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08YEREVAN818 2008-10-08 10:43:00 CONFIDENTIAL Embassy Yerevan
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1. (C) During their October 6 meeting, FM Nalbandian told
Ambassador that Turkish FM Babacan had invited him to visit
Turkey in late October in connection with the Davos Forum.
Nalbandian reported that President Sargsian's Tbilisi visit
had made good progress at warming the strained relationship
with Georgia. He also quoted Russian FM Lavrov as regretting
both the Georgian conflict and subsequent Russian recognition
of the separatist provinces as against Russia's interests,
but unavoidable. Nalbandian also recycled reftel complaints
about Azerbaijan's stance on NK. End Summary.

2. (C) Ambassador's October 6 meeting with Foreign Minister
Nalbandian covered a range of current issues. The
Ambassador's discussions with Nalbandian on Turkey and RFE/RL
have been reported separately.




3. (C) Nalbandian described both his and President Sargsian's
recent visits to Tbilisi as a success, noting that the GoG
did much to welcome the Armenian President--including
awarding him an honorary doctorate--and heal the rift that
developed during the height of the Russia-Georgia crisis.
Sargsian tried to make clear to the GoG that despite
Armenia's close ties to Russia, the GOAM had not taken any
steps to act against Georgia in the conflict or to support
Russia's position on South Ossetia and Abkhazia, and
continues to place great value on strong bilateral ties with
Georgia. Russia has not yet expressed any concern about the
two countries improving their ties, he said. Asked about
this during his visit to Armenia last week, Russian Foreign
Minister Lavrov responded to a RFE/RL reporter that it is
Armenia's right to decide on its relationships, though he
expressed the hope that in doing so Armenia will not create
future problems for Russia.

4. (C) Georgian President Saakashvili continues to take a
hard line with regard to reconciliation with Russia, although
at times he shows signs of softening, Nalbandian commented.
In an earlier meeting, Saakashvili initially told Nalbandian
that Georgia cannot have any dialogue with Russia.
Nalbandian said he told Saakashvili that that kind of
position is not helpful. During President Sargsian's
subsequent visit, Saakashvili's attitude about Russia was
more conciliatory. The GoG has also used its position in the
Black Sea Economic Cooperation (BSEC) forum to advance
measures against Russia and block measures favorable to
Russia. Nalbandian criticized the GoG's use of that
institution as a tool against Russia, and said it now appears
the GoG has relented to some degree.

5. (C) While in Georgia, President Sargsian discussed a
number of economic projects, including building a better road
to connect Batumi to Yerevan. Saakashvili announced the
project as a done deal at a press conference, but it has not
yet been concluded. However, the Georgian Minister of
Economy will be coming to Yerevan this week to discuss the
project. During Nalbandian's visit, he also discussed the
economic situation of Georgia's ethnic Armenian population in
Javakheti. The community is in poor economic condition, and
Nalbandian noted that Saakashvili should be sensitive to the
needs of the people in this area.



6. (C) Russian FM Lavrov visited Yerevan the week of
September 29, primarily to prepare for a visit to Armenia by
President Medvedev October 21. The situation in Georgia was
a major topic of discussion. Lavrov reportedly told
Nalbandian that neither the conflict in Georgia nor the
recognition of South Ossetia and Abkhazia were in Russia's
interest, and that Russia has other issues with which to
concern itself. However, the GOR felt that Georgian actions
in South Ossetia were unacceptable and that it had no choice
but to respond. Nalbandian argued that it is now simply "not
an option" for Russia to retract its recognition of those
territories. Nalbandian said that he has spoken frankly with
Lavrov about Georgia, emphasizing that escalating the
situation is in nobody's interest.



7. (C) Nalbandian reminded of Russian President Medvedev's

YEREVAN 00000818 002 OF 002

intention to host Presidents Sargsian and Aliyev in Moscow
for talks on NK, and said that Lavrov had renewed this offer.
He once again commented (reprising reftel) that he understood
President Aliyev had first suggested the Moscow meeting.
While Nalbandian indicated he was in favor of such a meeting,
he made clear this was not intended as a replacement of the
Minsk Group process, which the GOAM still supports--as, he
said, does Russia--and he confirmed as much to the co-chairs
at the UNGA. He noted, however, that the details of the
Moscow meeting had not yet been clarified by the Russians.

8. (C) Nalbandian also repeated his doubts (see reftel) about
Azerbaijan's willingness to participate in such a meeting,
reiterating his complaint about FM Mammadyarov's UNGA remarks
calling on the latest UNGA resolution as "the basis of
negotiations." Nalbandian commented that the Azerbaijani
government is at times refusing better settlement terms than
it had been ready to accept several years ago, but is hopeful
the GOAJ will be more accommodating following the upcoming



9. (C) Nalbandian mentioned that Turkish PM Babacan has
invited him to visit Turkey at the end of October, in
conjunction with the Davos Forum, October 31 to November 1.
Nalbandian noted the tentative electricity agreement
concluded in connection with Turkish President Gul's visit to
Armenia on September 6, and also indicated that Turkey would
be a welcome participant in Armenia's proposed new nuclear
power plant. (Note: We had been told previously by Deputy FM
Kirakossian that the electricity deal signed between the GOAM
and a private firm in Turkey has been put on hold by Turkish
energy regulatory authorities. End note.)



10. (C) Nalbandian confirmed that both he and President
Sargsian will participate in the upcoming CIS Summit,
although he does not expect much to occur. He expects there
to be a resolution about Georgia on the agenda, and added
that there is relatively little sympathy for Georgia--and
especially President Saakashvili--among the CIS heads of
state. He noted that if Saakashvili boycotts the Summit, it
is likely the resolution will be tougher, but he said that
Armenia would play the same helpful role it played at the
CSTO Summit.He commented that President Nazarbayev has been
very critical of Saakashvili publicly, and others more