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PP RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHYE #1241/01 2890243
ZNY CCCCC ZZH
P 160243Z OCT 07
FM AMEMBASSY YEREVAN
TO RUEHC/SECSTATE WASHDC PRIORITY 6464
RHEHNSC/NSC WASHDC PRIORITY
RUEKJCS/SECDEF WASHDC//USDP:RUE// PRIORITY
RUEKJCS/JOINT STAFF WASHDC//J5/RUE// PRIORITY
RUEHLMC/MILLENNIUM CHALLENGE CORP WASHDC PRIORITY 0113
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHVEN/USMISSION USOSCE 0521
RUEHNO/USMISSION USNATO 0430

C O N F I D E N T I A L SECTION 01 OF 03 YEREVAN 001241 
 
SIPDIS 
 
SIPDIS 
 
NSC FOR OVP 
STATE FOR S STAFF, E, EUR 
DOD FOR OSD 
MCC FOR CEO 
 
E.O. 12958: DECL: 10/12/2017 
TAGS: PREL PGOV OVIP SERZH SARGSIAN KDEM AM
SUBJECT: SCENESETTER FOR PM SERZH SARGSIAN'S WASHINGTON 
VISIT 
 
YEREVAN 00001241  001.2 OF 003 
 
 
Classified By: CDA R.V. Perina, reasons 1.4 (b,d) 
 
SUMMARY 
 
¶1.  (C) Prime Minister Serzh Sargsian's visit to Washington 
October 17-23 is his chance to see and be seen with 
Washington leaders in the run-up to his February 2008 
presidential election bid.  With his extensive defense and 
security background, Sargsian now needs to show himself as a 
world leader.  He is still feeling his way on economic and 
social policy issues, but is eager to embrace his expanded 
role.  Many observers are tempted into the easy cynicism that 
presumes Sargsian will be a "more of the same" president: 
shadowing Russian precedents on democratic (non)reforms, and 
offering little room for real change to take root.  We 
believe such assumptions are premature.  Sargsian's words to 
date have offered hope that he may be more flexible, 
reform-minded, and even visionary than President Kocharian, 
especially on key issues such as Turkish relations and 
getting to an NK settlement.  He is also smart enough to 
handle the current AGR debate in Washington with discretion 
and not embarass any of his interlocutors with this issue. 
END SUMMARY 
 
SARGSIAN'S DEBUTANTE BALL 
 
¶2.  (C) Prime Minister Sargsian's visit to Washington (and 
his stop in Paris immediately thereafter) represent his 
"coming-out party" on the world stage.  The transition time 
between the May 2007 parliamentary and February 2008 
presidential elections represent both an apprenticeship and 
audition period for Sargsian, as he uses the prime 
ministership both to learn the ropes of the civilian side of 
government and to campaign for the presidency.  Before 
acceding to the prime ministership in April 2007 (some weeks 
earlier than expected, after PM Markarian died March 25), 
Sargsian's experience was almost entirely in the security 
ministries.  We are pleased with Sargsian's attentive 
engagement with the Millennium Challenge program since he 
took over as prime minister and ex officio chair of the 
MCA-Armenia governing council.  He has also worked hard to 
get around to Armenia's various regions.  As defense 
minister, after deciding to intensify Armenia's NATO 
relationship, Sargsian accelerated the IPAP reforms, 
satisfying NATO officials with Armenia's rapid progress over 
the last three years. 
 
¶3.  (C)  Sargsian is not a deeply popular figure in Armenia, 
nor is he a natural politician. He comes across to many 
voters as colorless.  His election to the presidency is 
widely seen as inevitable, but like many "inevitable" 
candidates in elections, his chief asset is the perception 
that he is unstoppable.  The lack of competitve opposition 
alternatives bolsters this point.  His support is based more 
on the self-interest of Armenia's political and economic 
elites than on much of anyone's abiding loyalty to him 
personally.  Sargsian's behavior seems aimed at shoring up as 
much potential support for his presidential bid as possible. 
His control of the powerful Republican Party political 
machine, with its extenstive party cadres, infrastructure and 
deep pockets, seems firm.  Sargsian can best sell the 
electorate on his candidacy with his defense credentials (in 
a country where many feel surrounded by hostile neighbors), 
and on his ability to continue the positive economic trends 
of the past seven years. 
 
MAKING THE PITCH ON ELECTIONS AND GOOD GOVERNANCE 
 
¶4. (C) Sargsian says all the right things to us about his 
desire to improve Armenia's performance on meeting 
international election standards, tackling corruption, and 
making sure Armenia makes the grade on MCC indicators.  U.S. 
interlocutors should reinforce our strong interest that the 
presidential election be even better than the May 2007 
parliamentary election.  The latter was a step forward from 
Armenia's past appalling election  performance, but still 
troublingly opaque.  The process of vote tabulation and 
reporting was not nearly as transparent as it should have 
been.  We should also make a strong pitch to Sargsian that 
his own legitimacy will be at stake in February. Sargsian and 
 
YEREVAN 00001241  002.2 OF 003 
 
 
the ruling party are convinced (accurately) that no matter 
how well the elections are conducted, the opposition will 
loudly proclaim fraud and seek to rally voters into the 
streets in protest. 
 
¶5.  (C) MAKE THE OBSERVATION MISSION YOUR FRIEND:  Our 
argument is that the best source of legitimacy is a robust 
OSCE/ODIHR election observation mission able to corroborate 
Sargsian's victory.  However, during this past May's 
election, the government tightly restricted the number of 
accredited U.S. Embassy election observers, and put pressure 
on the OSCE/ODIHR mission, apparently trying to prevent any 
negative news from being reported.  We believe President 
Kocharian was behind the rather paranoid tone the GOAM set 
with the ODIHR observers, but we hope Sargsian will 
understand that his self-interest lies in winning the OSCE's 
good opinion, and that he can help set a different tone with 
the observers for the February election. 
 
¶6.  (C) KEEPING THE PEACE:  We are troubled by how many 
opposition politicians seem focused more on post-election 
rallies with which they hope to force the government to 
resign than they are on the election itself.  Ruling party 
figures have also mentioned this worry.  We should make the 
point that law-abiding, peaceful demonstrations are a normal 
part of a democracy, and the government must be careful to 
manage these situations with restraint.  Any use of 
disproportionate force to disperse protesters would be a 
serious black eye for Armenia. 
 
¶7. (C) WHITHER THE MCC INDICATORS: MCC officials should offer 
Sargsian and his team frank briefings on the implications of 
the fact that Armenia has just graduated to a higher national 
income bracket (GDP per capita), where the competition and 
standards are stiffer. This will put many of its MCC FY08 
indicators into the red.  Armenia had all too little room for 
error even in the previous category, as "Ruling Justly" 
indicators already skated on thin ice.  Senior State 
officials can usefully renew the point that the presidential 
election in February will be another key benchmark for MCC 
eligibility. 
 
MOVING TOWARD RECONCILIATION WITH TURKEY 
 
¶8. (C)  Encouraging Yerevan and Ankara toward reconciliation 
is often fraught with frustration, as both sides often seem 
all too anxious to back away.  Armenian leaders remain 
profoundly unconvinced of Turkish good faith, though Sargsian 
has in recent months given us encouraging words about his 
sincere desire to achieve normal relations with Turkey. If we 
believe that the current mood in Ankara offers real 
possibility of advancing Armenian-Turkish relations, we 
should make this point strongly to Sargsian.  His support 
will be necessary (though perhaps not sufficient) to any 
Armenian willingness to meet the Turks halfway in even first 
steps. 
 
THE VEXING "GENOCIDE" ISSUE -- NO ARMENIAN CAN STAND AGAINST 
IT 
 
¶9.  (C)   Sargsian has a pragmatic view and no wish to anger 
either Washington or Ankara on the sensitive AGR issue.  If 
asked about the issue, however, as he is likely to be, he has 
no option, politically, but to voice support for an AGR. 
When the HFAC passed the resolution, Sargsian was quoted in 
local papers saying "For every Armenian the issue of the 
Armenian genocide is special, and we must be grateful to 
those people working to promote it and those members of 
Congress who voted for it."  Sargsian is smart enough, 
however, to handle this issue with discretion and 
sensitivity, and not seek to embarass any interlocutor with 
the issue. 
 
 
ENHANCING THE IRAQ DEPLOYMENT 
 
¶10. (C) DASD Cagan's recent visit (septel) sought to convince 
the GOAM to double to about 100 soldiers its troop contingent 
in Iraq.  Sargsian understands that his full agreement to 
this enhancement of forces will be sought and expected in 
 
YEREVAN 00001241  003.2 OF 003 
 
 
Washington.  Cagan made clear that the additional Armenian 
troops would be trained and equipped by the United States out 
of special coalition support funds, not deducted against 
Armenia's FMF/IMET funding.  Sargsian sees the value of 
having Armenian troops train and operate alongside U.S. and 
Allied forces, but remains wary of overstretch of Armenia's 
small peacekeeping battalion, as well as of the political 
risks in an election year that would accompany additional 
Armenian casualties in Iraq. 
 
IRAN 
 
¶11.  (C) Armenia's relationship with Iran has been a frequent 
irritant in the U.S.-Armenia relationship.  Armenia believes 
fervently it has no choice but to have friendly relations and 
economic ties with its southern neighbor, including the 
recent construction of the (so far idle) Iran-Armenia natural 
gas pipeline.  The GOAM sees the latter as a strategic 
necessity, to give Armenia an alternate source of energy in 
the event that a Georgian-Russian crisis cuts off natural gas 
shipments from the north.  We have pointed out to the GOAM at 
every opportunity that if Armenia helps Iran export its gas 
onward to a third country this energy barter arrangement 
would be transformed into a deal that could trigger U.S. 
sanctions under the Iran Sanctions Act.  We also repeatedly 
make the point that in the current Iranian stand-off with the 
UN and IAEA over its illicit nuclear program, this is no time 
for "business as usual" between Armenia and Iran. We have 
repeatedly cautioned the GOAM not to allow Armenia to become 
a vehicle for Iranian propaganda efforts.  Sargsian, who has 
spoken positively of the Iranian relationship on a number of 
occasions, will expect this issue to be raised in Washington, 
and he will seek to defend Armenia's position. 
 
SARGSIAN'S STYLE 
 
¶12. (C) Sargsian keeps his own counsel and tends to be a man 
of relatively few words -- a sharp contrast to the voluble 
and emotive Kocharian.  He is soft-spoken and seeks to avoid 
confrontation.  Sargsian's Washington visit may be a learning 
experience for us all, as we see how he handles himself in 
different contexts.  We believe him to be a cool-headed, 
rational, and methodical decision-maker, who can be persuaded 
by clear-eyed appeals to Armenia's (or his own) best 
interests. 
PERINA