PUTIN'S UPCOMING VISIT TO ARMENIA: CEMENTING TIES

C O N F I D E N T I A L SECTION 01 OF 02 YEREVAN 000500 SIPDIS E.O. 12958: DECL: 03/21/2015 TAGS: PREL ECON ENRG AM RU SUBJECT: PUTIN'S UPCOMING VISIT TO ARMENIA: CEMENTING TIES REF: A) YEREVAN 287 B) YEREVAN 391 C) YEREVAN 476 Classified By: DCM A.F. Godfrey for reasons 1.4 (b, d). -------------- SUMMARY -------------- ¶1. (C) Russian president Vladimir Putin will visit Yerevan March 24 to 25 on what the Russian Embassy describes as a "working visit." He will make only a few stops during his roughly 24-hour visit, and Russian diplomats told us to expect "no surprises." While the visit may be routine from Moscow's point of view, it looms large for Armenia, especially on energy issues. Korobkov emphasized that this visit is taking place because of the GOAM's continued urging, and noted that Putin expects to discuss regional security (especially N-K) and economic issues. End Summary. -------------- ECONOMIC ISSUES HIGH ON THE AGENDA -------------- ¶2. (C) During Putin's visit he will be focusing on commercial and economic issues between Russia and Armenia. Oleg Korobkov, Political Counselor of the Russian Embassy, told us that Putin would pressure the Government of Armenia to support Russian interests in Armenia's energy sector, noting that he expected Armenia to accept Gazprom's participation in the extension of the Iran - Armenia gas pipeline closer to Yerevan (ref B). Part of Putin's delegation includes businessmen Ara Abrahamyan, RAO-UES Chairman Anatoliy Chubays and banker V. O. Levin. Putin may well press the GOAM for approval of RAO-UES' acquisition of Armenia's power distribution network, Electricity Network of Armenia. Korobkov added that Russia would offer in return to restart work some of the large, idle factories it acquired in the 2003 debt-for-equity swaps with Armenia. In a separate meeting March 16, Deputy Minister of Energy Iosef Isayan confirmed that Putin and members of his delegation would discuss the Iran - Armenia pipeline and the RAO-UES' bid to acquire the electricity network during the visit. Isayan said that his ministry was proposing that the Armenian side discuss a recent proposal by Georgian Prime Minister Zurab Noghaideli to extend the Iran - Armenian pipeline to Georgia (ref C). ¶3. (C) In his first meeting in Yerevan, Putin will be discussing economic issues with Minister of Defense Serzh Sargsian, the Armenian Co-Chair of the Intergovernmental Commission. (Note: The Armenian-Russian Intergovernmental Commission handles mostly economic issues, and functions in a similar fashion to the former U.S-Russian Gore-Chernomyrdin Commission. End Note.) According to Korobkov, among the issues they will discuss are transport issues, energy issues, the impact of renewed Kavkaz-Poti rail ferry service, and economic ties. -------------- DOING A FAVOR FOR KOCHARIAN -------------- ¶4. (C) Korobkov portrayed this (oft-postponed) visit as the result of heavy GOAM pressure. He noted especially that the ostensible reason for the visit, the opening of the "Year of Russia in Armenia" had been created to make the timing plausible. That having been said, he continued to point out that this year was the Year of Azerbaijan in Russia -- next year, Korobkov added, will be the Year of Armenia in Russia and the Year of Russia in Azerbaijan. Of course Putin will discuss Nagorno-Karabakh (N-K) with Kocharian, Korobkov told us, but we should expect nothing new, "since all Russian efforts" on N-K are "coordinated through the Minsk Group Co-Chairs." In addition to regional security issues, Korobkov noted, we should expect that most of the conversation will focus on economic issues. -------------- COMMENT -------------- ¶5. (C) According to Korobkov, Russia views this visit in largely economic terms, bringing along high-profile businessmen to prove the point. Korobkov seemed to back off Russia's past efforts to make Armenia promise to reduce the diameter of the Iran-Armenia pipeline and to focus on Gazprom's efforts to control any extension of the pipeline past the Southern Armenian town of Kajaran. We expect that Putin may use the opportunity to pressure Armenia into further concessions regarding the Iran - Armenia gas pipeline, and push for Russian participation in any future transit line to Georgia. What direct pressure Putin will exercise about RAO-UES' bid to buy the electricity distribution network is not certain, although Chubays' presence as part of Putin's official delegation may speak for itself. ¶6. (C) Contrary to GOAM wishes and earlier press information, Putin will not be visiting the "Genocide Memorial" during this "working visit." -------------- PRESIDENTIAL DELEGATION -------------- ¶7. (C) Putin will be accompanied by a fairly large delegation by Russian standards (a 60-member advance team, an additional 25 support staff and a 40-member delegation),the core group is relatively small. Putin will be joined in most meetings by: --Sergey Eduardovich Prykhodko, Presidential Administration --Aleksandr Sergeyevich Sokolov, Minister of Culture --Mikhail Yefimovich Shvydkoy, Federal Rosagenstvo Kultura, Former Minister of Culture --Artur Nikolayevich Chilingarov, Gosduma --Igor Yevgenyevich Levitin, Minister of Transport --Ara Abrahamyan --Anatoliy Borisovich Chubays, Chairman of RAO-UES --V. O. Levin, banker -------------- SCHEDULE -------------- ¶8. (C) Putin's draft schedule follows: Thursday, March 24 20:00 Putin (accompanied by his wife) arrives in Yerevan 21:00 Putin meets with Minister of Defense Serzh Sargsian, Armenian Co-Chair, Intergovernmental Commission RON Presidential Guest House Friday, March 25 11:00 Putin meets with President Kocharian Presidential Palace 13:00 Kocharian and Putin proceed to a working lunch Hotel Yerevan (includes spouses) 15:00 Putin calls on the Catholicos Echmiadzin 17:00 Putin, Kocharian open the Year of Russia in Armenia Opera (includes spouses) 20:00 Putin departs Yerevan (Note: Bella Kocharian will host Lyudmilla Putina for a ladies' cultural program during the majority of the visit. End Note.) EVANS