Author: Raffi Khondkarian

Armenia’s apricot farmers have had a bountiful season, but are unable to enjoy the fruits of their labour. They say that Spayka, an exporter with alleged connections to the president’s son-in-law, has captured the market — and is abusing its misbegotten power.

Khachatur Abrahamyan lives in the village of Aralez in the Ararat region of Armenia. He regularly takes a dozen boxes of apricots, which he has grown himself, to one fruit and vegetable shop in Yerevan. Each time he hastily unloads them from the car. The roadside of the shop is dotted with red lines, indicating a paid parking spot. He has only 15 minutes to unload the apricots and leave, otherwise, he faces a fine of ֏5,000 ($10).

Abrahamyan does not want to pay ֏150 ($0.3) for an hour of parking — it is a matter of a principle for him.

‘The streets belong to us as much as to “them”. Why should I pay for parking even when it is not clear to whom I am paying?’, says Khachatur, involuntarily swinging his arms.

The red lines are just the tip of the iceberg of his discontent, apparently accumulated over the month since the beginning of the season. Unlike in previous years, this harvest of apricots has been extremely bountiful. However, the villagers are not satisfied. At the beginning of July, the wholesale prices for apricots ranged from ֏100–200 ($0.2–0.4) per kilogramme. Last season, the price per kilogramme was from ֏300–1,000 ($0.6–2). Khachatur’s income for the whole year comes from the sale of apricots in June–July.

‘The government is the main culprit for the current situation. They do not control Spayka and other buyers of apricots. [The companies] adjust the prices as they see fit, while we make a loss’, he says resentfully.

Abrahamyan unloads the boxes and takes his money. Despite his indignation for the situation, he starts smiling. He accumulated debts over the winter and can now repay them. Annual preferential interest rates for state-supported agricultural loans reach 24%. Abrahamyan hopes that the apricots will allow him to pay off all his creditors. He, like many of his fellow villagers, hoped that the plentiful harvest would allow them not only to pay off their loans, but to get by until next season.

‘Now it is clear that this will not happen. God only knows what we will do now. Probably, we will again have to go to Russia to work’, says Khachatur, leaving the shop.

Spayka is an Armenian export firm which has a monopoly on exports of Armenian apricots. It is not known for certain who the real owners of the enterprise are, however the media often link Spayka with the name Mikayel Minasyan, Armenian Ambassador to the Vatican and son-in-law of the president.

The company’s transport fleet exceeds 200 lorries. They export and sell fruits and vegetables to Russia, other former Soviet republics, and to Europe. Spayka’s investments in agricultural production are expected to reach $68 million in 2017; last year, this was $86 million.

The company has two main bases in Russia: in Krasnodar and Moscow. Other Russian regions receive Armenian products from these two points under the Ararat Fruit brand. In 2016, Armenia produced 85,000 tonnes of apricots, more than 25,000 of which was exported to Russia.

In June, the Armenian government transferred 160 hectares of land to Spayka on the outskirts of Yerevan. The company plans to build new bases and complexes on this land.

A scandal recently broke out after a number of small Armenian exporters to Russia began to appeal to Lena Nazaryan and Arayik Harutyunyan, two MPs from the opposition Yelk (Way Out) block. They claim that Spayka has blocked access to the largest wholesale markets in Krasnodar, ‘Roza Vetrov’ (Rose of the Winds) and ‘Khutor Lenina’ (Lenin’s Farm), to other apricot exporters from Armenia.

These markets now accept produce only from Spayka. Lorry drivers who work in Krasnodar were advised to look for other markets outside the region. This forced small exporters to suspend purchasing of apricots. Spayka did the same — for a couple of days. As a result, in the second half of June — right in the high season — the price for choice apricots from rural residents of the Ararat and Armavir regions decreased from ֏600 to ֏400 ($1.2 to $0.8) per kilogramme. Naturally, the prices for fruit on the market started to fall precipitously.

Apricots are particularly perishable fruits, their season lasts no more than a month and a half. The temporary suspension in exports led to a glut on the local market and a drop in prices to ֏100–200 ($0.2–$0.4).

Spayka gave no official reaction to the issue, however, Samvel Farmanyan, an MP from the ruling Republican Party closely connected to the company and directly with Mikayel Minasyan, wrote a post on his Facebook page with the note ‘for media attention’, where he presented his conversation with a representative of the company’s management.

He said that he knew nothing about the problem of small exporters and that the company buys all available apricots from villagers. He also claimed that in Russia, Spayka must compete fiercely with exporters from Azerbaijan and Turkey, and all who do not believe this can go see for themselves.

However, rural people from apricot growing regions did not appreciate these comments, and residents of the village of Jrashen, Ararat region, blocked an important highway at the end of June, in protest against Spayka violating agreed prices. The company offered ֏400 ($0.8) per kilogramme instead of the previously agreed ֏600–800 ($1.2–$1.6). Representatives of the ministry went to Jrashen and soon announced that that they had ‘fixed the problem’.

However, villagers noted that the conflict was resolved solely at their expense — they had to agree to sell apricots at the proposed price.

The Ministry of Agriculture disputes the villagers’ position and accusations against Spayka. Deputy Minister Robert Makaryan attributes their ‘aggressive attitude’ with the late ripening of apricots putting Armenian growers behind others. He noted that in Daghestan and Uzbekistan, for example, fruits ripened much earlier, which led to the price dropping on the Russian market.

Referring to the head of Armenia’s trade mission in Russia, Karen Asoyan, the deputy minister, said that Krasnodar itself initiated the closure of the market for small exporters. Minister for Agriculture Ignati Arakelyan told reporters on 10 July that private companies do not create obstacles for small exporters, the problem lies in the fact that large countries often seek to work with large suppliers, in this case with Spayka.

The owner of a large fruit and vegetable shop in Yerevan, Gnel Hayrapetyan, says that the weak purchasing power of Yerevan’s residents is also to blame for the low prices.

‘There are not so many wealthy working people today. Additionally, now is the holiday season, the city is empty, so trade has fallen. We are forced to keep these prices, because at the end of the day we have to throw most of the produce in the dumps. Therefore, we do not sell apricots for cheaper than ֏500 ($1) per kilogramme. There is nothing to be done. It is necessary to survive somehow’, says Hayrapetyan.

He adds that there are various reasons the prices fall. According to him, one is the bountiful harvest of apricots this year, not only in Armenia, but in Russia and Uzbekistan as well. Another, he says, lies in the aspiration of some companies to create a monopoly and to force competitors from the market, through the alternation of dumping and artificial understatement of prices.

Both factors hit hard the pockets of rural residents, who are in a desperate situation and cannot even repay their loans. Hayrapetyan says that he often buys apricots knowing that he will not be able to make a profit on them, because he has many old friends asking him for support.

Statement by H.E. Mr. Edward Nalbandian, Minister of Foreign Affairs of Armenia at the Informal Ministerial Meeting of the OSCE

“Building trust through dialogue and cooperation”

Mr. Chairman,

Dear Colleagues,

Ladies and Gentlemen,

I would like to thank the Austrian Chairmanship and particularly Minister Sebastian Kurz for organizing this informal Ministerial discussion.

Joining efforts with a view to overcoming distrust and increasing confidence is enshrined in the birth certificate of this Organization, while dialogue and cooperation have been long identified as the instruments for achieving our common goals. We appreciate the Chairmanship’s initiative to once again apply to the foundations of the OSCE, since neither dialogue, nor cooperation can be taken as granted nowadays. We hope that this kind of discussions can contribute to reviving the true spirit of cooperation, being mindful that the most noticeable accomplishments of the OSCE have been secured through dialogue and compromise, political will and good faith.

The setbacks of our cooperation and erosion of trust do not merely limit to the existing disagreements on number of areas. Here we refer also to the abuse of the principle of consensus, the consequences of which go far beyond from damaging the trust, especially in the cases where there is none, but rather shaking the very essence of the OSCE which is designed to solve the issues through dialogue and cooperation and never through imposing the position of one participating State at the expense of all others and the entire Organization. Thus, the refusal of Azerbaijan to join the consensus on the extension of the mandate of the OSCE Office in Yerevan damages not merely the integrity of the field missions of the OSCE but its capacity of inclusive cooperation in implementing the commitments. Azerbaijan failed to respect the OSCE commitments back home and eliminated the OSCE Office in its own country before it attacked and closed the OSCE last assets in the region.

The violation and abuse of shared norms and principles do not happen in a vacuum. It does not come as a surprise that this participating State found itself alone and in isolation in challenging the OSCE Office in Yerevan.

Ladies and gentlemen,

The dire record of Azerbaijan’s noncompliance encompasses all three dimensions of the OSCE. The leadership of Azerbaijan uses every opportunity to boast about multiculturalism allegedly cultivated by them. In reality thousands masterpieces of Armenian cultural and historic heritage, sacred sites, churches, monasteries, cross stones destroyed and erased by Azerbaijan testify to the contrary. The 2016 report of the European Commission Against Racism and Intolerance states: “Political leaders, educational institutions and media have continued using hate speech against Armenians; an entire generation of Azerbaijanis has now grown up listening to this hateful rhetoric”. It is this generation raised in the environment of such propaganda that again and again commits despicable crimes. How could the leadership of Baku talk about multiculturalism at the same time declaring that “all Armenians of the world are number one enemies of Azerbaijan”? Probably it considers this to be part of Baku’s self-proclaimed “intelligent power”. There is nothing smart in trying to mislead the international community, especially those countries that do not have, difficulty to find out the truth, to warn their citizens of the Armenian origin to avoid visiting Azerbaijan, where they will be subjected to outrageous racist discriminating practice on the basis of their ethnicity.

Mr. Chairman,

In April 2016 Azerbaijan unleashed a large scale aggression against Nagorno-Karabakh that was accompanied by the grave violations of international humanitarian law, atrocities against the civilian population, including children, women and elderly persons, mutilation of the bodies, Daesh-style beheadings, which have been condemned by international community.

The OSCE Minsk Group Co-Chair countries initiated Summits in Vienna and St. Petersburg aimed at overcoming the consequences of Azerbaijan’s aggression as well as at creating conducive conditions for the advancement of the negotiation process.

During the Vienna Summit it was particularly agreed upon and then reconfirmed in St. Petersburg to establish the OSCE mechanism for investigation of the ceasefire violations; to increase the number and enhance the capacity of the OSCE monitors on the line of contact between Nagorno-Karabakh and Azerbaijan, and on the border between Armenia and Azerbaijan. The commitment on the exclusively peaceful settlement of the conflict was reiterated, the strict adherence to the 1994-1995 ceasefire agreements was emphasised.

Trust and confidence are built when agreements are implemented. With this understanding Armenia and Nagorno-Karabakh gave their consents to implement the mentioned high level agreements. Azerbaijan backtracked from those agreements as it had done with prior commitments many times before. This attitude of Azerbaijan questions its credibility for being a party to negotiations, which honours its agreements.

Ladies and gentlemen,

In the framework of the OSCE trust means first of all trust into Organization and its ability to address eminent security challenges in Europe. We firmly believe that based on the proposals of the Co-Chairs the OSCE should enhance its presence on the ground in the conflict zone on more permanent and stronger basis. In this respect the OSCE could help all parties to the conflict to respect ceasefire, avoid military escalation and build trust and confidence. The OSCE is an organization which was created on the lessons of history and history teaches us on many occasions that war is an outcome of misperception and miscalculation of security environment while peace is an outcome of trust. Azerbaijan has chosen a different path.

People on all sides of the conflict deserve to know who pushes them to the path of loss and suffering. Identifying the security threats in impartial and responsible manner is important for credibility of this Organization as well.

We took note that in their statement the OSCE Minsk Group Co-Chairs identified Azerbaijan as a party who first resorted to the violence. This has been far not the first appeal of the Co-Chairs addressed directly to Azerbaijan. On previous occasions the Co-Chairs have made a number of clear cut statements calling Baku to refrain from the escalation of the situation, to reaffirm the commitment to peaceful settlement of the issue, to refrain from criticizing the OSCE Minsk Group Co-Chair countries and to respect their mandate, give up efforts to shift the conflict resolution to other formats, to agree to the establishment of investigation mechanism of ceasefire violations. In response to Azerbaijan’s claims that tried to question the validity of the ceasefire agreements of 1994 and 1995, the Co-Chairs clearly stated that these agreements have no time limitation and should be strictly adhered to.

However, Azerbaijan ignores all appeals of the Co-Chair countries and continues to stick to its highly destructive attitude at the negotiation table and provocative actions in the conflict zone.

On July 4th the Azerbaijani leadership once again resorted to the tactics of notorious terrorist organizations and as many times before used its civilian population as a human shield for shelling the territory of Nagorno-Karabakh by heavy weaponry, including by multiple rocket launcher systems. In response, the Defense Army of Nagorno-Karabakh was obliged to exercise self-defense against the aggressive actions of the Azerbaijani side. Baku clearly demonstrated that it is not capable to comprehend the appeals of the Co Chairs.

As long as Azerbaijan fails to respect its international commitments in compliance with 1994-1995 trilateral ceasefire agreements, refuses to implement the Vienna and St. Petersburg Summit commitments, especially on the creation of the mechanism for investigation of the ceasefire violations, that can become also a mechanism for prevention of escalation, Baku bears full responsibility for all consequences for such behaviour.

This stresses once again the imperative for the international community to consider more tangible means to curb Azerbaijan.

We are bound together to advance the cause of peace and security through the OSCE. We will continue to be actively involved in all efforts aimed at building cooperation, consent and trust in the OSCE area.

Thank you.