through terminals. But there are still gaps in the
legislation in Armenia."
"There are still many unused opportunities because of the lack of
proper legislative norms. For instance, any internet club could be an
outlet to pay for, say, prepaid cell cards. But the present
legislation says a company has to be licensed by the Central Bank to
accept payments," Azatyan explains.
Azatyan says also the transfers through the terminals are made online
and take a few seconds, whereas the traditional method of payment
needs three days to fulfill the transfer.
The fact that people have started to accept this means of payment is
witnessed also by the representative of the Mega Pantera company, the
MegaPay terminals' owner, Georgi Khurshudyan.
Khurshudyan says the general population has had a mistrust of
payment-by-machine which is gradually being overcome in favor of the
convenience afforded by electronic payment. About 700,000 transactions
were made through Mega Pantera's 250 terminals in the first year.
Other payment alternatives were offered in Armenia several years ago.
Beginning 2004 Edram system was introduced in Armenia; the system
gives internet users opportunity to make online payments.
E-dram helps pay for gas, water, electricity, wire and cell phones, as
well as loan obligations with banks.
Anna Grigoryan, communications executive of the Edram says there are
18,000 people now registered with the system making more than the 10
percent of all internet users in Armenia.
Grigoryan mentions two major problems of developing the sphere in
Armenia - one, the accessibility of the internet, and second, internet
literacy.
The system has no such problem with Hamlet Kocharyan, a resident of
Yerevan, as the latter has been using it for more than a year already:
"Of course, it makes life easier, I buy their card and make all my
payments just from the workplace without standing in queue or losing
time. And the good thing is also that they don't take money for making
the utility service payments."
ArCa card holders, who have registered their cards in the virtual
system, have also had the opportunity to make online payments since
2004.
Armen Safaryan, head of the business development and international
ties unit of the Armenian Card CJSC says 4,845 virtual cards were
registered as of December 25, 2008.
"I think this figure is not enough, but the situation is created by
objective reasons - the problem of accessibility of the internet and
the communication lines and lack of internet awareness. The mass of
people to be able to pay through the internet is lacking," says
Safaryan.
The ArCa is starting an active campaign in 2009 to make the system
more popular: "We will be making cooperation offers to companies, who
mostly do not know of such opportunity, say, the disc shops, who do
not know they can sell the products online," adds Safaryan.
At present the ArCa system allows paying for a number of services -
telephone (local, international, mobile, prepaid, Easy and Alo card
reloading), electricity, gas, and water, but the most well-known of
the provided opportunities is the one of making transfers to ArCa,
Visa and MasterCard holders, from card to card.
The director of the TellCell company sees no threat of possible
decrease in the number of cash payments in case of the development of
the internet.
"First, Armenia is classified among the countries with large volumes
of cash circulation, and then only 7-10 percent of the population uses
internet, which means we still have chance to develop for another 3-5
years," says Azatyan.
**************************************** ************************************
7. ART AND PURPOSE: FAMILY CARE FOUNDATION SCHOOL TEACHES BEAUTY AND BUSINESS
By Siranuysh Gevorgyan
A small basement room of the seemingly ordinary two-storied building
in Koghbatsi Street is full of colourful Christmas angels, with jugs,
pitchers and flower pots of different size, small spruces and other
New Year tree decorations. The common feature of all these handcrafted
items is that the ornaments on them are borrowed from Armenian
miniature.
They are in fact "the hidden treasures of Yerevan". This is how the
items on display at the Family Care charitable foundation's exhibition
hall are called. They all were made by the charges of the Veratsnund
(Revival) art school in the northern town of Spitak.
(A majority of these children are of school age).
Mnay of these items have been decorated by Tatevik Sahakyan, a
designer at the Veratsnund (Revival) School. Tatevik, 21, has been
attending the school for the last four years. She says the school has
already become an indispensable part of her life.
Tatevik says she generally manages to finish up two items a day.
"It depends on the size of the item and the complexity of the
ornament," she explains.
The ornaments on the items are all taken from the Armenian miniatures
but Tatevik says she sometimes can't keep from making a small
amendment in the ornament, showing 'a personal attitude'.
Tatevik is a graduate of the department of outfit design at the
Vanadzor pedagogical college, but does not work by profession yet. She
says she liked the work of decoration when she was still at school.
"This school is of big importance to me. I had nothing to do at the
beginning and came here because of the interest. I then realized I
like this work very much and stayed here," she says.
The opening of the school in 1994 was initiated by Family Care
Foundation Director Antonio Montalto, who is also Italy's consul in
Gyumri. Montalto had also opened Villa Delenda B&B to cover the
Foundation's expenses. It is on the basement of this hotel that the
display of the children's handcrafted items is staged.
"The school gives an opportunity to kids to get away from everyday
duties after school and get detached from the unpleasant reality,"
says the Foundation's manager Lusine Ghazaryan.
There is a pottery by the school, where these beautiful items are made
and baked. Then they decorate this small exhibition in Yerevan owing
to Tatevik and other designers.
Arpine Papyan, head of the art school says children at school get a
number of skills, including drawing, making various items from paper
and clay and also decorate them.
The school in Spitak, which is about 100 kilometers to the north of
capital Yerevan, works six days a week. On the first three days
children living in the Italian district of Spitak attend, and on the
rest of the days the school is open for attendance by children with
special needs.
"Now there are 14 children in the first group and 11 in the second,"
says Papyan.
Since 2001, the Family Care Foundation has also offered an interest
group for women where they have an opportunity to knit nice wear,
engage in sewing or needlework.
The school's children send their pieces of work to Yerevan twice a
week. The proceeds originating from their sales are sent back to
Spitak to be paid to the school's charges for their work.
Ghazaryan says the sales are not big enough to seek profits.
"The Foundation in one way or another maintains the Veratsnund school,
however the proceeds from the sale of these nice things also help
cover some expenses," says Ghazaryan.
All items crafted by the children are made from clay.
"All these items can be used to keep food in them as all of them are
made from non-toxic materials. There are even certain color
restrictions, since not all colors can be obtained in a natural way,"
the Foundation's manager says.
Ghazaryan adds that the main buyers of the children's works are
tourists who stay at Villa Delenda.
**************************************** ************************************
8. HOT LINE: A NEW CENTER IN VANADZOR PROMPTS CITIZENS TO REPORT
CORRUPTION CASES
Naira Bulghadaryan
ArmeniaNow Vanadzor reporter
An Anti-Corruption Center has opened in Vanadzor, where citizens may
call a hotline and anonymously file complaints on authorities they
suspect of wrongdoing.
The hotline (0 8000 1112) started operation last month and is operated
as part of the initiative of Interests Protection and Support Centers
in Vanadzor, Gyumri and Yerevan project of the Transparency
International Anti-Corruption Center NGO.
The citizens will find support at the Helsinki Citizens Assembly
Vanadzor office in Vanadzor, the Asparez Journalists' Club in Gyumri,
and the Transparency International Anti-Corruption Center NGO in
Yerevan.
The three organizations have created a coalition of anti-corruption
activities to be financed by Casals & Associates Inc. of the United
States Agency for International Development (USAID) who will be
realizing the Mobilizing Action against Corruption within the next 4
years.
The centers will provide citizens with free legal advice, as well as
will restore the violated rights of the citizens in courts in case of
necessity with the help of the centers' experts.
As of yet, few residents know about the service.
"I will surely call if I see any violation," says Rafayel Movsisyan,
53, who did not know of the newly opened center until informed.
Movsisyan calls the recent activation of the government's work and
anti-corruption activities a game to ease the existing tension, as he
says: "to soothe the people's worries."
He says he will believe the government if high ranked officials are
punished for engagement in corruption and not some lower ranking
members who become scapegoats.
"The spine of the corruption should be broken," to have tangible
results in the fight against it, says Movsisyan.
Even before the hotline was setup anti-corruption workers in Vanadzor
conducted a survey and started investigation into the activities of
the municipalities of Vanadzor and Tashir particularly the cases of a
free of charge handing over of a land lot to an individual by the
mayor of Vanadzor as well as the community budget allocations made by
the mayor of Tashir.
"We will take steps based on the analysis of the decisions to have the
officials brought to administrative responsibility," says the
coordinator of the Helsinki Citizens Assembly Vanadzor office Artur
Sakunts, who also heads the Vanadzor center.
The center has its branches in the rest of the towns of the province
at the regional representations of the Helsinki Citizens Assembly.
Sakunts says the anti-corruption center will first deal with the
consequences of corruption, and only later, the reasons.
The head of the Lori anti-corruption center says the primary necessity
in fighting corruption is to increase the level of awareness among
citizens.
"In some cases citizens unaware of their rights do not even guess what
happens to them is a corruption case, because they frequently perceive
it as just giving and getting bribes," says Sakunts.
He says officials take advantage of citizens' unawareness to demand
bribes, which is considered a minor manifestation of corruption,
whereas the abuse of official position in favor of some group
interests discriminating against another group, mostly an unprotected
one, is more dangerous.
"There is no money interest here, but there is power abuse with discrimination."
Haykuhi Harutyunyan, lawyer at the Lori anti-corruption center says
its efforts should have influence on legislation.
"Very often cases of corruption are a result of legislative gaps.
There is serious controversy in the definition and the responsibility
provided for criminal, civic, ad administrative cases of corruption,
furthermore, the practice of their implementation makes the work even
harder," says Harutyunyan. That is the reason, the centers say,
legislative changes are an important part of their activities and they
plan to appear with proper initiatives in the future.
The Lori center along with professional lawyers plans to file 16 cases
in court within the next two years mostly in regard to its research,
with a perspective of serving as precedents to be applied for other
cases.
Casals & Associates Inc. has plans to open other centers throughout
Armenia as part of its implementation for USAID.
Administration Address: 26 Parpetsi St., No 9
Phone: +(374 1) 532422
Email: [email protected]
Internet: www.armenianow.com
Technical Assistance: (For technical assistance please contact Babken
Juharyan)
Email: [email protected]
*************************** **************************************************
January 9, 2009,
1. Facing the Storm: Is Armenia ready for financial fallout?
2. Globalization in the Storefront: At least 10 "legitimate"
franchises entered Yerevan in 2008
3. Karabakh Borders: De jure, de facto, de TV
4. Frozen conflict, unfrozen issue: Red Cross launches project on
finding the missing of Nagorno Karabakh war
5. "Sorry" Seems to Be the Hardest Word: Turkish elites agonize
over apology campaign
6. Cash Still King: Paying bills by machine and without queues
remains a novel idea in Armenia
7. Art and Purpose: Family Care foundation school teaches beauty
and business
8. Hot line: A new center in Vanadzor prompts citizens to report
corruption cases
****************************************** **********************************
1. FACING THE STORM: IS ARMENIA READY FOR FINANCIAL FALLOUT?
Richard Giragosian
Already weakened by a continuing domestic political crisis of
confidence, the Armenian government is facing a new challenge as the
global financial and economic crisis threatens to destabilize
Armenia's economy. The vulnerability of the Armenian economy, despite
the cushion of closed borders and limited links to the broader global
economy, is rooted in its inherent structural fragility.
This structural fragility is composed of three elements: a dangerous
dependence on the influx of remittances, or money from Armenians
working abroad, a weak and declining economy that is supported by the
superficial dominance of the country's service, commodity and
construction sectors, and, most distressing, a closed oligarchic
economic network centered on several commodity-based cartels or
monopolies.
But even more troubling is the Armenian government's rather
short-sighted refusal to even recognize the country's vulnerability to
the global economic crisis. Although government officials admit that
economic activity has already contracted considerably, they have
tended to downplay the significance of the downturn in construction
and the shortfall in the amount of remittance flows, the latter
providing an essential cash influx for most Armenians.
Such unfounded optimism was most recent expressed by Armenian Prime
Minister Tigran Sarkisian, whose recent year-end press interviews
reflected his desire to deflect criticism and reassure an already
worried public.
According to the prime minister, the Armenian government plans to
embark on large projects involving an "aggressive spending policy by
the state" to "neutralize" the impact of the global economic crisis by
creating jobs and proving expanded credit to small- and medium-sized
businesses.
Sarkisian asserted that the planned increase in public spending on
road and housing construction, which is to include some $250 million
for infrastructure projects in the earthquake damaged areas of
northern Armenia, will create more than 5,000 new jobs. In addition,
the government also plans to seek some $250 million in new loans from
the World Bank for the planned expansion of business credit.
Sarkisian also noted that Armenia would need more than $1 billion in
additional foreign funding to finance the construction of a new
nuclear power plant to replace the aging, Soviet-era Medzamor plant,
and for the planned railway link to Iran. But in the wake of a global
credit crunch, with lenders much more reluctant to take on such new
financing, it remains unclear from where Armenia can obtain such
foreign assistance.
Echoing the prime minister's optimism, Armenian Economy Minister
Nerses Yeritsyan argued that "Armenia overcame the first wave" of the
global financial-economic crisis because Armenia's banking system
remained untouched by the financial crisis and free from global risk.
He added that the Armenian government was taking "every measure to
over come the negative impacts of the crisis."
For his part, Finance Minister Tigran Davitian dismissed worries about
a subsequent reduction in the amount of tax revenue, arguing that the
"economic crisis has not affected tax collection in Armenia as yet."
Nevertheless, the Armenian government needs a minimum 20 percent
increase in tax collection simply to meet the recently adopted 2009
state budget. With an over-reliance on the value-added tax (VAT) as
the single largest source of budgetary revenue in the country, there
is a real danger that the state will be unable to meet its revenue
targets, especially given recent promises of a 40 percent rise in
salaries for customs and tax officials.
Despite these official claims, the Armenian public remains concerned,
however. As a recent public opinion survey conducted by the Armenian
Marketing Association revealed, some 47 percent of those polled felt
that the economic crisis will impact Armenia, with 43 percent
believing that the impact will financially harm their families.
Mounting Job Losses
The most significant demonstration of Armenia's vulnerability to the
global economic crisis has been in the sudden closure of several key
firms. Tied to the related downturn in global commodity markets, the
recent decline in prices for non-ferrous metals, Armenia's number one
export item, has sparked the loss of several hundred mining jobs and
the suspension of operations at Armenia's two largest chemical
enterprises, including the Nairit plant, which has forced almost three
thousand workers to be abruptly laid off.
In addition to the job losses from these closures, the budget
implications are also serious. For example, one of the largest mining
companies to downscale operations was the German-owned Zangezur Copper
and Molybdenum Plant, which is one of Armenia's leading corporate
taxpayers. According to the company's chief executive, Maxim
Hakobian, the firm now projects a 20 percent cut in its contributions
to the state budget in 2009.
The Link between Armenian Politics & Economics
Just as there are serious political repercussions to the impact of the
global economic crisis on Armenia, political considerations have also
played a role in the Armenian government's handling of its economic
reform program.
For one of the more obvious examples, the closure of several Armenian
businesses by tax officials was linked more to their owner's political
activities than to any overt tax violations. The inspection and
subsequent closure of the Bjni mineral water company, owned by
millionaire businessman Khachatur Sukiasian, an open supporter of the
opposition, raised questions over the government's arbitrary use of
the law, seemingly used more to punish than to regulate business
activity. The rare decision to close and auction the company for
allegedly engaging in tax evasion was additionally dubious due to the
obvious discrepancies with other even more notorious business
interests owned by other wealthy "businessmen" with openly close ties
to the government.
The closure of the Bjni bottling, one of the country's largest such
enterprises, also deals a serious blow to the local economy. Located
in Charentsavan, a generally impoverished and unemployment-ridden town
outside of Yerevan, the decision now threatens the livelihood of more
than 400 local employees.
Two other Sukiasian-owned firms, elements of his larger SIL Group,
were also targeted by the authorities, as the executives of both a
pizza restaurant chain and a printing house were arrested on tax
evasion charges. A third Sukiasian-owned firm, which held the
exclusive distribution rights for Phillip Morris cigarettes in
Armenia, was also forced out of business in 2008 after state customs
officials reportedly held up several large shipments of its imported
products.
The linkage between Armenia's domestic political instability and
economics was further demonstrated by the decision last month by the
U.S. Millennium Challenge Corporation (MCC) to maintain its suspension
of $236.5 million in economic assistance on the grounds that the
Armenian government has failed to address its concerns about "the
status of democratic governance" in the country. The decision
followed a similar move in May 2008, when the latest installment in
the five-year Millennium Challenge Account (MCA) program was frozen in
the wake of Armenia's post-election political crisis.
The most recent suspension was justified by the U.S. because of
"concerns" and unmet "expectations that the government of Armenia
fulfill commitments to implement substantive reforms." Commenting on
the freeze, U.S. Deputy Assistant Secretary of State Matthew Bryza
noted last month that Washington was "seriously worried" about the
continuing imprisonment of dozens of opposition members arrested
during the post-election crisis.
A Worrisome Prognosis
Beyond the limited parameters of the Armenian government's optimism
and public apprehension, a recent report by a leading diaspora group
has highlighted the dangers of the implications of the global crisis
for Armenia. In a report issued last month (available online at:
www.pf-armenia.org), the "Policy Forum Armenia" group warned that "the
ongoing financial crisis will have a deep and prolonged impact on a
wide range of economies" and noted that such a negative impact would
"also likely to be true for a peripheral economy like Armenia's,
regardless of how isolated its relevant sectors are from the rest of
the world."
As an independent professional non-profit association, the Policy
Forum Armenia group seeks to "strengthen discourse on Armenia's
economic development and national security and through that helping to
shape public policy," with a main objective of offering "alternative
views and professional analysis containing innovative and practical
recommendations for public policy design and implementation."
The Policy Forum Armenia report confirmed that "there is ample
evidence of a serious crisis in the making," and added that "in this
context, Armenia's economy is likely to be significantly affected."
The report provided a set of several policy recommendations, going
well beyond the limited scope of the Armenian government's seemingly
inadequate preparations and reflecting a more realistic recognition of
the need to take action now to better protect the Armenian economy for
the most severe effects of the economic crisis.
The report adds new policy recommendations that have been
disappointingly absent from public policy debate to date. And in this
light, the Armenian government should, most of all. incorporate the
report's call for an enhanced and expanded "social safety net" through
the adoption of measures to review poverty guidelines, targeting the
next layer of the country's socially vulnerable strata of population,
taking "credible steps" in eliminating corruption, and enhancing
existing unemployment insurance and providing assistance to employees
that have lost jobs due to crisis-related closures and downsizings."
****************************** **********************************************
2. GLOBALIZATION IN THE STOREFRONT: AT LEAST 10 "LEGITIMATE"
FRANCHISES ENTERED YEREVAN IN 2008
Sara Khojoyan
ArmeniaNow reporter
When New Year fever shoppers hit Yerevan streets this recent holiday
season they found that more than 10 "brand name" shops now fill the
consumer menu as internationally-recognized names replace nameless or
meaningless storefronts. Brightly decorated and designed window
casings continue to displace the gloomy and usually unattractive
holdovers from a bygone era.
The opening of world known brand outlets in Armenia has increased the
confidence among people about the availability of clothing for
consumers with average and high purchasing capacity. But the
increasing appearance of notable names hardly discourages skepticism
over whether the product inside matches the reliability of the name on
the door. That is to say: Still in Yerevan, just because a store
appears to be a franchise, that doesn't mean it is legitimate.
A few years ago, for example, a shop opened claiming to be "IKEA". It
was later revealed that the store was not a legitimate franchise and
soon the name changed to "IDEA". And, more recently, a shop has opened
calling itself "The Disney Store" on its marquee, however, in
television promotion more quietly refers to itself as "The 'D' Store".
Legitimate franchises new to the streets, however, include MaxMara,
Max&Co, Mexx, Motivi, Next, Stefano Ricci and others. These companies
are represented in Armenia through franchising that gives a number of
advantages to both the shop-owners and the consumers in Armenia.
"Armenians in Yerevan can get the same clothes, as say, the British in
London. And, then, everything in this shop - the floor, the furniture,
the jars, are all the way they are in any of the Next shop around the
world," says Vahe Gemilyan, the director of the recently opened Next
shop, which moved into space previously held by Slavyanskaya
restaurant.
Naira Shahnazaryan, director of the Benetton shop operating by
franchise contract in Armenia says the increase in the number of
unibrand shops in Yerevan will result in the close up of multi-brand
ones.
"The franchising makes our work easier, as we get financing for
advertisement. They tell us even the way the shop windows should look.
For instance, the New Year window of Benetton is like any Benetton
shop's around the world," mentions Shahnazaryan.
The franchising - a novice method of doing business [in Armenia] -
implies the owner of the company allows another business to use his
brand on certain conditions passing on his technologies of running it.
The majority of franchising contracts in Armenia relate to the imports
and sells of garments. The franchiser defines the design of the shop,
the size of discounts and the dates [for the discounts], and also sets
the standards of quality for delivering the service. Franchisees in
Armenia are Mango, Stefanel, Orchestra, Cop.Copine, Olsen, Nugat, and
other shops.
In November 2008 the American Trade Chamber in Armenia organized a
conference on Franchising in Armenia to propagate franchising
ideologies in Armenia.
"We can see movement mostly in franchising for imports and sells of
outfit and hotel businesses. We have quite a serious work to do in the
sphere of food products to manage to present new brands," mentions the
chairman of the American Chamber of Commerce in Armenia Davit
Atanesyan.
Atanesyan says the legislative conditions for organizing franchising
activities in Armenia are perfect, though: "The law protects the brand
but there are many problems with implementation.
Directors of a number of brand shops underline some shops get clothes
of previous seasons for discount prices abroad and sell them for lower
prices than in the brand shop.
Gayane Zakaryan, director at the French Orchestra children's store
says they have the exclusive right to use the brand in the territory
of Armenia: "But the nimble traders at out bazaars manage to get the
goods for lower prices at the warehouses in Turkey and sell at the
bazaars."
Nerses Yeritsyan, RA Minister of Economy says development of
franchising is essential for Armenia.
"Its very important the idea of franchising spreads in our society. If
we lack the know-how internally, then we need to import it from
abroad. Franchising is the first serious and important step in that
regard. No less important is spreading the successful business all
over the country," the minister mentioned at the conference of the
American Chamber of Commerce in Armenia.
And while the number of new stores and their branches in Yerevan
grows, store managers, like the majority of businesspeople in the
world, worry of the possible consequences of the world financial
crisis on the volume of trades.
The representative of the Sela store that opened a couple of years ago
in Yerevan, said they are concerned with the crisis like anyone else:
"But we will try not to lose our customers, we will do our best - by
means of actions or other events, to try to stay within the focus of
our clients' attention."
Gemilyan, manager of the Next store said they have developed a special
strategy to gain customers and make them loyal to the brand:
"We are very careful about every customer; we have even softened our
price policy to have every shopper find something for himself/herself
here."
Some stores though do not think of the influence the financial crisis
may have, yet. Ruzanna Barseghyan, Basic House store manager, a brand
that has recently opened a new branch in the center of the capital,
said they already have their clients and have no worries in this
regard. "What regards the financial crisis, it has not touched upon us
yet and we have not thought about it yet."
With import of franchises, also comes import of foreign prices. "There
are people who go to Europe and buy goods of past seasons at 70-80
percent discount and say after they return the prices there are
lower," says procurement manager of the company representing Betty
Barclay, MaxMara and Max&Co, Tatevik Stepanyan. "I can tell for us,
the difference in price as compared to Europe is very small.
Everything should be viewed in comparison: there are things that are
10 percent more expensive here and things that are 10 percent more
expensive there."
************************************* ***************************************
3. KARABAKH BORDERS: DE JURE, DE FACTO, DE TV
Naira Hairumyan
ArmeniaNow Karabakh reporter
In December of 2008 representatives of Karabakh's youth organizations
sent a letter to Armenian president Serjh Sargsyan asking him to use
his influence to have "weather forecasts" on Armenian TV channels quit
using maps in which Armenia and Karabakh are shown within the borders
they had in 1988. On these maps Nagorno Karabakh is presented within
the borders of former Autonomous Region of Nagorno Karabakh (ARNK, as
a part of Azerbaijani SSR) and Lachin corridor (connecting Armenia and
NKR) isn't there at all.
For 20 years Karabakh has had no connection to Azerbaijan, has been
building an independent - if unrecognized - statehood, establishing
interstate relations with Armenia, meanwhile Armenia hasn't decided
yet whether or not to recognize Karabakh's independence.
Despite the letter being actively circulated on the Internet, Armenian
TV channels, however, did not pay much attention to it (except for
Yerkir Media TV). Being unable to decide which map to use in their
weather forecast programs and in order to avoid any complications on
border issues they keep using the 1988 map as if the last 20 years
have not existed at all.
Does the government have a unanimous standpoint and conception on the
Karabakh issue settlement? On December 3, Heritage faction deputy
Larisa Alaverdyan raised the issue in the parliament of Armenia, to
which Prime-Minister Tigran Sargsyan responded by admitting that such
a problem does exist. Alaverdyan pointed out that during weather
forecast Armenian TV channels demonstrate a map on which there is no
linking line between Armenia and Karabakh, and Karabakh is shown
within the borders of former ARNK. Alaverdyan stated that it's not
simply a distortion of reality, but also a violation of NKR
Constitution and legislation, according to which NKR sovereignty
applies to its current administrative territory.
The letter by NKR youth organizations says that "the war crossed out
artificial and unviable borders of ARNK forced upon the Armenian
people", and that "the NKR Constitution adopted as a result of the
referendum held in 2006, consolidated sovereign borders of the
Armenian land liberated at the cost of blood of the best sons of our
nation".
"The fact of ignoring one way or another -be it ideologically or in
real politics- the victory of the Armenian nation and its results not
only disregards the memory of fallen heroes, but also encourages a new
armed aggression against the Armenian statehood," says the letter.
A few days later a number of Armenian NGOs and individuals joined the
statement of youth organizations by sending an open letter to the
heads of Armenian mass media.
The authors of the letter state that 14 years after calling a truce a
peculiar situation has formed: the objective reality of including
those regions into NKR, which once were a part of Azerbaijani SSR, is
not anyhow reflected in Armenian mass media, commercials or brochures.
NKR is either absent from maps or is shown within the borders of
former ARNK.
"Such maps are a violation of Article 142 of NKR Constitution
according to which 'until the integrity of the state territory of the
Republic of Nagorno Karabakh is restored and borders are precisely
defined public authority is implemented on the territory which is de
facto under the jurisdiction of the Republic of Nagorno Karabakh' ,"
quotes the letter.
The letter further calls upon mass media not to avoid showing the
acting real borders, actively cover life on the liberated lands and
inform citizens of Armenia about the strategic role of those lands
(the letter had 62 signatures).
The issue of maps has been important since the very beginning of the
Karabakh conflict, and ever since Internet came along it has become
urgent. Armenian websites demonstrate a surprising tolerance by
posting maps where Karabakh is a part of Azerbaijan. On brochure maps
produced by many tourism agencies printed in Armenia the borders of
Karabakh do not match today's reality.
Meanwhile, maps and catalogues produced abroad are more accurate, so
much that Azerbaijan is putting up a struggle against them. Day.az
site posted a list of travel SIM cards on which Karabakh is shown as a
part of Armenia or as a separate country. Those are: GSM-Travel,
SIMTRAVEL, Travel International SIM Card, produced by In Touch
company, Smart cards (USA), travel SIM cards produced by
telecommunication company Oneroam (Great Britain), GO-SIM' cards,
GLOBALSIM cards, produced by HBSGlobal and many others; the list was a
full 5 pages long.
So the situation arises in which Azerbaijani channels in their daily
weather forecast speak about Karabakh as their inseparable part, and
Armenian channels, by default, confirm.
***************************************** ***********************************
4. FROZEN CONFLICT, UNFROZEN ISSUE: RED CROSS LAUNCHES PROJECT ON
FINDING THE MISSING OF NAGORNO KARABAKH WAR
Marina Grigoryan
ArmeniaNow reporter
Almost fifteen years after calling a truce between Karabakh and
Azerbaijan, the International Committee of Red Cross (ICRC) is
planning to implement a project aimed at finding out what happened to
thousands of missing people.
According to ICRC data, the total number of people missing in the zone
of the Karabakh conflict (both Azeri and Armenians) is from 4-5,000,
the overwhelming majority of whom are servicemen.
James Reynolds, head of IRCR delegation in Armenia, says that
considering the time factor here, most of them are probably dead by
now.
"The project will enable us to draw a more precise and wide picture,
first of all, concerning the list of the missing about which [the
list] we already have certain information; it'll also help us to
obtain new information," Reynolds told ArmeniaNow.
In 2008, IRCR signed a framework agreement with state commissions on
the issues of Armenia's, Azerbaijan's and Nagorno Karabakh's war
prisoners, hostages and the missing. The agreement is envisaged to
regulate the search process of people's fates who went missing during
the conflict years.
According to that agreement, all records- among which there are
photos, description of the physical appearance of the missing,
description of what s/he was wearing or things s/he had right before
going missing- will be handed to the authorities for further
assistance in the identification process.
Larisa Alaverdyan, RA National Assembly deputy, member of Heritage
faction, who has been involved on an expert level in the issues of
hostages, war prisoners and the missing for many years, welcomes the
launch of the project, although she says that it should have started
much earlier.
"I am convinced that before Azerbaijan has been hindering that
process. The Armenian side has offered to start the process many
times. For example, in 2004, at an international conference in Geneva
devoted to the issue of the missing, I proposed signing an agreement
between Armenian and Azerbaijan at the end of the conference, on the
beginning of the search process of the missing. However, the
representative of Azerbaijan declared that he did not have such
authority. During the following years we never received an adequate
reaction from Baku," says Alaverdyan, who became Armenia's first Human
Rights Defender (Ombudsman) in late February of 2004.
According to the list by Fund "Against Violation of Law" NGO
(Alaverdyan was the Executive Director), about 1,000 Armenians are
missing.
"The difference in the numbers of the missing Armenians and Azeries
first of all reflects the total correlation of forces involved in the
hostilities," says Alaverdyan. "Besides that, there are many evidences
proving that after a certain battle was over Armenian field commanders
turned to the Azeris asking to take the bodies off the battlefield in
accordance with the Geneva convention. However, Azeri commanders did
not do that. Instead they would declare the dead soldiers and officers
as missing and captive, later (I can say even until now) using them
for political speculation."
Alaverdyan thinks that as a result of such approach there are many
nameless places of mass burial and that is why an identification
process of the buried remnants "isn't in Azerbaijan's best interest."
Data collection and recording within the project framework has already
started. As Reynolds says, the work is hard from a psychological point
of view, since ICRC representatives are dealing with people who,
during many years, have not received any news about their family
members. They are forced to stir up those people's memories making
them mentally return to the long gone days over and over again.
An appeal from a missing person's family member served as a ground to
ICRC for starting the search. Even if a corresponding state commission
informs about an episode in the course of which people went missing,
the incident is not recorded and a case isn't filed without an
appropriate conversation with family members.
"Period of limitation is not essential to us. I can say that until now
we come across cases of searching people who have been missing since
the World War II, Vietnam war, etc. We hope that during our project in
the process of interviews with relatives new details can come up about
already registered cases," Reynolds says.
As for exhumation of remnants buried in the conflict zone- which is
one of the search mechanisms- Reynolds says the process hasn't started
yet.
"We have to take into account that on top of all other factors,
exhumation is difficult in technical terms as well. There are also
issues of ethical and legal character, for example in regard of
digging mass graves or exhumation of citizens of other countries,
which will be inevitable in our case."
************************************* ***************************************
5. "SORRY" SEEMS TO BE THE HARDEST WORD: TURKISH ELITES AGONIZE OVER
APOLOGY CAMPAIGN
A Commentary by Jirair Haratunian
Trustee, Armenian Assembly of America
www.aaainc.org
For the past few weeks Turkey has been agonizing over an internet
petition initiated by a group of Turkish intellectuals apologizing for
the 1915 "Great Catastrophe" that befell the Armenian population in
Anatolia. The campaign ignited a counter movement led by former
Turkish ambassadors and a sharp rebuke by Prime Minister Recep Tayyip
Erdogan. The Prime Minister said, "If there was a crime let those who
committed it apologize. My nation, my country has no such issue."
Curiously, President Abdullah Gul initially characterized the petition
as evidence that Turkey is committed to the democratic principle of
free expression, but on January 1, after much criticism for his
passive reaction to the apology campaign, he confessed that it was not
helpful in the process of negotiations with Armenia.
Remarkably, the latest reports say that 26,000 signatories have
registered their personal apology to the internet petition, and the
Turkish media has headlined the campaign as a major news story for
weeks. They also gave wide coverage to the Armenian Assembly of
America statement quoting its Executive Director, Bryan Ardouny, who
said, "An irreversible trend has commenced in Turkey. This public
apology is a first step in that direction and will inevitably lead
Turkey in coming to grips with its genocidal past."
The petition's authors carefully avoided using the "Genocide" label in
their apology statement. Instead they called the horrors of 1915 "The
Great Catastrophe," a term that in Armenian is called "Medz Yeghern."
This was widely used by Armenians before Raphael Lemkin coined the
word genocide. The petition also avoided asking the Turkish state to
recognize the Armenian Genocide in any way. The campaign, the authors
asserted, is a means for Turks to personally apologize for the horrors
Armenians endured at the hands of the Ottoman regime.
The opposition arguments range from denial of any crimes against
Armenians to the comparison of equivalent losses suffered by Turks at
the hands of Armenian insurgents. They also recalled the
assassination of Turkish diplomats by Armenian terrorists in the
1970s.
A most interesting phenomenon in Turkey took place on the 32nd day of
the apology petition when the Turkish State Television network
broadcast a debate between three advocates and three retired
ambassadors who opposed the petition.
The moderator opened the debate noting its objectives. He said, "At
the root of the issue lies what happened to the Armenians in 1915: was
it a catastrophe, genocide, or deportation? Should we apologize? To
whom and for what should we apologize?"
One of the authors of the apology petition, Dr. Cengiz Aktar,
explained, "We apologized for not being able to talk about this for
many years. We also apologize for not being able to share the pain of
our Armenian brothers and sisters to a sufficient extent."
In response, former Ambassador Sukru Elekdag said, in part, "First
they are referring to 'The Great Catastrophe' which is a synonym for
genocide." He complained that the petitioners were only telling part
of the story. "There was a deportation decision of course, but this
was done in legitimate self defense during conditions of war. The
Russian army was advancing and Armenians took up arms and joined that
army."
The moderator asked whether the apology petition makes a positive
contribution to solving the difficult issues between Turkey and
Armenia. Elekdag replied, "This campaign cannot serve a useful
purpose." He noted that secret negotiations exist between Ankara and
Yerevan and that the Turkish proposal for a joint historic commission
to examine the history of the period was part of the negotiations.
Opponents also declared that the petition strengthens the Armenian
position on the issue in international quarters where the Armenian
Diaspora campaigns for international recognition of genocide.
Dr. Aktar made a passionate defense of the petition. He said that the
petition involved individual and personal apologies and does not
address itself to either the Armenian or Turkish governments. He said
responses from Armenians were positive. "They are giving a positive
response with tears in their eyes because they are finally seeing a
compassionate response after 90 years."
He also addressed the assertions that it was only deportation that was
sanctioned by the Ottoman government. He said, "The truth of the
matter is that the deportations were one of the biggest calamities
that ever happened in Anatolia. The Anatolian economy collapsed
because of this irrational decision, and from that time until today
the economy has not been revived in eastern Anatolia."
This television debate was a watershed event in Turkey. It
illuminated the differing sides of the genocide issue at a time when
Ankara has indicated an interest in changing its rigid policy towards
Armenia. It is a step away from past positions that sought to isolate
Armenia politically and economically. Instead, despite opposition
from Azerbaijan, Turkey has offered a program to establish a stability
and security platform in the Caucasus that includes both Armenia and
Russia. This, in addition to bilateral negotiations with Armenia, are
positive but fragile developments that will hopefully ease tensions
and lead to a more normal and stable relationship between Armenia and
Turkey who, in the final analysis, are destined to remain permanent
neighbors.
***************************** ***********************************************
6. CASH STILL KING: PAYING BILLS BY MACHINE AND WITHOUT QUEUES REMAINS
A NOVEL IDEA IN ARMENIA
Sara Khojoyan
ArmeniaNow reporter
For already a year the streets in Yerevan as well as those in other
large towns have blomed with orange-blue machines a meter and half
high inviting passersby to bill-paying convenience.
Sidewalk terminals have brought electronic transactions as Automated
Teller Machines made banking more accessible a few years ago here.
Aram Barseghyan, a resident of Yerevan, has been making his utility
services and cell phone payments through such terminals since they
first showed up. Users can pay water, electricity, gas services, but
most use them to pay for cellphone use.
"You don't need to stand in line, or hear one telling you there is no
change, or express discontent. One other good thing is that you can
pay in parts. I do all the payments very quickly, in just 10 minutes,
and can do them at any time. The good thing is the terminals provide a
number of services and there is an opportunity to pay for
international cell calls and also pay loans," says Barseghyan.
Currently, there are five companies operating such kiosks: TellCell,
MegaPay, OSMP, MGPay, and Tandem, and as the representatives of the
sphere mention, the first two are on leading positions. TellCell has
325 of about 600 total devices across the republic.
Aram Azatyan, executive director of the TellCell says despite the
company has already positioned itself in the market and makes about
7,000 deals per day through the terminals, there are still problems in
the sphere: "We have overcome the major difficulty, people have got
used to paying through terminals. But there are still gaps in the
legislation in Armenia."
"There are still many unused opportunities because of the lack of
proper legislative norms. For instance, any internet club could be an
outlet to pay for, say, prepaid cell cards. But the present
legislation says a company has to be licensed by the Central Bank to
accept payments," Azatyan explains.
Azatyan says also the transfers through the terminals are made online
and take a few seconds, whereas the traditional method of payment
needs three days to fulfill the transfer.
The fact that people have started to accept this means of payment is
witnessed also by the representative of the Mega Pantera company, the
MegaPay terminals' owner, Georgi Khurshudyan.
Khurshudyan says the general population has had a mistrust of
payment-by-machine which is gradually being overcome in favor of the
convenience afforded by electronic payment. About 700,000 transactions
were made through Mega Pantera's 250 terminals in the first year.
Other payment alternatives were offered in Armenia several years ago.
Beginning 2004 Edram system was introduced in Armenia; the system
gives internet users opportunity to make online payments.
E-dram helps pay for gas, water, electricity, wire and cell phones, as
well as loan obligations with banks.
Anna Grigoryan, communications executive of the Edram says there are
18,000 people now registered with the system making more than the 10
percent of all internet users in Armenia.
Grigoryan mentions two major problems of developing the sphere in
Armenia - one, the accessibility of the internet, and second, internet
literacy.
The system has no such problem with Hamlet Kocharyan, a resident of
Yerevan, as the latter has been using it for more than a year already:
"Of course, it makes life easier, I buy their card and make all my
payments just from the workplace without standing in queue or losing
time. And the good thing is also that they don't take money for making
the utility service payments."
ArCa card holders, who have registered their cards in the virtual
system, have also had the opportunity to make online payments since
2004.
Armen Safaryan, head of the business development and international
ties unit of the Armenian Card CJSC says 4,845 virtual cards were
registered as of December 25, 2008.
"I think this figure is not enough, but the situation is created by
objective reasons - the problem of accessibility of the internet and
the communication lines and lack of internet awareness. The mass of
people to be able to pay through the internet is lacking," says
Safaryan.
The ArCa is starting an active campaign in 2009 to make the system
more popular: "We will be making cooperation offers to companies, who
mostly do not know of such opportunity, say, the disc shops, who do
not know they can sell the products online," adds Safaryan.
At present the ArCa system allows paying for a number of services -
telephone (local, international, mobile, prepaid, Easy and Alo card
reloading), electricity, gas, and water, but the most well-known of
the provided opportunities is the one of making transfers to ArCa,
Visa and MasterCard holders, from card to card.
The director of the TellCell company sees no threat of possible
decrease in the number of cash payments in case of the development of
the internet.
"First, Armenia is classified among the countries with large volumes
of cash circulation, and then only 7-10 percent of the population uses
internet, which means we still have chance to develop for another 3-5
years," says Azatyan.
**************************************** ************************************
7. ART AND PURPOSE: FAMILY CARE FOUNDATION SCHOOL TEACHES BEAUTY AND BUSINESS
By Siranuysh Gevorgyan
A small basement room of the seemingly ordinary two-storied building
in Koghbatsi Street is full of colourful Christmas angels, with jugs,
pitchers and flower pots of different size, small spruces and other
New Year tree decorations. The common feature of all these handcrafted
items is that the ornaments on them are borrowed from Armenian
miniature.
They are in fact "the hidden treasures of Yerevan". This is how the
items on display at the Family Care charitable foundation's exhibition
hall are called. They all were made by the charges of the Veratsnund
(Revival) art school in the northern town of Spitak.
(A majority of these children are of school age).
Mnay of these items have been decorated by Tatevik Sahakyan, a
designer at the Veratsnund (Revival) School. Tatevik, 21, has been
attending the school for the last four years. She says the school has
already become an indispensable part of her life.
Tatevik says she generally manages to finish up two items a day.
"It depends on the size of the item and the complexity of the
ornament," she explains.
The ornaments on the items are all taken from the Armenian miniatures
but Tatevik says she sometimes can't keep from making a small
amendment in the ornament, showing 'a personal attitude'.
Tatevik is a graduate of the department of outfit design at the
Vanadzor pedagogical college, but does not work by profession yet. She
says she liked the work of decoration when she was still at school.
"This school is of big importance to me. I had nothing to do at the
beginning and came here because of the interest. I then realized I
like this work very much and stayed here," she says.
The opening of the school in 1994 was initiated by Family Care
Foundation Director Antonio Montalto, who is also Italy's consul in
Gyumri. Montalto had also opened Villa Delenda B&B to cover the
Foundation's expenses. It is on the basement of this hotel that the
display of the children's handcrafted items is staged.
"The school gives an opportunity to kids to get away from everyday
duties after school and get detached from the unpleasant reality,"
says the Foundation's manager Lusine Ghazaryan.
There is a pottery by the school, where these beautiful items are made
and baked. Then they decorate this small exhibition in Yerevan owing
to Tatevik and other designers.
Arpine Papyan, head of the art school says children at school get a
number of skills, including drawing, making various items from paper
and clay and also decorate them.
The school in Spitak, which is about 100 kilometers to the north of
capital Yerevan, works six days a week. On the first three days
children living in the Italian district of Spitak attend, and on the
rest of the days the school is open for attendance by children with
special needs.
"Now there are 14 children in the first group and 11 in the second,"
says Papyan.
Since 2001, the Family Care Foundation has also offered an interest
group for women where they have an opportunity to knit nice wear,
engage in sewing or needlework.
The school's children send their pieces of work to Yerevan twice a
week. The proceeds originating from their sales are sent back to
Spitak to be paid to the school's charges for their work.
Ghazaryan says the sales are not big enough to seek profits.
"The Foundation in one way or another maintains the Veratsnund school,
however the proceeds from the sale of these nice things also help
cover some expenses," says Ghazaryan.
All items crafted by the children are made from clay.
"All these items can be used to keep food in them as all of them are
made from non-toxic materials. There are even certain color
restrictions, since not all colors can be obtained in a natural way,"
the Foundation's manager says.
Ghazaryan adds that the main buyers of the children's works are
tourists who stay at Villa Delenda.
**************************************** ************************************
8. HOT LINE: A NEW CENTER IN VANADZOR PROMPTS CITIZENS TO REPORT
CORRUPTION CASES
Naira Bulghadaryan
ArmeniaNow Vanadzor reporter
An Anti-Corruption Center has opened in Vanadzor, where citizens may
call a hotline and anonymously file complaints on authorities they
suspect of wrongdoing.
The hotline (0 8000 1112) started operation last month and is operated
as part of the initiative of Interests Protection and Support Centers
in Vanadzor, Gyumri and Yerevan project of the Transparency
International Anti-Corruption Center NGO.
The citizens will find support at the Helsinki Citizens Assembly
Vanadzor office in Vanadzor, the Asparez Journalists' Club in Gyumri,
and the Transparency International Anti-Corruption Center NGO in
Yerevan.
The three organizations have created a coalition of anti-corruption
activities to be financed by Casals & Associates Inc. of the United
States Agency for International Development (USAID) who will be
realizing the Mobilizing Action against Corruption within the next 4
years.
The centers will provide citizens with free legal advice, as well as
will restore the violated rights of the citizens in courts in case of
necessity with the help of the centers' experts.
As of yet, few residents know about the service.
"I will surely call if I see any violation," says Rafayel Movsisyan,
53, who did not know of the newly opened center until informed.
Movsisyan calls the recent activation of the government's work and
anti-corruption activities a game to ease the existing tension, as he
says: "to soothe the people's worries."
He says he will believe the government if high ranked officials are
punished for engagement in corruption and not some lower ranking
members who become scapegoats.
"The spine of the corruption should be broken," to have tangible
results in the fight against it, says Movsisyan.
Even before the hotline was setup anti-corruption workers in Vanadzor
conducted a survey and started investigation into the activities of
the municipalities of Vanadzor and Tashir particularly the cases of a
free of charge handing over of a land lot to an individual by the
mayor of Vanadzor as well as the community budget allocations made by
the mayor of Tashir.
"We will take steps based on the analysis of the decisions to have the
officials brought to administrative responsibility," says the
coordinator of the Helsinki Citizens Assembly Vanadzor office Artur
Sakunts, who also heads the Vanadzor center.
The center has its branches in the rest of the towns of the province
at the regional representations of the Helsinki Citizens Assembly.
Sakunts says the anti-corruption center will first deal with the
consequences of corruption, and only later, the reasons.
The head of the Lori anti-corruption center says the primary necessity
in fighting corruption is to increase the level of awareness among
citizens.
"In some cases citizens unaware of their rights do not even guess what
happens to them is a corruption case, because they frequently perceive
it as just giving and getting bribes," says Sakunts.
He says officials take advantage of citizens' unawareness to demand
bribes, which is considered a minor manifestation of corruption,
whereas the abuse of official position in favor of some group
interests discriminating against another group, mostly an unprotected
one, is more dangerous.
"There is no money interest here, but there is power abuse with discrimination."
Haykuhi Harutyunyan, lawyer at the Lori anti-corruption center says
its efforts should have influence on legislation.
"Very often cases of corruption are a result of legislative gaps.
There is serious controversy in the definition and the responsibility
provided for criminal, civic, ad administrative cases of corruption,
furthermore, the practice of their implementation makes the work even
harder," says Harutyunyan. That is the reason, the centers say,
legislative changes are an important part of their activities and they
plan to appear with proper initiatives in the future.
The Lori center along with professional lawyers plans to file 16 cases
in court within the next two years mostly in regard to its research,
with a perspective of serving as precedents to be applied for other
cases.
Casals & Associates Inc. has plans to open other centers throughout
Armenia as part of its implementation for USAID.