By Shakeh Avoyan
Russia’s Prime Minister Mikhail Fradkov pledged Saturday to deepen “strategic partnership” with Armenia but made it clear that Moscow will not reconsider its decision to double the price of natural gas supplied to its South Caucasus ally.
Ending a two-day official visit to Yerevan, Fradkov also gave fresh assurances that the Russian government will make promised investments in moribund Armenian enterprises which were given to it in payment for Armenia’s $100 million debt in 2002.
“Our relationships persist and will develop further, which does not exclude the adjustment of certain economic issues, including a rise in gas prices necessitated by world demand,” he told reporters after talks with President Robert Kocharian.
Fradkov made the comment in response to a question on whether Russia’s state-run Gazprom monopoly will press ahead with its decision, announced last week, to drastically raise the gas tariffs for several other ex-Soviet states dependent on the Russian fuel. Analysts say reasons for the move are not purely economic as all of those states except Armenia pursue pro-Western foreign policies that regularly raise eyebrows in Moscow.
Armenia, by contrast, maintains close political and military ties with Russia and has never expressed a desire to join NATO. Fradkov implied that this is not enough of a reason for it to be exempted from the Russian price hikes which will almost certainly push up the cost of electricity generated by Armenian thermal power plants.
It was not clear if Kocharian and Prime Minister Andranik Markarian raised the issue during their separate meetings with the Russian premier. Statements released by their press services contained no references to it. They instead cited the two sides as praising a 20 percent increase in Russian-Armenian trade registered this year.
Also on Saturday Kocharian and Fradkov inaugurated a newly refurbished aluminum foil plant in Yerevan which is owned by Russia’s Rusal group, one of the world’s largest aluminum manufacturers. “I wish you success and green light. Hurrah!” Kocharian told its management and hundreds of workers.
“This enterprise is a vivid example of the potential of economic cooperation between Russia and Armenia,” Fradkov said for his part.
Rusal claims to have invested $70 million in the plant’s modernization carried by a German engineering firm. Its vice-chairman, Aleksandr Livshits, told journalists that the investments will allow the Russian giant to more than double production of aluminum foil in Armenia. “This is the best plant of its kind in Europe,” he said. “Russia has no such plant. Neither do your neighbors.”
Opposition leader Stepan Demirchian was also present at the opening ceremony. “This is a really good example of [Russian-Armenian] cooperation, unlike the equities-for-debt agreement,” he told RFE/RL, referring to the 2002 swap deal.
Demirchian used to manage the Yerevan-based Mars electronics company, one of the five Armenian enterprise handed over to Russia. Only one of them, a big thermal power plant in Hrazdan, is currently operational. The Russians have yet to deliver on their pledge to revitalize the four other enterprises with substantial investments and production orders.
Armenian leaders regularly raise the issue with senior Russian officials and Fradkov’s visit was no exception. The Russian premier cited “technical reasons” for the delay.
Armenian Minister of Trade and Economic Development Karen Chshmaritian disagreed with that explanation but said he is confident that the Russians will honor their contractual obligations. “I think that the Russian Federation will after all find a way to place orders to reactive the Mars plant and the three research institutes,” he told RFE/RL.