During a recent three-month trip we visited various countries. This time I would like to share, not ICT-related ideas, but my socio-economic and political observations, starting with the very interesting but little-known country of Armenia.
We travelled to Armenia – in the South Caucasus region of Eurasia – for several reasons.
Firstly, due to our interest in medieval history Armenia beckoned us because of its rich – be it troubled – history from the 5th to the 13th century and beyond. It also was part of the famous Silk Road and the Armenians were very successful merchants during its heyday.
The country is an emerging democracy and, despite being situated in Asia, sees itself as more European.
During its existence as a nation around the 8th century BC its territory has been invaded at least 15 times (not taking into account many other smaller insurgences). Because of this progress has stood still many times and as a result some of these historic sites remained largely unchanged over all those centuries. True, they were often attacked but after that they were basically repaired rather than being demolished and replaced by newer structures. In comparison, such buildings in Europe would have been replaced at least three or four times, and with ever greater and grander buildings. In Armenia you can often go back a thousand years or more to the original buildings.
Another reason for our interest was that during my work for the United Nations I had met Armen Orujyan who is an Armenian-American entrepreneur, an architect of innovation ecosystems. He is the founding CEO of the Foundation for Armenian Science and Technology (FAST) and as such he is heavily involved in promoting the digital development of Armenia. On several occasions he had mentioned that I should come to Armenia and during our trip he organised a high-level meeting with senior government and business people, where I shared my knowledge and insights within the context of Armenia. The Minister for Communication was among the people present and he offered his full support for the development of a ‘Smart Armenia’. I suggested the group should use this important offer to start a nationwide discussion with the leaders in this field to take the matter further.
And, lastly, there was the reason of pure curiosity and adventure, diving into the political, social, economic and historic elements of this country.
We had a highly professional guide Karine, and a driver Levon, organised by Go2Armenia and for two weeks we criss-crossed the country from the deserts in the south to the forested areas in north, skirting the borders of Turkey, Iran, Georgia and Azerbaijan. When you look at the map it is easy to see why the country has been used as a punching bag by its far more powerful and bigger neighbours. It is at the crossroads between Russia in the north, Turkey (think also Ottomans) to the west and Persia (now Iran) to the south. Its strategic position meant that this relatively small nation had no chance whatever of remaining in control of its own affairs.
The country also has a very rich pre-history, being part of the area where a significant part of western culture started – the Indo-European languages, writing, agriculture, etc. We visited 6000-year-old petroglyphs in the highlands (strangely these are only found above 3000 meters).
However this is a period of tribal activities rather than one of statehood. Armenia also has dolmen linking it with cultures, from around 4000-3000BC, that built Stonehenge in the UK, Carnac in France, the so-called Hunebeds in the Netherlands and other places along coastal Europe.
Statehood slowly began to emerge around the 8thcentury BC. Yerevan as a city was established in 782 BC.
Armenia became a nominal part of the Roman Empire in the 1st century AD and flourished during a few periods of relative peace and independence. The first period was in the 5th and 6th century and its Golden Age was in the 12th and 13th century. In its heyday its territory reached from the Caspian Sea to the Black Sea and the Mediterranean.
The country became the first in the world, in 301, to adopt Christianity as the state religion and in 405 it developed its own unique alphabet. It didn’t agree to the Council Chalcedon in 451 and therefore stuck to its own flavour of Christianity. It is these two elements that played, and still play, a key role in keeping Armenians together.
To appreciate the current situation in Armenia it is important to understand the effect these ongoing political and resultant economic struggles had on everyday life – especially since the situation is ongoing.
In the 12th century Armenia was already split into West Armenia (under Ottoman rule) and Eastern Armenia (under Persian rule). In 1828 Eastern Armenia became part of the Russian Empire and, since 1922, a Soviet Republic. During the Russian period political deals were made externally with Turkey (who received some more parts of Eastern Armenia) and internally with what was then another Soviet Republic, Azerbaijan, and this saw a further splintering of regions where Armenian people lived. Once the Soviet Union collapsed a number of enclaves became disputed areas, and this became the reason for the various Caucasian Wars during the 1990s. Armenia and Azerbaijan waged war in 1992-1994, and while there is a truce there is still no solution to the dispute over Nagorno-Karabakh (see below). As a result, the borders with Turkey and Azerbaijan are closed and, given that Armenia a landlocked country, this is a further economic disaster and has been a major stumbling block in making economic progress. As an indication, the number of people working on the land (agriculture) increased from 20% to 40%, and these are individual small farms; there are very few large-scale agriculture developments.
So for a thousand years the Armenian people have lived under hardship and this is revealed in the faces of the people and in the way they work. Everything is an effort and they all carry the horror stories of their people with them. The most recent horror story is the genocide 1915.
Despite the century-long foreign occupations and the split between East and West Armenia they did retain their culture wherever they were; so for hundreds of years an estimated 2 million Armenians lived in what is now west Turkey within their own communities, had their own Christian religion and spoke their own language.
In 1915, afraid that the Armenians in the Ottoman lands would begin to push for (semi-) independence, the government of the day started to imprison and execute intellectuals, and over the next few years drove them out of their region into what is now Syria (which was then still part of the Ottoman Empire). This happened with military force. The people were not fed during this ordeal and the area they were pushed into was a desert. In all, more than 1 million people perished during this event. Turkey continued this ethnic cleansing over the following decade, with the large Greek population as well as many other minorities also being pushed out. By 1923 a virtually ‘pure’ Turkish Turkey remained, perhaps with the exception of the Kurds, with whom Turkey currently also has severe problems.
Many Armenian people have relatives or know people who have perished. Turkey doesn’t admit this genocide, and this is part of the political problem between Armenia and Turkey. Furthermore Turkey supports the land claims of the Armenian enclaves by Azerbaijan, which recently bulldozed a medieval historic Armenian site in one of the enclaves with hundreds of famous Khachkars (carved, memorial steles bearing the Armenia cross. Khachkars are characteristic of Medieval Christian Armenian art), some dating back to the 8th and 9th century. The world protested but did nothing.
The 1915 genocide was most likely the largest single catastrophic event in the history of Armenia, but in no way was it the only one. Over the centuries, Armenians had to flee their country to escape murder and devastation and as a result there are now some 6 million Armenians in its diaspora. Interestingly, however, by far the largest part of them has kept to its Armenian culture and traditions – the diaspora is now one of the most important economic forces in the country, financing and assisting in many social and economic developments in Armenia. We visited some of these projects in Tatev and Dilijan.
The need for external assistance highlights another problem. Armenia is a small country with only 3 million people. It has few natural resources and is of little economic or political importance. Russia doesn’t want Armenia to become too close to the European Union, Turkey is needed by the European Union to solve their refugee problem, and Azerbaijan is a very important oil country. So over all these centuries Armenia has not been getting much more than lip services from powerful allies. It is basically struggling on its own. It depends heavily on its neighbour Iran and its former occupier Russia for any assistance – for example, to gets goods to and from the country. However, from our own experience the land routes to Georgia and Iran are inadequate. Amazingly the mobile infrastructure in the country is fantastic, this in stark contrast to most other forms of infrastructure.
During my business meeting we discussed the opportunities of using this digital infrastructure for the development of ICT skills and opportunities, along the lines that Armen is promoting. With its many young smart people Armenia can indeed become a smart country, its small size giving them an advantage similar to what we see in countries such as Estonia, Iceland, Latvia, etc. With a government interested in these developments there are some good opportunities for this industry. See also the blog I wrote on this topic Armenia using digital technologies to speed up its development
When travelling through Armenia one comes across all of the issues referred to above. As mentioned, you can touch and feel 6th, 7th , 8th and 9th century buildings more or less as they have always been, in fields with overgrown cemeteries, There has been little restoration and many of them need much more protection to safeguard them for future generations. However in the larger economic picture this is a minor problem.
What, however, is far more striking travelling through the country is the large number of dilapidated factories, kolkhozes and even hotels as well as an even larger number of unfinished or abandoned houses, especially along Lake Sevan. The main reason for this is the collapse of the Soviet Union; Armenia ’s main economy was based around industry and with the Soviet market gone these factories could not operate within the free market framework that is currently in place. These operations and buildings are simply abandoned, some even with large rusty cranes and other equipment still standing next to them. Investments that were underway in the 1980s came to an abrupt halt and many projects started during that period were never finished, resulting in those unfinished and abandoned houses, hotels and other buildings. A very sad sight indeed. Simply cleaning up all of this will cost billions of dollars that the country currently can ill afford.
There is a very significant difference between these rural areas and the capital Yerevan, where a third of the population lives. Although things are tight there also that city is showing progress. The city centre is attractive, a lot of Armenians from the diaspora have invested there in business, retail, tourism, etc. The main tourists coming to Armenia are from the diaspora and I spoke among others to Australian, Canadian, American, Belgium and Dutch Armenians. They come here for weddings and other family activities. Marrying in Armenia has become a trend, the basis for another interesting form of revenue for the country, and the many picturesque Armenian churches are an attractive proposition for this.
It is in the capital where the majority of economic progress takes place. Progress in Yerevan is also visible on the streets. We were there during their summer holidays and we encountered many happy Armenian holidaymakers in Yerevan.
Dilijan is another place where things are happening. The Central Bank has moved to this city and amazing educational facilities have been built there. We received a tour of the impressive and very modern UWC college from their very passionate director of development.
One of the key people in the Armenian diaspora – the Armenian-born Russian social entrepreneur, impact investor and venture philanthropist Ruben Karlenovich Vardanyan – mentioned that for Armenia to progress they will have to stop looking at the past and face the future, and many, especially young people, totally agree with that. These young people were/are also the people power force behind a small revolution earlier this year when they forced their conservative president to step down in favour of a more progressive one – who has now appointed many likeminded people into prominent positions.
Strangely enough, the conservative party of the deposed president is still the largest party, the next elections are in May 2019. Till that time the political situation will remain unstable. Add to this the unresolved dispute with Azerbaijan and the political problems with Turkey and it looks as though the country still has a long way to go before it will be able to reach its full potential.
In my opinion the diaspora could be the key force in any turnaround and the work that Ruben Vardanyan and people like Armen Orujyan are doing is pointing in the right direction. This is what my Smart Country meeting with some of the leaders in the country was all about and I will be keenly following their progress. Another positive development that we came across several times was investments made by USAID in healthcare and education; and subsidies and loans for entrepreneurs and budding businesses. Top marks for the American initiative. Slowly the EU is also providing more financial support in line with the democratic progress the country is making.
As Armenia borders on Iran I also had an opportunity to talk to a few Iranians, and to be honest I was quite shocked. In two of these interactions I spoke to people who had basically fled Iran for economic reasons. The situation with the sanctions has brought the country economically to its knees.
When I spoke to a young Iranian software entrepreneur in early August the exchange rate was 33,000 Rial for 1 US$. A week later the rate was 42,000 Rial. It is simply impossible to conduct any international business or run a local business that relies on overseas products and services.
This Iranian software entrepreneur had his own e-commerce business. Because of the economic situation there was simply no longer any business for him in Iran as his clientele had totally dried up. When the country and its people are in survival mode one of the last things you are worried about is expanding into e-commerce. He had moved to Armenia a few months earlier but had not been allowed to bring any significant amount of money with him. Furthermore, because of the sanctions transferring money has become impossible, aside from using a few ‘shonky’ banks in Russia and China. When he told me his story he had tears in his eyes, placing the blame on the Iranian Government which, because of ideological foreign policies, is prepared to let the country go under economically. He desperately wanted the government to be replaced with a secular one. Amazingly, against all his moral principles he supported Trump. He hopes that the economic hardship caused by the sanctions will bring Iranian people onto the streets and that this eventually might lead to the establishment of new (secular) government for the country. The big question is whether this can be done in a peaceful way.
During my business meeting in Yerevan I also met an Armenian business woman, who had set up a digital marketing company in Iran several years ago. Her story was very similar. Business has dried up, she has left a skeleton staff of one person in Teheran and moved to Armenia in the hope of creating business there and in other parts of the region, and hopefully eventually moving back to Iran. She also blamed the stubborn foreign policy stand of the government for the trouble, and she supports a new government.
However they both claimed that they were the lucky ones as they were able to move out of the country. The situation for most of the people in Iran is very different and very sad indeed.
Putting all of this into the broader political and economic context, what is happening in this region is a reflection of the broader global turmoil that is affecting many countries around the world. Management of our complex society becomes harder and harder for the governments that are supposed to provide vision and leadership for their people. Instead powerful grassroot movements are using people power to force changes. Armenia demonstrated this a few months ago and my friends with Iranian businesses hope to see it happening in this country as well. And while I am writing this the people in Romania are going through a similar process. Also click here for my insights on Iceland, a country that has been extremely successful in generating positive change through people power.
Nagorno-Karabakh, also known as Artsakh in Armenian, is a landlocked region in the South Caucasus, within the mountainous range of Karabakh. It is a disputed territory – it is internationally recognised as part of Azerbaijan, but most of the region is governed by the Republic of Artsakh (formerly named Nagorno-Karabakh Republic), a de facto independent state with Armenian ethnic majority established on the basis of the Nagorno-Karabakh Autonomous Oblast of the Azerbaijan Soviet Socialist Republic. Azerbaijan has not exercised political authority over the region since the advent of the Karabakh movement in 1988.
The roots of the conflict started with a decision by Stalin. After the Bolsheviks incorporated the various Caucasus countries (Armenia, Georgia, Azerbaijan and Nagorno-Karabakh) the latter was first promised to become part of Armenia, as 94% of its population was Armenian. Stalin reversed that decision the following day and gave it to the economically stronger Azerbaijan.
As long as these territories were all within the Soviet Union, free travel and trade existed and no serious conflict arose, but problems started when these republics became independent after the collapse of the Soviet Union. In 1988, in the run-up to this collapse Karabakh Armenians began demonstrating in their capital, in favour of unification with the Armenian republic. Unrest followed and shortly after Armenia and Azerbaijan declared themselves independent the war over Nagorno-Karabakh started. Since the end of the Nagorno-Karabakh War in 1994, representatives of the governments of Armenia and Azerbaijan have been holding peace talks mediated by the OSCE Minsk Group on the region’s disputed status.
See also my report on Russia: Russia – social, economic and political observations