Washington briefing: U.S. agency wants democratic reforms stepped up in Armenia

by Emil Sanamyan

Published: Saturday December 20, 2008

Amb. John Danilovich on Dec. 12. Armenian Reporter.

The U.S. Millennium Challenge Corporation (MCC) "reiterated its concerns about the status of democratic governance" in Armenia, according to MCC's statement following its board meeting on December 11. Although Armenia has remained eligible for U.S. aid under the program's guidelines, the volume of assistance has been restricted throughout 2008 after the State Department blamed the government for post-election violence.

In all, MCC allocated $28 million to Armenia in the first two years of the five-year $235 million compact aimed at reducing rural poverty through the construction of roads and irrigation systems. According to MCC's Armenia office, cited by Regnum news agency, its first quarter 2009 expenses will be $7 million.

By contrast, in 2006-2008 the United States allocated $213 million of $295 million of the Georgia compact, which is now on track for completion by next September. Earlier this year, MCC allocated an additional $100 million to Georgia as part of a $1 billion U.S. aid package to Georgia promised by the Bush administration following the August war with Russia.

With a political transition underway in Washington, a new MCC board with members of the Obama administration will meet in March to pick a new chief executive officer and "again review Armenia's performance and examine continued collaboration with the country during its March meeting."

The MCC board is chaired by the Secretary of State and includes other cabinet members and nongovernmental representatives.

In his farewell briefing on December 12, MCC's outgoing CEO, Ambassador John Danilovich, hinted at unresolved issues with Armenia.

"We have a good working relationship with Armenia," he said in response to a question posed by the Armenian Reporter. But "the government of the newly elected president [Serge] Sargsian needs to reassess their commitments to democratic principles in light of some election matters which occurred at the time of the election now about nine months ago."

While Ambassador Danilovich sounded positive that funding for MCC's suspended road project "should resume in March" and he noted that "the [Armenian] government has embarked on a number of reform efforts," the MCC board members "very much want the government of Armenia to continue with and increase the speed with the substance of those reforms," both for continuation of the current program and "also for the eventual possibility of future engagement with MCC" with a second compact.

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