Tuesday, March 15 2016 07:56

 Mr. Ambassador, let us start with a traditional question. What is you assessment of the Armenian-Czech relations?

Since the establishment of the diplomatic offices of Armenia and the Czech Republic in Yerevan and Prague, the Armenian-Czech relations have intensified and developed dynamically in the political, economic and humanitarian fields. As for the political relations, never before have they been at such a high level. In 2014, President of Armenia traveled to Prague, in 2015, the prime minister and defense minister paid visits to the Czech Republic. Earlier in 2012, the Armenian parliament speaker visited the country. The same tendency is observed on the Czech side. For instance, the foreign minister of the Czech Republic traveled to Yerevan in 2013 and 2015, the minister of industry and trade – in early February. The president and defense minister of the Czech Republic are expected to visit Armenia this June. Parliamentary delegations make mutual visits regularly. We will work to maintain this high level of cooperation in the future too.

What about the economic relations?

Unfortunately, the economic relations are not as good. The existing statistics do not give much ground for optimism. Although the statistical data of the Czech Republic and Armenia are slightly different, as re-export and some other nuances are sometimes not included in statistics, the tendency is generally the same. The Czech data on exports are slightly higher than the Armenian ones. Specifically, export of Armenian commodities to the Czech Republic in 2014 totaled $2.122 million and in 2015 - $2.181 million. 

As you can see, the growth is insignificant – a little more than $50,000. Import totaled $26.142 million in 2014 and $23.138 million in 2015. Unfortunately, a $3 decline was registered. We think it is connected with Armenia’s alignment with the Eurasian Economic Union and changes in the customs taxes and terms. I think it is connected with Russia’s economic problems too. Unfortunately, the commodity turnover between the two countries is at a low level, though the cooperation capacities in the field are not used at full. Meantime, Armenia can export goods for $10-$15 million to the Czech Republic. I am encouraged with the fact that the industrial commodity turnover is increasing, as it does not depend on the population solvency directly. Import of industrial products for energy resources will have a positive impact on the economy of Armenia. As you see, our economic cooperation is not as good as it could be, but the governments of our countries are working to boost our economic relationships.

You have said Armenia’s export can be increased to $15 million. Why don’t they do it?   

There are both objective and subjective reasons. The objective reasons impeding import are the distance, logistics, price and transportation problems. The subjective-negative reason is that the Czech consumers are not familiar with the Armenian products. This is an omission of the economic diplomacy. Yet, some positive trends have been observed during the last weeks, but there is still much to be done.  Armenia and the Czech Republic are in similar conditions – two not large countries with small markets. The government should support exporters by creating favorable conditions for them, reducing the interest rates, and providing insurance guarantees. I am glad to see that The Export Guarantee and Insurance Corporation (EGAP) cooperates with the Export Insurance Agency of Armenia.  The role of the national trade promotion agenda is high too. It works to establish new business contacts and made new contracts. This governmental organization has its own vector of cooperation bearing no relation to the diplomatic office. It is waging its own policy. Armenia has no such agency yet, though it is very effective. I think it is an omission too. 

 

Nevertheless, what are the main commodities the two countries import and export? 

As expected, the Armenian brandy is the most popular Armenian product on the Czech market. Unfortunately, "Ararat" is the only brand presented on the market, as other Armenian brands are not imported to the Czech Republic yet. "Ararat" is very popular at the Czech presidential palace; the Armenian brandy is tasted at all the important negotiations. However, there is another promising item for export - the Armenian wine. When I first arrived in Armenia in 2012, it was very difficult to find decent wine, as Armenian consumers prefer semi- sweet or sweet wines while Europeans are used to dry wine. Fortunately, the wine “Karas” and then many other good labels have emerged such as “Zorah,” “Kataro.” I think it is a good opportunity for Armenia to restore its erstwhile popularity as a wine exporting country. The Czech side has already made the first steps in the field. At present, Terra Vinifera, a Czech Company, is engaged in import of Armenian wines. I’d like to tell you how this importer discovered the Armenian wine.  He arrived in Armenia and asked me if there is good wine in the country. I said that there are few types and recommended him to buy several bottles at the airport, as he was leaving the country, and taste. He accepted my advice and bought several bottles of “Karas.”  Since he is a Czech lawmaker, together with several diplomats and lawmakers he tasted the Armenian wine “Karas” for the first time at a working dinner in the Czech Republic. The guests liked the wine and the businessman decided to import it. He had some difficulties with organizing import, as Armenia produced little wine then and could not satisfy even the local demand. Import of wine to the Czech Republic was interrupted for several times. But everything is in the past now.  Now the Armenian wine is supplied to the Czech Republic without interruption. Armenian wines are sold on the Czech market for 10-11 EUR in average, which is not cheap, but not too expensive for the Czech consumers.

 

Agricultural products are another promising item for import. I can tell you how I “familiarized myself with” the Armenian fruits and vegetables. The point is that I have never tasted tomatoes. However, I began to eat tomatoes in Armenia and I like them very much now, because the Armenian vegetables and fruits are very delicious.  Currently Spanish and Belgian vegetables prevail on the Czech market, as they are beautiful and cheap, but not very tasty, while Armenian agricultural products are natural. They may not look very fine, but by taste they surpass the European ones, and their price will accordingly be higher. There is also an opportunity to establish import of preserved food.

 

Well, export of ferromolybdenum is on the second place after brandy. And again the issue concerns to an insignificant amount of export, around half million USD. There is demand but the supply does not meet the demand fully.

 

Import of highly qualified work force may become another promising area of cooperation. Armenian workers are experienced and smart. There is deficit of such employees in the Czech Republic.  There are many areas for cooperation. It is just necessary to make the commodities more recognizable. 

In early February, a delegation led by Minister of Industry and Trade of the Czech Republic Jan Mládek visited Yerevan. What agreements have been achieved by Yerevan and Prague during that visit?  

Of course, details of the talks between governments are not always made public, but I can say that in Yerevan Mládek met among others with the energy minister of Armenia and visited the Metsamor NPP, as the Czech ŠKODA works there to extend the service life of the Plant. Energy is another promising field of cooperation. The projects are expensive and need large financial investments. Of course, commercial financing is good but it is expensive, that is why the cooperation is implemented via export bank - governmental structure, which offers lower interest rates and longer maturity. This and many other issues were on agenda of the talks in Yerevan.

 

Mr. Ambassador, do you anticipate return of the Czech Airlines to the Armenian market?

It is a painful issue for both Armenia and the Czech Republic. The new owners of the company tried to return to the Armenian market last December and this January to assess the profitability of flights. After making several flights, they found out that the flight conditions are not favorable in the long-term outlook. However, the negotiations are continued. The most delicate part of the talks is the conditions set by the Zvartnots Yerevan International Airport.  The service prices of the airport are rather high. Both Armenia and the Czech Republic as well as the Czech Airlines seek regular flights, but the company cannot operate at a loss. I think it is in favor of the Zvartnots Airport to offer more affordable prices for the service not to lose its customers. If I were asked about the resumption of the airline's flights two weeks ago, I would say that the flights would be launched in May. However, the latest data concerning this issue are neutral-negative. I would not like to look as a pessimist, but I am not optimistic about the situation.

Let us address the issues on the political agenda. At the last Session of PACE, the Czech delegation generally supported the stand of the Armenian delegates on the resolutions by Robert Walter and Milica Markovich. In this light, what do you think of the cooperation of the two countries at international organizations?  

 

As for PACE, I think it is a good platform for discussions, but the documents passed at the given organization do not have any impact on political decisions, much less when it comes to conflicts. It is necessary to understand that PACE is an Assembly of National Deputies that are not accountable to anyone except their voters and political forces. They are not even required to support the foreign policy vector of their countries. Therefore, I think it is inefficient to voice such kind of issues at PACE. Of course, it is quite logical that one wants to protect his country when its rights are infringed, but it should be understood that these resolutions have no political or legal weight. Neither one should ignore these documents, as they may negatively affect the relations of the two countries, because one of the sides will try to capitalize on it.

In this light, I’d like to praise the work of the Armenian parliamentarians led by Eduard Sharmazanov, the Vice Speaker, Chairman of the Armenia-Czech Republic Deputy Friendship Group, who successfully worked with our parliamentarians. I know that the stand of the members of our delegation to PACE was not in favor of the Armenian side. I know this because the first attempt of the Armenian diplomacy to change the stand of the Czech delegates to PACE on these resolutions was slightly shortsighted.  The Armenian side tried to influence these delegates through embassies and the government of the country. However, the delegates reacted to such information with hostility, as they considered it an attempt to press them and their independent views. I repeatedly told the Armenian side at various levels that such method is inefficient, as the delegates should discuss such issues personally and find common approaches. The Armenian side listened to my suggestions and took quite efficient efforts therein. Vice Speaker of the Armenian Parliament Eduard Sharmazanov had good contacts in the Czech Parliament, so he managed to settle this issue while traveling to Prague.

It is not the only case of successful, harmonious cooperation of the two countries’ delegates at international platforms. They have very good ties and many common approaches and their stands are often coordinated through a single call of the two countries’ foreign ministers. I think this speaks of the high level of political relations and confidence in each other, despite the fact that the Czech Republic is a EU member, and Armenia is a member of the Eurasian Economic Union.

The Foreign Relations Committee of the Chamber of Deputies of the Czech Parliament passed a document recognizing the Armenian Genocide. During his visit to Yerevan, the head of the Chamber of Deputies used the term “genocide” in his speech. During the events timed to the Armenian Genocide Centennial, the Czech Republic was represented by the parliament vice speaker… Will the Czech Parliament recognize the Armenian Genocide in the nearest future?

I would like to add that during the Armenian president’s visit to Prague, the Czech president used the term “genocide” to describe the events of the early 20^th century in Ottoman Turkey. Nevertheless, this question should not be addressed to me. This is a question to either the speaker of our parliament or our lawmakers. This question can be addressed to the chairman of the Armenia-Czech Republic Deputy Friendship Group, as he is the author of the resolution that was passed by the Foreign Relations Committee. This question can be addressed to the president too, as he is traveling to Armenia this June.

Although visa facilitation issues apply to all the countries of the Schengen Area, is it possible that the visa requirements between Armenia and the EU countries are lifted fully?

I think we are moving towards this and this will happen sooner or later. If you remember, Armenia and the EU signed visa facilitation and readmission agreements, which paves the way towards this. However, I cannot say how soon the visa requirements will be lifted. I can just say that the Czech Republic supports the idea. 

By Tatevik Shahunyan and Marianna Mkrtchyan