A Parliamentary Commission study into World Bank (WB) projects in 2004 amazingly found that the World Bank and its sister institution the International Monetary Fund (IMF) were clearly orchestrating ways and means to divert state assets from the Armenian public to a small circle of state associated cronies. Although the commission worked for only a year and studied a very limited sector of WB/IMF projects, it exposed fraud and embezzlement valued at more than two hundred million dollars, about a third of the state budget. Much of that was facilitated through a wider illicit program to transfer, virtually free-of-charge, billions of dollars worth of state assets to state officials, who operated through international front companies, often in Russia, and it included other methodologies which were used to siphon off hundreds of millions of dollars of poverty reduction funds to fill the coffers of the same corrupt state officials.
Fully aware of this massive theft of state assets and misappropriation of state funds, the Bank and the IMF continued to report years of economic boom, led by Foreign Direct Investment in the privatization of state assets, and followed by a boom in the construction sector. The Northern Prospect project of shops, offices and apartments is the star in the construction crown, adorned by dozens of apartment buildings. The construction epidemic has been spreading since the turn of the century, and with ever-increasing fervor; new apartment buildings occupy every available square meter of Yerevan’s city center and even sprawl throughout the outer suburbs in what appears to be a determined rush to expand the availability of real estate square meterage. But the offices and apartments continue to stand empty. Moreover, during the same period, Armenia’s population has seen a reduction of more than half a million, the lesser-privileged having been driven from their Republic to earn a living elsewhere.
In 2004, this presented a quandary to the Parliamentary Commission. Why were the corrupt state cronies continuing to pump hundreds of millions of their illicit dollars each year into construction projects, when there was no sign of the rush of eager punters they needed to turn their money laundering full circle? But by the beginning of 2007, the clouds over the internationally sponsored Yerevan horizon transformation started to clear. It became apparent to those in the know that the ground works were being laid for an eventual resolution of the Karabakh problem. The international community has long been demanding that Armenia withdraw from the occupied territories around Karabakh, as a lead-in to the full return of Karabakh to Azerbaijan. But despite ever-increasing pressure from the Minsk group, their final guidelines of 2004 continued to gather dust. In fact, the guidelines for compromise of the Karabakh issue are essentially the same as those President Kocharian used against his predecessor, Levon Ter-Petrossian in 1997, to drive him out of his Presidential office.
The preparation has been going on in secret right under every one of Yerevan’s million noses, with Kocharian determined the people of Armenia and of Karabakh should not have an inkling of his plan. So he waited his moment, the 2008 Presidential election, when he was to hand over his Presidential sword to his hand picked successor, Serge Sargsyan. With that feat behind them, and with total dominance over Armenia, Sargsyan and Kocharian could finally wash their hands of any responsibility toward their kindred folk and eventually sign the Karabakh agreement. That would lead to an immediate outflow of several thousand refugees from the surrounding territories, followed by an inevitable second wave of tens of thousands from the Karabakhi homeland, more than sufficient to fill the recently constructed Yerevan apartments.
It has been a well-conceived, well planned internationally supported program, essentially to resolve the Karabakh problem, but at the same time giving Armenia’s corrupt state cronies the opportunity to finally reap the rewards of the billions of embezzled dollars they have been laundering through the past years of construction. Azerbaijan will happily pay the two or three months worth of oil revenue needed to have Karabakh back under its control, Russia will probably act as go-between, converting the multi-billion dollar Azerbaijani compensation package to increased Russian investment in Armenia’s construction sector, and the people of Armenia will not only find themselves under increasing Karabakhi led tyranny for the next who knows how many years, they will again have the pleasure of knowing that billions of dollars of their compensation money will have been nicely siphoned off by their leaders - and all with the support and assistance of the World Bank and the International Monetary Fund.
It is for this reason that, since January 2007, I have been pursuing my internationally supported ‘Blowing the World Bank Whistle’ campaign, and why through the past year I have been articulating this message to senior representatives of the international community, including the UK Government, the Council of Europe, the OSCE, the UN, and the World Bank, for them to be assured that the people of Armenia know what the international community has been planning since the turn of the century and why Armenia is now under a state of emergency. And in as far as after a year of asking, the World Bank’s watchdog organization, the Department of Institutional Integrity (INT) obviously has no serious intention to investigate my claim of World Bank fraud and corruption in Armenia, it is for that reason I support Levon Ter-Petrossian in his fight to return independence to Armenia.
Armenian Parliamentary Commission (2003/4)