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[MosJan]

ARMENIA BANS WESTERN UNION TRANSFERS OVER Artsax

• The Central Bank of Armenia (CBA) has banned the activities of the money transfer company Western Union following the latter's decision to stop handling cash remittances to Nagorno-Artsax taken under pressure from Azerbaijan. The decision came just days after the Azerbaijani authorities ordered local commercial banks not to do business with Western Union and another world-famous company, MoneyGram, because they operate in Artsax. Azerbaijan's National Bank said on August 1 that any financial operations in "occupied Azerbaijani territories" are illegal. In a statement on Monday, the CBA's governing board condemned Western Union's refusal to wire cash transfers to Artsax through Armenian banks without a prior warning. It said the move "can harm the usual activity of the banks" and "influence the economic, financial and real sectors of the country's economy." "We figured that it's quite risky to have such a player in our market," Grigor Ghonjeyan, a member of the CBA board, told RFE/RL on Tuesday. He described Western Union's stance as "inconsistent" and "unprincipled." Ghonjeyan claimed at the same time that the CBA ban is "not political." "It is simply aimed at risk management," he said. The Colorado-based company did not immediately react to the development,. Multimillion-dollar remittances sent home by hundreds of thousands of Armenians working abroad have been essential for Armenia's economic recovery that gained momentum in the early 2000s. The total amount of remittances processed by Armenian and foreign banks jumped by 57.5 percent to $668.6 million in the first half of this year. A comparable amount of cash is believed to have entered Armenia through non-bank transfer systems like Western Union. Ghonjeyan downplayed the economic fallout from the ban on Western Union, saying that there are 16 other transfer companies operating in the country. "Their potential and capabilities will allow them to fully fill the gap soon," he said. But one Armenian commercial banker, who asked not to be identify, was less sanguine, saying that Western Union has been indispensable for Armenian migrant workers living in remote countries with no banking ties to Armenia. Still, he said they will eventually find alternative ways of sending cash to their relatives at home. Ghonjeyan indicated that the CBA may yet reconsider its decision if Western Union resumes money transfers to Artsax. "We are not going to initiate active negotiations with Western Union," he said. "But if Western Union changes its behavior in a way acceptable to us and offers our banks new contracts ruling out unilateral and sectarian decisions in the future, the Central Bank could revisit the issue and make a decision." (Photolur photo)

• By Hovannes Shoghikian

[MosJan]

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[MosJan]

ARMENIAN-AZERBAIJANI CONFLICT OF MONEY TRANSFER SYSTEMS

• According to the Armenian Central Bank Council August 25 decision, Western Union international money transfer system is prohibited in Armenia. The council decided to prohibit participation of the Armenian banks in the mentioned system and annul the contracts with it. The decision is motivated by the Armenian banks' risk management.

   

  To recall, Azerbaijan has recently demanded that Western Union, Money Gram and other money transfer systems should stop their operation in the Republic of Nagorno Artsax, otherwise, it would prohibit those systems' operation in Azerbaijan. After that, Western Union and Money Gram stopped their operation in Stepanakert branches of "Artsakhbank", "Unibank" and "Armeconombank".

   

  In fact, the Central Bank of Armenia gave an adequate answer prohibiting the operation of the Western Union in Armenia.

   

  To our question if the other systems continue to operate in Armenia, the press service of the Central Bank of Armenia answered positively. Consequently, only Western Union believed in the Azerbaijani threats. The other systems in Armenia will hardly want to be deprived of the Armenian market. Though in that case they will probably lose their opportunity of functioning in Azerbaijan.

   

  Anyway, the Armenian-Azerbaijani conflict this time again with the efforts of the Azerbaijani party moved to the sphere of money transfers.

• By Ara Martirosian, translated by L.H.