U.S. CUTS MILLENNIUM CHALLENGE AID TO ARMENIA OVER WORSENING DEMOCRATIC PRACTICES

uts-millenium-challenge-aid-to-armenia/
Jun 11, 2009

YEREVAN (RFE/RL)-The United States has effectively axed nearly
one third of a $235.6 million aid program for Armenia, citing its
government’s deteriorated human rights record and democratic practices.

The U.S. Millennium Challenge Corporation (MCC) indicated late on
Wednesday that the $67 million project to reconstruct and repair
about 1,000 kilometers of Armenian rural roads will not be implemented
anytime soon.

The agency, which administers the U.S. Millennium Challenge Account
(MCA) program, froze the project following a harsh government crackdown
on the Armenian opposition sparked by the disputed presidential
election of February 2008. The MCC board of directors has extended
the freeze during quarterly meetings held over the past year.

In a statement issued after its latest meeting in Washington chaired by
Secretary of State Hillary Clinton, the board said MCC "will not resume
funding for any further road construction and rehabilitation." "The
responsibility for this outcome remains with the government of Armenia,
whose actions have been inconsistent with the eligibility criteria that
are at the heart of the MCC program," Rodney Bent, the corporation’s
acting executive director, was quoted as saying.

"I do not anticipate that the Board will revisit this issue in the
future," added Bent.

The move came one day after the U.S. State Department reiterated its
discontent with Yerevan’s human rights record in an annual report on
U.S. efforts to promote freedom and democracy around the world. It
again described the February 2008 ballot as "significantly flawed"
and criticized the ensuing government crackdown on the opposition.

"Authorities used harassment and intrusive application of bureaucratic
measures to intimidate and retaliate against government opponents,"
said the report. "Police beat pretrial detainees and failed to provide
due process in some cases … Courts remained subject to political
pressure from the executive branch, with the selective prosecution
of political opponents and absence of due process reflecting the
judiciary’s lack of independence."

"U.S. officials repeatedly have warned the government that MCC funding
is contingent upon its progress in democratic practices and in meeting
the MCC indicators," added the report.

U.S. assessment of the May 31 municipal elections in Yerevan promises
to be just as negative. U.S. Ambassador to Armenia Marie Yovanovitch
said on Tuesday that U.S. Embassy officials who observed the vote
witnessed irregularities "throughout the city." Yovanovitch said a
report based on their findings will be released shortly.

The U.S. aid suspension led the Armenian government in July 2008 to
allocate about $17 million of its own funds to rural road construction
envisaged by Armenia’s MCA compact. The current economic recession and
a resulting major shortfall in tax revenues preclude more such funding
this year. Instead, the government secured in February a $25 million
loan from the World Bank for rural infrastructure rehabilitation.

The aid cut will not affect the main $160 million segment of the aid
package approved by MCC in 2006. It is due to be spent on rebuilding
and expanding the Armenia’s irrigation networks.