Armenia faces instability unless it takes quick steps to improve relations with its neighbors, and fosters the rule-of-law at home, according to a new study that examines the Caucasus nation's political and economic prospects. The report, prepared by the International Crisis Group, urges Armenia to approach the Nagorno-Karabakh peace process "realistically." It adds that President Robert Kocharian's administration should "supplement economic success with robust democratization."
The report, titled Armenia: Internal Instability Ahead, says the stalemated Karabakh peace process "looms over all aspects of Armenia's political life and compounds its instability." [For background see the Eurasia Insight archive]. A lasting Karabakh settlement is needed to secure Armenia's long-term economic security, the report maintains. Yet, Armenian leaders have little room for diplomatic maneuver in their negotiations with their Azerbaijani counterparts, it adds. Yerevan is under heavy popular pressure, especially from the Armenian Diaspora, to make no concessions on Karabakh's independence from Baku. [For background see the Eurasia Insight archive].
"The [Karabakh] issue previously helped unify Armenia's political elite, but ultimately, it may polarize popular opinion and society," the report says. While nearly all Armenians believe that the country should defend Karabakh's interests during peace negotiations, a growing number in Yerevan seem to feel the territory's priorities have already eclipsed Armenia's own needs, including regional economic integration. The Karabakh issue, at the same time, has become so politically sensitive that Armenian officials are afraid of disturbing the status quo. The report cites a poll conducted in August 2004, which shows that almost 50 percent of Armenians believe war with Azerbaijan is the country's most serious threat in the coming five years. "Today, the issue is perceived as dangerous, if not suicidal for Armenian politicians," the report said.
The Karabakh dilemma threatens to upend Armenia's economic development, which is the key to long-term security. Over the past decade, the country has experienced "substantial macroeconomic growth," with GDP now rising at a 10-percent annual rate, the report says. Growth has been unevenly distributed, however, with per capita income still standing at only $80 per month. The lack of a Karabakh settlement may bring economic progress to a halt, the report stresses. "The Southern Caucasus badly needs economic integration to sustain its nascent growth," the report states. "Yerevan is excluded from participation in all major regional trade and East-West pipeline projects, mostly as a consequence of the unresolved conflict."
The report indicates that achieving a Karabakh breakthrough will require a reevaluation of Yerevan's current negotiating stance. "Despite rhetoric, Armenians acknowledge they share many experiences and interests with other Caucasian nations," the report says. "They know the future can improve only if old relations with Azerbaijan which means addressing the Nagorno-Karabakh issue realistically and Georgia are renewed," the report says.
Complicating efforts to promote economic growth is the "frozen" state of domestic politics, in which Kocharian's opponents maintain a boycott of parliament. [For additional information see the Eurasia Insight archive]. The report characterizes Armenia as internally unstable "because many basic safeguards of a participatory democracy do not function. ... Elections have been invariably rigged, causing political unrest and violence."
The presidential and parliamentary elections of 2003, widely condemned for widespread irregularities, led to a sharp increase in domestic political tension. [For additional information see the Eurasia Insight archive]. Opposition leaders refused to recognize the voting results and pursued a popular-protest strategy, leading to a confrontation in April between pro-Kocharian police and opposition demonstrators in Yerevan. [For additional information see the Eurasia Insight archive]. Though the popular protests have abated, the political atmosphere remains polarized.
The report places the main burden for fostering domestic tranquility on the Kocharian administration. Incumbent authority's apparent desire to monopolize political power is distracting from efforts to improve living standards, it adds. "Corruption and violations of democratic procedure have disillusioned a population, half of which still lives below the poverty line," the report says. "Good governance is perhaps the most important element for fighting poverty and achieving sustainable development."
Events in Armenia may take a violent turn unless Kocharian takes quick steps to redress his opponents' grievances. "The number of persons ready to act outside the law to advance political aims is likely to grow if the government continues to repress peaceful protests violently and to rig elections especially should a charismatic [opposition] leader appear on the scene."
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