Saturday, August 30, 2014


Caucasus Report

Is Armenia's Government Running Scared, Or Playing For Time?

Armenian riot police clash with activists protesting against pension reform in Yerevan last month.
Armenian riot police clash with activists protesting against pension reform in Yerevan last month.
In a move few observers anticipated, the Armenian Constitutional Court ruled on April 2 that the pension reform that took effect as of January 1 is unconstitutional. The court gave the government and parliament six months, until September 30, to bring the relevant legislation into conformity with the constitution.

Whether that decision is intended to take the wind out of the sails of the opposition, which had announced the previous day plans to launch nonstop demonstrations on April 28-30 in a bid to force Prime Minister Tigran Sarkisian to step down, is not clear.

The introduction of the new pension system, under which persons under the age of 40 are required to pay 5-10 percent of their gross salary into one of two private pension funds authorized by the government and central bank, served as the catalyst for widespread protests. The number of participants, many of them aligned in the informal group Dem.Am ("I am against"), increased steadily from hundreds in November and December to thousands in January.

A bid last November by the four noncoalition parties in parliament to force an emergency debate on the reform failed because legislators from the majority Republican Party of Armenia (HHK) boycotted the session. The opposition condemned that boycott as "blatant disdain" of the constitution.

Two weeks later, the parliament rejected by a vote of 54 to 46 a bill drafted by the same four parties that would have postponed for one year implementation of the new system. 

In mid-December, the opposition formally appealed to the Constitutional Court to scrap the new system. The court duly suspended it in January pending a formal ruling, but some government agencies and private companies continued to make the relevant deductions from employees' salaries, triggering a new wave of protests and strikes by rail workers, the staff of the National Opera and Ballet Theater,     the Yerevan subway, and the national electricity company.

In the face of those protests, senior officials began to back pedal. Parliament speaker Hovik Abrahamian said in late February that the government was willing to "amend" the new system if it is flawed. A month later, Prime Minister Sarkisian, who in November had staunchly defended the new system, as the fruit of 10 years' consultations with the world's best specialists, admitted that "there are certainly shortcomings in those laws [regulating the reform]." "We are declaring that the right path is the path of dialogue and are inviting our young partners, representatives of the Dem.Am movement, to [engage in] a dialogue," Sarkisian said.

Two other factors may also have contributed to the authorities' apparent readiness for concessions. The first is the increasingly close alignment between the three openly opposition parliamentary parties -- former President Levon Ter-Petrossian's Armenian National  Congress (HAK), the Armenian Revolutionary Federation (Dashnaktsutiun) (HHD), and U.S.-born former Foreign Minister Raffi Hovannisian's Zharangutiun (Heritage) Party -- and  oligarch Gagik Tsarukian's Prosperous Armenia Party (BHK), the second-largest parliament faction, which positions itself as an "alternative" to the present leadership.

According to HAK lawmaker Aram Manukian, it was the wave of popular protest over the pension reform that finally "united four political forces that had serious problems with each other."

Until recently, the BHK and Tsarukian personally stopped short of endorsing the calls for regime change espoused by the other three parties. But in late March, all four parties decided to jointly propose a vote of no confidence in the cabinet at the April 28 parliament session. The BHK likewise endorsed the plan for mass protests. BHK legislator Vahan Babayan said last week that "in order to succeed we will need to ensure the presence of hundreds of thousands of people in Yerevan's streets, squares, in front of certain [government] buildings."

The second factor is the time frame for Armenia's accession to the CIS Customs Union, another initiative that Prime Minister Sarkisian has staunchly promoted in the face of popular outrage at the anticipated curtailing of Armenia's sovereignty and higher consumer prices that will result. Sarkisian announced recently that the formal agreement under which Armenia will be admitted to that body will be signed in May. By signaling readiness for concessions on the pension reform, the authorities may have hoped to remove at least one of two potential catalysts for mass protests.
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About This Blog

This blog presents analyst Liz Fuller's personal take on events in the region, following on from her work in the "RFE/RL Caucasus Report." It also aims, to borrow a metaphor from Tom de Waal, to act as a smoke detector, focusing attention on potential conflict situations and crises throughout the region. The views are the author's own and do not represent those of RFE/RL.