Nations in Transit, published annually by Freedom House, is the comprehensive, comparative, multidimensional study focusing on 27 former Communist states.

Here is presented Armenia study's executive summary.
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Nations in Transit 2004 - ARMENIA



EXECUTIVE SUMMARY

Armenia’s democratic development has proceeded haltingly in the 12 years
since independence. Although successive governments have established the
framework for a democratic market economy, their commitment to the
implementation and enforcement of legislation has been weak. The absence of a
system of checks and balances has resulted in rampant corruption throughout the
political hierarchy and has left the legislature powerless to hold the executive
to account. Moreover, elections have generally failed to meet international
standards, contributing to widespread public cynicism toward the authorities and
growing skepticism of the value of political participation. Armenia’s
macroeconomic stabilization record has been more successful. The average annual
real gross domestic product rate has exceeded 8.5 percent since 1998, inflation
has been in the low single digits since 1999, the currency is stable, and a
liberal trade regime has enabled a recovery in exports, reports the
International Monetary Fund. However, the majority of the population has yet to
benefit from these macroeconomic successes, further contributing to
disillusionment in Armenia’s political and economic transition.

The presidential and parliamentary elections in February and May 2003 did
little to advance Armenia’s transition toward a democratic, law-based state.
International observers noted serious irregularities in both elections and were
unable to judge them free and fair. The failure of a long-awaited referendum on
constitutional reform due to low turnout highlighted the extent of voter
cynicism toward the authorities. Despite pledges to the contrary, the
authorities failed to ensure that the country’s leading independent media
organizations were able to resume broadcasting before the elections. Media
freedom was further threatened by the inclusion of strict libel laws within
Armenia’s new criminal code, which came into effect in August. International
organizations continued to highlight human rights abuses within the judicial and
police systems but welcomed the abolition of the death penalty in September.
Rampant corruption and weak governance remained serious threats to Armenia’s
democratic and economic development.

Electoral Process. Presidential and parliamentary elections in 2003
provided a serious test of the authorities’ democratic credibility. However,
despite pressure on the authorities to ensure a free and fair process,
international observers judged that neither election met democratic standards.
The so-called power class retained its monopoly on political power. President
Robert Kocharian was returned to office in March, beating Stepan Demirchian,
leader of the People's Party of Armenia, in a runoff election, and the
Republican Party of Armenia (RPA) and other pro-presidential parties retained
their parliamentary majority in May. The RPA reached a power-sharing agreement
with the Armenian Revolutionary Federation and Country of Law Party to form a
coalition government. The opposition lodged several appeals with the
Constitutional Court but failed to overturn the election results. However, the
Court acknowledged that there had been serious voting irregularities.
Armenia’s rating for electoral process declines from 5.50 to 5.75, owing to the
mishandling of the 2003 elections.

Civil Society. Armenia’s civil society is still in the early stages of
development, although the number of registered nongovernmental organizations
(NGOs) continues to increase and stands at more than 3,000. Poor socioeconomic
conditions in Armenia have left civil society groups heavily reliant on external
funding, particularly from diaspora-based organizations. Government officials
remain reluctant to consult with policy research groups, while public cynicism
at the effectiveness of civic activism remains a barrier to the development of
civil society. Nevertheless, in 2003, in a positive demonstration of civil
society's capacity to influence policy making, the U.S.-based NGO World Learning
supported a group of Armenian NGOs in successfully lobbying the government for
the protection of the rights of the disabled in urban planning and construction.
Domestic NGOs also played an active role in monitoring the 2003 elections.
Armenia’s rating for civil society remains unchanged at 3.50.

Independent Media. Press freedom in Armenia suffered a series of
setbacks in 2003. The country’s leading independent broadcasting organizations,
A1+ and Noyan Tapan, failed in several bids to regain their broadcast
frequencies, despite repeated promises by the government that they would be able
to resume broadcasting. There were further incidents of violence and
intimidation against independent journalists, particularly in the run-up to the
presidential election. Combined with the country’s harsh libel laws, punishable
by up to three years in prison, this reinforced the culture of self-censorship.
Although the government removed some controversial clauses from a new Law on
Mass Media, local journalists remained skeptical that the bill would enhance
press freedom. Armenia’s rating for independent media declines from 5.00 to
5.25, owing to the continued difficulties faced by independent broadcasters and
the authorities’ decision to retain libel as an offense under Armenia’s criminal
code.

Governance. Armenia’s long-term political stability is threatened by
weak governance. Rampant corruption, the prevalence of vested interests within
the country’s power structures, and the weak rule of law remained serious
obstacles to good governance in 2003. Although Armenia’s legal framework is
sound in many areas, enforcement and monitoring are still weak. A new
competitive-based recruitment system in the civil service was under way in 2003.
Combined with wage increases, this process is aimed at attracting higher-caliber
staff and raising professional standards. However, low financial resources at
both national and local government levels remain a constraint on improving
governance. Parliament approved a Law on Freedom of Information in September
2003, which classifies the failure to release information as a criminal offense.
Armenia’s rating for governance remains unchanged at 4.75.

Constitutional, Legislative, and Judicial Framework. A long-awaited
referendum on constitutional reform was held in May 2003, but low turnout
rendered the ballot invalid. The proposed amendments would have somewhat reduced
the extensive powers of the presidency, which is currently empowered to appoint
and dismiss the prime minister and government and to dissolve the Parliament
practically at will. Despite constitutional provisions guaranteeing a full range
of basic human rights, Armenia continued to attract criticism from international
organizations in 2003 for its observance record. This stems partly from the
weakness of the judiciary, which is still far from fulfilling its role as a
guarantor of law and justice. The use of so-called administrative arrests,
torture within the police system, and the imprisonment of conscientious
objectors were particular areas of concern for human rights groups. Armenia’s
rating for constitutional, legislative, and judicial framework remains unchanged
at 5.00.

Corruption. Rampant corruption continues to hamper Armenia’s economic
and social development. The government finalized a long-awaited anticorruption
strategy in late 2003. However, the government’s past record in implementing
anticorruption measures and the continued involvement of high-ranking officials
and parliamentary deputies in business activities have resulted in widespread
skepticism from foreign investors and the Armenian public about the authorities'
commitment to eradicating corruption. The situation is exacerbated by the lack
of an independent judiciary, which is still susceptible to pressure from the
executive branch. A plethora of bureaucratic regulations and registration
requirements for businesses increases the opportunities for official corruption.
Armenia’s rating for corruption remains unchanged at 5.75.

Outlook for 2004. The controversial mishandling of the 2003 elections has
worrying implications for the country’s political stability in 2004. The
opposition will continue to challenge the authorities’ legitimacy but is
unlikely to effect substantive political change owing to the consolidation of
power in the presidency and among the president’s parliamentary supporters. The
authorities’ past record suggests that their commitment to implementing the
recommendations of a new anticorruption strategy will be less than wholehearted,
while vested interests in the political hierarchy will prevent substantive
improvements in governance.

NOTE: Nations in Transit ratings are based on a scale of 1 to 7, with 1
representing the highest level and 7 representing the lowest level of democratic
development. The 2004 ratings reflect the period January 1 through December 31,
2003. The ratings reflect the consensus of Freedom House, its academic advisors,
and the author of this report. The opinions expressed in this report are those
of the author.