US embassy cable - 04YEREVAN1556

UNCLAS SECTION 01 OF 03 YEREVAN 001556 
 
SIPDIS 
 
SENSITIVE 
 
DEPT FOR EUR/CACEN, EUR/ACE, EUR/PGI, DRL, EB 
DEPT PLEASE PASS USAID AND MCC 
 
E.O. 12958: N/A 
TAGS: PREL, PGOV, EAID, AM 
SUBJECT:  GOAM'S MCA MANAGEMENT AND CONSULTATIVE PROCESS IN 
THE RURAL REGIONS 
 
REF:  YEREVAN 1507 
 
Sensitive But Unclassified.  Please protect accordingly. 
 
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SUMMARY 
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1. (U) Ministry of Finance and Economy officials tell us 
that the consultative process in advance of the GOAM's 
upcoming MCA compact proposal submission has moved to the 
country's regions and is on schedule.  The GOAM has begun 
compiling a matrix of all concept papers and/or comments 
received from NGOs and international organizations and will 
begin a preliminary review of these documents o/a July 15. 
The MFE is managing the bulk of day-to-day MCA consultative 
operations for the GOAM and continues to link the process 
with the approach during the development of the GOAM's 
Poverty Reduction Strategy Paper (PRSP).  Please note action 
request in paragraph 10.  End Summary. 
 
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PRSP TEAM HEADS-UP GOAM MCA OPERATIONS 
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2. (U) As a follow-up to the Ambassador's earlier meeting 
with Minister of Finance Vardan Khachatryan, USAID Mission 
Director and Embassy Assistance Coordinator met with 
Ministry of Finance and Economy Development Department Chief 
Armen Hayrapetyan, PRSP Program Department Chief Sergey 
Balasanyan and PRSP Secretariat Coordinator Hovik Azizyan 
July 9 to discuss MCA issues.  Azizyan confirmed that the 
Ministry of Finance and Economy continues to manage the bulk 
of the GOAM's day-to-day operations on MCA in coordination 
with the Prime Minister's Economic Department and relevant 
ministries of the GOAM's MCA Board.  Azizyan said the GOAM 
would develop an unofficial organizational chart to help the 
USG and donor community better understand the GOAM's 
decision-making framework on MCA issues and promised to 
deliver the document within a week.  Post will transmit this 
and other documents via e-mail. 
 
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MCA BOARD COLLECTS CONCEPT PAPERS -- FIRST REVIEW JULY 15 
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3. (SBU) Azizyan confirmed information provided to Post 
earlier regarding recent GOAM MCA Board meetings (reftel). 
He said the Board was regularly collecting and informally 
reviewing project concept papers from a number of sources 
(NGOs, educational institutions, international 
organizations).  The Board had developed a matrix of concept 
papers received to date and would continue to accept papers 
from all sources (including from a GOAM internet website, 
government agencies, regional consultations) until 
approximately July 15.  (Note:  See 
www.mfe.am/mfeengweb/hazmart.htm for more details about how 
the GOAM is soliciting input on MCA from the public.  End 
note.)  After this date, the GOAM MCA Board will conduct a 
preliminary review of the proposals and fold viable ideas 
into the GOAM's draft compact proposal.  (Comment:  The 
matrix appears to include a number of proposals from NGOs 
that approached the Embassy and/or USAID mission during the 
past month.  Post has no reason to believe that any proposal 
has been rejected outright by the GOAM to date.  End 
Comment.)  Azizyan said the GOAM would continue to accept 
papers following July 15 but was eager to begin processing 
the best concept papers into "manageable" portions of the 
GOAM's compact proposal. 
 
4. (U) Azizyan briefly previewed the types of proposals 
received to date.  He said that the GOAM was happy to see 
that, for the most part, concept papers followed the 
parameters of the GOAM's PRSP.  The vast majority focused on 
job creation in rural areas.  He said that a number of 
concept papers, however, "missed the mark" and were weak 
attempts by some groups to tap into MCA funding.  Azizyan 
said that the GOAM MCA Board was nonetheless including these 
concept papers in the formal group to be reviewed beginning 
July 15. 
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MEDIA INTEREST WANING - EXPECT UPSWING WITH RURAL MEETINGS 
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5. (U) Azizyan agreed that while the majority of these 
proceedings had been open to the press, public interest was 
waning in the media (particularly among newspapers) 
regarding the MCA process itself in the nation's capital. 
He and his colleagues confirmed that Armenia's state 
television was airing the proceedings of GOAM MCA Board 
meetings each Sunday evening, to a lukewarm reaction by the 
viewing public.  He said that television coverage of the 
first set of consultative sessions in the region, however, 
was widespread and predicted an upswing in national media 
coverage as this process continues. 
 
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GOVERNORS AND PRSP NETWORK HOST MEETINGS IN RURAL AREAS 
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6. (U) Azizyan reported that the first set of MCA 
consultative meetings were well underway in Armenia's 
regions.  Regional governors, by mandate of the GOAM MCA 
Board, had been hosting open meetings in public places 
throughout their regions over the past two weeks.  Azizyan 
made special note of the fact that governors were instructed 
to host these meetings in locations other than their offices 
in order to encourage open participation and avoid the 
appearance of controlling the proceedings or outcomes.  He 
said that the consultative meetings included both a session 
for open commentary from participants regarding MCA as well 
as a chance to comment on the GOAM's early indication that a 
compact proposal would focus on rural infrastructure 
including water, roads, education and health.  The meetings 
reportedly include information on how to submit program 
ideas directly to the GOAM or through regional governors. 
Ministry officials showed us an example of a brochure 
detailing GOAM MCA procedures that governors are 
distributing during the meetings.  In addition to the 
governors' meetings, Azizyan said that the GOAM had 
activated the network of NGOs involved in the PRSP review 
process.  In some cases this network was hosting additional 
consultative sessions in addition to those organized by 
regional governors. 
 
7. (SBU) According to reports from regional offices and the 
MFE, some regional governors are planning to submit concept 
papers to the GOAM MCA Board as part of the nationwide 
process.  The governor of Armenia's southern Syunik province 
told the MFE that his office would submit its proposal in 
advance of the initial July 15 review.  According to 
Azizyan, proposals from governors will be included in the 
general matrix of concept papers but will likely be reviewed 
separately from those submitted by the general public 
(although still in the same format and during public 
meetings). 
 
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CONSULTATIVE SESSION IN DIMAVAN TYPICAL OF RURAL MEETINGS 
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8. (U) Hayrapetyan said that a recent consultative meeting 
in the village of Dimavan was typical of the ongoing 
meetings in Armenia's regions.  He said that a relatively 
large group of citizens (a few dozen) gathered for the 
meeting together with the regional governor, local media and 
PRSP NGO network representatives.  An MCA Board member and 
PRSP Secretariat representative were also in attendance. 
Hayrapetyan said that the participants came to the meeting 
with little in the way of formal proposals, but asked the 
GOAM to factor in job creation for the local population when 
devising the compact proposal.  He said that the meetings 
often turned into roundtable sessions about an entire series 
of local issues, but that GOAM MCA Board members and others 
guided the discussion to the best extent possible. 
 
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COMMENT:  RURAL PROCESS MOVING FASTER THAN EXPECTED 
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9.(SBU) The consultative process in Armenia's rural regions 
has moved along faster than we expected.  The GOAM has 
assured us that Embassy representatives will be invited to 
observe regional consultations within the next few weeks 
which will strengthen our perspective.  In the meantime, the 
consultative process appears to be progressing well.  Its 
influence on the GOAM's final compact proposal, however, 
remains to be seen. 
 
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ACTION REQUEST:  SHARING IDEAS AMONG MCA COUNTRY POSTS 
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10. (U) Post understands that an MCC Collective is being 
created at the Department for ease in transmitting front- 
channel cables regarding MCA issues.  We look forward to 
utilizing this address once it is authorized by Washington. 
While sharing front channel information is important, Post 
believes that sharing information among posts at MCA 
eligible countries via e-mail exchange would increase the 
flow of ideas.  An MCA e-mail exchange (for use by MCA PoCs 
at Posts, their respective desk officers and MCC 
headquarters at the Department) would allow us to better 
communicate among ourselves as USG parties and share 
relevant information with host governments.  Action request: 
Post requests MCC consider creating an MCA e-mail exchange. 
ORDWAY