Nations in Transit
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Population: 3 million
GNI/capita, PPP: US$8,180
Source: The data above are drawn from the World Bank’s World Development Indicators 2015.
The democracy scores and regime ratings are based on a scale of 1 to 7, with 1 representing the highest level of democratic progress and 7 the lowest. The 2015 ratings reflect the period January 1 through December 31, 2014.
EP - Electoral Process
CS - Civil Society
IM - Independent Media
NDG - National Democratic Governance
LDG - Local Democratic Governance
JFI - Judicial Framework and Independence
CO - Corruption
|National Democratic Governance||5.00||5.25||5.25||5.75||5.75||5.75||5.75||5.75||5.75||5.75|
|Local Democratic Governance||5.50||5.50||5.50||5.50||5.50||5.75||5.75||5.75||5.75||5.75|
|Judicial Framework and Independence||5.00||5.00||5.25||5.50||5.50||5.50||5.50||5.50||5.50||5.50|
The first years following Armenia’s independence from the Soviet Union in 1991 were extremely turbulent. The withdrawal of Soviet economic support, a war with neighboring Azerbaijan, an energy crisis, and a transportation blockade that left landlocked Armenia with just two open borders—one with war-torn Georgia and the other with Iran—all contributed to the country’s economic collapse in the early 1990s. Following a ceasefire in the Nagorno-Karabakh conflict in 1994, Armenia’s economy began to recover, but the territorial conflict with Azerbaijan continued to simmer, and the blockade by Azerbaijan and Turkey remained in effect.
Abrupt economic restructuring and a decline in living standards in Armenia’s post-Soviet economy have caused social frustration and political apathy. Excessive overlap between political and economic interests has depleted public trust in political elites, as has their record of rigged elections and corrupt administrative practices. The results of every national election since 1995 have been challenged by the opposition, which does not recognize the legitimacy of Armenia’s parliament, president, or constitution and remains personality-driven and passive between elections. Mass postelection protests in spring 2008 evoked a violent response from the authorities, leaving ten protesters dead and hundreds wounded. Armenia was hit hard by the global economic recession, revealing structural flaws—primarily a bloated construction sector reliant on investment from the United States and Russia.
Municipal elections in 2014 perpetuated the supremacy of the ruling center-right Republican Party of Armenia (HHK). The legitimacy of the ruling party nevertheless remained low and social discontent was widespread as the economy continued its slow recovery. The opposition continued to suffer from ideological and financial weaknesses and was unable to capitalize on the lack of trust in the administration. While preventing real competition for power, the incumbent authorities took measures during the year to mitigate societal discontent, conceding to the demands of public campaigns and implementing reforms that have improved the functioning and services of the state. The sociopolitical climate also contributed to media diversity and an active civil society, but at the same time it underscored the imminent need for real competition and viable political forces outside election cycles. Armenian foreign policy, bent on minimizing military risks in the unsettled conflict over Nagorno-Karabakh, steered the country toward the Russia-led Eurasian Economic Union (EEU), and Armenia signed an accession treaty in October.
National Democratic Governance. In contrast to a weak and ineffective opposition, the ruling HHK reinforced its dominance by restructuring the government in 2014. As the crisis in Ukraine unfolded, there was an increase in cross-border enemy fire and clashes with Azerbaijan over the disputed Nagorno-Karabakh province. The compulsion to minimize military risks in the unsettled conflict led Armenia to sign an agreement on accession to the Russia-led Eurasian Economic Union. At the same time, Armenian foreign policy witnessed close collaboration with the European Union (EU). Armenia’s national democratic governance rating remains unchanged at 5.75.
Electoral Process. Despite an overall improvement in electoral standards over the previous two years, municipal elections that took place in 121 communities in 2014 showed no progress. Campaigning and voting were peaceful and the vote count was satisfactory, but insufficient competition, especially in small communities, hindered the emergence of new officeholders. Incumbents were instead rotated with other government officials to preserve HHK power. Armenia’s electoral process rating remains unchanged at 5.75.
Civil Society. Armenia’s civil society remains active and diverse but suffers from overdependence on foreign donors. In 2014, protesters united around the ongoing crisis in Ukraine and fears of Russian encroachment. Although a number of civil society-led campaigns succeeded at gaining the attention of policymakers, they lacked a consistent agenda and lost momentum over time. Several attacks on opposition activists took place at year’s end. Armenia’s civil society rating remains unchanged at 3.75.
Independent Media. Armenia’s diverse and independent online media continued to grow in 2014, this time at the expense of televised media, which remains widely coopted by political forces. Moves to increase media regulation failed due to active resistance of the media community and organizations protecting freedom of expression. Journalists nevertheless continued to face political pressure and physical attacks and threats. Armenia’s independent media rating remains unchanged at 5.75.
Local Democratic Governance. Armenia’s self-governed communities remain financially unstable and reliant on the regional and national administrations. The long-planned project to merge these communities into financially stable entities stalled due to a lack of political leadership. The appointment of party loyalists to regional governments strengthened HHK’s power at the local level. Armenia’s local democratic governance rating remains unchanged at 5.75.
Judicial Framework and Independence. Corruption and executive oversight continue to discredit judicial bodies. Limited reforms led to improvements in the police’s treatment of suspects and ongoing efforts continued to improve prison conditions, but significant progress has yet to be achieved. Several high-profile cases garnered significant media attention during the year. Armenia’s judicial framework and independence rating remains unchanged at 5.50.
Corruption. New e-governance practices in 2014 served as both a deterrent to corruption and a method of increasing Armenians’ access to government information. Efforts to combat corruption yielded some results, such as the prosecution of a handful of public officials on corruption charges. Irregularities in public procurement nevertheless present a strong barrier to administrative transparency. Armenia’s corruption rating remains unchanged at 5.25.
Outlook for 2015. Armenia’s opposition will likely try but fail to establish viable organizational structures. Trust in institutions may rise but not drastically, especially as the economy grows at a slow speed and under threat of possible developments in Ukraine and the Middle East. Reforms will continue at a moderate pace, including important progress in state administration, but little change can be expected in local and national democratic governance or in the judiciary. Armenia’s ties to both Russia and the EU will strengthen provided the two do not have another major fallout.
Armenia’s political system operates on the basis of consensus among elite groups that control economic and political resources. Over time, the Republican Party of Armenia (HHK) has merged with the state bureaucracy, further cementing the ruling party’s control over resources and the policymaking process. Although there are discussions and debate in the parliament, it is effectively a rubber stamp of the ruling party. Society has little leverage over legislative processes and decision-making, and trust in governing institutions is very low. Although indicators of institutional trust hit all-time lows in 2013, Armenia’s citizens were slightly more optimistic in 2014: according to the European Union (EU) Neighborhood Barometer poll, 17 percent of respondents believed things are going in the right direction (an increase from 11 percent in 2013) and a relative majority (41 percent) expected further improvement in the next year.
Despite the weakness of the incumbent government, the even greater weakness of the fragmented and personality-driven opposition allows the HHK to dominate the political sphere. The opposition has contested the results of every election since 1995 but loses momentum between elections and has little overall impact on the policymaking process. Despite campaigning on both domestic and foreign policy issues in 2014, opposition parties did not influence decision-making during the year, and suffered from internal crises and dwindling popular support.
After Prime Minister Tigran Sargsyan, a reputed crisis manager and political outsider, stepped down in April 2014, he was replaced by Hovik Abrahamyan, speaker of the National Assembly and a seasoned heavyweight in Armenian politics and business. Sargsyan became ambassador to the United States, and Abrahamyan made significant changes to the government, appointing seven new ministers and merging the Ministry of Finance with the State Revenue Committee, and the Ministries of Territorial Administration and Emergency Situations. Abrahamyan’s restructuring flagged a return to business as usual, replacing Sargsyan’s technocrats with business elites and their representatives.
The constitutional review process initiated in 2013 continued in 2014. The ruling party drafted a concept paper on the transformation of Armenia into a parliamentary republic by 2018—the end of Serzh Sargsyan’s presidency. The opposition protested the changes, claiming that they would extend President Sargsyan’s rule and the dominance of the HHK beyond the end of his second term. However, the Constitutional Court praised the proposed reform and the Council of Europe’s Venice Commission—an advisory body that monitors legal reform in member states—also gave a largely positive assessment. The head of the commission, Gianni Buquicchio, stated that the changes could strengthen democracy but added that they must be based on a broad political consensus. He therefore urged Armenian opposition parties to rethink their categorical rejection of the proposed constitutional reforms.
Parties nonetheless refused to cooperate in the parliament throughout the year, and the HHK and opposition parties mutually blocked each other’s initiatives. In April, four opposition parties—Prosperous Armenia, the Armenian National Congress (HAK), Heritage, and Dashnaktsutyun—took to the streets to gather support for a no-confidence vote against the government. In June, the four parties issued a list of 12 demands to the government, calling for major economic and political reforms, discussions of which continued throughout the year to no avail. The opposition coalition folded in October, after Dashnaktsutyun declared its support for the transition to parliamentary rule, leaving only three opposition parties involved in the October street protests. Regardless, the rallies on 10 and 24 October gathered over ten thousand protesters, soon after which Sargsyan stalled the constitutional reform process. HAK leaders lauded Sargsyan’s action as a direct result of public pressure.
Armenia’s main foreign export partners are the European Union (EU) and the Commonwealth of Independent States (CIS), with 29 percent of its exports going to the EU and 24 percent to the CIS in 2014. The country is almost wholly dependent on Russia for energy. Overall, the Armenian economy grew by 3.4 percent in 2014, compared to a 3.5 percent increase in 2013. Still, this improvement is insufficient for eradicating poverty or recovering from the 2008 recession. With regard to foreign trade, 2014 saw an increase in trade with East Asia and a slight decline with the EU and CIS states, although they each still accounted for 28 percent of the total trade.
Armenia continued its cooperation with the EU in 2014. On 1 January, a joint EU-Armenian agreement on visa facilitation and readmission came into force, reducing the rejection rate of visa applications. In March, Prime Minister Tigran Sargsyan announced intentions to sign a new agreement with the EU, and the European Neighbourhood Policy (ENP) Progress Report, published in the same month, called for the continuation of reforms. In November, the EU pledged to provide Armenia with €140–170 million over the next three years for institutional reforms and infrastructure projects. The majority of Armenians assess EU-Armenia relations positively, although their number fell from 80 percent in 2013 to 62 percent in 2014. Despite the ongoing relationship between Armenia and the EU, the possibility of Armenian accession remains uncertain.
Earlier, in September 2013, President Sargsyan announced that Armenia would step away from an Association Agreement with the EU in favor of joining the Russia-led Eurasian Economic Union (EEU). According to the prime minister, the decision rested on the need for Russia’s military support in the unresolved Nagorno-Karabakh conflict with Azerbaijan. Armenia eventually signed an accession treaty with the EEU on 9 October 2014 at the CIS summit in Minsk, and the parliament ratified the agreement on 4 December, making Armenia the fourth member of the EEU. Public opinion overall favored the accession, 55 percent were in favor and only 13 percent opposed. Most political parties welcomed the event, save Heritage, which protested the accession as Russian encroachment on Armenian sovereignty.
Although Armenian officials generally refrained from commenting on the situation in Ukraine, in March, Armenia voted against United Nations (UN) General Assembly Resolution 68/262, “Territorial Integrity of Ukraine,” along with 10 other countries. Political parties followed suit in criticizing the resolution, apart from Heritage, which opposed Russian aggression. According to President Sargsyan, Armenia’s vote supported Russian-Ukrainians’ right to self-determination, echoing the defense of Armenians in Nagorno-Karabakh.
The unresolved conflict over Nagorno-Karabakh escalated in 2014. Some of the largest clashes since the 1994 ceasefire occurred on the border with Azerbaijan at the end of July, reportedly leaving at least 15 dead. Although the presidents of Azerbaijan and Armenia met a week later in Sochi and again in Paris in October, the conflict further intensified in November, when three Armenians died after Azerbaijan’s air force downed an Armenian helicopter flying over a neutral zone. The Azerbaijani army refused Armenian attempts to collect the bodies, and Armenian troops conducted a special operation 10 days later, reportedly killing two Azerbaijani soldiers in the process. Overall, 26 Armenian soldiers died in combat in 2014, an increase from previous years. In contrast, there were 20 non-combat deaths—representing a significant drop from two years before—due to large-scale campaigns for transparency.
Armenia is a semipresidential republic in which the president is the head of state and ministerial appointments require approval by Parliament. In practice, President Sargsyan has far more power than prescribed by the constitution, using the HHK majority in Parliament to ensure his right to handpick ministers and other appointed officials. Therefore, presidential elections in Armenia are a major means to shaping the national political landscape.
No national elections were held in Armenia in 2014, a break from the presidential and parliamentary elections of the previous two years. During the year, mayoral elections took place in 121 of the country’s 915 communities. Overall, these elections showed no progress from previous years, highlighting the general weakness of political parties and their low level of involvement in local politics. Small rural communities exhibited persistent concerns: voter passivity, poor media coverage, advantages for the incumbent, and the dominance of the ruling party with its superior access to resources. In 2014, HHK officials won in 87 out of 121 communities; members of Prosperous Armenia Party, Armenia’s second-largest party, took seats in 7 communities; and independent candidates won in 21. In over a third of the communities (mostly those with fewer than one thousand voters), only one candidate ran in the election, usually the incumbent mayor. Incumbents won in 95 out of 121 communities and lost in 12. Female candidates won in 4.1 percent of the polls, matching the trend prevailing since 2012. 
City mayors were elected in two cities on 8 June: Goris in the Syunik marz (region) and Jermuk in the Vayots Dzor marz. Only two candidates ran in Goris: Vachagan Adunts, the incumbent of the ruling party, and Hrayr Yolyan, an independent. Two other candidates, Ara Budaghyan and Tigran Karapetyan, withdrew their candidacy less than three weeks before the election despite considerable popularity, and one female activist, Ruzanna Torosyan, declared her intention to run but never registered as a candidate. According to journalists, former governor of Syunik Suren Khachatryan—who had resigned after his son shot and killed the brother of Budaghyan in 2013—supported Adunts and pressured the other candidates to resign. Although the allegations sparked protests by local residents, Adunts still won with 58 percent of the vote. Turnout was 51 percent, but a relatively high proportion of the ballots (6.2 percent), were declared invalid, probably due to the last-minute withdrawals. An observer from Transparency International reported cases of carousel voting by both candidates, but he observed few violations at the ballot boxes themselves.
The incumbent mayor of the ruling party, Vardan Hovhannisyan, won in Jermuk as well. He received 58 percent of the vote, while his independent competitor, Koryun Stepanyan, received 31 percent. Although there were no reports of fraud on voting day, both candidates misused administrative resources to secure votes. The incumbent reportedly had the support of major local business operator Ashot Arsenyan, owner of Jermuk Group, whereas Stepanyan was backed by the regional governor Edgar Ghazaryan.
Changes to the electoral code, including the abolition of single-member districts and a mandate to fill seats in the parliament using only party lists, featured prominently among the 12 demands issued by opposition parties in June. The opposition argued that the existing mixed system perpetuates the domination of the ruling party on the local level and extends it to the parliament. The government claimed that single-member constituencies are the only way to ensure representation for the country’s highly diverse local communities. They refused to address the demands until November, when President Sargsyan announced that a parliamentary discussion was in the works. The discussion was scheduled for December but opposition groups boycotted it following an attack on Aram Manukyan, a Member of Parliament (MP) from the HAK.
As of October 2013, the Ministry of Justice had registered 4,607 nongovernmental organizations (NGOs) and foundations in Armenia, although only 15 to 20 percent of them are consistently active. While Armenian civil society finds its strengths in persistent advocacy, good infrastructure, and considerable expertise and organizational capacity, it lacks financial stability and strong connections with the public. The United States Agency for International Development (USAID) NGO Sustainability Index rated Armenia’s civil society at 3.9, significantly less sustainable than Central Europe, which was rated at 2.7. Since many NGOs in Armenia rely heavily on foreign funding, their activities are vulnerable to funding fluctuations or interruptions.
Public perception of NGOs is also a problem. Most people are distrustful toward NGOs and have vague ideas about their work; in a downward curve from 32 percent in 2008, trust in NGOs decreased to 18 percent in late 2013 from 20 percent the previous year.
In February, the Ministry of Justice circulated a new version of a concept paper on institutional and legal reforms regarding the development of NGOs. Work on the draft had begun as far back as 2007 but stalled due to disagreements between NGO activists and the ministry. The 2014 draft incorporated some important revisions demanded by NGOs, including the ability to generate income without establishing an association. Still, NGOs and the government failed to reach a consensus on the draft, and its fate remained unclear at the end of the year.
The crisis in Ukraine, Armenia’s accession to the EEU, and fears of Russian encroachment fomented opposition- and NGO-led protests in 2014. One of the first rallies in support of Ukrainian antigovernment protesters was held in Yerevan on 24 January. On 5 March, four protesters were detained after they denounced Russia’s intervention in Crimea. Participants in a May demonstration in front of the Russian Embassy in Yerevan protested against Russia’s growing influence in Armenia. In the same month, Ivan Volynkin, the Russian ambassador to Armenia, claimed that Armenia should “neutralize” NGOs that seek to “drive a wedge between Russia and Armenia.” The following day, 20 NGOs made a joint statement calling on Volynkin to either apologize or resign. The spokesman of Armenia’s Ministry of Foreign Affairs stressed that the NGOs are registered and acted in accordance with the country’s legislation. During a June visit to Armenia, Dmitriy Kiselyov, the head of state-owned propaganda network Russia Today, cited the Russian foreign agent law as a means of controlling foreign-funded NGOs. Vice President of the National Assembly Eduard Sharmazanov said he saw no need to comment or act on Kiselyov’s statement due to his insignificance as a political figure. In August, protesters blamed the Azerbaijani, Armenian, and Russian presidents for the escalation of the crisis in Nagorno-Karabakh. Further protests took place on 3 September, when 11 people were detained after demanding the cancellation of Armenia’s entry into the EEU in front of the president’s residence. Another antigovernment protest brought together thousands of opposition supporters in Yerevan on 10 October.
The largest protests in 2014 ignited around social and economic issues. Protests began following 1 January, when the government put forward a controversial pension reform that required those under the age of 40 to give 5–10 percent of their gross wages to one of two private pension funds. The protests, led by a group called Dem.am (“I am against”), culminated in April when the Constitutional Court overturned the changes, claiming that they are unconstitutional. In a speech on 25 April, President Sargsyan admitted that 80 percent of the population was against the reform. In the fall, Dem.am called for similar protests against a bill that would reduce maternity leave benefits for high-earning women and women with less than three years of work experience, while also providing benefits for stay-at-home mothers, who currently receive no maternity leave support. The bill was halted in November as a result of wide-scale protests against the cuts in benefits for working mothers.
Although there are only a few overtly extremist organizations in Armenia, marginal groups propagandize ethnocentrism and traditionalism and condemn sexual, ethnic, and religious diversity. Several of these groups campaigned against the 2013 gender equality law, arguing that the law’s definition of gender as “acquired, socially fixed behavior of different sexes” gives a legal foothold to sexual minorities. One such group, the All-Armenian Parents Committee, held a several-hundred-strong march in September 2014 in defense of family values. The march was held in cooperation with the International Public Organization of Humanitarian Development, a body that has organized events together with the Russian embassy in Armenia. Organizations protecting the rights of LGBTI people are few in number but active in Armenia. Alongside organizations promoting gender equality, such as the Women’s Resource Center, they are the target of harsh criticism by pro-Russian groups.
In November, Armenia’s Yezidi community, the largest ethnic minority in the country, demanded that the government do more to stand up against Yezidi massacres in Iraq and garner support for the Yezidi nation at the UN. The government of Armenia responded by providing $100,000 in humanitarian relief and helping draft the UN Human Rights Council’s resolution on the Yezidi. The Ministry of Foreign Affairs followed up with a statement voicing the shared concern of the people and government in solidarity with Yezidi Armenians.
November and December witnessed several anonymous violent attacks on activists and opposition politicians. On 28 November, opposition activist Gevorg Safaryan fell unconscious after being beaten on the street. On 11 December, HAK politician Aram Manukyan was also attacked; police detained a suspect but released him on bail shortly after. In an interview, the suspect claimed he wanted to give Manukyan “a patriotic slap in the face” for insulting President Sargsyan. A similar assault happened to activist Vaghinak Shunanyan on 20 December. Shunanyan reported that his attackers threw him to the ground and punched him for insulting the president. Commenting on the incidents, Deputy Chief of Police Levon Yeranosyan told the press that if anyone dared to say anything bad about Sargsyan in front of him, he would “smash his head.”
Print and online media in Armenia are diverse. The online community is growing rapidly, and the internet is becoming an increasingly reliable platform for independent information and opinions. However, television remains the most popular medium for news and entertainment, and television stations present varying degrees of political bias. Only 50 percent of the public claims to trust the media according to the CRRC; the remainder cites political bias and low professionalism as key concerns.
Apart from public television and radio, all media are privately owned, and the law forbids the media from affiliating with political parties. Despite this, many television stations and several other media sources are coopted by political parties, leading to biased coverage. Advertising, the main source of nonpolitical funding for the media, is sufficient for sustaining leading national television stations but lacking for radio and print media, which are faltering and forced to rely heavily on political money. The market for online advertising is growing, however, making the internet a realm of hope for many struggling media sources, especially in the regions.
The previous years’ trends came to a head in 2014, when online media began, for the first time, to grow at the expense of televised and print media. Whereas 90 percent of Armenians indicated television as their main source of information in 2011, by the end of 2013, this number dropped to 79 percent. By contrast, 17 percent now look for information primarily online, an almost threefold increase from 2011. Internet usage increased overall, particularly among youth, with 90 percent of Armenians aged under 20 and 80 percent aged 21–30 regularly accessing the internet. The number of regular Facebook users in Armenia almost doubled in a year, from 340 thousand to 660 thousand. Increasing use of the internet has also contributed to the decline of print media, used only by 1 percent of Armenians as the primary source of information. Once one of the leading dailies, Azg went out of circulation in 2014 to return as a weekly. Its editor in chief admits it sold 44,000 copies a day in 1994 but now sells only 2,000 a week.
In September, a ban on advertising on public television (adopted by the parliament in March 2013 after several years of debate) entered into force. According to figures from October, the ban helped private television stations become more competitive and improved the general quality of public broadcasting, which has become more popular as a result.
In March, the Armenian media community took concern with an amendment that would subject media outlets to criminal prosecution for reproducing false or libelous information from fake social media accounts and for offensive comments made by visitors on their websites. According to media expert Samvel Martirosyan, outlets often copy and paste social media posts without comment or verification, but he also warned that under the law, any blogger or social media user could qualify as media. Domestic and international organizations, including Reporters Without Borders (RSF) and the Organization for Security and Cooperation in Europe (OSCE), condemned the amendment as a move to curtail media freedom. As a result, the amendment was dropped from discussion.
Journalists face political pressure in the form of lawsuits and verbal and physical threats. The Committee to Protect Freedom of Expression (CPFE) registered 65 free speech violations in 2014, down from 77 in 2013. They reported nine cases of physical violence, also a slight decrease from the previous year. In February, the head of Yerevan’s central police department slapped Ani Gevorkyan and erased her footage after arresting her at an opposition rally. Gevorkyan is a reporter from Chorrord Ishkhanutyun, a newspaper known to be critical of the government. The police dropped investigation of the case in September, an event which Gevorkyan attributes to judicial bias. In September, Artyusha Karapetyan, leader of the Kazakh community in Armenia, grabbed a reporter’s audio recorder after she approached him at a public event, while his bodyguard deleted pictures from her phone. An investigation was underway at year’s end.
In May, a judge ordered two news organizations—Ilur.am and Hraparak—to reveal their sources regarding a report that Shirak police chief Vardan Nadaryan attempted to steal a car at gunpoint while intoxicated. In June, Aravot reported a court order to reveal its sources for a news piece incriminating the family members of former governor of Syunik, Suren Khachatryan. Though permitted by law, Armenian courts had not once ordered news organizations to reveal their sources in the prior 20 years. The media community voiced its concern that the new practice would infringe on media freedom and independence.
Journalists associations exist in Armenia and a number of groups monitor violations of journalists’ rights and organize initiatives in the realm of media freedom, ethics, and sustainability. Many associations exist only on paper, however, and media development is unfolding in an overall competitive spirit with limited cooperation.
The Armenian government is planning for a full transition from analogue to digital broadcasting by June 2015. As it stands, the new digital network plan stipulates one digital broadcaster per region, which would force numerous regional broadcasters to shut down and threaten media pluralism. In response to the plan, NGOs submitted a proposal in late 2014 that would allow marginalized regional broadcasters to operate within private multiplexes. A bill to make the corresponding amendments to the law was submitted to the parliament on 16 December.
Local governance in Armenia is weak and inefficient, as remains true in many postcommunist states. In addition to the capital city, which is divided into 12 districts, there are 49 cities and 866 villages, and half of the villages have a population below 1,000. Each of these are self-governing communities and have a representative body called the Council of Elders with 5 to 15 members and an executive body (municipality) led by the community head (mayor). Council members and mayors are elected via public ballot for three-year terms. Mayors are accountable to the Council of Elders, although implementation procedures are often lacking. Local authorities are also heavily reliant on funding from the state and are not truly independent from regional or central administrations.
Armenia’s total population is about 3 million, with over one-third of the population concentrated in Yerevan. This means that many of Armenia’s 915 communities are very small and cannot collect sufficient revenue to sustain basic services. Communities’ main expenses go toward education (34.7 percent) and municipal administration and services (27.3 percent). The income of municipal budgets accounted for just 2.8 percent of Armenia’s GDP in the first half of 2014, with over half of this amount coming from state-budget subsidies. Additional subsidies were paid to communities located near the border with Azerbaijan, which suffer from cross-border enemy fire.
Most taxes go directly into the state budget, and communities only receive land and real estate taxes. The smaller the community, the less financially sustainable it is. Indeed, the only financially independent community of Armenia is the capital city, Yerevan. No changes to taxation or community income structures were made in 2014, nor did the government move forward with a long-planned reform that would merge Armenia’s communities into larger and more efficient and sustainable units. Although pilot activities merging 30 communities with a total population of 44,000 into five units were scheduled to launch in the fall, they were postponed after Minister of Territorial Administration Armen Gevorgyan resigned in October, and the prime minister merged his ministry with that of emergency situations, halting Gevorgyan’s reforms. Counterpart Armenia, a U.S.-sponsored program that sought to promote local self-government, also shut down in 2014. In the shadow of these changes, it is unclear when the community reforms will be implemented.
Prime Minister Abrahamyan appointed five governors in 2014, three of them with no links to their constituencies: Minister of Nature Protection Aram Harutyunyan became governor in Kotayk; Rubik Abramyan, an official from the Ministry of Territorial Administration, in Ararat; and Hovik Abovyan, head of one of the customs offices, in Tavush. In September, the prime minister reappointed Khachatryan governor of Syunik, a post from which he had resigned under public pressure in 2013. The mayor of Vayk, a city in Vayots Dzor marz, also became governor in November after the former governor was appointed ambassador to Poland. As some of the former governors were reshuffled to ministerial positions, the appointments served to amalgamate a political class and further consolidate the ruling party’s power on the local level.
Women’s involvement in the local government remained low, decreasing overall in the last four years. There are no female governors or mayors, and only 2 percent of rural communities are led by women.
Since 2007, the Information System of Community Governance has been expanded to boost the efficiency of services and logistics and increase transparency. During 2014, the system covered an additional 70 of Armenia’s 915 communities. It is now active in 580 communities, including 233 in which it also serves as the communal website (e.g., vedicity.am, artashat.am).
Armenian society holds low trust in the judiciary, which is permeated with corruption and remains largely under executive control. The functioning of the justice system remains one of the weakest links of Armenian governance. Police make arbitrary arrests without warrants, beat detainees during arrest and interrogation, and use torture to extract confessions. By the end of 2013, merely 15 percent of Armenian citizens said they had trust in the justice system while 53 percent said they mistrusted it. Trust in police was higher but also low, at 30 percent, whereas 38 percent reported not trusting the police.
Judicial reform planned for 2012–16 continued in 2014 with considerable funding from the EU, and improvements implemented during the year included the launch of the Armenian E-Notary Information System (AENIS). The World Bank’s assessment of the Armenian judicial system improved in 2014, its rule of law rating increasing from a percentile rank of 43.35 to 45.02, just above the average for CIS countries but falling behind EU countries.
As in previous years, numerous cases of torture and judicial corruption were reported in 2014. Several perpetrators were indicted, including the arrest and investigation of the chief of the Ijevan police department for fabricating criminal charges. Apart from abuse of police power, persistent human rights violations remained of concern, and poor conditions in closed institutions (e.g., boarding schools and orphanages) and domestic violence were widely discussed. Human rights activists campaigned for the adoption of a law on domestic violence following numerous reports and trials over the year. The draft law has stalled in the Ministry of Labor and Social Affairs since 2009, its adoption delayed several times.
State penitentiaries and detention facilities have been overcrowded in Armenia, but the situation improved after the 2013 general amnesty released 700 inmates. As of January 2014, 3,923 people were held in prisons intended to hold a maximum of 4,295. In addition to overcrowding, some of the prisons remain dangerously unsanitary and deny inmates adequate access to medical care. A new 1,200-inmate facility conforming to European standards was opened in Armavir in November as part of the government’s efforts to ameliorate poor conditions and reduce overcrowding.
The incarceration rate in 2014 approached the European average at 132 per 100,000. The prison system witnessed a few positive changes over the course of the year, including a legislative initiative that would allow convicts to use mobile phones and access the internet. However, Armenia’s prison mortality rate remains almost twice as high as the Council of Europe average, and only 5 percent of inmates eligible for early conditional release (ECR) were set free in 2013. In October, an EU-led round table assessing Armenia’s system for ECR found that it functions inefficiently and lacks clear criteria.
Several cases garnered significant media attention during the year. In September, David Vardanyan, the son of Yuri Vardanyan, Armenia’s current ambassador to Georgia and former minister of sport and youth affairs, was tried for drug trafficking and sentenced to four and a half years in prison. In October, the courts passed a verdict in the case of the Million Masks Movement, a group of 14 men who were arrested in November 2013 for clashing with the police while protesting with sticks and homemade explosives. Members of the group were given sentences between one and seven years for using violence against law enforcement, and a supporter—who opened fire in front of the courthouse during their sentencing—was arrested on the spot. Some human rights activists and opposition politicians considered the group members to be political prisoners, who were singled out for especially harsh punishment. The defendants are expected to appeal the sentence.
In 2014, a total of 220 judges served in Armenia, 52 of them female (5 more than the previous year). Minister of Justice Hrayr Tovmasyan resigned in April, after the appointment of the new prime minister. He was replaced by the former ambassador to Georgia, Hovhannes Manukyan, who had previously held positions within the judiciary, including vice-minister of justice and head of the Court of Cassation.
A high level of corruption has been one of the key challenges to Armenia’s economic development and democratization since independence. Despite a number of improvements, corruption remains pervasive, and bribery and nepotism are reportedly common among government officials, who are rarely prosecuted or removed for abuse of office. Major industries and the foreign trade sector remain dominated by monopolies, creating ample opportunities for corruption. The National Statistical Office recorded 599 corruption crimes in 2014, a 23 percent decrease from 2013; however, the number of crimes involving abuse of office increased by 50 percent. A large number of corruption cases still go unregistered. According to the EU Neighborhood Barometer just 4 percent of Armenian respondents rated corruption as the country’s most important problem (compared to the 12 percent average for EaP countries). In April, the Control Chamber published a report on corruption in Armenia, which found improvement in some areas but otherwise a wide range of persistent concerns, including pervasive irregularities in procurement in the agricultural, healthcare, and social welfare sectors. The report attracted little attention from the media and government officials, evidence that neither Armenian society in general nor the government is interested in acting on specific facts. Prosecutions in response to the 2013 report resulted in only one criminal case and 17 administrative reviews, despite the large number of irregularities reported. In June, Transparency International published a report on graft in defense establishments, highlighting secrecy in the military as a major obstacle to fighting government corruption.
Low tax collection, another symptom of weak and corrupt institutions, has been improving since 2009, when taxes and social payments accounted for just 19.9 percent of Armenia’s GDP. In 2014, this figure climbed to 23.5 percent. Armenia rose to 45th place in the World Bank’s Doing Business 2015 report, with the biggest improvement in the ability to collect taxes, which had previously been a major issue. Due to recent changes, all taxes can now be paid online.
Since mid-2013, the Special Investigation Service has posted daily updates on corruption arrests and cases on its website. Several dozen cases of bribery and other forms of corruption were opened in 2014. The military commissioners of the Nor Nork district of Yerevan, who extorted bribes from conscripts with health problems, were arrested in March. In another case, a criminal investigator was arrested for accepting a bribe to release a man suspected of murdering a child. However, most cases opened in 2014 are still being investigated, and it remains to be seen if the perpetrators will receive adequate sentences. One notorious corruption case ended on 8 December, in which the prosecution found the former head of the State Social Security Service Vazgen Khachikyan and 12 other officials guilty of embezzling over half a million dollars’ worth of pension funds. The defendants received between 20 months and 12 years in prison.
In September, a draft law that would have reduced the turnover tax for small and medium enterprises (SME) from 3.5 to 1 percent was postponed following opposition to the requirement that SME purchase cash registers and report their turnovers. The prime minister argued that the law would have prevented large businesses from filing as an SME as a means of tax evasion, while small family businesses were exempted from the turnover tax.
Public and state institutions became more transparent in 2014. Online access to information improved overall, and Armenia rose to the 61st place in the 2014 UN E-Government Survey, a significant jump from 94th place in 2012. According to the GiveMeInfo Project of USAID and the OSCE, state and public bodies answered promptly and in full to 44 percent of all information requests in 2014, with another 25 percent answered in full albeit late. However, 3 percent of requests were rejected without reason, and 16 percent were left unanswered.
Author: Alexander Iskandaryan
Alexander Iskandaryan is the director of the Caucasus Institute, a think-tank and educational center in Yerevan, Armenia. He also lectures and publishes on politics, democracy, and political transition.
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 Parliamentary elections were held in 2012 and presidential and Yerevan City Council elections in 2013.
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 “Ինչպես արտահայտել զայրույթը. գորիսեցիները զրկվել են քաղաքապետ ընտրելու հնարավորությունից” [How to express anger: Goris population deprived of the right to vote], Epress.am, 21 May 2014, http://www.epress.am/2014/05/21/ինչպես-արտահայտել-զայրույթը․-գորիսե.html; Republic of Armenia Central Electoral Commission, Sunday, June 08, 2014 To the Head of Community (Goris-Syuniq) election- Result (Yerevan: CEC, June 2014), http://www.elections.am/selfgovernmentbodies/election-25739/.
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 Marina Mkrtchyan, “Бывшие друзья сошлись в поединке” [A duel between former friends], Голос Армении [Voice of Armenia], 3 June 2014, http://www.golosarmenii.am/article/23798/byvshie-druzya-soshlis-v-poedinke.
 Ashot Safaryan. “Four opposition parliamentary forces to submit 12 claims to the Government,” ArmInfo, 2 June 2014, http://www.arminfo.info/index.cfm?objectid=037E83B0-EA6B-11E3-99F80EB7C0....
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 ''Protest in Yerevan, Armenia, Against Russian Intervention in Crimea,'' Epress.com, 3 May 2014, http://www.epress.am/en/2014/03/05/photos-video-protest-in-yerevan-armen....
 In 2012, Russia’s parliament adopted a law that required NGOs engaging in political activities and receiving foreign funding to register with the Ministry of Justice as “foreign agents.” See Sargis Arutyunyan, “Рупор Кремля - Дмитрий Киселев выдвигает Армении требования'' [Kremlin- Dmitriy Kiselyov to put forward requirements for Armenia], RFE/RL , 12 June 2014, http://rus.azatutyun.am/content/article/25419421.html.
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 Marianna Grigoryan, “Armenia’s Fight against Gender Equality Morphs into Fight Against EU,” Inter Press Service News Agency, 15 October 2013, http://www.ipsnews.net/2013/10/armenias-fight-against-gender-equality-mo... Հայաստանի Հանրապետության Օրենքը: Կանանց եվ Տղամարդկանց հավասար Իրավունքների եվ Հավասար Հնարավորությունների Ապահովման Մասին [Law of the Republic of Armenia: Equal Rights and Opportunities for Men and Women] (2 December 2011), available at http://www.parliament.am/drafts.php?sel=showdraft&DraftID=28173.
 “В Ереване состоялся круглый стол на тему «Молодежь и ЕАЭС: новые горизонты и реальные перспективы” [A roundtable held in Yerevan on the topic “Youth and the EAEU: new horizons and realistic prospects”], Russian Center for Science and Culture in Yerevan, arm.rs.gov.ru/node/13961; “В Ереване прошло шествие в поддержку семейных ценностей” [A march held in Yerevan in support of family values]. Caucasus Knot, 25 September 2015, www.kavkaz-uzel.ru/articles/249719/.
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 ''Տեղական ինքնակառավարման ոլորտի համար նոր ժամանակներ են սկսվում'' [A New Era for the Local Self-Government Bodies], Hetq, 17 October 2014, http://hetq.am/arm/news/56907/texakan-inqnakaravarman-olorti-hamar-nor-z....
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 The governor of Ararat became the minister of nature protection and the governore of Tavush the vice-minister of urban planning.
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 National Statistical Service of the Republic of Armenia, Women and Men in Armenia, 2014 (Yerevan: NSS, 2014), 147, http://armstat.am/file/article/gender__09.10.2014.pdf.
 Irina Ovannisian, ''Министр юстиции известен своими заявлениями в связи с 1 Марта'' [The Minister of Justice famous for his announcements in regard to March 1], RFE/RL, 5 May 2014, http://rus.azatutyun.am/content/article/25373864.html; The Government of the Republic of Armenia, Team Members- Hovhannes Manukyan, http://www.gov.am/en/gov-members/583/. National Statistical Service of the Republic of Armenia, Социально-Демографический Сектор: Правонарушения- Преступность [Social Demographic Sector: Offences- Crime] (Yerevan: NSS, January 2015), 148, http://www.armstat.am/file/article/sv_12_14r_550.pdf.
 European Commission’s Development and Cooperation Office, EU Neighbourhood Barometer: Eastern Partnership: Autumn 2014 – Wave 6 (Brussels: European Union, 2015), 20, http://euneighbourhood.eu/wp-content/uploads/2015/02/6009ENPI_Report-Wave-6_East_EN_final.pdf..
 Control Chamber of the Republic of Armenia, Հայաստանի Հանրապետության Վերահսկիչ Պալատի 2013 թ. Տարեկան հաշվետվության դրույքներ [Annual Report by the Control Chamber of the Republic of Armenia 2013], 31 March 2014, http://www.coc.am/files/year_reports/Arm_4_4_2014_16_11_9_iiwkdscb.doc.l; “Контрольная палата Армении считает неслучайными многочисленные случаи приема на работу беременных за месяц до декрета” [Control Chamber of Armenia considers numerous cases of hiring of women a month before maternity leave are not coincidental], Pastinfo.am, 5 May 2014, http://pastinfo.am/ru/node/40150.
 “Վերահսկիչ պալատի աղմկահարույց զեկույցի հիմքով ընդամենը մեկ քրգործ է հարուցվել [Just one criminal case was initiated following the Control Chamber of Armenia’s whistle-blowing report], News.am, 25 June 2014, http://news.am/arm/news/216295.html.
 Transparency International Anticorruption Center of Armenia, Corruption Risks Assessment In Defence Establishments In Armenia, (Yerevan: Transparency International Anticorruption Center, 2014), http://transparency.am/files/publications/1410875966-0-354121.pdf.
 The rating methodology changed in 2014; Armenia rated thirty-seventh in 2013, but using the new methodology, its 2013 rating was forty-ninth. See World Bank Group, Doing Business 2015- Economy Rankings (June 2014), http://www.doingbusiness.org/rankings /.
 “Մանրամասներ Նոր Նորքի զինկոմի եւ նրա աշխատակցի ձերբակալման դեպքի վերաբերյալ” [Details concerning the detention of Nor Nork military officer], News.am, 10 March 20, 2014, http://news.am/arm/news/199919.html.
 “За взятку от целительницы виновной в смерти ребенка, арестован следователь Артур Казарян” [Investigator Artur Ghazaryan arrested for accepting a bribe from a healer guilty of child’s death], Gisher News, 17 May 2014, http://news.gisher.ru/ru/society/kalanavorvel-e-datavory-ov-kasharq-e-ve... “Կաշառք ստանալու համար ձերբակալվել է ՃՏՊ փորձաքննությունների բաժնի պետըԿաշառք ստանալու համար ձերբակալվել է ՃՏՊ փորձաքննությունների բաժնի պետը” [Head of Expertise Department arrested for taking a bribe], Tert.am, 21 May 21, 2014, http://www.tert.am/am/news/2014/05/21/Bribe-arrest/?sw; “Арестован начальник отдела Министерства охраны природы Армении” [Department Head at Ministry of Nature Protection Arrested], Первый Армянский Информационный [First Armenian News], 28 August 28, 2014, http://ru.1in.am/1059282.html; “Կաշառք ստանալու պահին ձերբակալվել է Սևանի քաղաքացիական կացության ակտերի գրանցման բաժնի պետը. ԱԱԾ” [Head registrar of Sevan arrested for taking a bribe],Tert.am, 24 September 2014, http://www.tert.am/am/news/2014/09/24/nsc/?sw; Ruzanna Stepanian, “Judge Arrested On Bribery Charges.” RFE/RL, 26 December 2014, http://www.azatutyun.am/content/article/26764357.html.
 Khachikyan himself received a 12-year sentence. See Zaruhi Mejlumyan, “Yerevan Court Finds 13 Civil Servants Guilty of Embezzling $575K in Pension Funds,” Hetq, 8 December 2014, http://hetq.am/eng/news/57694/yerevan-court-finds-13-civil-servants-guil....
 Business Support Office- Armenia, “‘Family business’ classification and exemption from taxes,” news release, 2 September 2014, http://www.bso.am/family-business-classification-and-exemption-from-taxes/.
 United Nations Department of Economic and Social Affairs, United Nations E-government Survey 2014: E-government for the Future We Want (New York: United Nations, 2014), 199, http://unpan3.un.org/egovkb/Portals/egovkb/Documents/un/2014-Survey/E-Go....
 “Statistics on the Freedom of Information Situation in Armenia,” Givemeinfo.am.