ArmInfo.Leader of the "Republic" party, former Prime Minister of Armenia Aram Sargsyan, in an interview with ArmInfo, comments on the latest regional transformations with the participation of Armenia. Discusses the prospects and ways of development of the Armenian economy. Shares his own vision of the place and role of Armenia in the South Caucasus and in the world.
- Mr. Sargsyan, how did it happen that 30 years after gaining independence we found ourselves almost where it all began in 1991? And what role did Armenia's practically given up on the idea of "Miatsum" with Artsakh play in all this?
-I don't think we had given up on the "Miatsum" idea (connection, Ed. note), it's just that this model didn't work at this stage of the settlement, or, more precisely, if it continued, it would work against us. The fact is that, if I am not mistaken, problems similar to those of Artsakh, starting with the formula adopted in 1964, are resolved by the world on the basis of excluding the use of force, the right of peoples to self- determination and territorial integrity. And fitting the solution to the Artsakh problem within the framework of this formula at this particular stage was possible precisely within the framework of the principle of the right of peoples to self-determination. And that was done. The main reason for the current state of Armenia, in my opinion, is that all these 30 years our economy has not gone beyond the framework of Soviet logic. The available opportunities were not diversified, the available natural resources were spent completely out of line with the capabilities and requirements of the 21st century. And in wars, as you know, it is not armies that win, but states, which was perfectly understood in Baku, realizing the potential victory, if not of their army, then of their state. The Azerbaijani calculation was based on that, otherwise Aliyev would simply not have dared to go to war.
-As for the economy, it is clear. What about the national idea around which any state is built?
The greatest, main, cherished idea for the Armenian people, who have been deprived of statehood for thousands of years, has been to have their own Armenian state. And in the previous 30 years of independence, in addition to omissions, we also had acquisitions. Moreover, they are quite serious. But we, to our great regret, did not want to see these acquisitions and achievements, preferring to talk only about omissions and not wanting to compare our capabilities with our desires. Accordingly, in my opinion, it was simply impossible to come up with a better national idea than gaining independence by Armenia and Artsakh. And it was around this idea that the unification of all Armenians took place on a global scale. The victory in the 1991-1994 war, with all its subsequent achievements, is the result of this particular consolidation around this idea. Armenia's lagging behind, in my opinion, began with the postponement of the construction of a new nuclear power plant and the prolongation of the terms of the existing nuclear power plant. Since the moment of the privatization of the entire energy sector by Russia, that completely swept away the competition from here. As a result, having the only nuclear power plant in the South Caucasus and having fast rivers, Armenia today produces the most expensive electricity in the region. And this makes the prospect of founding any new production facilities in Armenia less attractive than in the same Georgia or Azerbaijan. For electricity, you know, you pay daily, and for the transportation of manufactured goods once a week or a month.
-But recently there have been some changes in this direction.
- That's the truth, and the periodic visits of the U.S. ambassador to Syunik, the brightly highlighted Syunik communication part of the EU's program for providing financial assistance to Armenia is another confirmation of this. By the way, it is in the supposed territory of the crossing - on the "corridor", cherished by the Turkish-Azerbaijani tandem, that the United States is going to install a powerful solar power plant near the village of Lichk worth from 4 to 6 billion US dollars. The American rationale is that the number of sunny days in Meghri exceeds the number of sunny days in the sunniest in Europe - Portugal by 1.8 times. Thus, Lichk is a completely profitable project from a business point of view.
- And from a geopolitical point of view?
- Undoubtedly, in any case, external investments in themselves are a source of formation of security in the country in which they are made. In this light, the diversification of the Armenian economy seems to have no alternative. It is another matter that alternative communication routes through the territory of Armenia may well become a reality, however, only if they are under the control of the Republic of Armenia. But there is one "but" here too - these processes can take place only if the main problem between Armenia and Azerbaijan is resolved - the issue of the status of Artsakh, at least in the example of the Cyprus version, when the status issue is officially postponed until better times. Until then, the conflict can not be resolved. No matter how much we carry out the delimitation of the borders, as long as the status issue is not resolved, the shooting will not stop. For example, a railway can operate without a status. Since cargo transportation does not imply escort and all possible risks on the territory of Armenia and Azerbaijan are regulated by international treaties. The military will not be needed for this. I have already voiced this proposal to Prime Minister Nikol Pashinyan, proposing to start this process by restoring the shortest 5-kilometer Yeraskh section of the railway between Armenia and Nakhchivan. Reconstruction of this section will allow connecting Armenia and Azerbaijan through Kazakh. No one in the world will understand us if, protesting against the blockade for 30 years, we begin to refuse to unblock the borders today. And this can be the very first step, which, at the same time, will be in our interests. It is clear that Armenian trucks cannot travel through Azerbaijan with Armenian license plates. As well as Azerbaijani cars across the territory of Armenia. But Armenian goods can freely move through the territory of both countries in Armenian cars, but with Russian license plates and drivers. I proposed this to the Prime Minister as well. And he completely agreed with my assessments.
-Does business know no borders?
-Definitely. And business knows how to calculate its own income. Meanwhile, the reduction in the mileage will bring considerable profit to Armenia in the most diverse vectors of our economy. For some reason, we do not want to take advantage of the fact that we are at the crossroads.
-On September 30, the Armenian government accepted as a donation a 25% stake in the GeoProMining Armenia subsidiary Industrial Company JSC, which make up 15% of the total capital of ZMMC. Owner of GeoProMining Roman Trotsenko announced plans to invest $ 3.5 billion in joint projects with Armenia. Do you think that your vision of Armenia's development is starting to come true?
-I am convinced that all countries of the world have accumulated their initial capital through the correct use of their natural and human resources. No country, including Italy, with its developed tourism sector, has been able to develop the country through loans and tourism, while maintaining and arming the army. Armenia, in turn, needs to learn how to properly and competently dispose of what we have. What I don't see today is that the mines are being developed using barbaric methods of the Stone Age, which leads to great losses and inefficiency. Kajaran is the most interesting mines in Armenia for foreign specialized companies. This is the only potential mine in Armenia that meets international standards. The rest of the mines are simply not interesting. Kajaran alone is capable of producing up to a million tons of copper concentrate annually. Which is a fantastic indicator, considering that in the best times all of Armenia produced 400 thousand tons of copper concentrate. It is important to note here that when offering your concentrate for processing to any copper smelter, the first thing we hear is the issue of annual supply volumes. And the larger the scale, the closer the time frame and the lower the cost of processing. So, in response to the proposal to process a million tons of concentrate, these people will simply build their own plant in Armenia, in Kajaran. Simply because such volumes will definitely justify this construction.
-How are things going at the Kajaran Mine today?
- Today we do not use even a third of Kajaran's potential. The mine is located on two banks of the river. Only the right bank is exploited. The left one is not exploited because there is a cemetery there, and, as you know, we care more about the dead than the living. Accordingly, no one even tries to do anything there. 30% of the mine is on the right bank, 30% on the left bank, and the remaining 40% on both sides of the river. Excavators cannot approach the riverbed, fearing the collapse of the river banks and its overflow.
Meanwhile, the main resources, and with a high percentage of copper, molybdenum and gold, are located in the riverbed and in its vicinity. Thus, today we are exploiting less than 30% of the potential of this mine. We develop it by barbaric methods, according to Soviet, inflated standards, the ZCMC management flies by helicopters, including these costs in the final balance, and everything is mired in corruption. I'm not even talking about how ZCMC acquired the owner. The Kajaran Mine, the largest in terms of proven reserves of copper, molybdenum and gold, was taken from the state through "night privatization". After that, the new owners not only got their money back in just a year, but also made a profit of $ 40 million. And today Robert Kocharian not only tries to disown corruption in this shameful deal, but also accuses the government of corruption when it returns back a part of ZCMC shares. The first person of the state at that time, Kocharian, could not have been unaware of what was happening, he knew for sure that the number one enterprise in the country was being sold for only 140 million dollars. He could not help but know that in the first year alone, Kajaran brought the new owners $ 180 million.
-Let's get back to the deal:
-Assessing the deal positively in the sense that the state, in the end, acquired a share in ZCMC, I assess negatively its process, which took place again at night. In particular, it is not clear to me why someone gives gifts to the state and what this someone will receive as a gift in return. By the way, earlier I presented to the Prime Minister's attention my approaches to Kajaran. I believe that the license for the left bank of the river from ZMMC should be taken away, since having a license for its development, the company does not do this. This license should be issued to any non-offshore company with work experience in this field. After that, of course, competition will begin between them, which will make the corruption schemes at ZCMC obvious to everyone. As a result, in a few years ZCMC will either sell the shares of the new company or merge with it. The latter, by the way, will open up an excellent opportunity to move the river bed above the mine along the right bank, so that the ecology does not suffer and to start developing Kajaran by 100%. Which will be a great asset for the state. I consider it wrong to give the entire Kajaran and not only Kajaran to the monopoly of one company.
At the same time, the processing of even 400 thousand tons of copper concentrate already requires the construction of a copper smelter in Armenia. And not only the plant, but also a new nuclear power plant with a capacity significantly exceeding the capacity of the existing nuclear power plant. Moreover, according to significantly superior Russian and French technologies.
-That is, diversification is needed again:
- I consider the diversification of property in Armenia a necessary condition for maintaining the country's economic and energy independence and creating an effective economy. The same applies to water resources. And, in my opinion, the Prime Minister expects offers of cooperation from the Iranian side in this direction. Iran, by the way, already buys "soft" water from us for irrigation of the Mazandaran plain. The cost of one cubic meter ranges from $ 6 to $ 8. Western companies are also interested in our water. They have already announced their readiness to invest up to $ 6.4 billion in the program of water resources management in Armenia. The French calculated that as a result of the construction of a new nuclear power plant and Meghri hydroelectric power station, Armenia will be able to dictate prices for electricity in the region. And I am convinced of the correctness of their calculations. Today our electricity is the most expensive in the region, but if we do everything right, we will get the cheapest electricity.
- What is stopping us, Russia?
- Let's conditionally call it jealousy. Which, at the same time, gives rise to phobias in our government and an unwillingness to risk their own chair. Serzh Sargsyan really wanted to take advantage of the opportunities offered to Armenia, but he was afraid of a possible change of power through the involvement of the fifth column, he was afraid of the war. Because Armenia was defended by Russia.
- The war has taken place:
- Quite right. And if we do not want a repetition of what happened, then we need to act within the framework of a completely different logic. If we want changes, we need to stop walking in circles and stop doing what we did before. Otherwise, there will be no changes. I openly and everywhere say that our vector is in the direction of ensuring security, sovereignty, etc. there should be a vector to the UN. If we want to clarify our borders, to clarify maps, then we should do this at the UN. Since any trilateral initiative, joint with Russia and Azerbaijan, is in reality four-sided. There is invisible, but Turkey is always present. The 9th clause of the unfortunate statement of November 9th was introduced at the request of Erdogan. I am convinced of this, since it was Erdogan who, since 1999, has been seized by the idea of a fix on the exchange of Meghri for Artsakh. Fortunately, he does not have the possibility of implementing it and, I am sure, he will not it. You and I do not want this, the Armenian leadership does not want this, the collective West, in particular, the United States, does not want this, and Iran does not want this.