Monday, 16 January 2017

Armenian News... A Topalian... Gas supplies to Armenia

RFE/RL Report
Russia, Georgia Reach New Deal On Gas Supplies To Armenia
January 11, 2017
Gevorg Stamboltsian
After almost one year of negotiations, the Georgian government and 
Russia's Gazprom monopoly have reached a new agreement on the transit 
through Georgia of Russian natural gas delivered to Armenia, it was 
announced on Wednesday. 

Armenia imports roughly 2 billion cubic meters of Russian gas 
annually, meeting more than 80 percent of its demand for the energy 
resource. Transit fees charged by Georgia have until now taken the 
form of free Russian gas equivalent to 10 percent of that supply 

Last year, Gazprom offered to pay the authorities in Tbilisi in 
cash. The two sides have held a series of negotiations since then. The 
last round of the talks was held in Belarus's capital Minsk on 

Georgia's Energy Minister Kakha Kaladze announced the following day 
that Gazprom's representatives proposed fresh financial terms for the 
transit. The Georgian government has accepted the proposal, he said 
after a cabinet meeting in Tbilisi. 

Kaladze did not disclose the new, dollar-denominated cost of Gazprom's 
use of a Soviet-era pipeline passing through Georgia, saying only that 
it will be "one of the highest in Europe." He said Georgia will also 
be able to buy more Russian gas at a discounted price. 

"Gas consumption in Georgia is rising and we will be able to buy, if 
necessary, [Russian] gas for $185, rather than $215, per thousand 
cubic meters," Kaladze was reported to tell journalists. 

Georgia currently buys the bulk of its natural gas from 
Azerbaijan. Over the past year, the Georgian government has signaled 
its desire to ease the country's dependence on Azerbaijani gas, 
prompting strong criticism from opposition groups favoring a harder 
line on Russia. The latter say that increased gas supplies from Russia 
could only give Moscow additional leverage against Georgia. 

The Russian gas price for Armenia currently stands at $150 per 
thousand cubic meters. It did not go down after Armenian utility 
regulators approved in November a sizable reduction in the domestic 
gas prices. The price cuts were requested by Gazprom-Armenia, the 
country's Russian-owned gas distribution network. 

Gazprom-Armenia's chief executive, Hrant Tadevosian, said the company 
hopes to make up for an anticipated loss in revenue through cost 
saving and greater consumption expected as a result of cheaper 
gas. Tadevosian also said the Armenian gas operator will save more 
money if Georgia agrees to lower its transit fees. "We expect those 
figures to be significant," he said.
What Assignment Has Been Given to Armenian Army?
12 January 2017 

The OSCE Minsk Group has made a statement on the Azerbaijani attack in Tavush on December 29 which has disappointed Armenia. The disappointment is with the “equality mark”. The statement notes an attempted incursion and that the Armenian Armed Forces are still holding the body of an Azerbaijan serviceman and calls to cease mutual accusations. 

Who has made the incursion, what fights took place and why the body of the Azerbaijani serviceman is in the Armenian side? The statement does not say anything about this. 

The Armenian foreign minister made a statement, noting that “when the Azerbaijani saboteur is neutralized in the Armenian trenches, it is more than evident even without the mechanism, which side initiates the attack.” 

He also said that the Armenian side has constantly insisted on the creation of an investigation mechanism at the line of contact which will make it clear who breaches the ceasefire. The three co-chairs should be persistent in their prompt reactions. “The perpetrator should not be allowed to perceive the belated reaction as a tolerance towards its actions,” Nalbandyan said. 

In fact, Nalbandyan makes the co-chairs face the fact and responsibility, indirectly accusing them of failure to be persistent. And earlier, the Armenian side had announced about having proof of the Azerbaijani attack which have been submitted to the relevant organizations. 

Aliyev has already announced that it will not adhere to the international law, which is evidence itself in a broader scale. Besides, Azerbaijan is not going to adhere to the agreements reached in Vienna. 

The co-chairs usually observe parity in their statements on armed incidents. Hence, the issue of restraining Azerbaijan occurs. What should be done when that country ignores agreements, the international law, makes regular attempts of incursions which result in casualties? 

After the December 29 attack the Armenian side carried out a punitive action. First, the attempted attack was preempted, then a special action was carried out, according to the chief of general staff of the Armenian armed forces Movses Hakobyan. He said that the rest is a military secret which he cannot unveil. For his part, the minister of defense Vigen Sargsyan hinted at the special action and said that Azerbaijan will pay a disproportionate price for such cases. 

Is there another way of restraining Azerbaijan or has such a way been left? Considering the peculiarities of the Azerbaijani society, perhaps the disproportionate answer may have a restraining importance. In addition, there should be no exception in all incidents. 

Experienced servicemen insist that about ten years ago the army had an order not to “answer” the provocations of the Azerbaijani side, including a threat of criminal responsibility. They say that as a result the Azerbaijani side has overcome the most important thing – fear from the Azerbaijani armed forces. No weapon has the value of fear. 

In addition, the start of the Azerbaijani “military diplomacy” has overlapped with this period. Besides, the Armenian side has made some “adjustments” to the line of contact, receding from a number of entrenchments, the so-called neutral area. 

In fact, many people say that the Armenian army is a caged lion which is not allowed to deal with the issue of restraining Azerbaijan. This is dismantling the army from the inside, causing a lack of confidence in the military and public circles. 

The result is unknown and was demonstrated during the April war. 

Will the December 29 incident and the punitive action change this state of things? What assignment does the Armenian army have? 
Moody’s: Flare-up of aggression between Armenia and Azerbaijan to weigh on CIS economies
12 Ja
The stabilization of oil prices has eased the direct and indirect economic and fiscal pressures on the nine rated sovereigns in the Commonwealth of Independent States (CIS) region. Still, the region’s overall credit outlook for 2017 is negative, driven by subdued economic recovery, external vulnerabilities in those countries with high foreign currency debt and the likelihood that political considerations will delay structural reforms that would bolster potential growth, Moody’s Investors Service said in a report.

In 2016, Moody’s took negative rating actions for five CIS sovereigns after slumping oil prices weighed on the credit profiles of major oil and gas exporters and had knock-on negative effects for the economies of many other sovereigns in the region.

“CIS governments managed the oil-price shock with increasingly orthodox policies, such as floating exchange rates and tight fiscal and monetary policies. These have mitigated the effects of the collapse in oil prices, and positioned most CIS countries for a modest economic turnaround in 2017,” said Kristin Lindow, a Moody’s Senior Vice President and co-author of the report. “However, the macroeconomic outlook remains weak, and downside credit risks still dominate.”

All CIS sovereigns should grow slightly faster in 2017 than in 2016. Moody’s forecasts median growth to rise to 2.0% in 2017 from 1.0% in 2016, and a further rise to 3.0% in 2018. Somewhat higher oil prices are likely to enable policymakers in oil-exporting countries to partially roll back fiscal and monetary policy tightening, and oil importers will benefit from a modest pickup in remittance inflows.

Moody’s projects that Russia, the largest economy by far among the nine countries, will record positive, albeit modest, real GDP growth of 1.0% in 2017 after two years of recession. This upturn will lift the broader region due to trade and financial linkages. Only Belarus is expected to shrink again in 2017.

Geopolitical conflicts also will continue to weigh on the CIS economies, mainly because of the impact of Western sanctions on Russia and the conflict in eastern Ukraine but also due to the flare-up of aggression between Azerbaijan and Armenia. Of the nine CIS sovereigns rated by Moody’s, only Belarus and Kazakhstan are not engaged in a military conflict or border dispute with a neighbor.

Longer-term, growth is expected to remain weak and a key constraint on sovereign ratings in the region. With aging populations (except in the Central Asian countries, Kazakhstan and Kyrgyz Republic) and low productivity growth and absent the deep structural reforms that would overcome these trends, potential growth has dropped for most CIS sovereigns.

Those governments with greater fiscal resources and more flexible policies tend to be better positioned to address external vulnerabilities. Moreover, foreign currency inflows from oil and gas exports help cushion oil exporters after currencies have depreciated. Oil importers, on the other hand, remain more exposed because they also tend to have lower foreign exchange and fiscal reserves.
Armenian wine production last year surges by 30 percent – union of winemakers
January 12 2017

Armenia’s wine production in 2016 surged by 30%, Avag Harutyunyan, the head of the Union of Armenian Winemakers, told a news conference today, citing what he described as ‘unofficial sources.’

In his words, local wineries produced at least 6 million bottles of wine, of which 4 million were grape wines. He also said that over the past seven years wine consumption in Armenia has been on the rise with many citizens shifting from vodka to that strong drink.

Avag Harutyunyan also claimed that according to the available data, many Armenian families had on their New Year tables locally-manufactured wines .

"Overall, in recent years, imports of foreign wines to Armenia decreased from 500 thousand to 200 thousand bottles, attributed to emergence of high-quality locally-made wines, as well as to growing confidence in the domestic manufacturer," Harutyunyan said.

"Nevertheless, Armenia exports only 2 million bottles of wine per year, while the neighboring Georgia exports up to 35 million bottles. The problem is that Armenia does not have enough resources for the production of cheap wines in the price range of $1- $1.5 per bottle, which are in the greatest demand across the Eurasian Economic Union", said Harutyunyan.

He also reminded of the Soviet legacy, when Armenia, unlike Georgia, was perceived as a brandy-producing country rather than wine.

According to official statistics, in January-November 2016 Armenia's wine production has increased by 15.6% to 5.8 million liters. -0-
Armenia’s jewelry industry doubles its output in Jan-Nov 2016
January 12

Armenia’s jewelry industry doubled its output in Jan-Nov 2016, compared with the same period a year earlier, to AMD 32 544 million, the National Statistical Service reports.

As many as 704.2 kilograms of jewelry have been produced in the country over the mentioned period against 885.1 kilograms in Jan-Nov 2015.

Diamond industry accounted for 113 025 karats against 68 977 karats respectively.

Export of precious and semiprecious stones, precious metals and articles made of them totaled about $312.2 million (82% growth) and import $145.5 million (44.2% growth). -

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