Kocharian's Administration
Let us return to the moment when the current administration of Armenia was first elected.
In the spring of 1998, the prime minister of Armenia, Robert Kocharian, the former president of Nagorno Karabakh, was elected as the president of Armenia. He won the second round of voting against Karen Demirchian, the former communist leader during the Soviet era. Karen Demirchian was appointed the chairman of the parliament, while Kocharian appointed the former finance minister, Armen Darbinian, as his prime minister.
The new administration's tougher policy on the Karabakh conflict, and on relations with Turkey, divided public opinion. Some welcomed the more decisive and uncompromising policy. Others were negative: they had been hoping external pressure on the governments of Armenia and Azerbaijan would force them to make concessions which would then lead to an agreement regarding Karabakh, and thus achieve stability in the region.
Under this policy, Armenia supported the firm stance of the Karabakh leaders, namely to avoid any agreement which would result in any form of "submission" of Karabakh to Baku. They were willing to wait until the international mediators re-evaluated their position.
In November, in an attempt to solve the issue of the Karabakh status, the #-Minsk Group, OSCE#Minsk group presented a new idea: a package solution in which Karabakh and Azerbaijan would build a "commonwealth". The then Russian foreign minister, Primakov, and the new Armenian foreign minister, Vartan Oskanian, were the minds behind the solution. What the "commonwealth" would actually mean in regard to the relations between Stepanakert and Baku was intentionally vague. The comparison made at the time was with the status of Serbia and Montenegro within the common frame of Yugoslavia; in other words, two self-ruling entities would co-exist within a mainly symbolic structure. The solution was approved by Armenia and Karabakh on November 26 as basis for further negotiations, but Azerbaijan rejected it. Baku refused to accept a status for Karabakh which would grant it the attributes of a sovereign state (including the right to foreign representation) or allow for Azerbaijan to be reorganised as a confederation. The suggestion was doomed to fail, and the Minsk group was finally forced to abandon it. 19
In Armenia, reforms were reaping results, although the pace of change was much slower than expected. Although the battle against corruption was being undertaken by an official body, corruption was so deeply rooted within the political circles that it was impossible to remove it entirely. At the same time, internal political struggles were ongoing in Yerevan. After one year, on June 11, 1999, Prime Minister Armen Darbinian resigned, and Kocharian appointed Vazgen Sarkisian, the then defence minister, to the post of prime minister.
Leading up to the autumn of 1999, meetings between the presidents of Armenia and Azerbaijan intensified and the USA laboured feverishly to achieve some sort of agreement before the OSCE top-level summit in Istanbul set for November 1999. The USA had great interest in an eventual agreement since they planned an oil pipe which would channel Caspian oil through the region to a Turkish port on the Mediterranean Sea. The recurring visits of OSCE members to Yerevan and Baku (especially the latter) indicated that something was underway and the hopes of the world community were high that an agreement or at least a basis for further negotiations would be reached, to be presented during the important summit.
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