Armenia’s oligarchy in trouble

In a somewhat predictable move, Armenian President Serzh Sarksyan has sent a letter to parliament speaker Galust Sahakyan urging that protocols between Turkey and Armenia be retracted.

Sarksyan, who asserted in his letter that Turkey has not taken the steps necessary in conjunction with the 2009 protocols — signed to normalize ties between Turkey and Armenia in Zurich on Oct. 10, 2009, with the goal of establishing diplomatic relations and opening the two countries’ land border — and that it is Ankara which bears full responsibility for this failure, noted also that political will in Turkey on the Armenian front is sorely lacking.

Sarksyan is, of course, a skilled chess player, and his moves in the run-up to April 24 — the day on which the Armenian victims who died at the end of World War I in Ottoman Turkey are commemorated — are a repeat of past years; he is trying to draw the attention of the international community to the situation between Yerevan and Ankara. In the meantime, Sarksyan’s stance never wavers from the principle of not being the first side to sit down at the table for talks; he is also now using the lack of political activity in Turkey on the protocol front in a masterly — and timely — manner.

At work in this latest move from Sarksyan is not just the hasty stance taken by the Turkish side in inviting him to Çanakkale, commemorating the centenary of the battle of the Çanakkale Campaign of World War I, but also domestic political turbulence at home in Armenia. And this is the most important symbol of the oligarchic battle that began recently in Armenia.

The war between Sarksyan and Armenia’s biggest oligarch, the founder and leader of the Prosperous Armenia Party (BHK), Gagik Tsarukyan, might well make Sarksyan even more authoritarian than he already is. For his part, Tsarukyan has the widely known nickname of “Dodi Gago” or “Stupid Gago,” and as not only an oligarch but an important politician he has displayed an anti-Sarksyan stance for a while now, working in concert with generally anti-Sarksyan blocs in Armenia.

Worsened Relations Between Sarksyan and Tsarukyan

Recent decisions made by the ruling party to make moves against tax evasion in Armenia have worsened relations between Tsarukyan and Sarksyan, with worries over the possibility of the loss of his enormous empire pushing him to take an even tougher stance. In the meantime, though, the response from Sarksyan — who is himself a resilient former soldier — did not take long in coming. Labeling Tsarukyan a disaster for the state, Sarksyan first announced that the oligarch had been unceremoniously kicked off the National Security Council of Armenia, and then noted that people should not expect to be able to arrive at and depart from such an important council as though they were “going to the cinema.” As this was playing out, circles close to Sarksyan began to underscore how vital it was to eliminate Tsarukyan without wasting time. It is expected that, at any moment now, Sarksyan will strike a serious blow at Tsarukyan’s chain of oligarchy. In the meantime, another important Armenian oligarch, Hovik Abrahamyan, has announced his full-fledged support for Sarksyan, thus putting Tsarukyan even more in the target position.

As all this unfolds, Robert Kocharyan, who was the second president of Armenia, and is also one of the most critical fulcrums in the unshakable Armenian oligarchy, has called on all sides to bring this war to an end as soon as possible.

Kocharyan, who underscored in his announcement that the oligarchic war would have negative effects on the country’s economy, the Karabakh issue and, of course, all the topics related to the 100th anniversary of the Armenian genocide, has also noted his real fears that the war might come right to his own doorstep. Following Kocharyan’s announcement, Sarksyan and Tsarukyan did, in fact, hold a private meeting in which the war was postponed for the time being. Tsarukyan’s decision to make peace for now has, in the meantime, greatly disappointed opposition forces in Armenia, who had been planning large rallies with this oligarch and politician. While that particular war has abated for the time being, it does appear that the question of how Armenian resources are to be distributed looks set to elicit the axes of war again in the near future. And so this is, for now, the greatest deadlock in Armenia, where the opposition seems unable to move into action, one way or the other.

In terms of understanding these latest developments, it is important to grasp just what a terrible state Armenia is in, and how firmly rooted the “mafioso” oligarchy that leads it has become. Just one example in all this can be seen in the considerable assets of former President Kocharyan, whose worried attempts to intervene in the unfolding war were notable. Kocharyan single-handedly holds some 80 percent of cellphone imports into Armenia in his hands; he is also the sole owner of many banks, mines and holiday facilities throughout the country. But it doesn’t end there; Kocharyan also owns a shopping center and gambling casinos in Moscow. He is also an “honorary” partner and board member of countless Armenian companies.

As for Tsarukyan, he worked in Russia during the 1980s as a gendarme, later going to prison based on what some (widely spread) rumors assert were rape charges. Tsarukyan’s rapid accumulation of power and assets came during the era of Kocharyan’s presidency; although he did not have much in connection with the political sphere, Tsarukyan managed to acquire factories (cement and alcohol manufacturing), petrol stations, furniture production facilities and mining companies during this time. Known now for his luxurious personal abodes, Tsarukyan is also said to love keeping both lions and predatory birds on the grounds of his homes.

In order to get a complete picture, though, it is of course also helpful to take a look at the assets of Sarksyan and his supporters as well. Sarksyan was a military commander during the era of the Karabakh war, and was until recently listed as the eighth-richest person in all of Armenia. Interestingly, Sarksyan is also an avowed gambler, even facing accusations on this front at the 2013 Parliamentary Assembly of the Council of Europe (PACE). At the time, Zaruhi Postanjyan, of the opposition Heritage Party, asked Sarksyan directly whether or not it was true that he had lost 70 million euros at a European casino. The line of questioning caused reverberations in the global press at the time due to the striking nature of the topic. Sarksyan has an enormous financial empire of his own; this includes many personal homes, buildings, a holiday resort, a petrol station, cement and alcohol factories, market chains, a football team and his own bank. He manages many of these through a variety of different partnerships he has formed over the years.

In the meantime, Sarksyan’s brother Sashik, who had some serious clashes with Tsarukyan in previous years, moved to the US, along with his own considerable fortune; the $30 million he brought with him remain shrouded in mystery as to their origin.

At the same time, it is also important to remember that the less prominent figures in Armenian politics sometimes have personal wealth and assets that far overshadow those that dominate the news with their warring. For example, the personal financial empire of Prime Minister Abrahamyan, who has proffered his full support for Sarksyan in this latest round of clashes with Tsarukyan, far outweighs those of the oligarchs we have listed thus far. Abrahamyan owns petrol stations, holiday resorts, mines, countless fields, cement and alcohol factories, hotels and apartments; he also has family ties through marriage with Tsarukyan. One of Tsarukyan’s daughters is married to Abrahamyan’s son. These days, Abrahamyan has become one of the most hotly debated figures in the Armenian media, as he has chosen to take sides with Sarksyan despite familial relations with Tsarukyan.

For years now, various groups have managed to plunder and take control of Armenia’s natural resources, using the protection of their political ties that give them unhindered access and no risk of prosecution. It is a giant oligarchic structure, and one whose enormous accumulation of wealth sometimes triggers arguments over how to divide assets. The structure is filled with names willing to remain quiet over internal disputes in order not to trigger public political fights. At this point, though, it appears that one faction of this structure is preparing to peel off, and the coming division will herald the emergence of a new group.

The recent move made by Sarksyan in regard to Turkey — a move that comes at a time of extraordinary tension at home — has clearly been made with calculations that have far-reaching implications. The attempts to strike down Tsarukyan and other chains in the oligarchic structure can all be interpreted as a reflection of rising authoritarianism on Sarksyan’s part, and as an attempt to block any slide in the existing axis of power. As the scene in Armenia appears more and more like that of a country under complete Russian guidance, Sarksyan’s unceasing desire to take single-handed control is now bringing the country face-to-face with even greater problems. One of which is that the various groups attached to and dependent on the Kocharyan chain of wealth and oligarchy appear unwilling to remain silent given all this.

Mehmet Fatih ÖZTARSU

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