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Armenia President Serzh Sargsyan suspends energy price hikes in face of demos

The president of Armenia has announced a delay in electricity price rises in an effort to end days of street protests over the hikes. Demonstrators are to decide what to do on Sunday evening.

President Serzh Sargsyan said that the government would temporarily "bear the burden" of the higher rates pending an audit of the Russian-owned power company on "how justified the tariff raise is and what its consequences would be for the country's economy."

"Annulling the tariff raise is extremely dangerous," Sargsyan told a cabinet meeting, warning that "if an audit confirms that the tariff raise is justified, consumers will start paying according to a new price."

Sargsyan said the money would come from the security budget.

Armenia's power distribution company is owned by the Russian state-controlled holding Inter RAO. It had said the rise was needed due to the devaluation of Armenia's currency, the dram.

Armenia is closely allied with Russia, which maintains a military base in the former Soviet territory. In January, Armenia joined the Russian-led Eurasian Economic Union.

On Friday night the president had held a meeting with Russian Transport Minister Maxim Sokolov, who co-chairs a Russian-Armenian economic commission. As a result of the talks with Sokolov, Russia agreed to loan Armenia $200 million (179 million euros) to help modernize its military, according to Sargsyan's office.

Protesters on Saturday dismissed the president's announcement as inadequate and repeated their demands for the increase to be removed altogether. One of the activists, Baginak Shushanyan told the crowd: "Our demand remains unchanged: the decision to raise electricity tariffs must be reversed."

For a ninth consecutive day on Saturday the demonstrators blocked traffic on the capital Yerevan's main avenue. Some 10,000 people rallied near the presidential palace chanting "we will win."

The announcement of 17-percent increases in electricity prices brought thousands of protesters out on to the capital's streets last Monday. Linked up by social media, they had intended to march on the presidential residence.

When the protesters were blocked by police, they sat down on the road and stayed there for the night. Riot police moved in early on Tuesday morning and used water cannon to disperse the demonstrators, arresting 240 people.

But by the evening more demonstrators had turned out. Police from then on stood by peacefully.

In the following days the protests took on a street party appearance with mainly young demonstrators dancing and singing national songs.

One third of the population of 3 million people in Armenia live below the poverty line.

jm/bk (AFP, AP)

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