Barev Dzez. Bari Yereko Good Evening. Thank you for your warm welcome. In so many ways, the Armenian-American community represents the foundation and the strength of our bilateral partnership with Armenia, so I´d like to thank the organizers for making it possible for me to be here tonight.
One of the many joys of being in Armenia is that so many Armenians have opened their homes and hearts to me, enriching my experience beyond measure and increasing my understanding of Armenia’s rich culture and unique people. Although I am now thousands of miles from Yerevan, I am delighted to see that same generosity of spirit exists here in the Armenian-American community in the U.S.
I thought that today I would make remarks and then leave plenty of time for questions and answers. My last stop on this trip is Washington, DC and I will share your thoughts and concerns with policymakers. Afterwards, I hope we´ll have a chance to meet in person.
I´d like to report to you how we view current events in Armenia, the status of the bilateral relationship, our goals in Armenia, and how we are using our assistance money to help improve the lives of the Armenian people. And for those of you who are interested in helping Armenia, I´d like to share some ideas on how you can do so, although Iknow many of you are already very involved and I´d like to hear about whatyou´re doing as well.
U.S. strategic interests in Armenia are straightforward – helping Armenia develop democratically, advance economically, and establish a sovereign state that is strong and secure. We believe that these goals benefit the Armenian people. They also benefit the American people, because a state that is democratic, prosperous, secure and at peace with its neighbors makes a better partner for the United States.
Over the years, the U.S.-Armenia relationship has been based on the shared belief that market economy and democracy – while imperfect systems – are still better than the alternatives. When Armenia, a nation of traders, broke free of communist restraints, its skilled entrepreneurs quickly emerged to form the basis of a market economy and the government established the framework to support this economy. Politically, sovereign Armenia built on the Armenian independence movement of the late 1980s, that sparked the downfall of the Soviet empire, and vastly expanded the basic human rights and liberties afforded to all Armenian citizens. In all these areas, the U.S. has consistently supported Armenia and provided approximately, $1.8 billion in total assistance.
Democracy
So where has Armenia´s political evolution taken it? The past 18 years have brought many advances, but naturally challenges remain. For example, elections remain problematic. Last year´s flawed presidential elections and the subsequent March 1 violence that ended in the deaths of at least 10 individuals continue to reverberate. Recently, we´ve received the good news that Parliament voted on a general amnesty. We welcome the release of former Foreign Minister Arzumanian, two parliamentarians, and a number of other opposition supporters. We look forward to additional releases as the amnesty is implemented and encourage further steps to ease lingering tensions and open the way for constructive dialogue.
Unfortunately, widespread and systemic fraud and intimidation marked the recent May 31 Yerevan mayoral elections, as well. In the precinct where I observed the vote count, two parties approached the chairman to get him to change their tally. He refused, noting that there was nothing he could do because observers were present. The plus side is that the count wasn´t changed; the negative is that there was an expectation that it could be changed – and it clearly was in a number of precincts as other Embassy observers witnessed.
There were some positives in this election: previously the mayor was an appointed position and now he is elected. During the election period, we also noted an improved media climate and greater freedom of assembly. And President Sargsian has publicly stated that there needs to be an investigation into the irregularities – which is happening.
We understand that the path to democracy is rarely swift or smooth. Our aim is to help the Armenian government and people restore momentum to their democratization efforts and renew their own aspirations of accountable government institutions and rule of law. I am confident that this can be achieved when the opposition and the government work together constructively.
It´s our firm belief that Armenian issues require Armenian solutions, consistent not only with democratic principles, but also with Armenian culture, history, and tradition. However, the U.S. government can certainly provide support.
Our focus is on bolstering democratic institutions at the national level, empowering civil society and promoting political participation of fully informed citizens. You don´t have to talk to too many people in Armenia to know there is a demand for accountability and transparency in government. Through our targeted assistance programs, we are strengthening both the public´s capacity to articulate that demand and the government´s ability to meet it.
Our assistance dollars – your assistance dollars – support fiscal management and capacity development to 38 municipalities, enabling them to provide services to generate revenues for the community. Our efforts to fight corruption include 11 newly-opened advocacy centers throughout Armenia. Over 1,000 individuals to date have contacted the centers for help and legal assistance, and several cases are moving through the courts. Our support for independent media and enhanced access to the internet is helping to create a better informed citizenry. And after a considerable pause, leaders in parliament have invited us to work with them to strengthen the capacity of their working committees.
We are building institutional capacity in Armenia´s defense bar, procuracy, and judiciary. We are also helping to increase law enforcement capacity, so the justice system can impartially and effectively enforce the law in accordance with international standards and human rights conventions. That´s important for democratic development. It´s also important for economic development.
Economy
Like every other country in the world, Armenia faces great economic challenges. After six consecutive years of double-digit growth, 2008 saw Armenia’s GDP grow a relatively modest 6.8 percent. Newly released figures indicate that the Armenian economy contracted 15% in the first five months of this year compared with the first five months of last year. Most alarming to me, the World Bank recently estimated that as a result of the crisis, Armenia’s poverty rate may increase from 23 percent to 28 percent by 2010.
When I travel in the regions, I can see the impact – in Goris, officials told us that the demand in stores has dropped by 50%; in Sisian, no bank has provided a single loan since January; and everywhere you can see unemployed youths hanging out with nothing to do.
In response to the economic crisis, the Armenian Government has borrowed over $1.5 billion from the World Bank, IMF, and the Asian Development Bank. These funds will be used for a range of initiatives including budget support, building rural roads, canals, and housing for earthquake victims, and to support loans for small and medium enterprises. As the largest donor to the three international financial institutions, the U.S. has supported Armenia´s loan requests, and will continue to support loans to meet Armenia´s needs.
The economic crisis is not attributable entirely to external factors, and in countering its effects, the Armenian government has an opportunity to undertake fundamental reforms to promote long-term economic growth and investment. President Sargsian has said that fighting corruption at all levels is a national priority, and such action is critical. A transparent legal system, improved enforcement of intellectual property rights, promotion of open competition in every sector of the economy, and modernized infrastructure are necessary elements of a competitive 21st Century economy and necessary to promote investment — both foreign and domestic.
U.S. assistance is helping to make the private sector more competitive and financially viable. USAID’s programs have been key to achieving 30 percent growth last year in tourism from Europe. We have trained the workforce in the IT sector to be more relevant to industry needs, and we have created new opportunities for investment and trade through partnerships with U.S. IT firms. Our $9 million credit guarantee program is helping banks provide loans to small businesses. We are providing technical assistance to 200 small companies to improve their business practices, and our training and technical assistance will help banks to lend $50 million to the private sector. And thanks to our assistance, 100,000 people in the community of Artashat will have water 24 hours a day starting in August. I’ll be there when the taps get turned on, and I invite any of you who are in Armenia to join us for a special day.
While most of our programs are focused on long-term impact, we have also reprogrammed funds to respond directly to the financial crisis by allocating 2.2 million dollars for a small infrastructure program that will generate 23,000 labor days in the regions on projects decided by communities throughout Armenia. In one community, this might entail putting in a well, in another a new roof for a school. The program will put people to work, so they can put food on the table. We also have social sector programs to help the most vulnerable — soup kitchens to feed the elderly, and unemployment and training centers to get people back on their feet.
What Can You do?
Thanks to the Armenian-American community, Armenia remains one of the largest recipients of U.S. assistance worldwide. Over the years, U.S. assistance has accomplished much. As any Armenian will tell you, U.S. assistance helped keep Armenia going during the “cold, dark years” by providing wheat, winter kerosene to heat homes and schools, and diesel fuel to keep the central power plants running. We provided the support to transform the gas and electricity sectors, and implement the safety measures that keep the nuclear power plant operational. And we have helped the Health Ministry revitalize and reform the delivery of primary health services, with a special focus on maternal and infant care.
I am proud of our many success stories, but there is always more that can be done.
I know many of you have been contributing to Armenia in different and important ways over the years. You may also want to partner with us. There are many ways of doing so and you would have the assurance that the U.S. government is closely monitoring the project. You could work with the State Department Humanitarian Assistance project funding small infrastructure projects for Armenia´s neediest. These projects cost around $12,000 each. I was just at a residential boarding school for 400 children with minor disabilities, and this small amount of money transformed the laundry into a sanitary environment that will actually clean clothes.
You could help fund a soup kitchen, or help us work to lower the mortality rate of women with the most common complications of labor. The program has already lowered mortality by 60%.
Or maybe you´re a businessperson with the sort of skills that are needed to prime the Armenian economy. We have a partnership with Sun Microsystems that has established “JAVA teaching laboratories” at 3 major Armenian universities. I went to the one at Slavonic University earlier this year, and that´s where you can see Armenia´s future. Bright kids are gaining the skills they couldn´t get otherwise, and Sun Microsystems is getting graduates with the skills they need. Productivity, exports, and revenues all rise. It´s a win-win, and you could be a part of it. We´ve also got a partnership with the Coca-Cola Corporation to stop discharge of raw sewage into the Aghstev River that runs through the center of scenic Dilijan. The project will reduce pollution in the area and protect the ecosystem of a resort site important to Armenia’s tourism industry.
If you are interested in working with us, please let me know. There are brochures in the back, and I have a stack of my business cards here on the podium, so you can be in touch with me.
If you are already contributing in other ways, thank you for doing so. It is really important – especially now.
Security
A thriving economy is key to Armenia´s future – and so is security.
Our security assistance and cooperation program is helping reform Armenia´s military, supporting Armenia´s integration efforts with NATO, assisting demining efforts, and enhancing the Peace Keeping Brigade that served in Iraq and continues to serve in Kosovo. We provide military education and language training, as well as equipment such as radios and field hospitals. Much of this assistance is delivered through a partnership with the Kansas National Guard, which has developed a close relationship with Armenia’s Ministry of Defense.
But our most important efforts in the security area are focused on supporting Armenia´s regional integration. It is a top priority for the United States to help Armenia and Turkey normalize relations, open the border, and resume commercial and other activities. I know that many of you are skeptical about this, but we believe it is worth pushing for. If this were to happen, it would be a plus for Armenia, Turkey, the region – and therefore the U.S. Open borders with Turkey, and eventually, we hope, Azerbaijan, would allow Armenia to be part of a regional market of 80 million. Integration with its neighbors would stimulate development of road networks, rail lines, energy pipelines and electrical grids, which would enhance Armenia’s economic and energy security.
No one knows what the direct economic impact on Armenia would be of an open border, but studies indicate that it would add a few percentage points a year to Armenia’s GDP growth. Some industries would do better than others, but we believe that travel and tourism, mining and metal products, electrical machinery and certain agricultural products would be very competitive.
The most important benefit is likely to be decreased dependence on inefficient, expensive, and vulnerable supply routes through Georgia and Russia. Political risk would go down, potentially attracting more domestic and foreign investment. Costs would go down for both consumers and importers. The greatest beneficiaries of a border opening would be the communities closest to the border, many of which are among the poorest parts of the country. When I was in Gyumri late last year, for example, everyone I spoke with talked about the need to open the border, and the positive impact that it would have on their daily lives.
An open border would also allow Armenians and Turks to travel back and forth, meet and talk to each other. We believe that both communities would discover that there is more that unites them than divides them. Normal interaction between the populations would permit both countries to capitalize on mutual interests and resolve differences.
For all these reasons, the U.S. strongly supports the normalization of relations between Turkey and Armenia. We believe that normalization should take place without preconditions and within a reasonable timeframe. And we urge both countries to proceed according to the agreed framework and roadmap. Normalization will promote peace, security, and stability in the whole region, and is – in the words of President Obama – “a goal worth working towards.”
Nagorno Karabakh
In the security context, there is also another goal worth working towards: a peaceful, just and lasting settlement of the Nagorno-Karabakh conflict. During the past year, the parties have moved ever closer to a framework agreement based on a set of Basic Principles developed through intensive negotiations. The Minsk Group Co-Chairs – and the U.S. is one of the co-chairs – remain fully committed to helping Armenia and Azerbaijan finalize these Basic Principles, which are based on the principles of self-determination, territorial integrity, and non-use of force. Securing an agreement would enhance Armenia´s security, and also the security of the people living in Nagorno-Karabakh. It would open borders, establish transportation routes, and kick-start commerce with Azerbaijan.
Over the last year, President Sargsian and President Aliyev have met five times. At their most recent meeting in St Petersburg in early June, both Presidents asked the mediators to continue their shuttle diplomacy and agreed to continue their own meetings. There is momentum in these discussions, and we look forward to more progress soon on this difficult but essential issue.
1915
Before I conclude, I would like to raise one other very important issue with you. I know there is disappointment, frustration, and anger in the Armenian-American community about this year´s April 24 Remembrance Day Statement. I have heard this in almost every meeting I´ve been in over the last several days, and while I know that many of you have relayed your concerns directly to Washington, I can assure you that I will do so as well.
While I know that the statement was a severe disappointment, President Obama went further in his statement this year than in an Remembrance Day statement. His personal views on this issue are well known, and he made reference to those views both in his statement and during his recent visit to Turkey.
Successive American presidents have long acknowledged the killings and forced exile of 1.5 million Armenians at the hands of the Ottoman authorities. Every April 24, my embassy colleagues and I personally honor those victims at the Tsitsenakaberd Memorial. When Assistant Secretary of State Phil Gordon was in Yerevan recently, he, too, visited the memorial and the museum and paid his respects. This history forms part of the personal stories of the more than half the population of Armenia that has descended from those expelled from Anatolia and elsewhere. I have spoken with many of them – many of you — and I have been deeply moved by what you have told me.
The resilience of Armenians in the face of this terrible past has touched and inspired me. It has made me more convinced than ever that we need to work together to ensure that Armenia is secure, and that Armenians have the opportunity to build a country that will prosper and flourish. While we will never — and must never — forget the past, we must also work toward a better future.
Conclusion
And Armenia is building that better future. Anyone visiting Armenia over the last two decades has seen dramatic development in all spheres. Much has been accomplished, although much more remains to be done.
We are fortunate to be present at this moment of historic opportunity. I am optimistic about the future, and see the possibility of resolution of regional disputes and the further development of Armenia´s political and economic institutions. Possible, however, does not mean inevitable — it will take hard work and political courage to transform Armenia and the region. The U.S. is committed to advancing the relations between our two countries, facilitating rapprochement among neighbors in the region, and helping Armenia achieve its political and economic potential.
The U.S.-Armenia relationship is a strong one, and it is a high priority for the U.S. Government. When Assistant Secretary Gordon came to Armenia, he had been on the job all of two weeks, and Armenia was the first country he visited travelling on his own. He told reporters that although he is responsible for 50-some countries and three international organizations, he had spent more time on the security issues of the Caucasus than on any other single issue. I think that makes clear the commitment not only of Dr. Gordon, but of the United States, to support the realization of democracy and prosperity, peace and security in Armenia and in the region as a whole.
Thank you for the opportunity to speak here today. I welcome your questions.
