Mistakes & missteps: Armenian government begins to falter

Richard Giragosian, Regional Studies Center (Yerevan, Armenia)

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In March not numerous but vocal opposition tried to limit premier’s power, while the government  accented its victories and successes.

Domestic policy

A parliamentary move to limit government power

Despite the obvious political power of popular support and an overwhelming majority in the parliament, the small but vocal Bright Armenia Party (LHK) introduced legislation on 27 March seeking to limit the power of the government led by Prime Minister Nikol Pashinian. The move was in response to the prime minister’s insistence that three powerful state bodies: the police, National Security Service (NSS) and the combined tax and customs State Revenue Committee (SRC) – remain subordinate to premier’s office, rather than account to the parliament. The bill also seeks to elevate the police and NSS to the level of full government ministries, thereby making them accountable to the parliament, while also calling for the merger of the SRC with the Finance Ministry. These three powerful agencies were traditionally under the control of the president, but with the country’s unprecedented transformation to a parliamentary form of government, the prime minister is eager to keep them under his direct jurisdiction. The government’s defense of keeping the three state bodies under prime ministerial control, as articulated by Deputy Prime Minister Tigran Avinian, is based on the argument that the importance of these state agencies necessitates a safeguard against their “politicization.”  

The legislation has little chance for passage due to the dominant position of the 88-seat ruling pro-government “My Step” bloc. However, the attempt by the 18-seat Bright Armenia Party is a logical bid to counter what their party leader and former Pashinyan ally Edmon Marukian defines as a dangerous move toward creating a “super prime-ministerial” scenario that tends to only replicate Armenia’s previous “pyramid” system of government. The bill is also a prudent attempt to bolster the authority and institutional power of the parliament as more of a “check and balance” branch of government in order to meet its own responsibilities of legislative initiative, accountability and oversight.

Ethics watchdog found to violate his own standards

The state Ethics Committee for High-Ranking Officials determined on 21 March that Davit Sanasaryan, the head of a supervisory body subordinate to the Prime Minister, violated the very same rules governing ethics in public service that he is empowered to protect. The Committee determined that Sanasaryan failed to “contribute to the credibility of and respect towards his office and the body he represents”.  The rather embarrassing case consists of public statements by Sanasaryan that accused Yerevan State University Rector Aram Simonyan of misappropriating or embezzling over 800 million drams (about $1.6 million) during his tenure as the head of the university. Although the charges tend to be in line with the public suspicion of Simonyan and the use of his position to support the former government, the legal presumption of innocence greatly contributed to a perception of bias and pressure by Sanasaryan.  


Armenian Premier defends his “economic revolution”

In a robust defense of his demand for an “economic revolution,” Armenian Prime Minister Nikol Pashinyan argued on 27 March that official statistics confirmed that the Armenian economy continued to expand, tax revenues were increasing and that his government’s efforts to forge a “level playing field for all businesses” were successful. In a report to the parliament, the prime minister added that “our model of economic development and economic revolution is working,” hailing a nearly 22% increase in construction for the first two months of 2019 and noting that a dramatic expansion of mortgage-related bank lending stood out as the evidence of the public’s “confidence in their own future”. Nevertheless, for the same period, exports declined by 11% and industrial output increased by a meager 2%.  

World Bank offers Armenia a new loan package

In an announcement on 28 March, the World Bank Group pledged some $500 million in new loans and other funding for the Armenian government over the coming five years, noting that the World Bank will “capitalize on the momentum and political will for deeper reforms and renewed commitment to good governance, sparked by recent changes in Armenia, to support rebalancing the economy toward a new growth model”. The new loan package will focus on the Armenian energy sector through modernization and reforms aimed at reducing dependence on energy imports, while also supporting measures to “increase competition and open the economy to foreign investment by providing direct financing to companies and supporting the development of export-oriented industries”.  The World Bank stands out as the country’s leading foreign creditor and main donor, providing Armenia with loans and grants totaling over $2 billion since 1992.

Foreign Policy

First official meeting of Armenian and Azerbaijani leaders

In their first official meeting, Armenian Prime Minister Nikol Pashinyan met with Azerbaijani President Ilham Aliyev on 29 March in Vienna. Hailed as a “positive and constructive” meeting, the two leaders agreed to strengthen the ceasefire in place over the Nagorno Karabakh (Artsakh) conflict zone and contribute to “an environment conducive to peace”, while also expressing their commitment to continue diplomatic negotiations. A subsequent joint statement issued by the foreign ministers of each country added that this round of talks offered “an opportunity for the two leaders to clarify their respective positions” and exchange “views about several key issues of the settlement process and ideas of substance”. The joint statement was also endorsed by the U.S., Russian, and French mediators co-chairing the OSCE Minsk Group, the sole diplomatic entity empowered to manage the Karabakh peace process. And in what was perhaps the most significant development, Prime Minister Pashinyan and President Aliyev further agreed to develop a number of unspecified but positive measures related to “the humanitarian field”.  This meeting followed three earlier informal conversations between the two leaders over the past six months, which was also noteworthy for a marked decrease in the number of violations of the inherently fragile ceasefire in place.

Azerbaijan conducts major military exercises

In a move seemingly to bolster their diplomatic negotiation position prior to a summit with the Armenian leader, Azerbaijan launched a major five-day military exercise on 11 March consisting of roughly 10,000 troops, 500 tanks, 300 missile systems, aircraft and other military equipment.  The exercise also coincided with the visit to Yerevan by James Appathurai, the NATO Secretary-General’s Special Representative for the Caucasus and Central Asia. During his visit, the NATO envoy praised Armenia’s “new efforts” and commitment to the Karabakh peace process, and stressed that the conflict had no “successful military solution”. On the same day, Armenian Prime Minister Nikol Pashinyan arrived in Karabakh to prepare for a special meeting of the Armenian National Security Council set for 12 March. And in a warning to both Armenia and Azerbaijan, the OSCE Minsk Group mediators issued a statement on 9 March calling on all parties to “refrain from statements and actions suggesting significant changes to the situation on the ground, prejudging the outcome of future talks or setting conditions for them, demanding unilateral changes to the format without agreement of the other party, or indicating readiness to renew active hostilities”.