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ANALYSIS: ARMENIA'S SEARCH FOR TIES OUTSIDE EEU RAISES DOUBTS OVER ECONOMIC BENEFITS OF MEMBERSHIP
ANALYSIS | 17.10.14 | 10:14
http://armenianow.com/commentary/analysis/57686/armenia_iran_prime_minister_hovik_abrahamyan_usa_e urasian_union_russia
Prime Minister Hovik Abrahamyan Meets IMF Director Christine Lagarde
By NAIRA HAYRUMYAN ArmeniaNow correspondent
On October 20-21, Armenian Prime Minister Hovik Abrahamyan is scheduled
to visit Iran, where he is going to meet with the president of the
Islamic Republic, Hassan Rouhani, Parliament Speaker Ali Larijani
and other officials.
Abrahamyan has just returned from the United States, where he met with
the leadership of the World Bank and the International Monetary Fund,
who promised to support the Armenian economy. Under what conditions
the international financial institutions promise this support is not
mentioned in official reports. After the meetings, Armenian Economy
Minister Karen Chshmarityan only said that Armenia's accession to
the Russian-led Eurasian Economic Union (EEU) "did not prevent our
Western partners from continuing their lending cooperation with us."
However, as German Ambassador to Armenia Rainer Morel noted still
before Armenia's signing of the Agreement on Accession to the EEU,
in order to continue cooperation with Armenia in the sphere of
investments, European countries need to see what conditions for
foreign economic relations will be put forward by the Russian-led
trade bloc. Iranian Ambassador to Armenia Mohammad Reisi said almost
the same. He diplomatically noted that his country would be glad to
establish cooperation with the EEU through Armenia.
PM Abrahamyan's visits indicate that the entry into the EEU is
not perceived by the Armenian government as an impetus for economic
development, and the government is seeking support in other countries
and organizations. Armenia's economy is almost stagnant and threatens
to pass into a negative point. This is due primarily to the fact that
the flagship of the EEU, Russia, has been under strict international
sanctions and in a state of isolation. The Russian ruble is drastically
devaluating against the world's major currencies, oil prices are on
the decline, and all that, as Minister Chshmarityan says, will very
soon have an impact on Armenia as well.
Firstly, it already affects the volume of remittances that Armenian
migrant workers wire back home from Russia. Secondly, it leads
to a complete absence of Russian investments that already were
scarce before, as well as inability to obtain substantial loans. In
particular, Armenia cannot get a loan of $300 million for the repairs
of its nuclear power plant that was promised to it more than a
year ago.
All this leads to Armenia's seeking sources of financing outside the
EEU. It can still get some assistance and loans from international
financial institutions, but investments are practically excluded. The
political decision to join the EEU appears to have put other countries
off as they do not want to invest in the Armenian economy thinking that
by investing in Armenia they invest in an unreliable Russian alliance.
In Armenia, they already start discussing scenarios in the event of a
collapse in Russia or agreements between Moscow and the West on the
conditions of the latter. Now the EEU and, in particular, Armenia's
membership in it rest on the power and imperial aspirations of Russian
President Vladimir Putin. It is unclear what will happen if Putin's
power or aspirations are called into question.
From: Baghdasarian
ANALYSIS | 17.10.14 | 10:14
http://armenianow.com/commentary/analysis/57686/armenia_iran_prime_minister_hovik_abrahamyan_usa_e urasian_union_russia
Prime Minister Hovik Abrahamyan Meets IMF Director Christine Lagarde
By NAIRA HAYRUMYAN ArmeniaNow correspondent
On October 20-21, Armenian Prime Minister Hovik Abrahamyan is scheduled
to visit Iran, where he is going to meet with the president of the
Islamic Republic, Hassan Rouhani, Parliament Speaker Ali Larijani
and other officials.
Abrahamyan has just returned from the United States, where he met with
the leadership of the World Bank and the International Monetary Fund,
who promised to support the Armenian economy. Under what conditions
the international financial institutions promise this support is not
mentioned in official reports. After the meetings, Armenian Economy
Minister Karen Chshmarityan only said that Armenia's accession to
the Russian-led Eurasian Economic Union (EEU) "did not prevent our
Western partners from continuing their lending cooperation with us."
However, as German Ambassador to Armenia Rainer Morel noted still
before Armenia's signing of the Agreement on Accession to the EEU,
in order to continue cooperation with Armenia in the sphere of
investments, European countries need to see what conditions for
foreign economic relations will be put forward by the Russian-led
trade bloc. Iranian Ambassador to Armenia Mohammad Reisi said almost
the same. He diplomatically noted that his country would be glad to
establish cooperation with the EEU through Armenia.
PM Abrahamyan's visits indicate that the entry into the EEU is
not perceived by the Armenian government as an impetus for economic
development, and the government is seeking support in other countries
and organizations. Armenia's economy is almost stagnant and threatens
to pass into a negative point. This is due primarily to the fact that
the flagship of the EEU, Russia, has been under strict international
sanctions and in a state of isolation. The Russian ruble is drastically
devaluating against the world's major currencies, oil prices are on
the decline, and all that, as Minister Chshmarityan says, will very
soon have an impact on Armenia as well.
Firstly, it already affects the volume of remittances that Armenian
migrant workers wire back home from Russia. Secondly, it leads
to a complete absence of Russian investments that already were
scarce before, as well as inability to obtain substantial loans. In
particular, Armenia cannot get a loan of $300 million for the repairs
of its nuclear power plant that was promised to it more than a
year ago.
All this leads to Armenia's seeking sources of financing outside the
EEU. It can still get some assistance and loans from international
financial institutions, but investments are practically excluded. The
political decision to join the EEU appears to have put other countries
off as they do not want to invest in the Armenian economy thinking that
by investing in Armenia they invest in an unreliable Russian alliance.
In Armenia, they already start discussing scenarios in the event of a
collapse in Russia or agreements between Moscow and the West on the
conditions of the latter. Now the EEU and, in particular, Armenia's
membership in it rest on the power and imperial aspirations of Russian
President Vladimir Putin. It is unclear what will happen if Putin's
power or aspirations are called into question.
From: Baghdasarian