By Emil Danielyan
Tigran Sarkisian, the longtime chairman of Armenia’s Central Bank, was overwhelmingly reelected by parliament for a second seven-year term late on Wednesday.
The parliamentarians voted by 86 to 4, with two abstentions, to endorse Sarkisian’s candidacy nominated by President Robert Kocharian. Leaders of the pro-Kocharian majority in the National Assembly said he has done a good job of maintaining macroeconomic stability and credited him with more than doubling the country’s external reserves to nearly $600 million.
The vote was boycotted by two opposition factions that have been refusing to attend parliament sessions for more than a year. One of them, the Artarutyun (Justice) alliance, read out on Tuesday a statement accusing Sarkisian of committing “blunders” that have inflicted “serious economic losses” on Armenia.
The statement referred to the dramatic and still mysterious appreciation of the national currency, the dram, against the U.S. dollar and the euro which has hit hard a large part of the country’s population dependent on external cash remittances.
The dram has gained more than 20 percent in value against the dollar since the beginning of last year. Sarkisian and other Central Bank officials have insisted all along that its strengthening primarily resulted from a 50 percent surge in those remittances. They totaled $740 million in 2004, according to the Central Bank.
This explanation has been endorsed by officials from the International Monetary Fund and the World Bank. Both lending agencies are satisfied with Sarkisian’s seven-year track record and are certain to welcome his reappointment.
However, local economists critical of the Armenian government claim the dram’s appreciation was engineered by the Central Bank with the aim of benefiting a handful of wealthy government-connected importers of fuel and other basic commodities. They point to the fact that buying dollars from numerous currency exchange bureaus in Yerevan is no easy task these days despite an increase in dollar supply claimed by the authorities.
Meeting with members of the Central Bank board last December, Kocharian admitted that “speculative deals” played a role in the exchange rate fluctuations and ordered them to remedy the situation. Within days the bank closed two dozen currency shops, accusing them of violating trading regulations.
The final years of Sarkisian’s first term were also marked by the collapse of several major Armenian banks. One of the oldest of them, Agrobank, unexpectedly announced its self-liquidation in October 2003. Its owner claimed to have been squeezed out of business by private competitors and their cronies in the Central Bank. The bank flatly denied the allegations.
“All commercial banks in the Republic of Armenia operate in equal conditions and no bank has a [government] ‘tutelage’,” Sarkisian insisted on Tuesday.
Sarkisian, 45, also raised hackles by making his and his staff’s salaries by far the highest in Armenia’s cash-strapped public sector and riding in a luxury German car which typically costs between $70,000 and $110,000.
Sarkisian came under more fire this week when he was pictured on the front page of a local newspaper having a conversation with a pro-government deputy on the sidelines of the parliament debate on his reappointment. The lawmaker, Vardges Matevosian, is one of the owners of the Armenian-Italian joint venture Safari International that organizes expensive hunting tours in Armenia.
Matevosian was quoted by the “Haykakan Zhamanak” daily as saying that the Central Bank chief expects “high-level guests from Germany” this year and would like to go hunting with them in a big forest in southeastern Armenia which is controlled by the firm.
The Armenian government gave the 3,000-hectare area to Safari International free of charge in June 2004, allowing it to organize commercial hunts. The company pledged in return to protect the forest against poaching and illegal logging. However, an extensive article that appeared in the Hetq.am online publication last month accused it of allowing anyone to kill endangered species living in the area in exchange for hefty fees.
Hunting for those animals is illegal and punishable by fines worth up to $6,000.
(Photolur photo: Tigran Sarkisian.)