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By Emil Danielyan
The United States formally released on Monday $235 million in additional economic assistance to Armenia which Secretary of State Condoleezza Rice said was made possible by its leadership’s pledge to hold free and fair elections.

Rice said the assistance is a “testament to the hard work and dedication of the Armenian people and their elected government” as she and senior Armenian officials signed a relevant agreement in Washington.

The money is to be provided to the Armenian government over the next five years under the Bush administration’s Millennium Challenge Account (MCA) program designed to promote good governance and economic reforms around the world. It is supposed to reduce widespread rural poverty by upgrading the country’s battered irrigation networks and rural roads.

“Our partnership will help Armenia to fight poverty through sustainable economic growth,” Rice said during the signing ceremony held at the State Department. “To ensure that progress toward this end remains constant, Armenia must continue to advance its democratic reforms.”

Rice recalled in this regard serious irregularities reported during last November’s constitutional referendum in Armenia, but added that the authorities in Yerevan have pledged to ensure that the next parliamentary and presidential elections, due in 2007 and 2008 respectively, are more democratic. “These are important commitments and the United States stands ready to help Armenia to ensure that its upcoming elections are free and fair,” she said.

Rice did not specify what will happen if those elections fall short of democratic standards. One of her top aides, Deputy Assistant Secretary of State Matthew Bryza, avoided any public criticism of the Armenian authorities’ human rights and democracy records during a recent visit to Yerevan. Still, U.S. officials in charge MCA’s implementation indicated earlier that the hefty aid program could be suspended and even terminated if the Armenian authorities fail to honor their pledges.

Foreign Minister Vartan Oskanian, who also spoke at the ceremony, assured Washington that his government is “aware that we have the obligation to build on the confidence that has been placed in our government and people.” “We know that corruption must not be tolerated and that law must rule, that the principles of democracy must be transformed to traditions of democracy in our country,” he said.

Oskanian acknowledged that the approaching elections will be an opportunity to end Armenia’s post-Soviet history of electoral fraud. “Our task until then is to partner with the United States and European governments to implement the necessary corrective steps to improve the conditions necessary for an honest and fair expression of people's voices,” he said.

Addressing Armenian-American leaders earlier on Monday, Oskanian said the release of MCA funds proves that Armenia is “on the right path.”

The launch of the aid program came nearly two years after Armenia was included on the list of 16 developing nations eligible for MCA funding. The Millennium Challenge Corporation (MCC), a U.S. government agency administering the scheme, approved the Armenian government’s detailed aid application late last year.

But it at the same time made the release of the requested aid conditional on “corrective steps” that would demonstrate the Armenian authorities’ commitment to protecting human rights record and stamping out vote rigging. In a December 16 letter to President Robert Kocharian, the MCC chief executive, John Danilovich, expressed concern at serious irregularities reported during the November 27 constitutional referendum.

Oskanian replied that his government acknowledges the “deficiencies” that marred the vote and will do its best to ensure the freedom and fairness of the 2007 and 2008 elections. Danilovich found these assurances convincing, lauding Yerevan’s “commitment to sustaining the democratic reforms” in a second letter to Kocharian sent on January 18.

“The signing of this compact today is therefore an affirmation of our confidence that Armenia will continue to enact the institutional reforms that will support the effective use of our aid, including measures to support and protect democratic and electoral processes,” Danilovich said on Monday.

Most of the MCA funds, $146 million, will be spent on rebuilding and expanding the country’s battered irrigation networks. Another $67 million would go to pay for capital repairs of about 1,000 kilometers of rural roads that have fallen into disrepair since the Soviet collapse. Officials say these projects will directly benefit 75 percent of approximately one million Armenians living in rural areas.

The MCA aid will be disbursed parallel to regular U.S. assistance to Armenia which has totaled $1.6 billion since 1992. Oskanian described it as “invaluable.”

(Armenian Finance Ministry photo: Danilovich, right, and Finance Minister Vartan Khachatrian signing the agreement.)
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