Armenia's Latest Anti-Corruption Crusade

Up and coming businessman Artak Barsegian was watching Prime Minister Andranik Migranian make a TV statement about his government's intention to crack down on corruption in Armenia.

"Privately, I have very strong doubts that any of this will bear fruit," he said. Only a day earlier, Barsegian had paid a 500 US dollar bribe to a government official to register his new consulting company. The official agreed to process all the necessary documents in exchange for the "tip".

"Sure, I had the choice not to bribe him," conceded Barsegian, "but then I would have to do it by myself, bribing a chain of bureaucrats one by one."

Armenians have little faith in government commitments to anti-corruption programmes. Every political leader since 1998 has pledged to curb bribery and backhanders. In March 1998, President Robert Kocharian peppered his presidential campaign with anti-graft rhetoric. Two years ago, Prime Minister Vazgen Sarkissian, who was murdered in a terrorist attack on parliament in October 1999, also promised a massive crackdown.

Just five days before his death, he said: "Corruption has become a catastrophe for Armenia." Some Armenians believe that Sarkissian's ostensible decision to cleanse the government of kickbacks was one of the prime motives for his murder.

His brother, Aram Sarkissian, who became the next prime minister, insisted that no-one would be immune from investigation, regardless of position. "In our fight against corruption, we will look to individuals, and not to their office," he declared. But nothing really changed during his tenure as premier.

Aram Sarkissian's successor, Migranian, has now made a new "anti-corruption strategy" a central plank in policy. He says he is the man who will make the country safe for sensitive foreign investors, sweeping away every last vestige of shady dealing.

Yet Armenia's anti-corruption strategy is the outcome of persistent pressure from the US government, the IMF and the World Bank.

On May 8, the government signed an agreement with the World Bank for a 300,000 US dollar package to create an anti-corruption programme. The Yerevan office of the Organisation for Security and Cooperation in Europe, OSCE, will manage the programme, in collaboration with a special working group composed of representatives of government and international organisations.

"Armenia is a small country and, if there is a political will, we can achieve significant results in fight against corruption," said Roy Reeve, head of the OSCE office in Yerevan. After meeting with ministers in the Armenian government, he is convinced that the determination to deal with the problem now exists. With the US also promising its support to the programme something might finally be done.

Allegations of high-level corruption continue to dog the government. While there are many instances of the integrity of public servants being called into question, the energy sector is most rife with allegations of financial impropriety. A year ago, an ad hoc parliamentary commission set up to look into corruption presented a report alleging that bribery and embezzlement cost Armenian taxpayers 200 million US dollars a year. A special working group was set up to look into the commission's findings. Some 25 officials are currently being investigated.

The latest, and most serious, case came to light following an investigation into gross embezzlement in the ministry of energy. Since the beginning of the year, the prosecutor's office has charged that former energy minister Ashot Safarian was involved in gross financial misappropriation in 1992-99. Safarian was arrested, but then set free in early summer. The prosecutor's office claims that the investigation continues, but no start date for court proceedings has yet been announced.

The government has backed a whistle-blowing initiative that could help track down officials who have made off with public money. But there are critical delays in bringing suspects to trial, as demonstrated by the success, so far, of the former energy minister in stalling legal proceedings against him.

Another anti-corruption initiative, the much-discussed draft law on the civil service, was finally passed by parliament in its second reading. Final adoption is expected in autumn. With corruption widespread in the civil service, the law could provide the legal muscle with which to fight bribery and nepotism.

Together with Georgia and Azerbaijan, Armenia ranks very badly in the anti-corruption NGO Transparency International's index on "corruption perceptions", coming in at number 76 in a survey of 90 countries conducted in 2000.

One consequence of endemic corruption is an outflow of foreign direct investment from Armenia, as occurred this spring in the energy sector. Almost no applications for participation were submitted after a tender announced by the government.

It remains to be seen whether the current prime minister will succeed where so many of his predecessors have failed.

Ara Tadevosian is the director of Mediamax news agency based in Yerevan and a regular contributor to IWPR.