Against a backdrop of controversy, Armenia's Prosperous Armenia Party is emerging as the leading challenger to the ruling Republican Party in this May's parliamentary elections.

At a press conference following the party's February 15 congress, Central Office Coordinator Vardan Vardanian declared that Prosperous Armenia, or Bargavach Hayastan, hopes to collect sufficient votes in the May 12 parliamentary poll to form at least the second biggest faction in the Armenian legislature after the Republican Party. The party's chairman and multimillionaire businessman, Gagik Tsarukian, went still further. "We have all the possibilities to win at the coming parliamentary elections and get our serious share of the job of governing the country," Tsarukian told conference delegates in a speech.

The size of the party's alleged membership alone -- 370,000 official members -- is cause for notice. If accurate, the number means that one out of every seven adult inhabitants of Armenia is a member of Prosperous Armenia. Yet, even if the figure is significantly inflated, the party would still outstrip its closet rivals.

An aggressive charity campaign run by an association that bears the same name as the party has helped build support for Tsarukian and his movement. Prosperous Armenia members often take active part in the charity's activities. [For details, see the Eurasia Insight archive]. Despite considerable controversy surrounding these giveaways, the government has not yet attempted to regulate the charity's activities.

It would appear to have little reason to do so. The party's goals, as outlined at the congress, show that it is committed to the course set by President Robert Kocharian's administration. "The principal idea and goal of BH [Prosperous Armenia] is to develop the obvious economic and political successes of the past years amid popular support," Vardanian declared to party members at the one-day event.

An official blessing, of sorts, has already been given to the party. "There are no contradictions either inside the ruling authorities or between the Republican Party of Armenia and Bargavach Hayastan [Prosperous Armenia]," declared presidential spokesperson Victor Soghmanoian in a surprising statement published by the Hayots Ashkharh daily. "And it is natural."

President Kocharian's chief of staff, Armen Gevorgian, along with Prime Minister Andranik Markarian, leader of the ruling Republican Party of Armenia, attended the conference. Commenting wryly on the budding cooperation between the two parties, the opposition daily Aravot argued in a February 16 editorial that a "bipartisan" system between the Republican Party and Prosperous Armenia "means that the ruling oligarchic system has found a mechanism of self-protection."

Given what appears to be a similarity of their policy interests, the possibility of an alliance between Prosperous Armenia and the Republican Party would seem likely. Leaders of the Armenian Revolutionary Federation, or Dashnaktsutiun, another party in Armenia's ruling coalition, also attended the Prosperous Armenia conference. However, Tsarukian stressed that Prosperous Armenia will not form any alliance during this spring's parliamentary elections.

The Republican Party, setting aside earlier criticism of Prosperous Armenia, appears content with the decision. At a February 19 press conference, Galust Sahakian, leader of the Republican Party parliamentary faction, commented that the issues raised by Prosperous Armenia during its conference were "normal and logical," adding that Prime Minister Markarian's presence at the gathering should be seen as an signaling his desire for free and fair elections in May, the daily Haykakan Zhamanak reported.

Manvel Sargsian, an expert at the Kavkaz analytical center in Yerevan, said that Kocharian intends Prosperous Armenia as a warning to the Republican Party, which is led by Prime Minister Markarian and Defense Minister Serzh Sarkisian. A criminal case recently brought against Republican Party parliamentarian Hakob Hakobian for allegedly taking part in a violent brawl "was a clear warning to the whole business community which cooperated with the RPA [Republican Party of Armenia] during the previous elections," Sargsian said. By contrast, he continued, Prosperous Armenia "is kept free of oligarchs . . . and current corrupt highly ranked officials who have a very bad reputation."

If Prosperous Armenia is to become a presence in government, it still must overcome some obstacles. For example, relative political unknowns -- university rectors, artists, scientists, medical professionals and current and former mid-level government officials -- comprise the bulk of the party's 35-member political council. For now, none have emerged as obvious candidates for high government office should the party's prediction of success in the parliamentary polls come true. Chairman Tsarukian himself has made clear that he has no ambitions to serve in the cabinet. As deputy minister of transportation and communications, Vardanian presently holds the most prominent government position among party members.