ARMENIAN LEADER SAYS ECONOMY AFFECTED BY GEORGIA-RUSSIA CRISIS

Public Television of Armenia
Sept 3 2008

The recent situation in the South Caucasus has inflicted a serious
damage on Armenia’s economy, this country’s president, Serzh Sargsyan,
said at his meeting with Armenian diplomats and representatives to
international organizations in Yerevan on 3 September. The meeting
was broadcast by Armenian Public TV at 1630 gmt on the same day.

Sargsyan said that Armenia is interested in a "peaceful resolution
of all problems in Georgia" which neighbours Armenia. He noted that
there were three "crucial tasks" for Armenia in the current situation:
resolution of frozen conflicts, transit routes, and development of
Armenia’s international relations. Sargsyan expressed his confidence
that "it is impossible to solve conflicts using force, and the
events in South Ossetia will have a sobering effect on those who are
still tempted to take this kind of step by increasing their military
potential and making belligerent statements", presumably referring
to Azerbaijan.

He said that the situation in South Ossetia, Abkhazia, and Kosovo had
once again shown that the final decision depends on the "strong will"
of the people in those regions expressed through a referendum. Sargsyan
said that Armenia cannot recognize the independence of Abkhazia and
South Ossetia without recognizing the independence of Azerbaijan’s
breakaway region of Nagornyy Karabakh. "Armenia should persuade
Azerbaijan that recognition of Karabakh’s independence is inevitable,"
he added.

Speaking about transit routes and energy supplies, Sargsyan said
that the construction of the Iran-Armenia gas pipeline had already
been completed and "we are capable of receiving gas from the Islamic
Republic of Iran". He added that final works that were currently
being carried out on the pipeline would probably be completed by
October. Armenia will be able to receive 2-2.5bn cubic metres of
gas a year from Iran, he said. Sargsyan pointed out that Armenia
and Iran were currently preparing other joint projects with Iran,
including construction of an oil refinery and Armenia-Iran railway.

Speaking about ties with Turkey, Sargsyan said: "It is possible to
make changes to the relations between Armenia and Turkey which need to
show political will and consistency. This will be the cornerstone of
political maturity for both countries." He added that he had invited
Turkish President Abdullah Gul to Armenia to jointly watch a football
match between the two countries’ national teams on 6 September because
he was sure that direct contacts were the only way to settle the
relations between the neighbouring nations. Sargsyan pointed out that
"without forgetting the past, they [Turkey] should look to the future
and begin contacts without preconditions". He said he believed that
the two countries would be able to discuss "any issues, even the most
difficult ones".

Sargsyan noted that Armenia should expand its involvement in "regional
and different international formats". He said that Armenia was trying
to boost cooperation within the framework of the Collective Security
Treaty Organization (CSTO). He highly assessed the CSTO’s Rubezh-2008
(Frontier-2008) joint command-staff exercise that was recently held in
Armenia. He added that Armenia would expand its bilateral and strategic
cooperation with Russia. Sargsyan also said that the during the
recent meeting with his Russian counterpart Dmitriy Medvedev in Sochi,
they discussed the implementation of a number of regional projects.

He noted that Armenia also intended to expand its cooperation with the
USA and the two countries have serious plans in this direction. The
president added that Armenia also was also expanding its relations
with the EU within the framework of the European Neighbourhood Policy
and he would do his best to fulfill commitments undertaken "as soon
as possible".

Sargsyan said that Armenia would "consistently continue" its relations
with NATO within the framework of the Individual Partnership Action
Plan. He added that military exercises within the framework of
NATO’s Partnership for Peace Programme would be held in Armenia in
the near future.

Sargsyan also urged Armenian diplomats to improve their work, saying
that he was dissatisfied with it.