CPC - Caspian Policy Center


armenia’s grand rebalance: eu and russia

Armenia’s Grand Rebalance: EU and Russia

Author: Nicholas Castillo

Apr 18, 2024

Image source: twitter

On March 14, the European Parliament voted to foster closer ties with Armenia. One of the more noteworthy aspects of the motion was the statement, “Should Armenia be interested in applying for candidate status and continuing on its path of sustained reforms consolidating its democracy, this could set the stage for a transformative phase in EU-Armenia relations.” While the European Parliament is not the main body responsible for supervising the European Union (EU) accession process, coming amidst increased public discussion by Yerevan’s own elites about the prospect of EU candidacy, the acknowledgment from Brussels signals a more ambitious period of EU-Armenia relations. A few weeks later, on April 5, the European Union announced a groundbreaking €270 million investment initiative in Armenia. With Europe evidently interested in a new phase in relations, it appears possible that Armenia will seek EU candidacy in the coming years, breaking with decades of affiliation with Moscow that long precluded Western alignment.

These recent developments dovetail with other signs of improvement in Armenia-EU relations in the past few months. In October 2023, Pashinyan delivered a speech to the European parliament, laying out his desire for greater EU cooperation and going to great lengths to describe Armenia as a struggling democracy, even ending his speech by stating, “I am convinced that democracy can provide peace, security, unity, prosperity, and happiness. Let's prove this together. Long live democracy!” Such rhetoric in the past has proven effective in increasing Western support to countries like Ukraine and Georgia. In a likely reference to Russia, Pashinyan also critiqued the lack of action by “countries having bilateral security obligations to Armenia.” In December, Armenia’s Foreign Minister stated that his country hoped to “get as close to the European Union as the EU deems possible.” 

All of this is a historic shift for Armenia, which, since the collapse of the Soviet Union, has been a Russian ally. In contrast to its neighbors, Georgia and Azerbaijan, who looked to the United States and Türkiye, respectively, following independence, Armenia joined a variety of Russian-sponsored intergovernmental organizations and relied on Moscow for military assistance and economic resources. Today, Russia continues to maintain strong economic influence in the country: Gazprom, the Russian state energy company, owns nearly all gas infrastructure, and Russian firms have close to a monopoly over grain and petroleum imports to Armenia. Russia remains the largest destination for Armenian exports abroad and is the largest source of remittances sent home by migrant workers.

But Russian-Armenian relations have been in decline since at least 2020. The last four years have seen a number of conflicts with neighboring Azerbaijan, usually over the Karabakh region, resulting in decisive losses for Armenia and Yerevan-supported separatist forces. Throughout this, Yerevan’s repeated requests for assistance from Moscow or from the Moscow-backed Collective Security Treaty Organization (CSTO) resulted in no concrete or effective response.

Russian inaction during these last few years has provoked outrage in Armenia. Prime Minister Pashinyan eventually accused Russia of “absolute indifference” and called Armenia’s reliance on Russia a "strategic mistake." Subsequently, Armenia began to limit engagement with Russian organizations. Yerevan refused to host CSTO military exercises and declined its turn to chair the organization. An even clearer snub of Russia, as one set of recent CSTO exercises was taking place, Armenia announced it would hold limited military training exercises with American soldiers, a first-ever. 

Russian passivity during the fighting with Azerbaijan over Karabakh only sped Armenia’s drift away from Moscow. Last October, despite Russian warnings to the contrary, Armenia ratified the Rome Statute of the International Criminal Court, meaning that if President Vladimir Putin were to arrive on Armenian territory he would fall within the jurisdiction of the ICC and be subject to arrest. The Kremlin described the move as “extremely hostile.” During an October interview with the Wall Street Journal, Pashinyan blamed Russian peacekeepers for the exodus of Armenians from Karabakh and confirmed that he is now looking to “diversify” Armenia’s foreign policy. In March 2024, Pashinyan announced Armenia had “frozen” its participation in CSTO and, regarding Armenia’s long-term membership, only stated, “we shall see.” 

The latest public polling from Armenia likewise shows discontent with Russia. Only 31% of Armenians consider Russian-Armenian relations to be “good,” down from a height of 93% in 2019. Additionally, 51% of Armenians now consider Russia their country's biggest economic threat (54% responded Türkiye and 50% Azerbaijan). A growing number, 40%, now also consider it the biggest political threat. The data reveals there is a significant block of Armenians with pro-Russia views, usually around 30% depending on the question, but it is a consistently smaller group than those with anti-Russia stances, by as much as 30%. 

Armenia has also attempted to sideline Russia through ongoing peace negotiations between Armenia and Azerbaijan, as Yerevan seeks to keep Europe as the center of diplomatic efforts. European countries are frequent participants in Azerbaijani-Armenian peacebuilding, with EU President Charles Michael and German Chancellor Olaf Scholz taking on active roles in negotiations. The EU already has a presence on the ground in Armenia, operating observer missions there since 2020. France, a country long sympathetic to Armenia, looks as if it is eager to improve ties and become a more active security partner, delivering new military aid to Armenia last fall. 

Yet, Russia’s continuing economic and military influence in Armenia should not be discounted. Some Armenian officials have made careful statements, saying it is not “possible” for Armenia to join NATO and re-assuring that Armenian policymakers are “not discussing” exiting the CSTO or the Eurasian Economic Union. Armenia has likewise seen trade with Russia grow dramatically since 2022 and appears to be assisting Moscow evade Western imposed sanctions. More important, Armenia continues to host two Russian military bases as well as a Russian peacekeeping force. Yerevan’s critics argue these are outmoded bases that provide little security. Armenia has requested Russia withdraw its border guards stationed in Yerevan’s central airport, but for now, there remains no end in sight for the bases' presence in Armenia. If the country ever formally sets its sights on EU membership, the bases will undoubtedly be a major issue. As European officials have made clear in relations with countries like Serbia and Georgia, it is no longer acceptable for aspiring members to maintain close ties with both Russia and Europe. For instance, it is highly unlikely that Brussels or Moscow would tolerate Armenia applying for EU membership, if it remains a member of the Eurasian Economic Union. 

However, as much as Armenia’s ties with Russia are obstacles to European integration, they also present Brussels with a unique opportunity to co-opt a country historically within Moscow’s sphere of influence. According to European Union scholar Dimitris Tsarouhas, the EU has “has finally embraced the geopolitical dimension of EU enlargement” and views building relations with Armenia as “part of that change.” Within this context, according to Tsarouhas, Armenia’s repeated and public efforts to distance itself from Moscow are crucial. Moreover, while membership negotiations for Armenia would clearly be far off, Tsarouhas argues that “at a time when the Eastern Neighborhood policy of the EU has shifted gear towards accession negotiations and the prospect of EU membership with Georgia and Moldova, alongside Ukraine, confirming Yerevan's aspirations for a potential future membership serves the purpose of maintaining the positive momentum in bilateral ties.” The EU may be willing to give Armenia time to sort out its relations with Russia or temporarily overlook them, having already granted Georgia candidacy last year despite several major issues (including sanctions evasion).

Statements by EU officials reflect the geopolitical aspect of growing EU-Armenia ties. At the April 5 announcement of the EU’s new investment plan, European Commission President Ursula von der Leyen praised “the measures that Armenia has taken against the circumvention of our sanctions against Russia.… This shows that the European Union and Armenia are increasingly aligned in values and interests.” The remark came amid some signs that Armenia is beginning to take stronger actions against sanctions evasion, banning some Russian financial transactions.

However, the Armenian economy’s high dependence on trade with Russia makes sanction de-risking complicated and threatens the country’s fragile financial balancing efforts. In March, Armenian banks agreed to stop processing bank transactions made by Russian Mir payment cards due to sanctions imposed on Russia. 

Yerevan’s pivot toward Europe is playing out in real-time, but overall, the geopolitical picture remains complicated. Armenia’s intentions are clear, backed up by actions relating to the CSTO and the regional peace-process. Yet, as a result of 30 years of partnership, Armenia is too intertwined with Russia economically, politically, and militarily to become outwardly hostile to Moscow and completely cut ties overnight. Something like EU candidacy might emerge as a long-term goal for Armenia, but for post-Soviet countries with ties to Russia, accession processes lasting more than a decade are common. What is most likely to play out in Armenia in the near term is something similar to what has emerged in Central Asia, since the outbreak of the war in Ukraine: a multi-vector foreign policy that counterbalances Russia with other major powers. The influences and interests of Europe will play an increasing role in Armenian foreign policy, but Russia will remain an important factor for Armenia, even as anger mounts against Moscow.

Related Articles


Russia’s Premature Withdrawal, Withered Force

On April 16, footage showing the alleged withdrawal of Russian peacekeepers from Azerbaijan’s Karabakh


Armenia's Top Trade Partners