VZCZCXRO6844
RR RUEHDBU
DE RUEHYE #0201/01 0820844
ZNY CCCCC ZZH
R 230844Z MAR 09
FM AMEMBASSY YEREVAN
TO RUEHC/SECSTATE WASHDC 8844
INFO RUCNCIS/CIS COLLECTIVE
RUEHAK/AMEMBASSY ANKARA 1705
RUEHLMC/MILLENNIUM CHALLENGE CORPORATION WASHINGTON DC

C O N F I D E N T I A L SECTION 01 OF 04 YEREVAN 000201 
 
SIPDIS 
 
E.O. 12958: DECL: 03/19/2019 
TAGS: PREL PGOV PHUM KDEM COE GG TU AJ RU AM
SUBJECT: SPEAKER LEANS FORWARD ON MARCH 1 DETAINEES, 
ASSURES OF CLEAN MAYOR'S RACE, RAISES REGIONAL NEGOTIATIONS 
 
REF: A. 08 YEREVAN 864 
     ¶B. YEREVAN 26 
 
YEREVAN 00000201  001.2 OF 004 
 
 
Classified By: AMB. Marie L. Yovanovitch, reasons 1.4 (b,d) 
 
¶1. (C) SUMMARY:  Without revealing specifics, National 
Assembly Speaker Hovik Abrahamian seemed to signal dramatic 
new moves on releasing March 1 (and election-related) 
detainees in the upcoming weeks, now that the parliament has 
enacted the criminal code revisions negotiated with PACE. He 
indicated that the criminal code revisions would mean that 
charges would be dropped against most or all of the "Trial of 
Seven" defendants and others, with still more to be freed by 
pardons.  It was unclear if this would mean that eventually 
all the detainees would be freed or simply a large 
percentage. 
 
¶2. (C) Abrahamian reprised his reftel points on the 
importance of MCC continuing.  The Ambassador highlighted 
that Armenia must fulfill its Ruling Justly commitments, and 
confided that the mood in Washington was not at all 
permissive on Armenia's continuing democratic failings. 
Ambassador said that the May 31 Yerevan election would be a 
big benchmark.  Abrahamian again highlighted President 
Sargsian's commitment on Turkey and NK, working torward 
regional peace and stability, while complaining that Armenia 
got no financial help for the economic losses of the 
Georgia-Russia conflict, while Georgia got a rich U.S. 
payout.  Abrahamian echoed earlier GOAM complaints about two 
items of wording in the human rights report. 
 
END SUMMARY 
 
¶3.  (C) PROGRESS ON POLITICAL DETAINEES?:   National Assembly 
Speaker Hovik Abrahamian led off the March 20 conversation 
with Ambassador by extolling the fact that the National 
Assembly had earlier that week enacted revisions of Armenia's 
criminal code articles 225 and 300, in accordance with his 
negotiations with PACE co-rapportuers John  Prescott and 
Georges Colombier.  He said that President Sargsian should 
sign the revisions within a day or two, and this would put 
them into effect within the next two weeks.  He said that 
these changes would lead to prosecutors dropping all article 
225 and 300 charges against the "Trial of Seven" defendants. 
(NOTE: Two of the seven -- MPs Myasnik Malkhasian and Sasun 
Mikhailian -- have one other charge each against them in 
addition to articles 225 and 300. Malkhasian has a resisting 
arrest charge and Mikaelian a weapons possession charge. 
There is one other high-profile defendant, Gagik Jhangirian, 
who is not part of the "Trial of Seven" and who is charged 
only with resisting arrest. END NOTE) 
 
¶4. (C) KINDLY PRESIDENT TO PARDON THE REST?:  He said this 
would also have a "positive impact" on the roughly 60 other 
cases of March 1 and related defendents in jail or prison, 
saying that he personally was working hard to ensure that "no 
one would be in prison for his political views."  He 
mentioned that some who were guilty of real, non-political 
crimes, such as weapons violations, must be punished 
appropriately by the courts.  Abrahamian went on to note that 
the president is disposed to be very forward-leaning on 
issuing pardons or amnesties for many of these detainees, 
once the relevant trials are completed. He joked that 
President Sarsian's staff sometimes worried that the 
president is "too kind and soft" on these issues.  Abrahamian 
said "the sooner the trials are complete, the sooner the 
political situation willl stabilize."  Ambassador agreed, 
with the caveat that trials must be seen as fair by the 
Armenian people, and the law applied equally to everyone, to 
which Abrahamian agreed.  The timeframe of all this was 
unclear, but it seemed that all of this would play out before 
the June MCC Board meeting. 
 
¶5.  (C) WANT TO GET IT DONE: Ambassador replied that it would 
be a very positive signal if Armenia manages to free all of 
these March 1 detainees in the near term, and not just the 
"Trial of Seven" but the rest of the roughly 60 as well. 
Abrahamian replied that Armenian leaders understand it is in 
their political interest, domestically and internationally, 
to resolve this issue.  He said he and other officials 
realize that having the likes of Gagik Jhangirian (former 
deputy prosecutor general), Alexander Arzumanian (former 
foreign minister), and Myasnik Malkhasian (member of 
parliament), in prison is a cause of political discontent and 
one they would like to resolve.  The president was unwilling 
to interfere with the judicial process while it was underway, 
but as soon as those processes are complete will be eager to 
"turn the page on March 1-2 in a way that everyone will be 
happy about."  Ambassador welcomed this approach. 
 
 
YEREVAN 00000201  002.2 OF 004 
 
 
¶6.  (C) TURKEY AND NAGORNO-KARABAKH:  In agreeing with 
Abrahamian's praise of President Sargsian's "human approach" 
to the prospect of pardoning prisoners for their "mistakes," 
Ambassador noted that President Sargsian indeed seems to have 
an open mind to different points of view, whether on 
political prisoners, or Turkey relations or resolving the 
problem of Nagorno-Karabakh (NK).  Abrahamian replied that 
the National Assembly fully supports the president's 
approaches to negotiations with Turkey and Azerbaijan on 
these issues.  Abrahamian said that Sargsian genuinely wants 
to achieve regional peace and stability through these 
negotiations.  Others had questioned or criticized inviting 
Turkish President Gul to Yerevan last September, but 
Abrahamian supported this.  Abrahamian said that normalizing 
relations with Turkey would make it easier to come to a 
resolution on Nagorno-Karabakh.  Abrahamian noted that NK 
leaders in Stepankert often complain that they are excluded 
from the Minsk Group process, and that he himself had 
recieved such complaints on a recent visit to NK.  Abrahamian 
then reiterated the importance of the Minsk Group, and said 
that achieving regional peace and stability would pay major 
economic dividends -- which is more important than ever in 
the context of the current worldwide economic crisis. 
 
¶7. (C) NK LANGUAGE IN THE HRR:  Abrahamian went on to 
complain about the language on NK in the 2008 State 
Department human rights report.  He said that it angers 
Armenians that the report called NK a part of Azerbaijan. 
Ambassador responded that our policy is to help the two sides 
seek a balanced, negotiated resolution of the NK dispute 
based on the three principles of self-determination, 
territorial integrity, and non-use of force. 
 
¶8.  (C) DOUBLE STANDARDS? FINANCIAL COMPENSATIONS?: 
Abrahamian commented bitingly on Azerbaijan's recent 
referendum to eliminate term limits on President Ilham 
Aliyev.  He said that if Armenia had passed such a referendum 
it would have been excoriated by the international community. 
 He said that Armenia comes in for much tougher criticism 
than neighbors Azerbaijan and Georgia because it lacks either 
oil and gas or a strategic sea access (apparently meaning 
importance for oil/gas transit or military overflights), but 
that these double-standards are unfair.  He complained that 
Armenia suffered $600 million in economic losses from the 
Russia-Georgia conflict and got no help from the West, while 
the United States had poured a billion dollars into Georgia. 
Ambassador replied that Russia had caused the crisis by 
invading Georgia, so it was only appropriate that Russia make 
Armenia whole for its losses, as it has done by announcing a 
$500 million credit to Armenia.  The U.S. realized that 
Georgia would obviously not be compensated by Russia, and 
stepped into that breach.  Abrahamian rejoindered that the 
Russian credit had nothing at all to do with the 
Russia-Georgia conflict, but with the economic crisis and 
joint projects the two countries would conduct in Armenia. 
 
¶9.  (C) HUMAN RIGHTS REPORT CRITICIZED; TIP ON TRACK:  Aside 
from criticizing the NK language in the HRR, Abrahamian also 
echoed complaints we heard earlier from FM Nalbandian on the 
statement in the HRR that "Prostitution and sex tourism are 
legal in Armenia."  Ambassador pointed out that FM Nalbandian 
had raised this point, and she had researched it and 
discovered that the GOAM is partially correct.  While the 
statement is technically accurate as written -- prostitution 
and sex tourism are not criminal offenses -- it is perhaps 
not ideally phrased.  Sex tourism is not an existing 
phenomenon in Armenia, and prostitution is a civil offense 
and subject to administrative fines.  Ambassador undertook to 
modify the way this is phrased in next year's report. 
Ambassador also mentioned our satisfaction with recent 
Armenian progress on Trafficking in Persons, and that we 
hoped -- if current trends continue -- that Armenia might 
graduate from the TIP Tier Two Watch List this year. 
Abrahamian claimed credit for having launched the ministerial 
anti-TIP council in 2007.  (COMMENT:  This is disingenuous at 
best.  We are unaware of any ministerial council ever meeting 
while Abrahamian was deputy prime minister, and certainly no 
such council accomplished anything on Abrahamian's watch. 
Abrahamian's successor as deputy prime minister has made the 
ministerial council into an active functioning body.  END 
COMMENT) 
 
¶10. (C) YEREVAN MUNICIPAL ELECTIONS:  Ambassador noted that 
the upcoming May 31 Yerevan election would be a major 
political and democratic benchmark for Armenia, representing 
nearly half of Armenia's population.  The Speaker replied 
that the election would be completely free and fair; the 
opposition would have full and equal access to television and 
other media.  He said that he himself was engaged in ensuring 
the elections would be clean, and that the parliament's local 
 
YEREVAN 00000201  003.2 OF 004 
 
 
government committee would act as election observers.  It 
would be unacceptable to allow the upcoming election to be "a 
blemish on the country." 
 
¶11.  (C) OPPOSITION'S SUSPECT INTENTIONS?:  Abrahamian 
predicted that no one party would have a majority, several 
parties winning seats in the council would have to form a 
coalition and select a mayor. He predicted that all four 
parties in the government coalition would each win seats in 
the city council, as would the Armenian National Congress and 
Heritage Party.  He said it was odd that former President 
Ter-Petrossian had chosen to run for mayor.  The job requires 
good management skills and familiarity with municipal 
governance challenges. Abrahamian commented that the only 
chance for any problems with the upcoming election would come 
from opposition provocations or determination to disrupt the 
election proceedings.  He said "If Ter-Petrossian has honest 
intentions, I welcome him in the race." 
 
¶12.  (C)  BAD INDICATORS ALREADY:  Responding to the 
Ambassador's earlier expressions of concern about the 
indirect nature of the election, Abrahamian insisted that 
Armenian had "nothing in writing" from any European 
organization (Council of Europe, PACE, OSCE, etc) criticizing 
the model that Armenia had adopted.  Ambassador commented 
that the "bonus" provision in the municipality law distorts 
voters' representation.  She said that "if I were a voter 
voting for the party that surpasses a 40 percent plurality 
and wins the bonus of 10 percent more seats in the council, 
and you vote for a party that does not get this benefit, it 
means that my vote has been worth more than yours." This was 
in violation of the vote's principle of proportionality.  She 
went on to note that appointing Gagik Beglarian to the 
mayorship immediately after he was selected as the ruling 
party candidate created the bad appearance that "the fix is 
in" on the upcoming race, and noted that elections in the 
recent past -- including Gagik Beglarian's August 2008 
election to head the central Yerevan "Kentron" district -- 
had featured abuse of administrative resources and 
intimidation tactics.  Ambassador said we would be watching 
for similar abuses in connection with the May 31 election. 
Abrahamian did not respond specifically to any of these 
points, as the conversation turned instead to MCC. 
 
¶13.  (C) MILLENNIUM CHALLENGES:  Ambassador reported that the 
MCC Board had decided at its March session to continue the 
operational hold on the $60 million roads component of 
Armenia's MCC Compact. Abrahamian reprised almost verbatim 
his reftel comments that the MCC program benefits the rural 
poor, and Armenians would view the United States very 
negatively if the program were cut. He said this is 
particularly true in the current tough economic times, noting 
the expression that "you don't kick a man when he's down." 
 
¶14. (C) TIME GROWS SHORT TO AVOID PENALTY:  The Ambassador 
reiterated that the GOAM knew full well MCC was a conditional 
program, and a reward for countries with good performance and 
sound policies, and Armenia is lagging.  She confided that 
some Board member had been ready to terminate the roads 
component already in March, and in fact some had suggested 
that the entire Armenian Compact be terminated, having 
already been given nine months to correct its Ruling Justly 
failings and having failed to do so.  The June Board might 
take "irreversible actions" unless Armenia improves rapidly. 
 
15  (C) THE CRITICAL TO-DO LIST:  The Ambassador highlighted 
that everyone wants the MCC program to be able to continue 
and to be successful -- none more than she -- but that this 
would be difficult absent serious progress by the GOAM which 
will be persuasive to the Board. She said that release of the 
March 1 detainees would be a very positive step.  We also 
need to see progress on media freedom and freedom of 
assembly, with the latter meaning both public rallies and an 
end to NSS actions to pressure hotels not to give meeting 
space to parties and NGOs.  Abrahamian asked if the 
Ambassador could give a specific example.  She replied that 
OSI's conference on human rights which she had addressed May 
19 had been scheduled for the Marriott, but that the Marriott 
had cancelled the booking under pressure, requiring OSI to 
find another venue.  Abrahamian promised to raise this point 
with the president. 
 
¶16.  (C) A PRO-FREEDOM GUY:  Abrahamian said his position all 
along in government policy debates has been that full freedom 
of assembly must be allowed and political parties should be 
able to rally as they please.  He commented that authorities 
had never refused the opposition permission to rally 
outright, only that the opposition had insisted on rallying 
in the central Freedom Square or Matenaderan, while the 
government had counter-proposed a site away from the center. 
 
YEREVAN 00000201  004.2 OF 004 
 
 
But in any case his view was that the more the public gets to 
see and hear the oppposition speak, the less enamored they 
will be at Ter-Petrossian's lack of any real program or 
content.  Ambassador agreed that the best strategy for the 
government would be to allow robust exposure for the 
opposition. 
 
¶17. (C) COMMENT:  Throughout most of the meeting, Abrahamian 
seemed relaxed, upbeat, and comfortable with himself and the 
situation.  He grew pensive over Ambassador's pointed 
messages on MCC and the municipal electon, but overall 
projected every appearance of optimistic confidence that 
Armenia will get back on track in short order.  He was 
strongly foreshadowing dramatic steps forward on the 
political detainees front -- though as yet we are unable to 
assess whether this will be as sweeping as we demand or 
simply something that seems bold by the lights of a 
post-Soviet mindset.  Still, Abrahamian's strongly 
forward-leaning position suggests that we will see some kind 
of significant developments in the upcoming weeks, and we 
find this encouraging. 
 
¶18.  (C) COMMENT (CONTINUED):  Other recent conversations 
with knowledgeable political insiders suggest that 
Abrahamian's star is rising.  We are told that elites 
increasingly are turning to Abrahamian as the "go-to guy" to 
solve their problems for them, as the prime minister has 
seemed either unwilling or incapable of settling these issues 
to the satisfaction of oligarchs, party stalwarts, and 
various insider interests.  His reputation as a 
behind-the-scenes problem-solver -- and the chits he is 
increasingly collecting from various elites and powerbrokers 
-- seem to be creating a growing power base of his own, 
separate from both the president and Abrahamian's erstwhile 
patron former President Kocharian. Bets are being placed that 
Abrahamian could become the nest Prime Minister -- and the 
next President. 
PENNINGTON