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Armenia
Area: 29,800 sq km
Population: 3,213,011 (2001 census), of which
urban: 2,066,153 (64.3%)
rural: 1,146,858 (35.7%)
Capital City: Yerevan (population: 1.2 million)
Ethnic Group: Armenian 97.9%, Russian 0.5%, other (mostly Yezidi Kurds) 0.3% (2001 census)
Note: as of the end of 1993, virtually all Azeris had emigrated from Armenia
A total of 3,145,354 Armenians, 3,409 Assyrians, 40,620 Yezidis, 1,176 Greeks, 14,660 Russians, 1,633 Ukrainians, 1,519 Kurds, 4,640 other (2001 census).
Languages: 97.7%, Yezidi 1%, Russian 0.9%, other 0.4% (2001 census)
Religion(s): Armenian Orthodox 97%
Currency: 1 dram=100 luma
Major political parties: Armenian Republican Party, Armenian Revolutionary Federations (Dashnaks), United Labour Party, Prosperous Armenia, Country of Law Party, , Peoples' Party, National Unity Party, Republic Party, Constitutional Union, National Democratic Party, National Democratic Union, National Democratic Alliance Party, Democratic Party, Armenian Pan-National Movement, Ramkavar Liberal Party, Self Determination Union, Communist Party of Armenia, Armenian Aryans.
Government: Republic
Head of State: President Robert Kocharian
Prime Minister/Premier: Serge Sarkisian
Foreign Minister: Vartan Oskanian
Membership of international groupings/organisations: BSEC, CCC, CE, CIS, EAPC, EBRD, ECE, ECOSOC, ESCAP, FAO, IAEA, IBRD, ICAO, ICRM, IDA, IFAD, IFC, IFRCS, ILO, IMF, Intelsat, Interpol, IOC, IOM, ISO, ITU, NAM (observer), OPCW, OSCE, PFP, UN, UNCTAD, UNESCO, UNIDO, UPU, WFTU, WHO, WIPO, WMO, WToO, WTrO
GEOGRAPHYArmenia is the smallest of the three South Caucasus states in size and population. It makes up only 10% of the Greater Armenia of 2000 years ago, which is now largely subsumed by the Eastern Anatolia region of Turkey. It is a landlocked, mountainous country, subject to earthquakes (the latest of which in December 1988 killed 30,000 people) and borders Georgia, Azerbaijan, Turkey and Iran.
Location: Southwestern Asia, east of Turkey
Geographic coordinates: 40 00 N, 45 00 E
Area:
total: 29,800 sq km
land: 28,400 sq km
water: 1,400 sq km
Land boundaries:
total: 1,254 km
border countries: Azerbaijan-proper 566 km, Azerbaijan-Naxcivan exclave 221 km, Georgia 164 km, Iran 35 km, Turkey 268 km
Coastline: 0 km (landlocked)
Maritime claims: none (landlocked)
Climate: highland continental, hot summers, cold winters
Terrain: Armenian Highland with mountains; little forest land; fast flowing rivers; good soil in Aras River valley
Elevation extremes:
lowest point: Debed River 400 m
highest point: Aragats Lerr 4,095 m
Natural resources: small deposits of gold, copper, molybdenum, zinc, alumina
Land use:
arable land: 17%
permanent crops: 3%
permanent pastures: 24%
forests and woodland: 15%
other: 41% (1993 est.)
Irrigated land: 2,870 sq km (1993 est.)
Natural hazards: occasionally severe earthquakes; droughts
HISTORYIn 1915-18 up to 1.5m Armenians (one third of the Armenian population) died of starvation or were systematically killed during the final years of the Ottoman Empire. The Armenians of Nakhichevan (part of Azerbaijan) were driven out in the 1920s. An independent Armenian state existed from 1918-1920 before being subsumed into the Soviet Union.
Nearly all Armenians are Christian and have their own Armenian Apostolic Church. A new Catholicos, 'Karekin II', was elected in October 1999. In 2001 Armenia celebrated 1700 years of Christianity as the state religion. The large Armenian diaspora lives mostly in the US, in the Middle East and in France where they are particularly influential. There are 10-12,000 British Armenians.
The decision to secede from the USSR was not initially smooth; the more radical 'Union for National Self-Determination' urged immediate secession in 1990 and attacked buildings with Communist Party associations. The parliamentary majority, the Armenian Pan-National Movement, wanted to secede in accordance with Soviet laws and urged a national referendum as required by those laws. This took place in September 1991 when the disintegration of the Soviet Union was gathering pace. More than 99% of voters supported independence, reflecting massive popular opposition both to the coup attempt in Moscow and to the perceived Soviet bias towards the Azerbaijani position in the Nagorno-Karabakh (NK) dispute.
In October 1991 Levon Ter-Petrossian, a respected academic who had led the Karabakh Committee and been imprisoned as a result, was elected Armenia's first President (he had previously been Chairman of the Supreme Soviet) with 83% of the vote. His party is the Armenian Pan National Movement. He faced intense opposition pressure in parliament, due to the situation in NK and economic hardships, and there were some public demonstrations against him in 1992, and particularly in 1994. However, the successes of the Armenian forces in and around NK during 1993 and the improvements in the supplies of energy went a long way towards relieving the pressure.
Parliamentary elections - and a constitutional referendum - took place on 5 July 1995. The pro-government Respublika Bloc won a landslide victory. This made it easier for Ter-Petrossian to press ahead with economic reform, and gave him more leeway on the Nagorno-Karabakh conflict. International observers concluded that the elections were "free but not fair" as they were well conducted on the day, but a number of opposition parties including the Dashnaks were refused registration.
Presidential elections took place on 22 September 1996. There were four candidates - Ter-Petrossian, Manoukian of the NDU representing several opposition parties in coalition, Manucharian from the Scientific-Industrial and Civil Union, and Badalian from the Communist Party. Ter-Petrossian quickly claimed victory (ie over 50% of the vote in the first round) but the opposition alleged widespread fraud and organised a series of demonstrations. These were at first peaceful but on 25 September the Parliament building was stormed and the Chairman (Ararktsian) and his deputy were badly beaten.
In a subsequent, stormy, session of Parliament immunity was withdrawn from the opposition MPs and several were beaten up and arrested. Police and armed troops were put on the streets. The OSCE's report said the discrepancies and breaches of the electoral law "can only contribute to a lack of confidence in the integrity of the overall election process. The results of the first round of balloting could even be questioned until a thorough review and assessment of the irregularities and discrepancies are conducted." The Central Electoral Commission's (CEC) final results gave Ter-Petrossian 51.75% of the vote, Manoukian 41.29%, Manoucharian 0.60% and Badalian 6.34% but the opposition referred the matter to the Constitutional Court. The Court ruled on 22 November that the results, as announced by the CEC, were not open to question. Although violations had occurred they were not on the scale alleged and it would not be possible to judge how they had affected the outcome. Encouragingly, local elections held on 10 November were deemed by Council of Europe observers to have been free and fair.
To restore Armenia's international reputation, promote national reconciliation through dialogue with the opposition and speed up economic reform and restructuring, Ter-Petrossian appointed as Prime Minister in November 1996 the respected Armenian Ambassador to London, Dr Armen Sarkissian. Unfortunately, Dr Sarkissian had to resign for health reasons in early March 1997 and Robert Kocharian, leader of the N-K Armenians, was appointed in his place.
Ter-Petrossian resigned as President in February 1998 after internal disagreements over policy towards the Nagorno-Karabakh conflict. Elections were held in March 1998 and Robert Kocharian won by a margin of nearly 20 % over his nearest rival. The OSCE/ODIHR Election Observation Mission reported 'serious irregularities' during the elections and that these fell short of OSCE standards. The overall result was not, however, called into question.
POLITICSPolitical Developments and ElectionsParliamentary elections were held on 30 May 1999. The newly formed Unity Alliance (a political alliance between the Republican Party of Defence Minister Vazgen Sarkissian and the People's Party led by former Communist leader Karen Demirchian) won 41.69% of the vote and gained the largest number of parliamentary seats (29), although short of an overall majority. The preliminary assessment of the OSCE/ODIHR Election Observation Mission was that the elections 'demonstrated an improvement over prior elections' and were 'a relevant step towards compliance with OSCE commitments'. Following the elections, Vazgen Sarkissian was appointed Prime Minister and Karen Demirchian elected as Chairman of Parliament.
On 27 October 1999 five gunmen broke into the National assembly building and opened fire killing Vazgen Sarkissian and Karen Demirchian plus six of their parliamentary colleagues. The gunmen were lead by Nairi Unanian, an extreme Nationalist. Although many conspiracy theories abound there has been no evidence to contradict the official view that this was an attack by a group of disaffected loners.
To calm the population after the attack, President Kocharian appointed Aram Sarkissian, brother of the murdered Prime Minister, as Prime Minister, despite his complete lack of political experience. Following this, Kocharian had an uneasy relationship with the National assembly and faced down calls for his impeachment. In May 2000 Kocharian appointed a new Prime Minister and Cabinet having purged all his critics from office. The Respublika Bloc subsequently split with the Republican Party led by current Prime Minister Andranik Makarian working with President Kocharian, and the Peoples Party, now led by Karen Demirchian's son Stepan Demirchian, leading the opposition.
Presidential elections were held on 19 February 2003. The opposition failed to agree on a single candidate. Stepan Demirchian emerged as the main challenger to President Kocharian who just failed to win an overall majority. Artashes Geghamian, leader of the National Unity Party, came third. In the second round on 5 March. Robert Kocharian, won with 67.48% of the vote, Stepan Demirchian came second with 32.52%. The OSCE/ODIHR Election Monitoring Mission reported that the Armenian elections had fallen short of international standards for democratic elections, noting in particular a deterioration in standards in the second round. The Opposition challenged the election result in the Constitutional Court which acknowledged serious problems with the election, but ruled that the results stood. Stepan Demirchian led a series of demonstrations between the two rounds of the elections and throughout March challenging the election result. Many activists were detained and the demonstrations petered out in March 2003.
National Assembly Elections took place in May 2003. The OSCE once again criticised the conduct of the elections and several re-runs of constituency elections were held in June 2003. The Republican Party, endorsed by the powerful Defence Minister Serge Sarkisian, won the majority of votes and has 40 seats, followed by the smaller Country of Law Party with 20 seats, the other main pro-government party the Dashnaks have 11 seats. Stepan Demirchian's Peoples Party led the Justice Alliance of some 15 opposition parties, they have 14 seats. Another opposition figure, Artashes Geghamian leader of the National Unity Party, ran separately and won 9 seats. The Republican Party, the Country of Law Party and the Dashnaks joined in a coalition which formed the government, dividing government and parliament posts between them. The Justice Alliance and National Unity are the opposition in the parliament. There are two other blocs: United Labour (6 seats) and Peoples Deputy (17 seats) which usually vote with the governing coalition. In addition there are 14 MPs who have not joined any of the factions.
A long-running opposition boycott of Armenia's parliament has turned the National Assembly into a dull and apolitical body. The boycott started in February 2004 when the parliament's pro-government majority refused to consider opposition demands for a 'referendum of confidence' in President Robert Kocharian. The President's supporters have largely ignored the boycott.
On November 27, 2005 Armenia voted in a referendum on constitutional amendments. The reform package was strongly supported by the Government. Most opposition parties opposed the reform package; called on their supporters to boycott the vote; and withdrew their representatives from election commissions. According to the results, 1,411,791 voters, or 93.3%, supported the amendments. 82,159 voters, or 5.4%, voted against the reforms. Statements released by the Council of Europe Observer Mission, EU, and others drew attention to serious irregularities noted in the process. The 14-member PACE delegation noted that the Referendum generally reflected the free will of those who voted. However, on voting day the observers witnessed serious abuses in several polling stations, which cast a shadow over the credibility of the officially announced turnout. The opposition disputed the results of the referendum. The Armenian authorities did not invite representatives from the OSCE or the CIS to observe the referendum.
On May 12, 2006 after public disagreements with the President, the Chairman of the National Assembly Arthur Baghdasarian resigned from his position as 'Speaker”. The political council of his Country of Law Party took the decision to leave the government coalition and join the opposition. The governing Coalition maintained a stable majority by drawing into its fold the United Labour Party and defectors from the Country of Law party.
The Prime Minster, Andranik Margaryan, died of a heart attack on 25 March, at the age of 55, having been in poor health for a number of years. Margaryan was also the chairman of the ruling Republican Party of Armenia. Defence Minister Serge Sarkisian assumed Margaryan’s party responsibilities, and on 4 April was appointed Prime Minister. Mikayel Harutyunyan was appointed to the post of Defence Minister on 23 April.
Parliamentary elections are to be held on 12 May. Presidential Elections are due in 2008.
ECONOMYArmenia weathered the Russian financial crisis better than other CIS states. GDP grew by 7% in 1998 fuelled primarily by an expansion in domestic credit by the Central Bank and by government investment expenditure. However this proved unsustainable and the government was forced to tighten fiscal and monetary policy during the second half of 1999 slowing GDP growth for the year to 3%. GDP grew by 9.6% in 2001 and 12.5% in 2002. In 2003, Armenia recorded GDP growth of 15.1% due mainly to donor-funded construction projects. The Lincy Foundation alone spent USD175m on road construction or repair and refurbishing cultural centres.
Real GDP grew by 14% in 2005, the fourth consecutive year of double-digit growth, underpinned by favourable weather conditions that boosted agricultural production and a boom in construction. Domestic demand continued to be sustained by rising incomes, investment, and remittances. In January-August 2006 GDP real growth was 11.3%. During this period appreciation of the dram continued.
The inflation rate, which for some time had stabilised at around 3.2%, rose to 8.2% in 2003. This represents a significant rise from 2000 when Armenia experienced a brief period of deflation. Inflation remained subdued in 2005, with the end-year inflation rate falling to -0.2%, reflecting a drop in food prices associated with a good harvest and lower import prices as a result of dram appreciation. The average inflation rate for January-August 2006 was 1.5%.
Fiscal policy remained sound in 2005, with an overall deficit of 2.6% of GDP, slightly higher than programmed (2.4% of GDP), and there was a notable increase in tax revenue. Tax revenues rose by 0.3% of GDP relative to 2004 reflecting better administration and further closing of loopholes in the tax system, particularly in value added and profit taxes.
Foreign debt in 2002 amounted to approximately USD 1,026m. This changed to USD 1,098, 1,183 and 1,099 million in 2003, 2004 and 2005, respectively. Armenia has a fairly good relationship with the IMF and World Bank.
The 2004 household survey shows a further decline in poverty and inequality, but the overall level of poverty remains high. The headline poverty rate fell from 56 percent in 1999 to 39 percent in 2004, with extreme poverty declining slightly in 2004, following a sharp drop in 2003. Unlike in previous years, the reduction in poverty was driven by a decline in rural poverty, and, to a lesser extent, of poverty in non-Yerevan urban areas, owing mainly to higher growth of agricultural incomes, private transfers from abroad, and state social assistance. The update of the authorities’ Poverty Reduction Strategy Paper (PRSP) is expected to be completed by end-2006.
Main Macroeconomic IndicatorsSources – Armenian Ministry of Finance and Economy and the National Statistical Service of Armenia.
Nominal GDP (in mln USD) - in 2005: 4902.8
- in Jan-Aug 2006: 3149.7
GDP deflator- in 2005: 3.2
- in Jan-Aug 2006: 4.5
GDP per capita- in 2005: USD 1,523.8
- in Jan-Aug 2006: USD 978
GDP real growth- in 2005: 14.0%
- in Jan-Aug 2006: 11.3%
Net Exports/GDP: -13.0% (2005)
Investment/GDP: 29.7% (2005)
Consumption/GDP: 86.8% (2005)
Import of goods/GDP: 36.7% (2005)
Export of goods/GDP: 19.9% (2005)
Trade balance (Exports/Imports): USD -827.8m USD (2005), USD -719.9m Jan-Aug 2006)
External debt/GDP: 22.4% (2005)
Interest payments/GDP: 0.4% (2005)
Wages/GDP: 1.5% (2005)
Taxes and duties/GDP: 14.3% (2005)
Total Expenditure/GDP: 18.6% (2005)
Capital Expenditure/GDP: 3.3% (2005)
Deficit (-)/GDP: -1.9%
Foreign Direct Investments, net: USD 248.3m (2005) USD 107.5m (Jan-June 2006)
Inflation (period average): 0.6% (2005); 1.5% (Jan-Aug 2006)
Exchange rate (period average): (Dram/USD): 457.7 (2005), 435.3 ( Jan-Aug 2006)
Openness of Economy: 70.3% (2004)
Unemployment rate: 31.6% (2004 estimate)
GDP by Sector - 2005 and Jan-Aug 2006, respectivelyIndustry: 7.4%; -1.0%
Agriculture: 11.2%; -6.9%
Construction: 35.1%; 36.9%
Trade and Catering: 9.6%; 12.9%
Transport and Communication: 13.2%; 14.3%
Other: 11.2%; 16.3%
IndustriesDiamond-processing, metal-cutting machine tools, forging-pressing machines, electric motors, tires, knitted wear, hosiery, shoes, silk fabric, chemicals, trucks, instruments, microelectronics, jewellery manufacturing, software development, food processing, brandy.
Export Commodities
Diamonds, mineral products, foodstuffs, energy
Import Commodities
Natural gas, petroleum, tobacco products, foodstuffs.
INTERNATIONAL RELATIONSArmenia's Relations with NeighboursArmenia is Western-looking and is seeking integration into European structures. It has also been able to look to the large Armenian Diaspora (particularly in the US and France) for support. However, the realities of Armenia's present political and economic position mean that the closest relationship is with Russia. Armenia joined the CIS on 21 December 1989 and signed a Friendship Treaty with Russia in January 1993 but this was not ratified by the Russian parliament. In August 1997 Russia and Armenia signed a fresh Friendship Treaty for ratification by the Russian government by December 1997. The Azeris strongly criticised this treaty on the ground that it contained provisions on military co-operation. There is a Russian division currently stationed in Armenia, as well as Russian border guards. A treaty was signed by Yeltsin and Ter-Petrossian on 16 March 1995 establishing the legal status of the base and numerous documents on military co-operation have been signed since. Armenia is one of six parties to the CIS Treaty of Collective Security signed in Tashkent in May 1993.
Armenian relations with Turkey have a troubled history and continue to be sensitive. Turkey recognised Armenia (the first country to do so), along with Georgia and Azerbaijan in 1991. But diplomatic relations between the two countries have not been established and the Turkish/Armenian border has been closed since May 1992. Turkey and Armenia have prepared a draft agreement on establishing diplomatic relations, but it is not expected that the Turks will sign it until the Nagorno Karabakh conflict is resolved. Despite the troubled bilateral relationship, Turkey has provided a limited amount of humanitarian assistance to Armenia. The Turks and Armenians also work together in the Black Sea Economic Co-operation Organisation. Talks between the then Chief State Adviser Libaridian and Turkish Prime Minister Tansu Ciller led in 1995 to the opening of the air corridor between the two countries.
Armenia joined 'Partnership for Peace' (PFP), launched at the NATO Summit on 10 January 1994 and hosted the Co-operative Best Effort PfP exercise in June 2002. Armenia joined the Council of Europe in January 2001 and the World Trade Organisation in January 2003
Armenia's Relations with the International CommunityEUEC aid (UK's share is 16%) is mainly humanitarian assistance. Total food and humanitarian aid of nearly 127 million Euro have been and will be allocated from 1992 to 1999. Technical assistance is provided through TACIS (Technical Assistance for the Commonwealth of Independent States). TACIS support is mainly in the form of policy advice, institution building, training and the design of legal and regulatory frameworks. The 2002/03 TACIS Programme will be for 10 Euro million.
A Partnership and Cooperation Agreement (PCA) between the EU and Armenia was signed on 22 April 1996. The PCA governs political, economic and trade relations between the parties and lays a basis for social, financial, scientific, technological and cultural cooperation between them. The UK formally ratified the PCA on 22 April 1998 and entered into force on 1 July 1999. The Presidents of Georgia, Armenia and the Prime Minister of Azerbaijan (President Aliev was unable to travel due to ill health) met with EU Foreign Ministers in Luxembourg on 22 June 1999 to mark the entry into force of the PCAs.
In June 2004, Armenia (together with Azerbaijan and Georgia) was included in the European Neighborhood Policy (ENP), at its request and following a recommendation made by the European Commission. The European Commission is recommending a significant intensification of relations with Armenia, through the development and implementation of an ENP Action Plan.
Nagorno-KarabakhRecent History
The present phase of the Nagorno-Karabakh (NK) conflict began in 1988 after the Regional Soviet of Nagorno-Karabakh adopted a resolution on the transfer of N-K to Armenia. The resolution was rejected by the USSR and Soviet troops deployed to N-K to suppress nationalist sentiments. Following the break-up of the Soviet Union N-K declared its independence. Azeri forces then attempted to re-establish control but met fierce resistance. In 1992 N-K forces captured Shusha (a previously Azeri-populated town within N-K) and established a corridor to Armenia through Lachin. And in 1993 N-K forces, with help from Armenia, retook northern N-K and occupied the entire south-west corner of Azerbaijan, some 20% of Azeri territory. This encroachment onto Azeri territory led to wide-scale international condemnation, including four UN Security Council Resolutions demanding that 'local Armenian forces' withdraw from the most recently occupied areas outside N-K.
The 1994 spring offensive began in early April with each side accusing the other of renewed attacks and shelling of civilian targets. Fighting was intense along the entire front line, with both sides seeming better prepared militarily than in previous years. However, on 12 May 1994 a cease-fire was brokered in direct talks between Armenia and Azerbaijan and on 27 July 1994 the Armenian and Azerbaijani Defence Ministers and the Commander of the Nagorno-Karabakh Army signed an agreement consolidating it. With the exception of minor violations the cease-fire has held. Armenia, Azerbaijan and the authorities in Nagorno-Karabakh have all confirmed their readiness to continue it indefinitely until a political agreement is concluded. The number of deaths in the conflict probably exceeded 15,000 with at least 900,000 Azeris and 300,000 Armenians displaced.
Negotiations on the settlement of the Karabakh conflict took place on February 10-11, 2006 in Paris and in Rambouillet at the initiative of French President Jacques Chirac. The presidents failed to reach agreement. They instructed their foreign ministers to continue negotiations to find new ways for a future settlement.
The next Presidential meeting was held in Bucharest on June 4, 2006, as part of the Black Sea forum of Dialogue and Partnership. But again the Presidents failed to find agreement.
The Issues
The issues in dispute include the future political status of NK and the nature of any international guarantees of that status. Armenia points to a 1991 referendum (ruled illegal by the Azerbaijani government) in which the people of NK voted for independence. The Armenian Parliament refuses to accept any solution to the conflict, which refers to NK as part of Azerbaijan, while Azerbaijan has annulled NK's former autonomous status.
International Efforts
In 1992 the (then) CSCE established an international peace process, known as the Minsk Group, with the aim of undertaking negotiations with the parties to the conflict, to reach a peaceful political settlement. At its December 1994 Summit in Budapest the OSCE agreed to integrate the mediation efforts of the Russian Federation and the Minsk Group making Russia a co-chair of the Minsk Group (initially with Sweden, then with Finland, and now in a Troika with the US and France). The summit also agreed in principle to the deployment of a multi-national peacekeeping operation, following the conclusion of a political agreement on the cessation of the armed conflict, and establishing a High Level Planning Group (HLPG) to work on details of an operation. There is as yet no sign of a political agreement being reached. The Minsk Group now comprises Russia, USA, France, Germany, Sweden, Italy, Turkey, Belarus, Austria, Norway and Finland. The UK is not a member.
Since the 1994 ceasefire, President Kocharian and Heydar Aliev met regularly to discus the NK dispute. There was widespread optimism of a breakthrough at US hosted talks in Key West, Florida in April 2001. The talks failed to achieve agreement, the detail of which has been kept close. There has been little recent signs of a political breakthrough, although President Kocharian and the new President of Azerbaijan, Ilham Aliev, met at the end of 2003.
As a result of the conflict, the OSCE imposed an arms embargo on both Armenia and Azerbaijan in 1992. The UK observes this embargo.
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