25 June 2018

Monday, 00:02



Serzh Sargsyan prepares a solid ground for his future premiership



Finally, the government of Armenia is formed after a protracted political process started since late 2015. At that time, the country held a constitutional referendum, which replaced the presidential form of government with a parliamentary one. Although the authorities explain this move as an attempt to improve the state institutions, ensure democracy, and transparency, it is not a secret that the main reason behind this initiative was the desire of the incumbent President Sargsyan to stay in power after the expiry of his presidential term. In fact, Sargsyan does not seem to have any problems: in the internal political field, the ruling Republican Party (RPA) has practically destroyed its main rival, the Armenian National Congress (ANC). The referendum, parliamentary elections and the elections of the mayor of Yerevan were held without any problems. We can say with confidence that there is virtually no systemic opposition in Armenia, and the parliamentary factions are formed of representatives of “pocket parties”.

As it was expressed earlier, most likely Sargsyan will continue to rule the country as a prime minister. At the same time, the so-called “government of national harmony”, which Sargsyan mentioned last summer after the disarmament of the terrorist group Sasna Tsrer, is being steadily injected into the consciousness of the Armenian society. At first glance, it seems this project is implemented without participation of the ruling party, even without its initiative. Therefore, it is no surprise that the outcome of the events was voiced not by the ruling party, but by its opponents (in fact, allies) in the parliament. Before the elections, the representative of the Armenian Revolutionary Party Dashnaktsutyun (ARFD) Armen Rustamyan stated that if Sargsyan assumed the post of prime minister in 2018, then his party would support such a decision. Another parliamentary bloc Tsarukian will not be against Sargsyan's premiership either. This idea was voiced by Tsarukian’s representative Vardan Bostanjian. Both positions are insignificantly different from each other, and this is quite understandable. At least because ARFD is an ally of the ruling party, and the Tsarukian block is trying to demonstrate itself as a moderate opposition, which is not a sight for sympathy any longer, but ridicule…

Thus, the Armenian authorities, in particular Sargsyan himself, can solve two problems simultaneously. Firstly, they will form a “behind-the-scenes majority”, which can be considered a government of “national harmony”. Secondly, Sargsyan will still have a power in Armenia, hence can easily create for himself an “alternative” support in case someone inside the ruling clan tries to change the rules of the game. With this in mind, we can assume that the main danger for Sargyan can only be an intra-clan struggle. These forces can prevent the implementation of Sargsyan's plan to rule the country as a prime minister after 2018. Sargsyan understands this and is going to appoint his most loyal men to key positions.

According to Armenian media, in 2018, Sargsyan is going to transfer the post of the president to the incumbent Chairman of the Constitutional Court of Armenia Gagik Harutyunian. This is understandable, given that Harutyunian rendered invaluable services to both Robert Kocharian and Serzh Sargsyan during the presidential elections in 2004 and 2008. As next year Harutyunian turns 70, he will no longer be able to work at his current position, and most likely will respond affirmative to Sargsyan’s suggestion.

The Chair of the Parliament was given to the Doctor of Medicine, urologist-pediatrist Ara Babloyan, which surprised many in Armenia because he was not on the list of candidates for this post. The main candidate was the deputy from the ruling party Karen Karapetian (namesake of the incumbent prime minister), as well as the brother of a Russian billionaire Samvel Karapetian. However, instead of him, Sargsyan choses Babloyan. This unremarkable figure will lead the legislative body of the parliamentary state. His main success is full loyalty to President Sargsyan. The Armenian media controlled by the authorities have tried to explain this event claiming that Karen Karapetian had allegedly refused the offer to become a speaker. And that Babloyan was chosen because there was a process of “internal cleansing” going inside the ruling class since early March, and Babloyan did not have special problems with corruption scandals and was far from oligarchic circles. However, the facts prove the opposite.

First, any talks about “internal cleansing” are false. If you look at the composition of the Armenian parliament of the 6th convocation, it differs insignificantly from the previous ones. Take at least two deputies-generals, former warlords and war criminals Seyran Saroyan and Manvel Grigorian. According to Armenian media, the women members of parliament ask the chairman to reseat them away from these two odious personalities, because during the parliamentary sessions they all shout loudly and interrupt the speakers with abusive words. As for the “white hands” of the new speaker of the Armenian parliament, Babloyan is one of the main oligarchs in the healthcare sphere. He owns the Center for Uronephrology and Children's Surgery, as well as the medical complex “Arabkir” - the Institute Health Problems of Children and Adolescents. His influence in this sphere can only be compared with the wife of the former President Robert Kocharian, Bella Kocharian, or with the wife of the former Defense Minister Seyran Ohanian, Rusanna Khachatrian. But, as already noted, Sargsyan preferred the candidacy of Babloyan, not Karen Karapetian. The reason for this is the close ties of the Karapetian brothers with the current Prime Minister of Armenia Karen Karapetian. This is the main danger for Sargsyan's political future.

The Armenian experts are increasingly active in discussing the internal conflict between the supporters of the president and the Karapetian brothers, as well as their namesake, Prime Minister Karen Karapetian. According to Armenian media, Karapetyan's group has its own plans about the future of Armenia. The head of the government already said that he was not going to leave his post after 2018, that is after the end of Sargsyan's term. This can seriously spoil Sargsyan's plans. At the same time, Samvel Karapetian, the guardian of this group, has a good reputation in Armenia as a whole, and his activity in the country is becoming more active.

All these events take place amidst the opposition of the president, who should but does not want to leave, and the prime minister, who intends to remain in office after April 2018.

By the way, the relations between Karapetian and the Dashnaktsutyun Party have always been very complicated. The latter has been doing dirty work for others for over a hundred years, traditionally leaving the Armenian people as the only loser of its initiatives. Most likely this time the Dashnaks will become an instrument in the hands of Sargsyan against Karapetian. Another such tool may be a businessman, the President of Union of Armenians of Russia Ara Abramian, who has long been competing with the Karapetians. He has already managed to make a couple of critical statements about the Prime Minister. However, the main trump of Sargsyan's group against Karapetian is deterioration of Armenia's economic performance. It is worth recalling that at the beginning of this year, Karapetian initiated the Investor Club of Armenia. Some Russian businessmen of Armenian origin adopted a declaration participate in the business projects of the Club together with the Armenian government.

The promise of huge investments from abroad, deep political and economic reforms became the basis of the electoral program of the ruling party represented by Prime Minister Karapetian. We wrote at that time that the promised “golden rivers” would not flow to Armenia, and the promotion of the young reformer Karapetian in the future may become a threat to the ruling elite of the country because of Prime Minister's ability to start his own game. This forecast has become true.

“In the next few years, we expect $3.2 billion investments in Armenia, of which $850 million will be available this year,” said Karapetian speaking at the pre-election meeting on March 11. “We promise what we can do.” But the reality is different. According to the National Statistical Service of Armenia, in the first quarter of 2017, foreign direct investment to Armenia was about $41 million, which is $10 million more than the same period of 2016. But the growth was recorded mainly from offshore zones. At the same time, in the first quarter of 2017, the capital outflow was $15.6 million compared to an inflow of $3.5 million in 2016. The situation with private money transfers, mainly from Russia, is also difficult. Thus, in March 2017, the country received 127 million drams, and in April this figure fell to 109 million drams. Economist Vahan Khachatrian is sure that the inflow of transfers in March was aimed at providing the current government with the necessary propaganda effect on the eve of the parliamentary elections. “In April, $86 million were taken out of the country. Why does not anyone speak about this?! This is a record indicator since 2007. This means only one thing: investors do not trust the country's leadership, they are afraid to invest money in the Armenian economy,” said Khachatrian at a press conference. According to another expert, Hayk Kevorkian, Armenian-Russian businessmen simply played a trick in the same way they did in 2008, when some of them promised investments and even voiced specific figures such as $500 million. However, this money has never reached the treasury!

In principle, as early as the beginning of the year, any reasonable person would not believe the fairy tales about “multimillion” investments in Armenia in the shortest possible time. In fact, the pro-government Armenian media describes these events merely as “the failure of Prime Minister.” Rumors are circulating about the Sargsyan clan, which is about to force Karapetian to resign. Other politicians also joined this battle. What is quite remarkable is that they do not represent the authorities. Recently, in his interview with Radio Liberty, the deputy from the Elk faction (“Exit”) Edmond Marukian predicted the resignation of Karapetian in the spring of 2018. When asked about what this forecast is based upon, Marukian gave an absolutely “impenetrable” political response: “That’s my impression”. At the same time, neither the pro-government media nor the “impressionable” political oracles speak of the failure of the oligarchic criminal group that supports Sargsyan and prevents Karapetyan in all possible ways in the failure of reforms and the influx of investments.

Apparently, Sargsyan has a very overwhelming advantage over Karapetyan due to a number of his supporters, which includes pseudo-opposition, oligarchic groups, etc. In addition, “punching his own men” into high administrative and power structures, Sargsyan looks like an absolute winner in the showdown. However, he should always remember where Karen Karapetian had worked before becoming the prime minister. He had worked for Gazprom of Russia. Again, we can see his close ties with the Karapetian brothers. Since no one doubts that only Moscow can say the last word about the future of Armenia, it is too early to express hasty conclusions about the end of the confrontation between Sargsyan and Karapetyan.