Monica Ellena in Tbilisi -

Sit-ins continue and barricades are still up, but streets are now peaceful in Armenia’s capital Yerevan, where thousands are protesting against a hike in electricity prices in defiance of police, who early in the week had used water cannon to try to disperse them.

Rights groups and citizens took to the streets on June 19 claiming that the 16% rate increase – the third in two years and the fifth since the Russian-owned Electric Network of Armenia (ENA) acquired the power grid distribution in 2006 – would hit hard one-third of the country’s households who live in poverty. Armenia is one of the CIS’ poorest countries and it has the CIS’ highest electricity tariffs, which has contributed to create anger at the way the power company, which sits on a debt of AMD106bn (€196mn), is being run.

The non-partisan, mostly youngsters-led No To Plunder movement points the finger at the company’s mismanagement and, by extension, at the country’s monopolised economy and rampant corruption.

“The protest is against higher tariffs, the hike is the tipping point for the young who are disillusioned, who want change, are tired of monopolies, can’t take the corruption anymore,” Sos Avetisyan tells bne IntelliNews in a phone conversation from Yerevan. Sos, and his son Narek, were among the 237 people arrested and questioned by the police on June 23. “It is difficult to say now where it will go from here, but now what people want is the authorities to cancel the increase.”

Although the police dropped the anti-riot gear and relaxed their approach, that may be wishful thinking. For ENA keeping the current tariffs is not for negotiation, and while maintaining that “not a single government wants any price rise” Prime Minister Hovik Abrahamyan said that the increase is “justified.”

“The society largely thinks that the energy price rise is conditioned by abuses in power distribution networks, as the people say - by the plunder. I don’t deny there have been some abuses, [but] not even a mite was included in the tariffs.”

He assured consumers that they will not pay for ENA’s over-spending and stated that the government will allocate over AMD2.5bn (€4.72mn) annually to lessen the impact for low-income households.

For the thousands who have been resisting the scorching Armenian summer heat as well as rain and water cannons, that may just not be good enough. “We are not in a hurry. We have one month and 10 days,” one of the protest leaders, Vaghinak Shushanian told reporters.

Demonstrators twice rejected President Serzh Sargsyan’s offer for a meeting with a five-member representation, explaining that they had nothing to discuss, they only wanted the president to scrap the decision. The new tariffs are due to enter into force from August 1.

In May ENA applied for a 40% rise in electricity rate claiming the national currency’s weakness as one of the leading factors for the request. However on June 25, ENA’s parent company Inter RAO reported an increase of its first-quarter revenues in Armenia by 65.3% y/y to RUB5.7bn (€92.59mn). Arka news agency cited the company as stating that the RUB2.3bn (€37.3mn) increase was a result of “rising electricity tariffs as per decision of the regulatory body in August 2014, as well as from the increased Armenian dram versus the Russian ruble.”

Meanwhile, rumors have it that ENA is on the radar of Moscow-based Tashir Group, headed by Armenian businessman Samvel Karapetyan. Approached by Arka news agency, ENA’s spokesperson Natalia Sarajyan declined to comment.

Don’t call us Maidan-ers

The dissent has attracted attention in mainstream international media, which otherwise rarely cover the Caucasian nation of 3.2mn. As social media trended on the hashtag #ElectricYerevan, and photos of protesters rubbish-cleaning the area flooded the web, many analysts heralded the coming of age of Armenia’s civic movements.

But the protest was labelled a “new Maidan” (after Kyiv’s main square) or a renewed “colour revolution” too quickly.

“The protests do not represent a sort of Armenian-style Maidan nor do the demonstrators have a politically-driven sense of strategy,” explains Richard Giragosian, founding director of the Yerevan-based Regional Studies Centre (RSC).

“The real driving issues are much deeper, rooted in widespread and widening disparities in wealth and income, a well-entrenched perception of an Armenian government’s “arrogance of power,” and against a backdrop of poverty and inequality.”

Unbalanced relationship

The tariffs’ hike has exacerbated underlying social tensions in the cash-strapped republic where high unemployment, a limping economy and a delicate geopolitical situation pose questions about the future.

But most activists refuse to be branded as anti-any foreign country – by which they mean Russia. The reasons are not difficult to spot. Russia is Armenia’s main energy supplier and the two former Soviet republics have close political and economic ties. Apart from ENA, Russian companies manage and operate Metsamor nuclear plant (which supplies 40% of Armenia’s energy), the Hrazdan Thermal Plant and the country’s gas distribution system, while most of the banking, telecommunication and transport sectors are also in Russian hands.

Armenia is also highly dependent on the ebbs and flows of the Russian economy and the downturn has dented exports and hit remittances. Plus, Armenia hosts a key Russian military base and Moscow is Yerevan’s sole security guarantor. The frozen conflict with Baku over Armenian-populated Azerbaijan’s breakaway region of Nagorno-Karabakh is on a constant nerve-shaking verge of resuming on a large scale.

But despite Russia’s grip over Armenia, the relationship is not in question, although people would like a change in the “terms of reference” in what is a deeply unbalanced relationship.

The smartphones illuminating the central Baghramyan Avenue in the night hours also highlighted the gap between Soviet-minded politicians and the internet generation.

“[The protest exposed] the serious and pronounced lack of credibility of the country’s older, more established traditional opposition political parties,” explains Giragosian. “In fact, one concrete loser from this situation is the set of various opposition parties and personalities, which as a whole, has failed to lead and has been forced to follow the younger, non-partisan protesters.”