Baghdassarov proposed Serzh Sargsian to build “settlements in the occupied territories”: WikiLeaks, 2010

WikiLeaks-Armenia N 132

2010-02-17

C O N F I D E N T I A L SECTION 01 OF 03 YEREVAN 000078

REF: 09 YEREVAN 241

Classified By: Ambassador Marie Yovanovitch. Reason 1.4 (B/D)

SUMMARY

¶1. (C) In a wide-ranging recent discussion with Ambassador and DCM, Armenian oligarch and Sargsian confidante Mikhail Baghdassarov expressed optimism that the Turkish parliament would ratify the normalization protocols, but insisted that Armenia could not be expected to ratify first. He said Armenia should have good relations with its neighbors, including Turkey and Azerbaijan, adding that most of Armenia's leading businessmen favored the opening with Turkey. Armenia should continue to take steps to demonstrate its goodwill to the Turks, but "will not jump without a parachute." Speaking of the Turkey-Armenia and N-K processes, Baghdassarov said bluntly that "Russia used to be more on the Armenian side, but now the Russians are more with the Turks." Baghdassarov cautioned that it would be wrong to push President Sargsian further on N-K at this point given the pressure he is under on Turkey-Armenia, and noted that former president Ter-Petrossian fell from power over perceived concessions on N-K. Baghdassarov argued for a more "active" Armenian policy on N-K, including building settlements in the surrounding territories to "show the Azerbaijanis they have something to lose" - although he admitted that President Sargsian "doesn't even want to think about that." On domestic politics, Baghdassarov reiterated his skepticism over the performance of Prime Minister Sargsian, and criticized Armenia's governing institutions -- government, parliament, and presidency -- for poor performance. He hinted at the long-rumored rivalry between the President and National Assembly Speaker Abrahamian, but backed off when asked if the rivalry was being stoked by former President President Kocharian, whom Baghdassarov claimed has taken himself out of Armenian politics. End Summary.

WHO IS MIKHAIL BAGHDASSAROV?

¶2. (C) Ambassador and DCM met for lunch on January 21 with Mikhail Bagdassarov, one of Armenia's leading businessman and a loyal friend of President Serzh Sargsian. Baghdassarov is the owner of Armavia, Armenia's national airline (discussion of civair issues to be reported septel), and is a major importer of gasoline for his extensive chain of filling stations. He is also the monopolistic importer of jet fuel for Yerevan's Zvartnots airport, and owns one of Armenia's two cement plants. Baghdassarov also has significant business interests in Russia, where he spends much of his time. Baghdassarov is perceived as closer to the President than any of Armenia's other oligarchs, and he sees Sargsian frequently. Baghdassarov is originally from Baku -- his first language is Russian, and he speaks just a few words of Armenian. We believe Baghdassarov's comments to us often represent the President's thinking, or at least reflect issues that the two have discussed.

ARMENIA NEEDS RELATIONS WITH NEIGHBORS

¶3. (C) As in past conversations, Bagdassarov expressed strong support for the normalization process with Turkey. He said Armenia needs to establish "normal" relations with its neighbors, including Turkey and Azerbaijan. Despite the fits and starts of the process with Turkey, Baghdassarov said he believed the Turks would eventually ratify the protocols. Armenia would benefit more economically from normalization and a border opening, he said, but Turkey would benefit politically. He chalked up Turkey's delay in ratification to the GOT "seeking a higher price" from Armenia for opening the border. Baghdassarov asserted that all of Armenia's major businessmen -- with the exception of "one or two illiterates" -- support the Turkey-Armenia process.

¶4. (C) Baghdassarov argued that the GOAM should continue to take steps that demonstrate Armenia's goodwill toward Turkey, but cautioned that "we can't jump without a parachute.”Although he expressed no doubt that Armenia could easily ratify the protocols in the National Assembly, Baghdassarov said it is not realistic to expect Armenia to ratify before Turkey. In this situation, he said, "the people will expect the stronger country to go first." Baghdassarov said, however, that it might be possible for the Government to submit the protocols to the Armenian parliament, much as the Turks have done, as a further signal to encourage the GOT to move forward.

RUSSIANS "USED TO BE" ON ARMENIA'S SIDE

¶5. (C) In a striking comment that Baghdassarov repeated several times, he claimed that Armenia could no longer count on Russia for support when it came to dealing with Turkey. Referring to the Turkey-Armenia process, he said one problem is that "Russia used to be on Armenia's side" but is now "more with the Turks" because of Russian-Turkish economic interests. When the Ambassador pointed out that both Putin and Lavrov had publicly supported Armenia's position of no linkage with N-K, Baghdassarov countered, "that's what they say publicly." He then amended his argument slightly, saying that while Moscow may not be on Turkey's side, it is at best neutral when it comes to Turkey-Armenia. (Comment: This conclusion is one that Baghdassarov probably didn't pull out of thin air. There was at least a hint that he knew more than he was willing to tell, but that he had heard this frustration expressed by someone else -- most likely the President. It is even possible that he had been asked to deliver that message.

End comment.)

DON'T PUSH TOO HARD ON N-K

¶6. (C) Echoing what we have heard repeatedly from President Sargsian in recent months, Baghdassarov warned that the international community "should not push the President too hard" on Nagorno-Karabakh at this time. He said that while most Armenians support normalization with Turkey, there is a lot of suspicion that something inimical to Armenians' interest is brewing in the N-K settlement process. These fears have been stoked by both the opposition and the diaspora -- especially in the United States. Baghdassarov recalled that former president Levon Ter-Petrossian fell from power in 1998 for appearing to go too far, too fast on N-K, and implied that President Sargsian would run a similar risk if he accelerated the process under Turkish pressure. (Comment: Baghdassasrov was particularly concerned that the protocols did not establish final status for NK simultaneous with Armenia's return of the territories and again recalled Ter Petrossian's ouster. It is possible that he was sending a message from the President with this statement.)

SETTLEMENTS IN N-K?

¶7. (C) Baghdassarov revealed that he had told the President that Armenia should become "more active" in dealing with the N-K issue and the Azerbajanis. Specifically, he had proposed to the President that Armenia begin building settlements in the occupied territories that surround N-K proper. "This would show to the Azerbaijanis that they have something to lose if they don't resolve the problem." Baghdassarov was clear that the thinking behind his suggestion was not similar to the Dashnaks' - who favor settlements as a way of consolidating Armenia's hold on the territories -- but rather to gain advantage in the negotiation process with Azerbaijan. He lamented that the President "did not agree" with his proposal. The Ambassador pushed back hard, arguing that while settlements may theoretically strengthen a country's hand in negotiations, the reality is that the government becomes hostage to the settler community and cannot move forward toward a peaceful resolution.

DOMESTIC POLITICS: PM "DOING BETTER;" PRESIDENT "DOES TOO

MUCH"

¶8. (C) In marked contrast to his harsh criticism of Prime Minister Sargsian in the past (reftel), Baghdassarov was careful in his comments regarding the PM. He said the Prime Minister is "doing better" and that over the last two years he had learned a lot. But Baghdassarov lamented that at the Cabinet level, individuals should already be professionals and not making mistakes at the expense of the Armenian people. He also grumbled that during the last year of economic crisis, the Prime Minister established policies that were unfriendly to business - at a time when he should have been creating the most welcoming conditions for business. Baghdassarov claimed that with his recent investiture in the ruling Republican Party, the "technocrat" PM is one step closer to his dream of a political career.

¶9. (C) For his part, President Sargsian wanted the PM in the party to squelch criticism and unhappiness within the Republican Party that the ruling party did not get the plum PM position. Baghdassarov said the President had made a decision to keep the PM on, because he was skilled at handling foreigners and convincing the IFIs that Armenia could repay the loans that the GOAM needed to stay afloat. He claimed that the President handles "everything else," but this isn't an ideal system, because the President travels constantly and even when he is in Yerevan can't run every ministry. In addition, the ministries don't have strategies and a framework for decision-making, so Ministers aren't sure what decisions to take. Everything waits for the President, according to Baghdassarov. He added that another reason that the government is dysfunctional is that the Cabinet is made up of different parties. While the President wanted a smoothly functioning government, that might not be the goal of the non-ruling party; their goal was to weaken the government and strengthen their own position before elections.

YOVANOVITCH

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Russian diplomat Andrey Kelin traveled to Ankara to discuss the Armenia-Turkey relationship – WikiLeaks, 2005

WikiLeaks – Armenia No 40

2005-12-22 12:29

C O N F I D E N T I A L SECTION 01 OF 02 YEREVAN 002209

SUBJECT: TOUCHING BASE ON A TOUGH 2005 FOR ARMENIA-TURKEY

Classified By: CDA A.F. Godfrey for reasons 1.4 (b,d).

SUMMARY

¶1. (C) MFA Middle East Department Chief Artem Aznaurian and MFA Turkey Desk Officer Sahak Sargsyan told us December 22 that 2005 had not produced much progress in the Armenia-Turkey rapprochement process, but said the GOAM would continue to engage in working-level meetings with Turkish diplomats during the upcoming year. Aznaurian was anxious to report that Russian diplomat Andrey Kelin, Head of the CIS Department at the Russian MFA, had consulted with the GOAM recently on issues related to Turkey and even traveled to Turkey to discuss the Armenia-Turkey relationship. On prospects of opening the Armenia-Turkey border, Aznaurian said the GoT was "saving face" by listing settlement of the Nagorno-Karabakh conflict as a pre-condition but reiterated the MFA's pessimistic line about prospects for a border opening (in the near-term) absent a breakthrough on N-K. He characterized the relationship as "still caught in the exchange of letters between Kocharian and Erdogan," which did not produce satisfactory movement for either side.

Comment: Despite a fresh line-up of diplomats working the Turkey portfolio, the last set of disappointing meetings between Deputy FM Kirakossian are still hanging heavily over the GOAM [Government of Armenia]. The news that there is no meeting on the calendar between GOAM and GOT [Government of Turkey] Deputy Foreign Ministers is disquieting and we should encourage the two sides not to let this particular channel of communication go silent. End Summary.

2005: NOT A BANNER YEAR FOR ARMENIA-TURKEY

¶2. (C) MFA Middle East Department Chief Artem Aznaurian and MFA Turkey Desk Officer Sahak Sargsyan told us during a December 22 meeting that 2005 had not produced much progress in the Armenia-Turkey rapprochement process. Aznaurian, who is not prone to gratuitous cheerleading when it comes to Turkish-Armenian relations, was more pessimistic than usual about what, if anything, had been accomplished between the two sides over the past year. Aznaurian said the status of the relationship was "still caught up in the exchange of letters between Kocharian and Erdogan." He said that the GOAM had hoped more tangible progress would come out of the exchange of letters, which "did not prove satisfactory for either side." When asked about the status of the somewhat regular meetings between Deputy Foreign Ministers in Vienna, Aznaurian said the latest meetings had not produced anything new in terms of an action plan or confidence building measures (reftel). He said that the GOAM would continue with this format but said there was not a date on the calendar for the next meeting. As during previous meetings, Aznaurian was quick to point to Armenia's representation at the Black Sea Economic Conference (BSEC) in Istanbul as the GOAM's main source for information and policy issues related to Turkey.

TATTLING OR TOUTING RUSSIAN INVOLVEMENT?

¶3. (C) Aznaurian pointed to continued engagement by countries like the United States as key to the Armenia-Turkey rapprochement process. He appeared anxious, however, to point to recent conversations with the Russians on the issue as indication of their growing interest on the issue. He said that the two sides discussed prospects for establishing relations with Turkey during their recent bilateral government consultations. According to Aznaurian, Russian diplomat Andrey Kelin (Head of the CIS Department at the Russian MFA) expressed interest in the issue during his latest meeting with the Armenians and even traveled to Turkey to discuss the Armenia-Turkey relationship. Aznaurian noted that it was outside of Kelin's portfolio to travel to Ankara and asked what the USG [U. S. Government] thought of what might be growing engagement by the Russians on the topic.

BORDER: STILL TIED TO N-K

¶4. (C) Aznaurian reported that immediate prospects for opening the Armenia-Turkey border were still slim. He said the issue was undoubtedly linked to settlement of the Nagorno-Karabakh conflict but raised doubts about the extent of the GoT's conviction on this point. Aznaurian predicted that the GoT was merely "saving face" by listing settlement of the Nagorno-Karabakh conflict as a pre-condition for opening the border. He said that N-K was always among the Turks' top three pre-conditions but said that they regularly alternate its place on the list "perhaps as a pretext, but probably just to save face" with the Azeris.

COMMENT

¶5. (C) Despite a fresh line-up of diplomats working the Turkey portfolio, memories from the last set of disappointing meetings between Deputy FM Kirakossian and Turkish Deputy Undersecretary Ahmet Uzumcu are still hanging heavily over the GOAM. The news that there is no meeting on the calendar between GOAM and GOT Deputy Foreign Ministers is disquieting and we should encourage the two sides not to let this particular channel of communication go silent.

GODFREY

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Serzh Sargsian: Haydar Aliyev “understood that Karabakh was lost; the son doesn’t see it” – WikiLeaks, 2009 -Secret

WikiLeaks – Armenia No 110

2009-10-27

S E C R E T SECTION 01 OF 04 YEREVAN 000759

SUBJECT: DAS KAIDANOW DISCUSSES REGIONAL INTEGRATION, SECURITY WITH SENIOR ARMENIAN OFFICIALS

Classified By: Ambassador Marie L. Yovanovitch, reasons 1.4 (b,d).

SUMMARY

¶1. (S/NF) During meetings October 20 and 21, senior GOAM [Government of Armenia] officials told EUR DAS Tina Kaidanow that Turkey will need to be the first to ratify the protocols signed October 10. President Sargsian told Kaidanow that there has never been any question that Armenia would ratify, but that Armenia ratifying first would be "a major tactical mistake for us." He indicated that Armenia cannot wait indefinitely for Turkish ratification. In separate meetings, Foreign Minister Edward Nalbandian and Speaker Hovik Abrahamian shared those views, citing continued unhelpful Turkish Statements linking normalization with the Nagorno Karabakh conflict. While Kaidanow noted that the USG would not pressure Armenia to make "one-sided concessions," as the Armenians termed them, to facilitate normalization of relations with Turkey, she underscored the deep importance of visible progress on the Minsk Group negotiations over Nagorno-Karabakh in order to encourage Turkish parliamentary ratification. Defense Minister Seyran Ohanian expressed interest in continued U.S.-Armenia defense cooperation, calling it essential to his efforts to reform the armed forces. Kaidanow replied that it would be critical for the USG to see continued progress from the GOAM in strengthening its export control regime. She pressed her interlocutors for progress on democracy and human rights (septel). END SUMMARY.

NORMALIZATION WITHIN A REASONABLE TIMEFRAME

¶2. (C) During an October 20 meeting, President Sargsian told DAS Kaidanow Armenia had done its part to make Turkey-Armenia normalization possible; now Turkey would determine where the process leads. He noted that the Turks had four choices: the Turkish Parliament could ratify the protocols to establish diplomatic relations and open the Turkish-Armenian border; it could ratify with reservations; it could reject ratification; or it could prolong the process indefinitely without taking action. On the latter option, Sargsian said he made clear to Turkish President Gul that the more protracted the process, the less chance there would be for normalization. The Armenians could not wait forever, he said. The President's critics in Armenia have argued that the Turks only want to drag the process out to get them past next April 24 (Armenia's Day of Remembrance of the events of 1915). But waiting that long would be unacceptable to Armenia.

¶3. (C) DAS Kaidanow agreed that with the passage of months, ratification becomes more challenging. On the Turkish side, she noted complex political considerations that will come into play, but said that at the highest levels, the U.S. will make the case to the Turks that normalization is of critical importance to both sides and to the region.

WITHOUT LINKAGES

¶4. (C) Kaidanow said that there would be no pressure from the U.S. for any "one-sided concessions," as Sargsian termed them, on Nagorno-Karabakh in exchange for progress on normalization. However, she noted, it would be very important to show continued momentum within the Minsk Group process to improve the prospects for ratification of the protocols in the Turkish Parliament. President Sargsian's trip to Chisinau and his engagement in a discussion of the Madrid Principles text at that meeting was a wise step in this regard, she said, and further engagement in the form of additional meetings over the next weeks would also be critical. Conversely, any perception that the Minsk Group process is backsliding or losing steam would play into the hands of those in Turkey who oppose normalization and who will be looking for any excuse to kill ratification.

¶5. (C) Given the process that lies ahead, the problem, Sargsian said, would not be with the Turks, but with Azerbaijani President Aliyev. "Obviously he will do what he can to show that the NK process is slowing, and that Armenia is not being constructive." Sargsian warned that we should expect a new wave of unhappiness from Aliyev with the Minsk Group format, followed by demands for new conditions "just like Aliyev did two to three years ago" to good effect, the President said. The whole logic of the Madrid Principles was based upon the notion of achieving a balanced agreement. Any attempt to change this logic at this point would only bring the situation closer to military conflict, he warned. Sargsian suggested that dealing with Heydar Aliyev had been more productive than now dealing with his son Ilham, because the father "understood that Karabakh was lost; the son doesn't see it."

¶6. (C) Kaidanow suggested the Armenian Parliament ratify quickly to demonstrate it had fulfilled its commitment and put the onus on the Turkish side to do the same. Sargsian called the approach "impossible." If Armenia ratifies first, it would "end the whole process." Sargsian went on to say that there has never been any question that Armenia would ratify, and that now was the time to put pressure on the Turks. He said Armenia ratifying first would be "a major tactical mistake for us," implying that early ratification, followed by an interminable wait for Turkish reciprocation, would be a humiliation Sargsian would pay for politically.

NEED FOR CONTINUED PROGRESS ON EXPORT CONTROLS

¶7. (S/NF) Kaidanow stressed that one bilateral issue above all others could affect the U.S.-Armenia relationship: reform of the Armenian export control regime. While the GOAM had made important progress in strengthening its munitions export controls over the past six months, it would be critical for the U.S. to see continued progress in strengthening export control for dual use items and in implementation of the various new laws and decrees adopted. Success would open up new opportunities for bilateral engagement, whereas a lack of progress could bring bilateral cooperation to a halt. Sargsian said there should be no question of failure, that he did not see any challenges, and that he too saw the issue as critically important. Kaidanow noted that USG dual use experts would be coming to Yerevan in November for what she hoped would be very productive consultations.

FOREIGN MINISTER NALBANDIAN ON RAPPROCHEMENT AND NK

¶8. (C) Kaidanow congratulated Foreign Minister Nalbandian, in a separate meeting, for reaching a significant milestone with the signing of the Protocols in Zurich. Nalbandian noted that the successful signing would not have happened without the intervention of Secretary Clinton, and the Foreign Minister passed a letter thanking the Secretary. He noted that the process with Turkey had passed through six or seven stages, each more difficult and complicated. Nevertheless, the Protocols were signed, President Sargsian had a "very very positive and productive" discussion with Turkish President Gul during half-time of the soccer match in Bursa, and now the Armenians were ready to fulfill their commitments.

¶9. (C) Unfortunately, Turkish statements about linkages to resolution of NK complicated matters, Nalbandian said. According to Nalbandian, Turkish Foreign Minister Davutoglu said he understood from the U.S. there would be "big progress" on NK in the coming days. "But in Chisinau we were talking about two of the fourteen Madrid Principles, and we are not very close on those two," Nalbandian said. It is not realistic to talk about a breakthrough, he stressed. In trying to link the two processes, the Turks damage both. "Opening the border isn't a favor which we need to reciprocate."

¶10. (C) Nalbandian claimed that much of the problem stemmed from the fact that Aliyev had not properly informed by the Turks of progress on the normalization effort between Turkey and Armenia, and he was shocked to learn that there were protocols ready to be signed. At Chisinau, according to Nalbandian, Aliyev tried to show there was no progress or worse. His strategy will be "to ask for more, more, more until the process collapses," the Foreign Minister claimed. Still, both sides are talking about an eighth meeting for Sargsian and Aliyev in a few weeks, and needed to continue with a step-by-step approach to making progress. Perhaps at the December 1 OSCE Ministerial, Nalbandian suggested, they could take steps to consolidate the cease fire by agreeing to withdraw snipers from the line of contact. While it was an old suggestion that has failed once, he said, Minsk Group Co-chairs should push for the measure. Nalbandian also worried that the UN resolution the Azerbaijanis want to table regarding Nagorno-Karabakh Internally Displaced Persons (IDPs) was "absolutely dangerous" and could stop all progress on NK.

¶18. (U) EUR DAS Kaidanow has cleared this cable.

YOVANOVITCH

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