BIGtheme.net http://bigtheme.net/ecommerce/opencart OpenCart Templates

Armenia chooses Euroasian Union over the EU: What now?

With just two months left till the Vilnius Summit, Armenian President Serzh Sargsyan announced that his country would be seeking to join the Russia-led Customs Union, thus effectively reneging on his country’s commitments for closer economic and political cooperation with the EU. Mr. Sargsyan revealed this foreign policy change after talks with his Russian counterpart, Vladimir Putin, on September 3rd. We sat down with Mr. Badri Kochoradze, professor of social sciences in leading universities in Georgia and former director of the Institute for European Studies at Tbilisi State University, to discuss possible implications of Armenia’s decision.

serzh-sargsyan-vladimir-putin-customs-untion-armenia
Armenia will become the fourth member of the customs block made up of Russia, Belarus and Kazakhstan. The decision to join the Euroasian Union (and effectively cancel pledges to deeper economic and political cooperation with the EU) was announced during a meeting between Mr. Putin and Armenian President Serzh Sargsyan in Russia.

Beyond the EU: In the heat of negotiations for closer political and economic integration with the EU, President Serzh Sargsyan declared that Armenia would instead be seeking to join the Eurasian Customs Union, a free trade bloc spearheaded personally by Russian strongman Mr. Putin. Has Armenia’s hand been twisted into coercion or does it genuinely see herself better off in a Moscow-led bloc?

Prof. Badri Kochoradze: In the short run this step is self-evident taking into account an overwhelming economic and security dependence of Armenia on Russia. Nearly all major Armenian political parties actually unanimously endorsed the decision made by President Serzh Sargsyan on joining the Customs Union and eventually Eurasian Economic Union led by Russia. Against the backdrop of Armenia’s already existing multilateral security memberships of regional cooperation dominated by Russia (such as CSTO) and bilateral strategic security as well as economic agreements with Russia, Armenia had no real choice but announce joining the would-be Unions.

“Nearly all major Armenian political parties actually unanimously endorsed the decision made by President Serzh Sargsyan on joining the Customs Union and eventually Eurasian Economic Union led by Russia”
Therefore, this is the case where coercion and self-interest go hand-in-hand at least in short-term perspective. However, this event happened at the cost of losing a chance of long-term political association and economic integration with the EU. Joining the Customs Union is incompatible with initialing and then signing  the Association Agreement (AA) with the EU, as well as embracing the Deep and Comprehensive Free Trade Area (DCFTA) with the latter.

Obviously, “diverting” Armenia from the AA and DCFTA is a long shot for Russia. The last one is aimed at discrediting and eventually dismantling the Eastern Partnership (EaP) that interferes with the interests of Russian dominance “near abroad”. So Russian strategy and expectation is that the other EaP countries will be forced to follow the suit in the run-up to November 2013 EaP Vilnius Summit.

Beyond the EU: Swedish FM, Carl Bildt, expressed his concerns and disappointment over Armenia’s decision to detract from its EU-orientated course. Given the eagerness of the EU to save face by keeping Armenia on the negotiating table for the upcoming summit, what mechanics could the EU invoke to appease to the Armenian elite and turn its course back towards the West? Is there even such a possibility?

 Prof. Badri Kochoradze: The EU is deprived of immediate strategic leverage over Armenia comparable to Russian one. The EU is strategically losing the geopolitical chess-game vis-à-vis Russia thanks to its protracted due process and sometimes too pedantic (if not capricious) conditionality to EaP countries. Instead of swift and bold political decision-making offsetting the all-out Russian pressure exerted over EaP countries generally, and Armenia in particular, the EU is employing a process-oriented strategy against the hard-nosed Russian Realpolitik measures.

“If Armenia joins the Customs and Eurasian Unions then its EaP membership will become nearly senseless, so technically that will amount to EaP being dismembered”
Armenia is virtually trapped in immediate military-security and economic dependence on Russia. Security-wise, Armenia must keep occupying undisputed Azeri territories in order to retain disputed territory of Karabakh against growing indigenous military and economic power of Azerbaijan. Economically, Armenian energy sector is entirely in the hands of Russian big businesses and more than million Armenians send remittances home from the Russian federation.

Moreover, Russian military hardware is largely supplied in kind to the country (as opposed to Azerbaijan that buys it). Under such circumstances, the economic dependence seems to be absolutely indispensable. In this regard, the EU’s promises for political association and economic integration, offering limited economic assistance, look toothless.

Beyond the EU: What repercussions could Armenia’s change of heart have in the wider context of the region as a whole? Is it possible that the EU will now bolster its engagement in Georgia in an effort to show Armenia what it lost out on?

Prof. Badri Kochoradze:  If Armenia joins the Customs and Eurasian Unions then its EaP membership will become nearly senseless, so technically that will amount to EaP being dismembered. The EU definitely feels that the next in line in South Caucasus can be Georgia. Its prime minister has already indicated his open-mindedness towards Customs and then Eurasian Union at this critical time of approaching EaP Vilnius Summit. Although, he publicly declares that there is no contradiction between Georgia’s Euro-Atlantic aspirations and its would-be membership in Eurasian Union, it is quite obvious that these two prospects are incompatible.

Against this backdrop, the pro-integration rhetoric of EU and its enlargement Commissioner Stefan Fule is getting stronger, but, as in Armenia’s case, its leverage on the ground vis-à-vis Georgia is weaker than that of Russia. Of course, catching Georgia seems to be more difficult for the federation considering a large and dynamic – as compared to Armenia – pro-western layer in Georgian society. However, the biggest battlefield seems to be Ukraine that is supposed to sign the AA at the EaP Vilnius Summit. The last event will make its EU political association and economic integration technically irreversible. If that happens, it will constitute the largest strategic failure of Russia.