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Armenia's Economic Pulse

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  • #91
    Re: Armenia's Economic Pulse

    Diamond Sector News


    Nov 8, 2007

    YEREVAN, November 8. /ARKA/. Armenian Shoghakn diamond-cutting
    enterprise has reduced its monthly output from 25thnd carats to 3 or
    4 thousand, Sergey Gasparyan, the general director of the company,
    said in an interview with ARKA News Agency.

    He also said that the stuff had been cut as well - only 300 employees
    remained instead of former 1800.

    Gasparyan said that these measures were taken because of grown cost
    price of final product and volatile situation in currency exchange

    He said that the company's output is completely exported, because
    Armenia has no raw materials resources and consumer market.

    That's why the dollar's precipitously fluctuating exchange rate drives
    final product's cost price up and makes it not competitive at markets.

    Gasparyan said that the output reduction was also due to considerable
    reduction of the world diamond consumption market.

    "Earlier, the U.S.A. was the biggest diamond consumer - about 70%,
    while now the country consumes only 30% of the world diamond output. It
    depends on further developments at the marker whether the enterprise
    will be able to work to its full capacity", he said.

    Gasparyan said that as a rule, sales reach their peak at the period
    between September and December. It means that future plans will be
    outlined only after summarizing results later this year.

    "The enterprise has necessary industrial capacity, however a part of
    them are temporarily frozen until situation stabilization", he said.

    He said raw materials were stably supplied to Shoghakn, and for seven
    years of its record the enterprise had never staid idle because the
    lack of raw materials.

    Gasparyan said that the enterprise produces 50thnd carats every month
    from one hundred square meters of raw materials.

    Shoghakn is the leading diamond-cutting enterprise in Armenia. Its
    quota in Armenian diamond industry makes 35%.

    One of the key diamond suppliers is Israel. Once Shoghakn's monthly
    output was 35,000 carats.

    The enterprise belongs to entrepreneur Lev Levaev (LLD Diamonds)
    from 2000.


    Oct 15 2007

    Armenia's polished diamond output of fell 49.2 percent to approximately
    US$99 million (AMD 32.97 billion) in January-September of this year,
    according to Gagik Mkrtchian, the head of the Trade Ministry's precious
    stones and xxxelry department.

    Mkrtchian told Russian news source Interfax that sales for these
    first nine months of 2007 also fell 51.1 percent to approximately
    US$95.68 million (AMD 31.84 billion) and exports similarly decreased
    50.4 percent to approximately US$94.51 million (AMD 31.45 billion).

    Mkrtchian predicts the "slump" in the diamond cutting center will
    recover by the end of this year and that the sector is expected to
    grow in 2008. He added that the slowdown in production and exports
    has translated into local job cuts.

    Russian diamond producer Alrosa and the Armenian government signed
    a cooperation agreement in August between the cutting and xxxelry
    sectors. Mkrtchian said that a joint company between Armenian cutting
    companies and Alrosa is expected to start work in 2008, which will
    enhance Armenia's cutting center.

    Mkrtchian also told Interfax that he hopes, for the sake of local
    employment, that Shogakn, the country's largest cutting company, which
    is owned by Lev Leviev, would not close, despite reports claiming
    the contrary.


    ARKA News Agency
    Dec 21 2007

    YEREVAN, December 21. /ARKA/. The Russian ALROSA diamond exploration
    and cutting company plans to export $28-$30mln rough diamonds to

    ALROSA Vice-President Sergey Ulin reported that the company plans
    to hold another meeting to discuss the results of the first six
    months of its cooperation with Armenia and determine the parameters
    of cooperation with possible corrections toward larger supplies not
    only for the end of next year, but also for 2009, he said.

    RA Minister of Trade and Economic Development Nerses Yeritsyan
    expressed hope that the ALROSA Company will put its plans into practice
    within the next few years.

    "We have much to do to specify the policy and prospects for development
    to amplify the opportunities for business expansion in Armenia by
    such a large company as ALROSA, and not only in diamond processing,"
    the Minister said.

    The Chairman of the International Association of Armenian xxxellers,
    owner of the DCA diamond-cutting enterprise, member of the RA
    Parliament Gagik Abramyan said that experts of the ALROSA Company
    are expected to pay a regular visit to Armenia next July to conduct
    inspections at the country's diamond-cutting enterprises.

    "The issue of increasing the number of Armenian diamond-cutting
    companies meeting the ALROSA-set terms will be considered," he said.

    Abramyan pointed out that cooperation in two directions will be
    carried out next year.

    "At a meeting with President Robert Kocharyan we talked about the
    purchase of rough diamonds as well as about the supply of diamonds
    for further processing and re-export," he said.

    This October, ALROSA experts conducted inspections and made assessments
    of 23 Armenian diamond-cutting companies. Thereafter, they selected
    four Armenian enterprises that will process rough diamonds worth
    $1mln supplied by ALROSA - Daymotek Company, Arevakn, SCA and Ukos.

    On August 6, 2007, in Yerevan, the RA Government and the ALROSA Company
    signed an agreement on cooperation in xxxellery and diamond-cutting
    industries. The agreement envisages the supply of rough diamonds to
    Armenia for processing and re-export. Under the agreement, Armenian
    diamond-cutting enterprises are to process rough diamonds 0.30 to
    1.5 carats, which process is economically unsound in Russia.

    Russia is one of the largest suppliers of rough diamonds - 1/3% of
    the world diamond output. Armenia, in turn, has many professional
    diamond-cutters capable of processing up to 1mln carats yearly.

    The ALROSA Company is of the world's largest diamond-extracting
    company, its share in the world output being 25%. In 2006, the ALROSA
    Group sold products worth $2.86bln, with the sale of cut diamonds
    totalling $141.1mln The ALROSA stockholders are Rosimuschestvo
    (Russian Property) (37%), Ministry of State property Management of
    Yakutia (32%), individuals and legal entities (23%). Eight Yakut
    uluses hold 8% of the ALROSA shares.

    By Hovannes Shoghikian

    Radio Liberty, Czech Rep.
    Dec 21 2007

    Russia's state-owned diamond monopoly said on Friday that it has
    started implementing a recent agreement with the Armenian agreement
    which should shore up Armenia's declining diamond-processing industry.

    Under the agreement signed in Yerevan in August, the ALROSA giant
    undertook to resume supplies of Russian rough diamonds to Armenian
    companies. Those supplies fell sharply in 2004 and ceased altogether
    in 2006, contributing to an ongoing downturn in a sector that was
    once a key driving force of Armenia's economic growth.

    The ALROSA chairman, Sergey Vybornov, said 22 Armenian diamond-cutting
    firms applied to his company following the August deal but only
    four of them were chosen to receive Russian precious stones. They
    have already been supplied with $1 million worth of uncut diamonds,
    he told reporters in Yerevan.

    According to Vybornov's deputy, Sergey Ulin, ALROSA, which mines
    diamonds in eastern Siberia, plans to carry out at least $28 million
    worth of such deliveries in the course of next year and could raise
    their volume in 2009. He said the Russian giant, which accounts for
    one fifth of global rough diamond sales, sees "optimistic grounds
    for developing cooperation" with Armenia.

    Underscoring the importance of that cooperation, both President Robert
    Kocharian and Prime Minister Serzh Sarkisian received the visiting
    ALROSA executives on Friday.

    Minister for Trade and Economic Development Nerses Yeritsian said
    after the talks the Armenian government will do its best to facilitate
    ALROSA operations in the country. Yeritsian said the government is
    also holding "active discussions" with the Russian company on the
    possibility of expanding their presence into other sectors of the
    Armenian economy. He gave no details.

    Vybornov said in that ALROSA is negotiating with the authorities in
    Yerevan over the possible of an unnamed Armenian mining enterprise.

    It was not clear if he referred to the Indian-owned Ararat Gold
    Recovery Company, which develops the bulk of the country's gold

    According to government statistics, Armenian plants manufactured 25
    billion drams ($82 million) worth of gem diamonds in the first half
    of this year, down by 48 percent from the same period last year.

    Armenia's total diamond output dropped by over 17 percent to 93
    billion drams in 2006, continuing the production slump that began in
    2004. Refined diamonds have since ceased to be the country's single
    largest export and now account for just 1 percent of its gross
    industrial production.

    Government officials and analysts blame the sector's decline on
    a combination of internal and external factors, including falling
    global demand for precious stones and the dramatic appreciation of
    the Armenian dram.


    Interfax News Agency, Russia
    Russia & CIS
    February 28, 2008

    Kristall of Smolensk, Russia's biggest diamond cutter, has reached
    an agreement to process some of its rough diamonds in Armenia, the
    state company said.

    Kristall plans to outsource in Armenia cutting of stones that would
    be less profitable to process in Russia.

    Kristall will sign a memorandum with Armenia's Diamond Company in
    early March on joint processing of rough diamonds.

    "The participants in the project plan to work out a joint program
    to develop cutting of diamonds in Armenia, which besides process of
    raw material will include joint efforts to develop the technological
    potential of Armenia's cutting industry and increase the efficiency
    of processing rough diamonds," Kristall said.

    Kristall increased its turnover by 13% in 2007, to $404 million.
    What if I find someone else when looking for you? My soul shivers as the idea invades my mind.


    • #92
      Re: Armenia's Economic Pulse

      Originally posted by aray View Post
      Now 305,517. How you fertilize it Siamanto
      A picture is worth a thousand words!

      "If faut cultiver son jardin." (Voltaire)
      Last edited by Siamanto; 03-07-2008, 10:53 PM.
      What if I find someone else when looking for you? My soul shivers as the idea invades my mind.


      • #93
        Re: Armenia's Economic Pulse

        The Dram Appreciation and The Armenian Economy


        YEREVAN, DECEMBER 14, NOYAN TAPAN. Under conditions of rapid economic
        development, it is impossible to avoid appreciation of the national
        currency, and as a small country Armenia has difficulty with managing
        the appreciation of the dram, Shigeo Katsu, WB Regional Vice President
        for Europe and Central Asia, expressed this opinion on December 14.
        According to him, there are several measures (including increasing the
        competition and making the economy more transparent) for dealing with
        the difficult situation as a result of the dram's appreciation.

        S. Katsu pointed out the necessity of taking extra measures aimed at
        extending the business environment and the investment field. In his
        words, the rules of the game and the main players of the economic field
        should be definite, while investors should be fully informed about it.
        He said that there are still a number of problems in Armenia, and
        foreign investments have consideraly contributed to their solution.
        However, these investments were mainly made in some sectors of the

        Nevertheless, S. Katsu positively assessed the two-digit growth of the
        country's economy. According to him, economic developments are
        proceeding rapidly in Armenia and this growth is expected to continue
        in the next years. He expressed an opinion that Armenia should be able
        to increase its investment attractiveness not only in economy but also
        in the sphere of educaion.

        by Armine Avetyan

        168 Zham, Armenia
        Nov 27 2007

        "Only importers are good businessmen in Armenia"

        The US dollar became cheaper for 35-40 drams last week; then the
        dollar gained 20-25 drams but it did not grow enough to reach the
        previous level. Currently, 1 US dollar is traded at 296-300 drams at
        Yerevan's currency exchange offices.

        According to a media report, a record 20m dollars was traded in the
        Armenian Stock Exchange last Friday [23 November]. The average rate
        was 312.9 drams and the closing rate was 312.5 drams. Meanwhile, the
        rate was 275-300 drams at currency exchange offices on the same day.

        Experts attribute such a difference in one day to financial schemes.

        Many think that the depreciation of the US dollar is a result of
        schemes in general. Compared with 2003, the US dollar has already lost
        50 per cent. Some analysts say that this is a unique "tax" imposed
        by the Armenian authorities on remittances Armenians get from abroad.

        [Passage omitted: this "tax" is higher than the 20-per-cent VAT
        applied in Armenia]

        Armenians who rely on remittances sent by their relatives living abroad
        suffer the most. While they could get 58,000 drams for 100 dollars in
        2003, they get only 30,000 today. Exporters suffer too because they
        sell their products for dollars but make their expenses in drams at
        home. Manufacturers constantly complain that their production costs
        keep rising making their products uncompetitive in world markets.

        "If the trend continues, we may stop our production," Hovhannes
        Iskajyan, chief accountant of Yerevan champagne factory, says. The
        factory exports champagne and wines to Russia. [Passage omitted:
        appreciation made the factory to cut production for 30-40 per cent]

        Karen Stepanyan, deputy director of the Armenmotor company that
        produces meat grinders, says the company has planned to export 1,000
        grinders to Russia in 2008 to be sold within three months. [Passage
        omitted: the company fears it will lose the Russian market due to the
        dram appreciation; another exporter says they lost the US market in
        2005 because of the dram appreciation]

        In response to these complaints, the Armenian authorities -
        and especially Central Bank chairman Tigran Sargsyan - say the
        manufacturers should boost their productivity instead of complaining.

        "That's stupid," Hovhannes Musayelyan, director of the Synopsis
        company that produces and exports information technologies, says.

        [Passage omitted: appreciation has already made Armenia a risk zone
        for the Synopsis company]

        "The interests of manufacturers are ignored in Armenia, and it
        turns out that only importers are good businessmen in Armenia,"
        Musayelyan says.

        Due to the US dollar depreciation, another field that has been deemed
        as priority has lost more than 60 per cent: the diamond-cutting
        industry. The Shoghakn factory, a giant in this field, is on the
        verge of going out of business. The company suspended production
        in the summer for a long time; it resumed a small-size production
        in September.

        However, the company may stop working by the end of the year or in
        the beginning of 2008. "The US dollar was 340 drams in the summer,
        and I presented the owners with a new plan and persuaded them not to
        shut down the factory," Shoghakn director Sergey Gasparyan says.

        "Now, only 300 workers are employed in the factory. I was planning
        to hire more people but what happened those days changed our plans."

        [Passage omitted: Gasparyan says he is unsure of the factory's future.]

        P.S. Former Central Bank of Armenia chairman Bagrat Asatryan offered
        his comments yesterday [27 November] to the website A1+. "If thinking
        boyishly, one can be even proud of the dram appreciation, but if you
        start thinking in more details, this is a tragedy for the country in
        terms of economy," Asatryan said. "The appreciation of the dram should
        be considered in the context of the economic conditions, there can
        be no baseless appreciation. If the appreciation is translated into
        cheaper, let's say, potatoes, bread and other products, it would be
        great. But what we have in the result of this policy is that potatoes
        are cheaper in the USA than they are in Armenia."

        Lragir, Armenia
        Dec 5 2007


        The revaluation of the dram, more exactly the depreciation of the
        dollar causes worry, said Prime Minister Serge Sargsyan in a briefing
        on December 5. inquired from the head of government whether
        it worries the government that the continuing revaluation of the dram
        and especially the fluctuations reported a few days ago may jolt the
        financial market, which for its part may threaten national security.

        `Our economy is small and open, and therefore vulnerable.
        Figuratively, the storm in the ocean is more dangerous for small
        ships and boats. For big ships, the storm is not so dangerous. The
        storm on the international market is highly dangerous for us. Here is
        one circumstance. The second circumstance is that a peculiarity adds
        to all these problems. Our citizens get immense sums from their
        relatives who live in the United States or Russia. They get
        remittances in dollars. On the one hand, the state of these people is
        becoming worse because prices do not go down, and now, for instance,
        the dram value of one hundred dollars is less, and it is the second
        additional circumstance determining the revaluation of the dram
        because a greater dollar sum comes. It is clear that the government
        worries about it, it is clear that we are making serious moves,
        especially that the depreciation of the dollar does not foster
        export. We need to boost our GDP,' Serge Sargsyan says.

        However, he says the moves they take cannot produce results in one,
        two or three months. `These moves will have a long-terms effect. What
        worries most is the fluctuation by 20 drams. We are attending to this
        problem, and this does not depend on the process underway on the
        international market, we need to find out the main reason. Was it an
        attempt to jolt our economy? Was it a speculation to make money or
        was it another process? For instance, interference of other
        countries, and so on,' Serge Sargsyan says.


        Noyan Tapan
        Feb 21, 2008

        YEREVAN, FEBRUARY 21, NOYAN TAPAN. Remittances of natural
        persons without opening a bank account are made in Armenia by the
        Armenian commercial banks and the organizations with a licence
        for implementation of remittances (granted by the Central Bank of
        Armenia (CBA). With the aim of implementing rapidly money transfers of
        customers, the Armenian commercial banks have joined 18 international
        systems (Western Union, Money Gram, Anelik, Unistream, Contact and

        According to the CBA press service, remittances to Armenia through
        the banks - participants in these systems amounted to 385 bln 819 mln
        drams about 1 bln 127.9 mln USD in 2007 (their numer made 1,527,585),
        exceeding 9.8fold the amount of remittances abroad. The net inflow of
        money through commercial banks made 346 bln 451 mln drams, growing by
        69 bln 495 mln drams as compared with 2006. The amount of remittances
        to Armenia grew 1.2fold (by 70 bln 351 mln drams) on 2006. The average
        amount of a remittance to Armenia made 253 thousand drams in 2007,
        not changing as compared with 2006.

        The organizations, which are members of the international money
        transfer systems and implement money transfers in the territory of
        Armenia, made payments of 3 bln 504 mln drams to their customsers in
        Armenia and implemeted transfers of 718 mln drams abroad in 2007. The
        average amount of a payment to customers (in remittances to Armenia
        made by payment and settlement organizations through a money transfer
        system) made 101 thousand drams in 2007, remaining at the level of
        the previous year. Money transfer implementing organizations made
        money transfers through Armenian commercial banks as well.

        Transfers to Armenia through the Swift system amounted to 1 trillion
        823 bln drams (declining by 34 bln drams on the previous year), while
        their number made 287,786. The average amount of a transfer made 6.3
        mln drams, declining by 0.5 mln drams as compared with 2006. Payments
        to natural persons (in transfers through the Swift system) grew by
        13.7 bln drams to about 203 bln drams, while the average amount of
        a payment increased by 62 thousand drams to 2.16 mln drams. At the
        same time, the amount of natural persons' transfers abroad through
        the Swift system grew by 22 bln drams to 303 bln drams.

        On the whole, the amount of transfers to natural persons through
        commercial banks and money transfer implementing organization grew
        by 17% as compared with 2006 and made 599 bln drams, while the amount
        of transfers abroad grew by 7% to 343 bln drams.

        What if I find someone else when looking for you? My soul shivers as the idea invades my mind.


        • #94
          Re: Armenia's Economic Pulse

          Russo-Armenian Economic Relations (Part I)


          ITAR-TASS News Agency, Russia
          September 24, 2007 Monday

          Russian businesses are strengthening their positions and influence
          in the Armenian economy.

          Now the whole market of the republic's fixed and mobile communication
          is controlled by Russian businesses. Vympelcom (trade mark Bee Line)
          is the owner of the Armenian telephone company ArmenTel (the whole
          fixed and a part of mobile communication). On September 14, Mobile
          TeleSystems (MTS) announced the purchase of 80 percent of stocks of
          the leading operator of the Armenian cellular communication Vivacell.

          The Russian business positions in the Armenian power engineering
          industry are very strong. In 2005, the Interenergo company that is a
          daughter of the UES (Unified Energy Systems) of Russia electric power
          utility, bought the right to manage Electrical Networks of Armenia
          for a period of 99 years.

          On September 2, the leader of the industry and one of the largest
          taxpayers of Armenia - the ArmRosgazprom JV for gas transportation
          marked its 10th anniversary. Russia's natural gas monopoly Gazprom
          holds 57.79 percent of stocks of this monopoly seller of gas on the
          Armenian domestic market, 34.7 percent of the JV stake belongs to
          the Armenian government (the Energy Ministry) and 7.71 percent to
          the ITERA Group. ArmRosgazrpom is taking part in the laying of a gas
          pipeline from Iran to Armenia and is going to export electric power
          to neighbouring counties.

          The fuel and energy sector remains the most promising sphere of
          bilateral cooperation. Armenia gets 80 percent of needed energy
          resources from Russia. The Armenian NPP is the main cooperation
          facility. The nuclear power plant was shut down after a devastating
          earthquake in Armenia in 1989 and in 1996 is was de-mothballed with the
          participation of Russian specialists. The power unit of the Armenian
          NPP that uses Russian nuclear fuel generates up to 40 percent of
          electricity consumed in the republic. From April 2003 the NPP was
          transferred to the financial-industrial management of the INTER RAO UES
          closed joint stock company. The Sevan-Razdan hydropower plant cascade
          was transferred to the property of RAO UES as part of settlement of
          the Armenian debt to Russia for the supplied nuclear fuel.

          In December 2003, INTER RAO UES started to manage Armenia's largest
          Razdan thermal power plant that accounts for about 30 percent of
          all power generating capacities of the republic. In January 2004,
          the plant was finally handed over to Russia as part of the debt
          settlement. The Razdan Energy Company was created that took over the
          property rights of this facility.

          On Friday, it was announced here that Russia's major investment company
          Troika Dialogue is buying Armimpexbank. Russia's Vneshtorgbank had
          earlier become the owner of Armsberbank and renamed it into VTB Armenia
          bank. The Russian insurance company Ingosstrakh owns 75 percent of
          stocks of Armenia's major insurance company Efes (INGO-Armenia).

          Military-technical cooperation is an important aspect of
          Russian-Armenian relations. Within its framework Armenia purchases
          equipment and weapons at internal Russian prices. Armenian military
          undergo training at Russian military academies free of charge or on
          privileged terms.

          In the meantime, Armenian Prime Minister Serzh Sarkisyan is beginning
          an official visit to Moscow to discuss a broad spectrum of issues of
          Russian-Armenian cooperation in the political and economic spheres.

          He will meet Russian Prime Minister Viktor Zubkov, hold talks on
          various aspects of bilateral relations and give a press conference
          at Itar-Tass.

          It is the first visit to Russia paid by the current Armenian cabinet
          head who was appointed for the post in April. Sarkisyan retained
          the post of the head of the Armenian part of the intergovernmental
          commission on economic cooperation between Russia and Armenia.

          The two countries' cooperation is developing on the bilateral
          and multilateral basis. Armenia, the same as Russia, is for the
          strengthening of the Commonwealth of Independent States (CIS) and a
          member of the Collective Security Treaty Organisation (CSTO).

          Russia and Armenia have become reliable economic partners that found
          reflection in their treaty "on long-term economic cooperation for
          the period up to 2000,"signed in September 2001 by Russian President
          Vladimir Putin and Armenian President Robert Kocharyan.

          Russia today is the main trade partner of Armenia. Russia's Exports
          to the country are mainly nuclear fuel and equipment supplies for
          the Armenian nuclear power plant, energy resources, machinery and
          equipment. Food products, raw materials, unprocessed aluminium, as
          well as liquors and semi-precious stones and metals prevail in the
          structure of Russian imports from Armenia. About 70 Russian regions
          are maintaining bilateral economic relations with Armenia.

          The volume of trade turnover between Russia and Armenia has doubled
          and may exceed 0.5 billion US dollars by the end of the year, Russian
          Acting Transport Minister Igor Levitin who heads the Russian part of
          the intergovernmental cooperation commission said in Armenia last
          week. He stated that Russian investments in the Armenian economy
          have also increased. In the first half of the year they amounted to
          74 million dollars.

          The lack of direct transport service between the two countries is
          the main obstacle to the development of Russian-Armenian economic
          cooperation. The Abkhazian section of the railway between Russia and
          Armenia is closed, therefore the main part of cargoes from Russia
          to Armenia is transported via the Black Sea through the Georgian
          Poti port and then by railway. Measures are currently being taken to
          increase the load on the Kavkaz-Poti ferry service.

          By Emil Danielyan

          Eurasia Daily Monitor, DC
          Oct 30 2007

          Armenia's trade with Russia has increased dramatically this year,
          paralleling the growing Russian economic presence in the country,
          which has sparked concerns about Armenia's economic independence
          and even national security. The almost 62% year-on-year rise in
          Russian-Armenian trade registered in the first eight months of 2007
          comes despite Russia's continuing transport blockade of Georgia,
          Armenia's main commercial conduit to the outside world.

          According to the most recent data posted by Armenia's National
          Statistical Service (NSS) on its website,, the volume
          of bilateral trade totaled $404 million in January-August 2007, up
          from $250 million registered during the same period last year. Much
          of the gain resulted from an almost 100% surge in Armenian exports
          to Russia, most of them alcoholic beverages and prepared foodstuffs.

          Even so, Armenian imports of Russian commodities and goods (notably
          natural gas) continued to account for most of the bilateral commercial
          exchange, rising by 50% to about $280 million.

          Consequently, Russia saw its share in Armenia's external trade
          grow from 13.1% to 15.2%, solidifying its status as the South
          Caucasus state's single largest trading partner. The NSS reported
          similarly strong gains in Armenia's trade with Georgia, Ukraine,
          and Kazakhstan. As a result, the share of non-Baltic former Soviet
          republics in its trade reached 32.6%, up from 28.4% recorded in
          January-August 2006. The European Union, by comparison, accounted
          for 38.2% of the January-August 2007 turnover.

          Officials in Moscow and Yerevan have welcomed the growing commercial
          ties between their countries, which they say will reach a new high of
          $700 million in the full year 2007. Speaking after talks in Moscow on
          September 25, the Russian and Armenian prime ministers said they would
          try to ensure that Russian-Armenian trade hits $1 billion next year
          (Armenian Public Television, September 25). Armenian Prime Minister
          Serge Sarkisian instructed his ministers to closely work with their
          Russian counterparts to meet this target (Statement by the Armenian
          government, September 27). Nikolai Ryzhkov, a Russian lawmaker
          co-chairing a Russian-Armenian inter-parliamentary commission, came
          up with a more conservative estimate during a mid-October visit to
          Yerevan, predicting bilateral trade will likely pass $1 billion mark
          only in 2009 (Interfax, October 19).

          Russia-Armenian trade is growing strongly despite Russia's decision
          in June 2006 to close its main border crossing with Georgia. Moscow
          cited the need to conduct repairs on Russian border guard and customs
          facilities. The move, whatever its real motives, hit hard Armenian
          companies that heavily relied on the Upper Lars crossing in shipping
          goods to Russia and other parts of the former Soviet Union. Armenian
          government officials and lawmakers have since been lobbying their
          Russian counterparts to reopen Upper Lars. According the Armenian
          ambassador in Moscow, Armen Smbatian, the Russians have promised to
          do that some time in 2008 (RFE/RL Armenia Report, September 28).

          Armenian exporters, meanwhile, appear to have quickly adapted to the
          new situation through an even greater reliance on a rail-ferry link
          between the Georgian Black Sea port of Poti and Ukraine's Ilyichevsk.

          A similar ferry service, designed to primarily cater to Armenia,
          was launched in April 2007 between Poti and the Russian port of
          Port-Kavkaz. However, the service has yet to become regular and
          frequent enough to process substantial amounts of freight. Sarkisian
          reportedly raised the issue with his Russian counterpart, Viktor
          Zubkov, during their Moscow meeting.

          Zubkov told journalists after the talks that Russian companies would
          invest $1.5 billion in Armenia "in the near future." He gave no
          details, saying only that much of those investments will be channeled
          into the construction of an oil refinery in southeastern Armenia
          that will process crude from neighboring Iran. The ambitious project
          featured prominently during Iranian President Mahmoud Ahmadinejad's
          October 22 visit to Armenia. Speaking at a joint news conference
          with Ahmadinejad, Armenian President Robert Kocharian said Yerevan
          and Tehran agreed to press ahead with the project's implementation.

          Another top Russian official, Transport Minister Igor Levitin, said
          in Yerevan on September 14 that Russian investments in the Armenian
          economy will reach a record-high level of $500 million in 2007 (Azg,
          September 15). He did not specify whether the figure includes $430
          million that the Russian telecommunications operator MTS paid to
          purchase Armenia's largest mobile phone network, VivaCell, from a
          Lebanese-owned firm. The deal, officially announced in Yerevan on
          September 14, came almost a year after the $500 million acquisition
          of Armenia's national telephone company and its wireless network by
          another Russian telecom operator, Vimpelcom.

          The Armenian government is believed to have played a key role in both
          takeovers that left another sector of Armenia's economy under Russian
          ownership. It has also been instrumental in Russian control of the
          Armenian energy sector. That control has become near total since the
          signing of a controversial April 2006 agreement that enabled Armenia
          to avoid a doubling of the price of Russian gas until January 2009
          in return for handing over more energy assets to Russia. It was
          officially confirmed on September 12 that those assets include the
          entire Armenian section of an under-construction gas pipeline from
          Iran (Haykakan Zhamanak, September 13). It will now be owned by the
          Armenian national gas company in which Russia's Gazprom conglomerate
          has a controlling stake.

          The tightening of Russia's economic grip on Armenia is widely
          attributed to Kocharian's and his preferred successor Sarkisian's
          obvious desire to ensure the Kremlin's continued support for their
          regime. The two men, who single-handedly make all key decisions
          affecting the nation, are poised to cede more industries to Russian
          companies ahead of next spring's Armenian presidential election.

          Those include Armenia's rail network and largest gold mining company.


          ARKA News Agency, Armenia
          Oct 4 2007

          YEREVAN, October 4. /ARKA/. Armenian-Russian trade turnover can be
          increased through cooperation in atomic energy, RF Ambassador to
          Armenia Nikolay Pavlov stated in his interview to the Golos Armenii
          newspaper, commenting on RA Premier Serge Sargsyan's official visit
          to Moscow.

          The Ambassador explained that the matter concerns join exploration
          of uranium deposits in Armenia.

          On this context, Pavlov pointed out great importance of improving
          the schedule of the Caucasus-Poti ferry service. "Of we resolve the
          problem of excisable products at the customs station of the port of
          Caucasus before the end of the year, the trade turnover will certainly
          increase," Pavlov said.

          Speaking of the investment volume, the RF Ambassador stated that
          Russian investments in Armenia's economy are not so large - about

          "At their recent negotiations in Moscow, the Prime Ministers discussed
          the issues of construction of an oil refinery in Armenia, development
          of processing enterprises in the country with the involvement of
          Russian business. Russian investors are ready to invest capital
          in Armenia," Pavlov said. He added that such companies as Gasprom,
          VTB, RAO EES Rossii, Vympelcom and RUSAL are and will go on working
          with Armenia.

          As regards the construction of an oil refinery in Armenia, a
          feasibility report is being worked out. "We must specify the capacity
          of the refinery and the consumers. This is a most interest project,"
          he said.

          Pavlov pointed out that the Armenian-Russian Intergovernmental
          Commission for Economic Cooperation held a meeting in Yerevan
          recently. A number of documents were signed at the meeting, namely,
          a contract with the Armenian "Armavia" airline for a purchase of
          Sukhoi Super Jet 100 airplanes worth over $50mln in 2008, a corrected
          schedule of measures for the implementation of a program of long-term
          Armenian-Russian economic cooperation until 2010.

          In January-July 2007, Armenian-Russian trade turnover increased by 57%
          and totaled $330.1mln. Armenia's exports to Russia totaled $111.8mln
          (17.7% of Armenia's total exports) - a 2.05-fold increase compared
          to January-July 2006.

          What if I find someone else when looking for you? My soul shivers as the idea invades my mind.


          • #95
            Re: Armenia's Economic Pulse

            Russo-Armenian Economic Relations (Part II)

            ArmeniaNow 2 Nov 2007


            Gayane Abrahamyan

            Russia continues to expand its presence in Armenia's economy, buying
            up infrastructures of national importance. The increased
            `Russification' of Armenia gives way to concerns that Speaker of
            Russia's State Duma Boris Grizlov in 2004, calling Armenia an
            `outpost' is coming true.

            Strategic partner Russia owns 80 percents of energy sources and
            systems of independent Armenia, which has forced Armenia into the
            state of an `energy colonization', economists say.

            With the latest deal Russia took possession of the communication
            sphere. On September 14th the Russian MTS got 80 percent of
            International Cell Holding Company, the owner of K-Telecom for 310
            million euros. 90 percent of Armenia's leading communications operator
            ArmenTel were bought by Russian Vimpelcom Company in November 2006 for
            382 million euros.

            Armenia still owns some infrastructure including the railroad, but the
            Russian Railroads Company will be the most likely winner in the tender
            announced on October 15th as it competes with an unknown company from

            Last year, Andranik Manukyan, Minister of Transport and Communications
            of the Republic of Armenia stated that the only way to save the
            Armenian railroad is to hand it over for concession management to
            Russia, something the RA government is likely to do.

            The beginning of the Russian policy of getting economic leverages is
            symbolically chosen to be the year of 2002, when the `Property for
            Debt' deal was set into circulation; according to the deal Armenia
            gave Russia 4 enterprises and the most powerful Hrazdan
            Thermo-Electric Station as a pay for its debt to Russia of $97 million.

            `Russia intruded into its strategic partner's home like a bailiff and
            demanded our strategic entities for just $97 million. This took place
            in case when Russia had forgiven much larger debts to others: say, $40
            billion to Turkey, Syria and had even reconstructed Georgia's debt in
            $150 million with the right of privilege to repay in 6 years,'
            economist Eduard Aghajanov says.

            In 2001 Putin called the criticism of the deal `hysteria over selling
            the Fatherland' saying those times have passed and the economy has to
            go in a different direction.

            The `hysteria' of opposition and economists became even fiercer, when
            none of the enterprises was re-launched within the 5 years since then,
            gave no production and did not bring any use to the economy of the

            Andranik Mihranyan, Russia-based political scientist of Armenian
            descent believes the deals have been made by mutual agreement and
            Russia has never imposed conditions unacceptable for Armenia.

            `Russia simply has very little interest in those plants. It has even
            appeared that Russia does not need them, because there are numerous
            similar factories in Russia itself that do not operate.'

            A similar opinion was expressed in Yerevan recently by the co-chairman
            of the Armenian-Russian inter-parliamentary commission Nikolai
            Rizhkov, saying the plants received particularly by the `Property for
            Debt' deal were not profitable for them. `Some of our expectations
            connected with those enterprises did not prove right.'

            Economic analyst Aghajanov asks who forced the Russians to purchase
            the enterprises. And answers that the decision on the purchase has not
            been economic, but rather political aiming to get as much leverage in
            the Armenian economy as possible.

            The most powerful leverage is the energy system. Russia bought more
            than 80 percent of the country's energy sources and system, including
            the 5th energy bloc of the Hrazdan Thermal-Electric Station, the Sevan
            Cascade, distribution network, and took the Metsamor Nuclear Power
            Plant for licensed management because of a set state monopoly in this
            sphere. With the exception of thermal-electric and several minor
            hydro-electric stations, the rest are owned by Russian companies.

            Besides, no cash money has been given for the majority of these structures.

            The first energy infrastructure that became Gazprom's was the 45
            percent of ArmRosGazProm. Russians paid in gas instead of the $148
            million over several years.

            According to official data the Russian RAO UES paid $25 million for
            the Sevan-Hrazdan cascade; however, some sources mention the RAO UES
            took the cascade in exchange for the Armenian debt for nuclear fuel.

            The Hrazadan Thermal-Electric Station went into Russian possession as
            a result of the `Property for Debt' deal. An exception is the Electric
            Network of Armenia as RAO UES has to pay $70 million in exchange -
            though not to Armenia but to the owner of the network - the British
            Midland Resources.

            The most controversial deal further empowering the economic leverages
            of Russia and deepening the disproportion of the Yerevan-Moscow
            relations was signed in 2006, when the 5th bloc of the Hrazdan
            Thermo-Electric Station, the last significant energy system, was ceded
            to Russia (the other four blocs already belonged to the Russian

            Under Russian pressure the initial length of Iran-Armenia pipeline was
            also drastically minimized, thus preventing its competitiveness to the
            Russian energy companies.

            This new deal was called `Property for Gas', which, Aram Sargsyan,
            chairman of the oppositional Republic Party says should in fact be
            called `Everything for the Post.'

            The necessity in `Property for Gas' deal appeared after Russia decided
            to increase the price for the gas for 2.5 times ahead of parlamentary
            elections in Armenia; and coincided with time when Armenia was making
            attempts to diversify its energy sphere.

            After protracted negotiations, the government of RA gave preference to
            Iranian Mar and Sanir companies in both tenders for the construction
            of the Iran-Armenia gas pipeline and the modernization of the Hrazdan
            Thermal-Electric Station the same year.

            `Russia realized quite well that this cooperation with Iran is a
            serious alternative and blackmailed Armenia by increasing the price
            for gas,' former Prime Minister, and presidential candidate Vazgen
            Manukyan says insisting the latest deal is a new leverage in the hands
            of Russia to be used for political purposes.

            `In the presidential election in 2008 Russia may say: `If my proxy
            does not come to power I will make the price for the gas $250, if he
            does - it will remain at $110',' Manukyan told Armenianow.

            The 5th bloc of Hrazdan station was given to Russia for $60 million in
            cash, while the remaining nearly $189 million will be paid to the
            ArmRosGazProm as subsidy.

            For three years the citizens of Armenia will be getting relatively
            cheap gas; however, another highly important energy entity of the
            republic will go into Russia's possession. According to the agreement
            the prices may go up beginning 2009.

            Radical opposition political analyst Suren Surenyants is confident the
            authorities agreed to the economically unprofitable gas deal to
            prolong their stay in power and to fulfill all the `directives' of the

            Vahan Hovhannisyan, deputy speaker of the National Assembly, member of
            the Armenian Revolutionary Federation insists Armenia-Russia relations
            are a strategic partnership in nature and include mutual obligations
            of the sides: `We may frequently dislike those obligations, but they
            are unavoidable.'

            `After the Soviet years it's natural that the relations with Russia
            are viewed as colonial. However, the situation has changed and I don't
            see a threat that Russia may use its economic leverages for political
            purposes,' a co-chairman of the Armenia-Russia Inter-Parliamentary
            Commission Vahan Hovhannisyan said.



            YEREVAN, JANUARY 14, NOYAN TAPAN. A Russian-Armenian economic forum
            will be held in Yerevan on January 20-21. The Union of Armenians of
            Russia (UAR) and the RA ministry of trade and economic development are
            the event's organizers. NT correspondent was informed by the UAR that
            it is envisaged that at the January 21 plenary sitting of the forum,
            the Armenian prime minister Serge Sargsian will address forum
            participants with an opening speech, while the chairman of the UAR Ara
            Abrahamian will make a speech of welcome.

            During the plenary sitting, the RA minister of trade and economic
            development Nerses Yeritsian will give the report "The Development
            Prospects and Priority Investment Directions of Armenia's Economy". The
            director of the Armenian Development Agency (ADA) Tigran Davtian will
            make the report "The Current Investment Environment in Armenia".

            On the same day A. Abrahamian and N. Yeritsian will hold a joint press
            conference. Individual meetings of businessmen - forum participants
            will take place. 60-70 businessmen are expected to arrive from Russia
            to participate in the forum.



            Jan 21, 2008

            YEREVAN, JANUARY 21, ARMENPRESS: Addressing an Armenian-Russian
            business forum in Yerevan today Armenian prime minister Serzh
            Sarkisian said the event was an important avenue for businessmen of
            both countries to seek new ways for boosting their ties.

            He said Russian investments in Armenia's real sector of economy since
            its independence have amounted to nearly $1 billion or one third of
            all foreign investments and about 900 ventures with joint capital
            have been opened.

            The Armenian prime minister singled out, particularly, IT, machine
            building, tourism and some other sectors as areas in which both
            countries have huge resources to make progress.

            The forum was attended by Igor Levitin, Russian transport minister
            who co-chairs together with Serzh Sarkisian the bilateral government
            commission for cooperation.

            Igor Levitin for his part described Russia's relations with Armenia
            as dynamic. He said trade between Armenia and Russia grows over 50
            percent annually. For example, it grew 60 percent in 2006 and is
            expected to grow 63 percent for 2007.

            The Russian minister also spoke about Russian investments in Armenia's
            major sectors-energy, transport, mining and banking . He said removing
            transport obstacles will give a very strong push to bilateral trade.

            Armenia has had no overland connections with Russia since 2006 July
            after Russia closed a border check point on its border with Georgia
            for a repair that was to end in several months. The trade is being
            carried out through ferry boats which join Georgian ports with Ukraine
            and Russia.

            The Russian minister urged Armenian companies manufacturing building
            materials not to miss their chance and take part in construction of
            sporting facilities for southern Russian city of Sochi that will host
            2014 Winter Olympic games.

            Levitin reminded that Russia is ready to invest in prospecting of
            uranium in Armenia. An agreement to that end was signed in Yerevan
            last year.



            Jan 30 2008

            YEREVAN, January 30 (Itar-Tass) -- The governments of Armenia and
            the Moscow region signed a cooperation agreement on Wednesday.

            The signing of the document was in the centre of Moscow region Governor
            Boris Gromov's one-day visit to Yerevan.

            When receiving the Moscow region governor, Armenian President Robert
            Kocharyan said he was satisfied with the signed agreement.

            He is confident that the document will give an additional impetus to
            the development of Russian-Armenian cooperation.

            The Moscow region has a big potential and its authorities are ready
            to tap it in order to enhance Russian-Armenian relations, Gromov said.

            During his meeting with Armenian Prime Minister Serzh Sarkisyan,
            the governor discussed further development of bilateral interaction.

            The interlocutors pointed to the key role of contacts between the
            Russian and Armenian regions in that cooperation.

            The Moscow region and Armenia have traditionally good relations,
            Gromov said.

            The signed agreement envisages the setting up of working groups
            in various spheres and specific programs of cooperation, including
            agriculture, housing construction, and culture, the governor said.

            Our main task is to create favourable conditions for the development
            of business, economic, cultural and social contacts, Gromov said.

            In 2007, trade turnover between Armenia and the Moscow region had
            neared 40 million U.S. dollars, the governor reminded, adding,
            "There is no point in saying that this index is high."

            What if I find someone else when looking for you? My soul shivers as the idea invades my mind.


            • #96
              Re: Armenia's Economic Pulse

              Russo-Armenian Economic Relations (Part III)
              The Position of the Current Leadership: Economic Relations, Cooperation or Integration?

              Sergei Blagov

              March 27 2008

              Serzh Sarkisan, whose controversial election as president of Armenia
              precipitated political violence in Yerevan, is hoping closer ties with
              Russia can hasten a return of stability in the South Caucasus country.

              Sarkisian -- the current prime minister who is scheduled to be
              inaugurated as President Robert Kocharian's successor on April 9 --
              flew to Moscow on March 24 for meetings with Russia's presidential
              tandem, outgoing chief executive/incoming prime minister Vladimir
              Putin and president-elect Dmitry Medvedev. [For background see the
              Eurasia Insight archive].

              Already Russia's closest ally in the region, Sarkisian said he was
              committed to "deepening and expanding" Armenian-Russian ties. He also
              expressed gratitude for Moscow's support of the Armenian government's
              handling of the political crisis in Yerevan. [For background see
              the Eurasia Insight archive]. "We always felt your assistance in the
              election process," Sarkisian said during a meeting with Putin. "To
              be honest, we never expected such clear-cut" support.

              Putin and Medvedev seemed happy to take the Armenian leader up on
              his offer of closer relations. "This is your first visit after the
              elections, and, of course, we see special symbolism in this fact,"
              Medvedev said.

              Putin, meanwhile, clearly indicated that Armenia's current domestic
              difficulties would not hamper the Kremlin's ability to do business
              with Sarkisian. "I know that political processes in Armenia are
              complicated," Putin acknowledged. The Russian leader then expressed
              confidence that "no matter how the internal political process in
              Armenia unfolds, what has been built in the past years in relations
              between the Russian Federation and Armenia will be maintained and
              will develop in the future."

              Sarkisian indicated that his incoming administration would seek to
              quickly restore a sense of stability in the country, pledging to
              create "an atmosphere of tolerance." The centerpiece of his emerging
              stabilization program is an initiative to boost social welfare and
              economic opportunity. [For background see the Eurasia Insight archive].

              The two countries have been doing a lot of business in recent years.

              Trade between Russia and Armenia reached $800 million in 2007,
              marking a 60 percent increase over the previous year, according to
              the Russian official statistics. Moscow voiced expectations that
              bilateral commerce would top $1 billion in the near future.

              Trade between Russia and Armenia has been hampered by transportation
              bottlenecks. For over a year, Sarkisian has been lobbying Russian
              officials to expedite the opening of ferry service connecting Russian
              Black Sea ports and the Georgian city of Poti, a move that would ease
              Armenia's transport woes. Moscow's recent decision to ease transport
              restriction with Georgia could revive hopes that ferry service could
              begin soon. [For background see the Eurasia Insight archive].

              One notable bilateral trade development occurred February 6,
              when Atomredmetzoloto, a uranium mining subsidiary of Russia's
              nuclear monopoly Rosatom, created a joint venture in Armenia to
              develop uranium reserves estimated at 30,000-60,000 tons. The deal
              was clinched during a visit to Armenia of the Prime Minister Viktor
              Zubkov, who was accompanied by Sergei Kiriyenko, head of Rosatom.

              In Yerevan, Kiriyenko pledged to participate in a tender to build a
              new nuclear power plant in Armenia. The initial estimated cost of the
              project is $1 billion. Zubkov and his Armenian counterpart Sarkisian
              also inked an agreement covering Armenia's participation in the
              International Enrichment Center in Angarsk, in Russia's Irkutsk region.

              One potential trouble spot in relations centers on energy supplies.

              Armenian officials have hoped to ensure, through their expressions of
              loyalty to Moscow, that the Kremlin-controlled energy conglomerate
              Gazprom would give Armenia a preferential price for gas. Armenia
              currently pays $110 per thousand cubic meters (tcm) and this contract
              price remains effective till January 1, 2009. That price is far
              lower than what some other former Soviet states pay Gazprom. Yet,
              even if Gazprom was inclined to maintain Armenia's favorable rate,
              events now seem to mandate that Yerevan will face a substantial price
              increase in 2009. Gazprom's recent pledge to pay "European market"
              prices to Central Asian producers means that the gas that it obtains
              from the region with cost the Russian company upwards of $300/tcm. It
              will have no choice, then, but to pass costs on to its customers. [For
              background see the Eurasia Insight archive].



              2008-03-25 17:03:00

              ArmInfo. Integration processes with Russia will grow at a quickened
              pace, Chairman of the Central Bank of Armenia (CBA) Tigran Sargsyan
              said in his interview with "Rossiyskaya gazeta" (Russian newspaper).

              According to him, time and confidence are the important elements
              of modern economy. If there is mutual understanding, the economic
              contacts are established quickly. Mentality, traditions, the huge
              cultural layer, which have always unified Armenia and Russia are
              becoming a strong stimulus for new business opportunities. It is
              much more complicated with Europe and America: establishment of new
              economic relations needs time, and time is money. The integration
              processes with Russia will leave behind the integration processes
              with other countries.

              Commenting upon the possible suspension of the Millennium Challenge
              Program in Armenia, Sargsyan said that this program would greatly
              help the country, though the country mostly relies on its own
              economic potential. "Armenia will go forward along the path of market
              reforms. Those indices, which already exist and those which will by
              all means be, will allow our American colleagues to reconsider the
              decision and renew the project. Due to the strong basis of relations
              with Russia, we'll manage to overcome a number of problems, including
              the temporary suspension of the financial support under the Millennium
              Challenge Program. The relations with Russia, which have become more
              intensive over the past three years, prove that the financial and
              economic problems in Armenia are overcome", he said.

              The CBA chairman said that actually being isolated from the foreign
              world by transport blockade and having no serious natural resources,
              Armenia demonstrates sustainable rates of economic growth. In 2007,
              the growth rate made up 13,7%, with inflation rate being 6,6%. This
              is the lowest inflation index among the CIS countries. The real
              incomes of the population annually increase by 19-20%, the poverty
              level decreased twice over the past three years. To a large extent,
              this is the result of the economic policy conducted the Armenian
              government headed by Armenian President Robert Kocharyan and Armenian
              Prime Minister, newly-elected President Serzh Sargsyan.

              Russia traditionally maintained good relations with Armenia. After the
              disintegration of the Soviet Union, the cooperation dropped abruptly:
              the former plan schemes went out of date, and the new ones were not
              created yet.

              Cooperation on market bases became possible over the past five years
              when the economy of both states consolidated to the extent possible.

              In 2007 the Russian-Armenian trade turnover grew by 65% to $700mln
              against just $300mln in 2005. Last year Russia had the biggest 16.1%
              share in Armenia's foreign trade. Besides, Russia is home to a very
              big Armenian community and almost 80% of all private money transfers
              from Armenia are sent to Russia.

              Presently, Russia and Armenia are implementing a whole number of joint
              projects. In 2008 they are planning to complete the construction of
              the second section of Iran-Armenia gas pipeline, a project financed
              by AromRosgazprom (joint venture of Gazprom, Itera and Energy Ministry
              of Armenia).

              The company has started to modernize the Sevan-Hrazdan Water Power
              Plant and is building Kajaran-Ararat gas pipelines. In 2008-2010
              AtomRosgazprom is planning to invest almost $30mln in the Armenian
              economy, particularly, in the restoration of Yerevan and Azrni water
              power pants, modernization of Argel, Sevan and Kanaker WPPS. Presently,
              Armenia buys Russian gas at a preferential price - $110/1,000 c m,
              while for its neighbors the price is no less than $230/1,000 c m.

              In the nuclear sphere, Rosatom and Ecology Ministry of Armneia have
              signed an protocol for establishing a JV for prospecting, mining
              and processing of uranium in Armenia. The JV is planning to spent
              several hundreds of millions of US dollars on this project. In early
              Feb 2008 the foreign ministries of Russia and Armenia exchanged notes
              on Armenia's joining the International uranium Enrichment Center,
              set up by Russia and Kazakhstan in May 2007.

              Rosatom is going to take part in the tender for the construction of
              new nuclear power plant in Armenia. The Russian business is active
              in Armenia's banking sector. In late 2007 Gazprombank bought 80.09%
              stake in Armenian-Russian Export-Import Bank (Armeximbank).

              Such big players as Troika-Dialogue, Unibank, Gazprombank, VTB have
              come to Armenia. Russian companies control a big part of Armenia's
              telecoms and manufacturing sectors. MTS OJSC owns 80% of the mobile
              telecom operator K-Telecom (VivaCell), while VimpelCom owns the
              fixed and mobile telecom operator ArmenTel. Rusal owns Armenal foil
              rolling plant.

              Rostekhnologies State Corporation has specific investment plans
              in Armenia's engineering and machine-building sectors. Since 2002
              RosDefenseExport has supplied Armenia with military products worth
              $25mln. Russian Railways manages Armenian Railways Company and has
              promised by 2010 to restore the railway communication with Turkey and
              by 2009 with Azerbaijan. The Russian company is planning to invest
              $570mln in Armenian railways. If the transport blockade of Armenia
              is lifted and the Abkhazian section is opened, this figure may grow
              to $2.132bln. The development of the transport infrastructure will
              help us to more effectively use our economic capacities.

              Armenia's legislation is rather liberal, so, the Russian business
              has no problems on the Armenian market. International experts say
              that the Armenian economy is much more open and attractive than the
              economies of the other CIS countries.

              The Armenian authorities are working hard to turn Armenia into the
              financial center of the region. Armenia is a place where different
              banking cultures can work in harmony and dialogue.



              March 25, 2008

              YEREVAN, March 25. /ARKA/. Armenia and Russia to speed up their
              cooperation development, Tigran Sargsyan, chairman of the Central
              Bank of Armenia, said Monday in an interview with Rossiyskaya Gazeta.

              He pointed out time and trust as important factors of economic

              He thinks these factors lay favorable ground for establishing
              economic ties.

              "Mentality, traditions and cultural relations have always united
              Russia and Armenia and created favorable environment for establishing
              business ties", Sargsyan said.

              He said that this doesn't apply to Europe and America - time is needed
              for establishing new economic relations, and time is money.

              "Integration processes with Russia will outdo integration with other
              countries", the Central Bank head said.

              He said that once Armenia's economic relationship with Russia lagged
              behind political, but in recent tree years, the countries built up
              political relations.

              "Armenian and Russian governments view new industries, changeover
              to science intensive economy and high technologies as top-priority

              This will spur our economies integration", Sargsyan said.

              Armenian-Russian trade turnover grew 65.5% to $704.1 million. Armenia's
              exports to Russia totaled $201.8 million (17.4% of Armenia's exports)
              in 2007 after growing 66.5%, compared with the previous year.

              Imports from Russia reached $502.3 million in 2007 after growing 65.1%,
              compared with 2006.

              As a whole, Russia has imported commodities worth $570.5 million
              (17.4% of total imports).

              Statistical reports say, in 2007 Russian imports reached the record
              high making 15.9% of Armenia's foreign trade turnover.

              What if I find someone else when looking for you? My soul shivers as the idea invades my mind.


              • #97
                Re: Armenia's Economic Pulse

                The Artsakh Report (Part I)


                DeFacto Agency
                April 10 2008

                YEREVAN, 10.04.08. DE FACTO. In 2007 the amount of the Nagorno-Karabakh
                Republic foreign trade turnover made $ 277 million 392, 9 thousand,
                which exceeds the level of 2006 by 75 %.

                According to the information DE FACTO received at the NKR National
                Statistic Service today, export had made $ 72 million 549, 6 thousand
                (growth is 60 %), import - $ 204 million 843, 3 thousand (growth is
                81 %).

                Deficit of trade balance increased by 95 % as compared with 2006 and
                made $ 132 million 293, 8 thousand.

                In 2007 the amount of the NKR foreign trade turnover with the CIS
                countries made $ 260 million 894, 8 thousand, or 94, 1 % of total
                turnover. To note, $ 257 million 735 thousand (92, 9 % of the sum)
                fall to the share of the RA.

                In the total amount of export 47, 3 % make raw materials, 28, 8 % -
                gems and semi-precious stones, precious metals and articles made of
                them, and 10, 2 % - foodstuffs.

                In import's structure 23, 8 % make raw materials, 17, 6 % - foodstuffs,
                10, 8 % - production of vegetable origin, and 9, 6 % - cars, equipment
                and mechanisms.


                One more project on electricity export

                12-04-2008 12:23:34 - KarabakhOpen

                Currently a program of development of energy sector is being drafted,
                which involves exploitation of energy resources of the major rivers of
                Karabakh, construction of small water power plants, thanks to which
                Karabakh may start exporting energy, said Prime Minister Ara
                Harutiunyan in a consultation yesterday.

                The prime minister underlined that during the drafting of the program
                an issue of review of tariffs occurred but the prime minister says it
                is necessary to avoid change of tariffs.

                Ara Harutiunyan underlined that currently Karabakh supplies 45 percent
                of its demand, and imports power from Armenia. With regard to the
                national energy company, Artsakh Energy, Ara Harutiunyan said the
                company not only did not foster but also hindered the development of
                the energy sector, sustaining major losses. The head of state urged to
                reduce power loss. He said this year the sector generated 12 percent
                more profit but it is not a limit.

                Losses of power in Stepanakert and Hadrut were reduced, unlike
                Kashatagh, Martakert and Shahumyan where the people in charge received
                a warning.

                The head of the electricity board of Kashatagh says electricity bills
                60 kWh of which is subsidized by the government are not paid. The prime
                minister proposed reviewing the mechanism of subsidizing. Loss of power
                in the region is 52 percent compared with 72 percent in the same period
                of last year. However, it is not enough. In Martakert the loss of power
                is 23.6 percent, in Shahumyan 38.6 percent.

                The prime minister said the heads of the regional offices of Artsakh
                Energy will be fired if the situation does not change.

                Several years ago the ex-prime minister Anushavan Danielyan worked out
                a program of construction of small water power plants. The program
                seemed realistic but it was not brought into being. The ex-prime
                minister explained that there were no investors. If the current program
                also relies heavily on investors, it may end up in the same way as the
                previous program.



                DeFacto Agency
                March 26 2008

                YEREVAN, 26.03.08. DE FACTO. A big tourist center will open in former
                polyclinic's building in Stepanakert, a shareholder of Tourist Center
                CJSC Sergey Shahverdian told in an interview with

                The restoration works have already started.

                According to S. Shahverdian, the building's architectural appearance
                will be completely maintained. A tourist agency and an information
                center for tourists will be placed here. There will also be exhibition
                halls and other services necessary in tourist industry.

                The restoration works mainly financed by Russia's Armenians will be
                concluded in a year and a half. The territory of the park adjoining the
                building, where an open-air exhibition is to be held, will be equipped
                with modern amenities as well. "The Artsakh artists will have an
                opportunity to exhibit and sell their works", Sergey Shahverdian said.

                In his words, the idea to establish such a centre sprang up as early
                as in 2004. "It was very important for us that the center should
                be placed in an ancient building of the city restored in line with
                historical-architectural and tourist requirements", S. Shahverdian
                said. He also added they have made a right choice. "During the works
                on pulling down additional walls and partitions we have found unique
                arch apertures". "According to experts' estimations, the building
                was constructed in eighteen fifties, after tsar's troops had been
                dislocated in Karabakh", S. Shahverdian added.


                [The title is misleading, as the article suggests that during the first months of the current year, it was one third of last year's twelve months; it compares "apples and oranges???" Siamanto.]

                08-04-2008 20:44:36

                The minister of agriculture Armo Tsatryan says the pace of sowing of
                crops is normal. As of March 31, 1131.3 ha of crops have been sown
                which is one third of last year's index.

                The government provided seeds of potato, corn, soy, peas to farmers in
                the form of interest-free loans. According to the minister, already
                more than 300 tons of potato seeds, 215 tons of peas, 8 tons of corn
                and 5 tons of soy have been distributed. Loan is due by October 1,
                after the harvest.

                Also Armo Tsatryan said in an interview with that
                last year 1185 ha of potatoes was sown. This year 999.6 ha have been
                sown by April, compared with 614.2 ha of the same period of the past
                year. 213.8 ha of vegetables have been sown against 7.9 ha last year.

                According to the minister of agriculture, 12 thousand ha of privatized
                and rented land, as well as 1500 ha of the government reserve are
                fallow. Half of 300 million drams foreseen for this program has
                been disbursed to farmers, the rest will be disbursed in June after
                cultivation. According to the minister, another 120 million drams
                will be needed.


                19-03-2008 11:56:55

                Spring sowing has started, and the government provides assistance to
                farmers. 1500 tons of nitrite fertilizers have been imported to NKR,
                which is sold to farmers at a lower price thanks to the government
                subsidy. 1 kg of fertilizer costs 104 drams of which the owners of land
                pay 80 drams, those who rent land pay 100 drams, said the NKR minister
                of agriculture Vladimir Zakiyan in an interview with the Azat Artsakh.

                According to him, 274 tons of seeds of potatoes of early ripe sorts
                have been imported. The price of the seeds is 230 drams. Seeds were
                provided to all the regions. It is foreseen to buy another 30 tons
                for the regions of Martuni and Kashatagh. It is also foreseen to
                import seeds of corn, pea, bean and buckwheat.

                What if I find someone else when looking for you? My soul shivers as the idea invades my mind.


                • #98
                  Re: Armenia's Economic Pulse

                  The Artsakh Report (Part II)


                  28-03-2008 11:17:07

                  According to the NKR National Statistics Service, the labor resource
                  of NKR was 81.6 thousand in 2007 and was up by 1.6 percent compared
                  with 2006. The economically active population totaled 59.1 percent,
                  which was up by 1.5 percent compared with 2006. As of January 1, 2008
                  the number of people employed in economy was 56.1 thousand compared
                  with 54.6 thousand in 2006, including 15.1 thousand self-hired people
                  and 41 thousand wage earners. 23.5 thousand people of working age did
                  not work or look for jobs, compared with 23.1 thousand people in 2006.

                  In 2007, according to the NSS, the average monthly wage of people
                  employed in the economy was 68,610 drams, and was up by 21 percent
                  compared with 2006. In addition, the monthly wage of people employed
                  in offices and organizations funded by the government was 77,235 drams
                  and was up by 20.2 percent compared with 2006. The monthly wage of
                  people employed in commercial and non-commercial organizations was
                  62,641 drams and was up by 21.8 percent.

                  In the fourth quarter of 2007, the ratio of the minimum salary to
                  the average salary was 26 percent, and to the cost of living was
                  64.3 percent.

                  The ratio of the average monthly wage to the cost of living was
                  247.3 percent.


                  Price Index/Cost of Living
                  CONSUMER PRICE INDEX 109.2% IN NKR IN JAN-MAR 2008

                  April 10, 2008

                  STEPANAKERT, April 10. /ARKA/. The consumer price index was 109.2% in
                  the Nagorno-Karabakh Republic (NKR) in January-March 2008 as compared
                  with the corresponding period last year. The index of prices for food
                  products (alcoholic beverages and tobacco inclusive) was 114.9%, that
                  of prices for nonfoods 101.3% and that of prices for services 102.8%.

                  The NKR Statistical Service reports that the consumer price index
                  was 103.2% in the NKR in January-March 2008 as compared with last
                  December. The index of prices for food products (alcoholic beverages
                  and tobacco inclusive) was 104.6%, that of prices for nonfoods 101.7%
                  and that of prices for services 101.2%.

                  Price monitoring conducted by the NKR Statistical Service showed a
                  rise in the prices for a number of essential goods in the NKR. A 36.1%
                  rise in the price for bread was recorded in March 2008 as compared
                  with last March, a 27.9% rise as compared with last September and an
                  8.5% rise as compared with last December.

                  The respective rise in the price for flour was 73.9%, 44.4%
                  and 16.4%. The price for noodles rose by 14.2%, 13.8% and 3.1%
                  respectively. The price for rice rose by 3.6%, 7.4% and 2.9%, for
                  beef by 7.1%, 7.1% and 5.9%, for animal fat 29.4%, 23.7% and 6.8%,
                  for vegetable oil by 59.6% and 50.9% as compared with last March and
                  September respectively. A 3.5% fall in the price for vegetable oil
                  was recorded as compared with last December.

                  In March 2008 price of bread grew by 36.1 percent compared with March

                  12-04-2008 12:24:27 - KarabakhOpen

                  According to the results of monitoring of prices by the NKR National
                  Statistics Service, in March the prices of some foodstuffs went up.
                  Compared with the prices in March, September and December 2007, in
                  March 2008 the price of bread went up by 36.1 percent compared with
                  March, 27.9 percent compared with September and 8.5 percent compared
                  with December. The price for flour went up by 73.9 percent, 44.4
                  percent, 16.4 percent; noodles 14.2 percent, 13.8 percent, 3.1 percent;
                  rice 3.6 percent, 7.4 percent, 2.9 percent; beef 7.1 percent, 7.1
                  percent, 5.9 percent; animal fat 29.4 percent, 23.7 percent, 6.8
                  percent; vegetable oil went up by 59.6 percent compared with March,
                  50.9 percent compared with September, and went down by 3.5 percent
                  compared with December.

                  Compared with the CPI in December 2007, the CPI in March 2008 is 103.2
                  percent, foodstuffs (including alcohol and tobacco) 104.6 percent,
                  other goods 101.7 percent, services 101.2 percent. Among foodstuffs
                  increase was reported in potatoes 121.9 percent, bread 107.3 percent,
                  dairy products 104.7 percent, meat 104.6 percent, fruit 103.3 percent,
                  the NKR National Statistics Service reports.

                  Compared with the CPI in December 2007, in March 2008 the CPI was 102.5
                  percent in Stepanakert, 102.9 percent in Askeran, 103.9% percent in
                  Hadrut, 104.0 percent in Martakert, 104.3 percent in Martuni, 105.9
                  percent in Shushi and 103.7 percent in Berdzor.

                  Compared with the CPI in January to March 2007, in January to March
                  2008 the CPI was 109.2 percent, foodstuffs 114.9 percent, other goods
                  101.3 percent, services 102.8 percent, and compared with March 2007, in
                  March 2008 the CPI is 110.9 percent.


                  Workforce/Population Data
                  SOME INDEXES OF WORK'S MARKET IN 2007 IN NKR

                  Azat Artsakh Daily
                  Published on March 26, 2008
                  NKR Republic

                  As NKR National Statistical Service informs, working recourses, which
                  includes economically active and economically non active population,
                  in 2007 in NKR has compiled 82.6 thousand people, an increase in
                  comparison with the previous year - 1.6 per cent. Economically active
                  population, by whom a suggestion of manpower for creation of goods
                  and services in accountable scopes is satisfied in 2007 in NKR, it
                  compiles 59.1 thousand people, an increase in comparison with the
                  previous year - 1.5 per cent.

                  By 01.01.2008 condition, a number of occupyers in household has
                  compiled 56.1 thousand people, instead of the previous year's 54.6
                  thousand people, moreover, a number of hired workers - 41.0 thousand,
                  self-occupyers - 15.1 thousand people. In 2007 in NKR a number of
                  unemployment has compiled 5.1 per cent, instead of the previous year's
                  6.1 per cent. In the republic economically non active population,
                  who hasn't work in accountable period and hasn't looked for a job,
                  has compiled 23.5 thousand people, instead of the previous year's
                  23.1 thousand. In branch connection, an average monthly nominal wage
                  has been rather high especially in crediting and governing systems,
                  which have compiled 211.5 and 163.1 per cent. By results of the
                  4th quarter of 2007 a correlation of minimun wage in regard towards
                  average nominal wage has compiled 26.0 per cent, in regard towards
                  minimal consumer budget - 64.3 per cent and correlation of average
                  nominal consumer budget - 247.3 per cent.



                  03-04-2008 16:36:55

                  As of January 1, 2008, the population of NKR is 138,834, of which
                  71,652 or 51.6% are urban dwellers. Compared with January 1, 2007
                  the population has grown by 1087 or 0.8%, the National Statistics
                  Service informs.

                  48.1% of the population are men, 51.9% are women. 36.7% live in
                  Stepanakert, 16.7% in Martuni region, 13.7% in Martakert, 12.5%
                  in Askeran, 6.2% in Kashatagh, 3.3% in Shushi и 2% in Shahumyan.

                  As of the beginning of 2008, 24.5% were children under 15, 64.5%
                  were working age people and 11% are people of retirement age. In
                  other words, the ratio of working people to children and pensioners
                  is 1000 to 550.

                  In 2007 2145 children were born which is up by 2% compared with
                  2006. 1227 people died, which is down by 0.6% compared with 2006. The
                  number of deaths among children under 1 year was 19, under 5 years 25.

                  In 2007 519 marriages were registered compared with 827 in 2006,
                  the rate of divorce did not change and totaled 123.

                  The number of people who arrived in Karabakh (excluding internal
                  migration) was 831, left 1026.

                  What if I find someone else when looking for you? My soul shivers as the idea invades my mind.


                  • #99
                    Re: Armenia's Economic Pulse

                    Production of Uranium In Armenia

                    The Project
                    Russia & CIS General Newswire
                    December 24, 2007 Monday 12:00 PM MSK

                    Armenia could begin producing uranium in 2 - 5 years

                    YEREVAN Dec 24

                    Armenia could begin producing uranium in the next two to five years,
                    Armenian Energy Minister Armen Movsisian told journalists.

                    According to the best-case scenario, the exploration of uranium
                    reserves together with Russian experts will be completed within a
                    year and uranium can be produced within two years, while in the
                    worst-case scenario the production could begin in five years, the
                    minister said.

                    It is not economically rational to enrich uranium on the Armenian
                    territory, because the country lacks industrial uranium reserves, the
                    minister said.

                    It was reported earlier that Armenia decided to join the Russian-
                    Kazakh agreement on the establishment of an international uranium
                    enrichment center in Angarsk in the Irkutsk region, the Armenian
                    government said late last month.

                    According to preliminary reports, Armenia has no less than 30,000
                    tonnes of uranium. An additional survey may increase the size of
                    these reserves by 1.5-2 times.

                    Movsisian also said that an international consortium may build a
                    nuclear power plant in Armenia. The attitude of the international
                    community to the construction of a nuclear power plant in Armenia has
                    changed for the better over the past five years. "Today the
                    international community extends a helping arm to Armenia to build its
                    new NPP," the minister said.

                    Russia could deliver safe nuclear reactors, Europe could supply
                    electrical and technical equipment, while the United States could
                    deliver automatics. The minister said that a technical and
                    feasibility study for a new NPP is expected to be prepared by
                    September 2008.

                    Project works will begin and a general contractor will be chosen

                    Armenia and Russia have been discussing a possibility to extend the
                    term of financial management of the Armenian NPP by INTER RAO UES,
                    which expires in September 2008. Financial management brought a
                    positive result: problems related to the delivery of fuel assemblies
                    to refuel the plant and to hold planned maintenance works were
                    solved, the prime minister said.

                    It is planned that the Armenian NPP will be decommissioned in 2043.

                    The decommissioning will cost 238.75 million euro. The plant will be
                    decommissioned gradually in order to reduce the financial burden. The
                    second energy unit of the NPP is expected to be stopped in 2016. The
                    closure of the station is considered in conjunction with a project to
                    build a new NPP by 2016.

                    The Armenian NPP generates almost half of the electricity in Armenia.
                    INTER RAO UES trust management was introduced for five years at the
                    NPP in 2003.



                    RIA Novosti
                    March 6 2008

                    YEREVAN, March 6 (RIA Novosti) - The Armenian government authorized
                    on Thursday the establishment of a joint venture with Russia for
                    the additional prospecting of uranium deposits in the South Caucasus

                    Russia's state nuclear corporation Rosatom and the Armenian
                    environmental ministry agreed in February to set up a joint venture on
                    a parity basis for the additional prospecting of Armenian uranium,
                    which will be enriched in a specialized international center in
                    Angarsk, East Siberia.

                    The centre is to operate under the supervision of the International
                    Atomic Energy Agency (IAEA).

                    "This decision was made pursuant to a memorandum signed between
                    Rosatom and the Armenian environmental ministry on February 6, 2008
                    on developing cooperation in uranium prospecting, production and
                    processing," the Armenian government's press office said.

                    Armenian uranium reserves are estimated at 30,000-60,000 metric tons.


                    The Exploration of Uranium

                    Noyan Tapan
                    April 22, 2008

                    YEREVAN, APRIL 22, NOYAN TAPAN. The RA minister of environmental
                    protection Aram Harutyunian and the director general of
                    Atomredmetzoloto OJSC (Russia) Vadim Zhizhov on April 22 signed an
                    agreement on creating a closed joint-stock company (CJSC) on uranium
                    prospecting. Under the agreement, the company will be registered within
                    3 months, then it will receive a licence for uranium prospecting in
                    Armenia. It is planned to start geological prospecting in September
                    in Syunik marz.

                    According to A. Harutyunian, Armenia and Russia signed an agreement on
                    cooperation in the peaceful use of atomic energy as early as 2000. In
                    February 2008, the RA ministry of environmental protection and Rosatom
                    agency (Russia) signed a memorandum on development of cooperation in
                    geological exploration of uranium mines, mining and processing. This
                    memorandum confirmed the sides' intention to found a joint venture.

                    A. Harutyunian said that the whole process of geological prospecting
                    will be transparent and in line with requirements of the Armenian
                    legislation. In his words, the Russian side envisages to make
                    investments of about 3 million dollars this year.

                    The authorized capital of the joint venture makes 92 mln 241 thousand
                    drams (over 297.5 thousand USD). A temporary account will be opened
                    in Areximbank CJSC (Gazprombank Armenia) in order to set up this
                    company. Atomredmetzoloto will pay (in money) 50% of the company's
                    authorized capital. The Armenian side - the ministry of environmental
                    protection will pay its share of capital in property, as well as in
                    the form of geological and other information.

                    Atomredmetzoloto company manages all the uranium manufacturing assets
                    of Russia and implements some projects in Kazakhstan. The company
                    is in second place in the world by its uranium reserves. 100% of
                    Atomredmetzolot's shares is owned by Atomenergoprom OJSC that makes
                    part of the Russian atomic energy agency Rosatom.


                    The Enrichment of Uranium
                    Energy Publisher, TX
                    Feb 10 2008

                    Russia: Armenia inks deal for uranium enrichment

                    The agreement to join the enrichment center was signed by the prime
                    ministers of the two countries.

                    by World Nuclear News

                    Armenia has signed an agreement with Russia to join the international
                    uranium enrichment center to be set up in Siberia. The two countries
                    have also agreed to set up a joint venture for uranium exploration.

                    The agreement to join the enrichment center was signed by the prime
                    ministers of the two countries, Victor Zubkov and Serzh Sarkisyan,
                    during a visit by Zubkov to the Armenian capital Yerevan. Armenia now
                    joins Kazakhstan and Russia in the venture to set up a shared
                    enrichment centre at Russia's existing Angarsk plant. Ukraine has
                    also expressed interest in signing up.

                    The international center is seen as a first step towards an
                    internationalized nuclear fuel cycle and possible nuclear fuel
                    'bank', which would contribute to non-proliferation aims by ensuring
                    security of supply of nuclear fuel without countries needing to
                    establish their own fuel production facilities.

                    The two countries also signed a memorandum to set up a 50:50
                    Russian-Armenian joint venture to explore for uranium and other
                    minerals in Armenia, with prospecting activities due to begin in
                    September 2008.

                    Speaking after the prime ministerial talks, Sergei Kiryenko, head of
                    Russian state nuclear energy corporation Rosatom also told reporters
                    that Russia would be the likely winners of a tender for the
                    construction of a new 1000 MWe nuclear power plant on the site of
                    Armenia's existing Metsamor plant. Kiriyenko said the government of
                    Armenia would announce a tender for the construction of new nuclear
                    power plant, adding modestly: "We are going to take part in it and we
                    have quite good chances to win."

                    The Metsamor power station originally hosted two nuclear units. Both
                    were closed down after a severe earthquake in 1988 triggered concerns
                    about their seismic vulnerability. One unit is now undergoing
                    decommissioning but the other restarted operations in 1995 and is
                    earmarked for closure around 2016. Armenia relies on Metsamor for
                    over 40% of its electricity and in November 2007 the USA also
                    signalled its support for nuclear new build in the country, pledging
                    a reported $2 million towards planning studies.


                    The Situation In Russia

                    RIA Novosti
                    April 23 2008

                    MOSCOW. (Sergei Golubchikov for RIA Novosti) - On April 22 in Yerevan,
                    Russia and Armenia signed a treaty to set up a joint venture for the
                    exploration and mining of uranium and other minerals in Armenia.

                    The company is being established on parity lines and will be registered
                    within the next three months.

                    It was signed by Vadim Zhivov, general director of the Atomredmetzoloto
                    (ARMZ) uranium holding and Armenia's Environmental Protection Minister
                    Aram Arutyunyan.

                    ARMZ manages all of Russia's uranium assets and runs some projects
                    in Kazakhstan.

                    Today, AMRZ ranks second in the world for uranium reserves. This is
                    the result of the nuclear industry's restructuring, and in particular
                    the pooling of its core plants under one umbrella.

                    With the focus on nuclear power, Russia is now planning its uranium
                    future carefully to warrant the successful development of its nuclear

                    The collapse of the Soviet Union has left Russia high and dry, with
                    many well-researched fields outside its boundaries, mainly in Central
                    Asia (Tajikistan, Kazakhstan, Kyrgyzstan and Uzbekistan).

                    For now, Russia has only one uranium-containing deposit, in the Chita
                    Region, with its Streltsovsky mining and chemical plant. Its total
                    reserves are estimated at 150,000 metric tons of ore. Other fields
                    in Eastern Siberia have a further 70,000 metric tons of explored raw
                    materials. Altogether, the proven reserves amount to 615,000 metric
                    tons. This figure also includes 344,000 metric tons from Elkon,
                    the largest recently explored Russian field located in the north
                    of Yakutia-Sakha.

                    Russia's uranium-bearing provinces present a challenge for
                    developers. The largest of them - the Aldanskoye deposit - can be
                    developed only by sinking. The ore occurs at a depth of 300 meters,
                    and mining is unprofitable.

                    During authoritarian times that problem did not exist: northern uranium
                    was obtained by the free labor of prisoners, including political
                    ones. In Chukotka, for example, they supplied the material for the
                    first atomic bombs. As prison camps closed down, uranium mining in
                    the northern latitudes stopped.

                    Now a search is on for an economically feasible way of opening up the
                    mothballed mines. Uranium prices are increasing throughout the world;
                    over the past three years they have doubled, and not surprisingly. One
                    cubic centimeter of uranium is equivalent to 60,000 liters of gasoline,
                    110 to 160 metric tons of coal, or 60,000 cubic meters of natural gas.

                    Being highly concentrated, this fuel can be easily and cheaply
                    transported any distance. Its price factored in as part of generated
                    power is comparatively small. So even a massive rise in uranium fuel
                    prices has little effect on nuclear power costs. Since 1997 they have
                    gone up by just 7%.

                    With current uranium production at 3,400 metric tons a year, its
                    reserves will last for half a century. How will Russia's nuclear
                    industry fare once the explored reserves run out? There are two
                    options. The first is to look for an alternative way of supplying
                    fuel for the nuclear industry. One is to use so-called "fast reactors"
                    (fast-breeder reactors).

                    Their advantages are moderate power intensity and low fuel
                    consumption. Fast reactors can use uranium from poor fields, with a
                    low degree of enrichment.

                    Another way is to recycle spent fuel, namely to obtain plutonium fuel
                    separated from the uranium extracted from nuclear reactors.

                    Russia has cornered a sizeable part of the world's future uranium
                    market, and its share could grow as new fields are tapped in Eastern

                    It can also receive supplies from other countries - ones that have
                    no nuclear industry of their own or lack enriching technologies.

                    Russia already owns 49% of the Russian-Kazakh Zarechnoye company,
                    which is developing a field of 19,000 metric tons of uranium.

                    In 2007, Australia became one of Russia's uranium partners. It boasts
                    the world's largest uranium deposits. The leaders of the two countries,
                    Vladimir Putin and John Howard, signed an agreement in Sydney, under
                    which Russia will receive $1 million worth of raw Australian uranium
                    per year for its nuclear needs. The document will come into effect
                    once the two parliaments ratify it.

                    Mongolia is also going to play an important role. Theoretically,
                    its natural uranium resources put the country at the cutting edge of
                    the world market, and just need to be explored.

                    Russia's potential uranium reserves (natural and weapons-grade) will
                    enable it to claim 45% of the world's uranium enrichment services
                    market by 2030 and 20% to 25% of the nuclear plant construction market.

                    Given closed nuclear cycle technologies (fast-breeder reactors), these
                    resources will be able to meet global power needs for 1,000 years.

                    Sergei Golubchikov is an associate professor at Russian State Social

                    The opinions expressed in this article are the author's and do not
                    necessarily represent those of RIA Novosti.


                    Originally posted by Siamanto View Post
                    Related Post
                    Last edited by Siamanto; 05-12-2008, 10:33 PM.
                    What if I find someone else when looking for you? My soul shivers as the idea invades my mind.


                    • Re: Armenia's Economic Pulse

                      Armenia's Telecom Sector
                      Part I: Armentel's Monopoly


                      Noyan Tapan
                      May 4, 2008

                      YEREVAN, MAY 4, NOYAN TAPAN. A meeting "without ties" of the heads
                      of the IT sector was held in Tsakhkadzor on May 1-3. The meeting was
                      entitled "The Ways of Information and Communication Development". It
                      was attneded by 80 heads of nearly 50 companies, and 20 representatives
                      of the RA ministry of economy, the State Customs Committee, the State
                      Tax Service, the Public Services Regulatory Commission, the RA State
                      Commission on Protection of Economic Competition, international donor
                      organizations and about as many representatives of the mass media.

                      During the meeting, round tales were conducted on the following
                      subjects: The Tax ans Customs Legislation and Administration of the
                      Republic of Armenia, The Education of Information and Communication
                      Technologies (ICT), and the Communication and Security.

                      The main problem raised during discussions on the last subject was
                      related to the factors affecting the quality and price formation
                      of data transmission services via the Internet. It was stated
                      that although the sector of Internet services has been liberalized,
                      ArmenTel CJSC does not actually provide other providers with channels
                      for provision of last mile Internet services to ultimate users. The
                      company also avoids connecting its channels to the networks of other
                      companies and provides itself Internet access and data transmission
                      services through fixed-line phone connection.

                      This creates for ArmenTel conditions for monopoly and the opportunity
                      to provide the indicated services at cheapest prices, which makes it
                      impossible for other companies to compete with ArmenTel in the sector
                      of last mile services and to attract investments to this sector. On
                      the last day of the meeting, discussion on this subject was held with
                      the participation of the RA minister of economy Nerses Yeritsian. He
                      proposed that representatives of the companies of the telecommunication
                      sector clarify the situation through research and propose possible
                      ways out in order to find legislative solutions to the problems. The
                      version of constructing a new fiber-optic cable for international data
                      transmission and a fixed-line network was not ruled out at the meeting.

                      During the round table on the subject "ICT Education", it was pointed
                      out that the use of information and communication technologies in the
                      comprehensive education system is being regulated gradually by such
                      steps as connecting schools to the Internet, the budgetary financing
                      of schools' Internet traffic and the creation of school electronic
                      content. As for the issue of training of ICT specialists, there are
                      still problems with presentation of orders for preparation of experts
                      of the higher educational system, qualification of lecturers, and
                      the absence of levers on the private sector's impact on the quality
                      of education and the educational programs.

                      According to N. Yeritsian, it is envisaged to solve the problem
                      related to tax and customs administration through introduction of
                      automated systems of new orders and registration.

                      The meeting was organized by the Union of IT Enterprises, the
                      USAID-financed Competitive Armenian Private Sector (CAPS) Project,
                      and the RA ministry of economy with the support of U Com company.


                      Reduction of prices for Internet-communication should be clearly motivated and not differentiated

                      2008-05-05 15:47:00

                      Since October 1, 2007, ArmenTel Company has been officially deprived of
                      the monopoly for Internet-communication networks in Armenia. However,
                      it did not affect the alignment in the branch, as the Company preserved
                      the telephone network ownership, therefore, an opportunity of rendering
                      DSL-communication. Naturally, it made the Internet-providers operating
                      in the country dependent, as ArmenTel, which preserved the monopoly in
                      fact, did not loose the freedom of optional management of prices for
                      traffic being realized by providers. On April 18, ArmenTel, appearing
                      now under the Beeline trademark, announced of the reduction of prices
                      for Internet-traffic ` from 400,000 drams to 30 per 1 megabit. However
                      it does not concern the providers, which will be supplied Internet at
                      the previous price. At ArmInfo's request, Director General of one of
                      the Armenian leading providers, `Arminco' Company, Grigory Sagyan
                      commented on the situation.

                      - Mr. Sagyan, how do you treat reduction of prices for

                      - A cut in prices for Internet is a positive phenomenon. I think that a
                      budget Internet promotes the population integration into the world
                      information network and, thus, contributes to increasing of the general
                      educational and cultural level. However, any fall in prices should be
                      clearly motivated and not differentiated. The present price fall per
                      Megabit/sec from 1.2 mln drams to 30 thsd drams bypassed the providers,
                      that may make it possible to draw some conclusions regarding the plans
                      of the Internet-communication market management in the country.
                      Noteworthy, ArmenTel does not render services at 30,000 drams to
                      another operators but forces them to buy the service at 1.2 mln drams.
                      The matter here concerns not falling in prices but the tariff policy,
                      as a result of fulfillment of which the competitive operators
                      (providers) of ArmenTel are fully withdrawn from the market.

                      - How did the situation originate under which one company was permitted
                      to control the price mechanisms in the telecommunications market of the
                      whole country?

                      - The point is that ArmenTel has got a confidence that if it is not a
                      monopolist, it is enabled to conduct an autonomous price policy.
                      However, a term `dominating position in the market' is used today
                      instead of the term «monopoly», as ArmenTel owns a network of
                      communication, which is led to every apartment ` it is about 250,000
                      telephone lines in Yerevan. This dominating position envisages
                      regulation of the cost of services being rendered by network. The
                      regulation today is carried out by two organizations, al least ` Public
                      Services Regulatory Commission and Economic Competition Protection

                      - Thus, the monopoly, either legal or factual, does not contribute to
                      development of the telecommunications branch, does it?

                      - This is testified by the examples of the past. ArmenTel preserved the
                      monopoly for cellular communication till 2005, and the users had to pay
                      $200 for telephone cards in the black market to get communication, the
                      quality of which entirely depended on the operator's will. Elimination
                      of the monopoly and appearance of a competitive company increased both
                      the quantity and the quality of mobile communication. Let everyone
                      decide how much the parallels with the present situation may be drawn
                      here. Perhaps, it will succeed to withdraw all the competitors from the
                      market within several months due to the price differentiation,.
                      However, just after that we shall face an absolute «lawlessness», as it
                      was before the market demonopolization.

                      - Will the appeal to the relevant governmental bodies on market
                      regulation be of help under these conditions?

                      - Under the developed conditions, this is the only possible solution.
                      Thus, we are going to apply to RA Public Services Regulatory Commission
                      the next few days, to consider the created 00situation and make an
                      adequate decision for the healthy market atmosphere.

                      Thank you for the interview


                      RA State Commission for Protection of Economic Competition starts considering 'Web' and 'Arminco' internet providers' statements

                      2008-05-07 22:03:00


                      The Armenian State Commission for the Protection of Economic
                      Competition started considering "Web" and "Arminco" internet providers'

                      To recall, on April 30 the "Web" and "Arminco" companies applied to the
                      Commission stating that the terms of provision of internet
                      communication services offered by Beeline company contain phenomena of
                      artificial restraint of competition. According to the statements,
                      Beeline provides internet communication in the Hi-Line Unlimited format
                      "using the phone lines' infrastructure belonging to it the monopoly
                      order, while other companies engaged in provision of internet
                      communication are deprived of the opportunity to use this
                      infrastructure". The "Web" company thinks that "these steps of Beeline
                      are evidently aimed at acquisition of monopoly in the sphere of
                      internet communication provision as well". The two providers think that
                      Beeline deny them the opportunity to provide channels of distinguished
                      communication, i.e. potentially competitive type of services on
                      internet communication. The applicants expressed a request to consider
                      the issue and take relevant measures, as well as to discuss the issue
                      of Beeline's status as the dominating company in the sphere of
                      provision of relevant services.


                      Armenian Economy Minister: legislative restriction of ArmenTel's powers not best way to settle conflict with Internet providers

                      2008-05-04 14:38:00


                      Legislative restriction of ArmenTel's powers is not the best
                      way to settle the conflict with Internet providers, Economy Minister
                      Nerses Yeritsyan said at an IT-Forum in the resort town of Tsakhkadzor
                      on 3 May.

                      He said that any restriction will lead to a relevant response by the
                      company and it is necessary
                      evaluate 'whether we will win or lose'. He is sure that providers do
                      not think 'globally' when expressing their dissatisfaction with
                      ArmenTel. He assured those present that the government aims to form an
                      IT-society, which requires revealing and settling the key problem. It
                      is necessary to carefully analyze the demand and supply in the market
                      before making any specific decisions, the minister said. 'Maybe it
                      would be reasonable for the providers to combine efforts to create an
                      alternative telecommunication network', the minister said. The
                      government will not attract investments in creation of an alternative
                      network for it is the business of private companies. 'It is already the
                      third or the fourth discussion in this format and no consensus has been
                      found so far. Unfortunately, we failed to interest either ArmenTel or
                      VivaCell and I think that such meetings should be continued>, N.
                      Yeristyan said.

                      The event organizers were the Union of IT Enterprises, Ministry of
                      Economy, and Competitive Armenian Private Sector Project (CAPS) funded
                      by USAID.

                      What if I find someone else when looking for you? My soul shivers as the idea invades my mind.