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Armenia Accepts Russia’s Ultimatum

Armenian President Robert Kocharian arrived in Moscow on a two-day visit yesterday to open the Year of Armenia in Russia. Yet, the main goal of Mr. Kocharian’s trip is to negotiate the price on the Russian gas. Moscow has given an ultimatum for its strategic ally: either gas price will be raised to $110 or Armenia will hand to Gazprom its gas infrastructure and then enjoy cheap gas for one more year. Robert Kocharian accepted the ultimatum, Kommersant learnt, and is willing to transfer a 45 percent stake in the Iran-Armenia gas pipeline under construction to Russia.
Presidents Vladimir Putin and Robert Kocharian opened the Year of Armenia in Russia at a ceremony in the State Kremlin Place. Famous ethnic Armenian French singer Charles Aznavour and composer Michel Legrand came to the ceremony.

The event was just an occasion to discuss serious economic issues such as the gas problem which threatens to spoil the harmonious allied relations. Moscow came with an unexpected statement late last year saiying that Armenia should pay $110 for 1,000 cu. meters of gas instead of the former $54 from 2006. Moscow thus demanded that its sole strategic partner in Transcaucasia pay as much as the overtly unfriendly Georgia. Russia suggested pointblank: Armenia can pay for gas at the new price or it can hand the fifth power unit of the Razdanskaya thermoelectric power station and the republic’s gas transportation system as a payment for cheap gas.

The ultimatum caught Armenian officials unawares. Yerevan kept on hoping that their active pro-Russian stance and support of the Kremlin’s foreign policy would help Armenia escape the common lot of other CIS nations. Russia, however, insisted on transferring gas relations on a market basis. The proposed gas price was considered impossible for the modest Armenia. President Kocharian thought over the Russian demand for almost a month only to brace himself to accept the terms imposed by the Kremlin.

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