MCA: THE VIEW FROM YEREVAN

UNCLAS SECTION 01 OF 02 YEREVAN 001194

SIPDIS

SENSITIVE

DEPT FOR EUR/CACEN

E.O. 12958: N/A
TAGS: PREL EAID PGOV PHUM ARMENIA'>AM
SUBJECT: MCA: THE VIEW FROM YEREVAN



1. (U) Sensitive But Unclassified. Please treat
accordingly.

--------------
PROGRESS IN RECENT YEARS
--------------


2. (SBU) Over the past 12 years since independence
ARMENIA has moved from a state of open conflict with
one of its neighbors to a stable, if occasionally
uneasy, truce, has gone from a deep economic and
humanitarian crisis to a fast-growing economy with
the benefits of economic growth beginning to extend
to the population at large and has seen the first
flush of patriotic euphoria fade as the country
works to build an independent and democratic
society. Over the course of your brief visit you
will be meeting with government leaders and
political activists from across the political
spectrum, with representatives from the NGO
community and with local businessmen. While you are
here, you will have an opportunity to appreciate the
consultative approach ARMENIA pursued developing its
Poverty Reduction Strategy Paper, see examples of
the considerable progress that ARMENIA has made in
recent years and understand the significant
challenges still facing ARMENIA in its transition.

--------------
FLAWED ELECTIONS SET THE STAGE FOR UNREST
--------------


3. (SBU) While ARMENIA's flawed 2003 presidential
elections have laid the groundwork for the current
political discord, we believe that there is little
doubt that President Kocharian did indeed win the
election, if not by the official margin.
Nonetheless, the opposition has focused on the
flawed elections and still low (although improving)
standard of living to rally moderate numbers of
protesters to call for Kocharian's resignation.
With no coherent program or charismatic figure,
however, the opposition has been unable to transform
a generalized sense of dissatisfaction with the
status quo into any sort of "revolutionary fervor" -
- and attendance at opposition rallies has been
dropping steadily over the past five weeks. The
opposition has shown neither the desire nor the
capacity to engage in serious political work to
affect the course of the country and its future.
Electoral reforms and Council of Europe-required
constitutional reform are areas where an engaged
opposition could have a significant impact. For its
part, the government has moderated its responses to
the rallies from the excesses and nearly 200
administrative detentions following the April 12
rally and march. It has not yet demonstrated,
however, it is willing to back away from
administrative measures to intimidate the
opposition. As a result, there is little prospect
of any meaningful political dialogue or interaction.

--------------
PRESIDENT KOCHARIAN--FIRMLY IN CONTROL
--------------


4. (SBU) President Robert Kocharian is deeply
engaged in the Millennium Challenge process. An
avid reader, he speaks fairly good English, although
he will likely use an interpreter for at least part
of your meeting with him. You will find him a well-
informed interlocutor with strong opinions.

--------------
PRIME MINISTER--CEREMONIAL HEAD OF THE BOARD
--------------


5. (SBU) You will be meeting with Prime Minister
Andranik Margaryan, who the GOAM has identified as
the likely ceremonial head of the board of directors
charged with responsibility for oversight of any
eventual MCA compact proposal. Margaryan, the
longest sitting Prime Minister in ARMENIA's post-
Soviet history, played a major role in forming the
current governing coalition in the ARMENIAn
parliament. Margaryan points to recent strong
economic growth as the result of reforms he
sponsored since taking on responsibilities as Prime
Minister in 2000. He is generally respected by
colleagues as a pleasant and effective leader who
enjoys good relationships across party lines. A
slow but deliberate interlocutor, Margaryan
considers himself a "simple man," whose background
and views on life are representative of the ARMENIAn
population as a whole. An engineer by background,
53-year-old Margaryan was jailed by Soviet
authorities for a short period in the mid-1970s.
--------------
NATIONAL ASSEMBLY--A WHIFF OF MODERATION
--------------


6. (SBU) During the recent political events the
National Assembly, under the leadership of its
Speaker, Artur Baghdasarian, has played a mediating
role between the government and the opposition.
Although the vast majority of the National Assembly
and all of its leadership are members of the
governing coalition, the speaker and his closest
advisors have worked to carve out a modest space for
political discourse. The extent to which the
governing coalition can bring the opposition into
the political process will be crucial: successful
constitutional reform (a part of ARMENIA's on-going
Council of Europe commitments) and electoral law
reform will only be possible if politicians from
across the political spectrum participate actively.
ORDWAY