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Armenia Straddles East-West Divide

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  • Armenia Straddles East-West Divide

    ARMENIA STRADDLES EAST-WEST DIVIDE

    The Washington Post
    January 8, 2015 Thursday

    by Karoun Demirjian
    YEREVAN, ARMENIA

    YEREVAN, ARMENIA - When Armenia broke ranks last year with other
    former Soviet states marching toward Europe and pledged to join
    Russia's new customs union instead, the goal of keeping a foothold
    in both the East and the West didn't seem all that challenging.

    It wasn't the first time the country had pulled off such a high-stakes
    balancing act: For years, Armenia has been the only full member of
    the Collective Security Treaty Organization, the Russian-led military
    alliance, to also participate in NATO peacekeeping missions. And with
    the United States and European Union promising to continue economic
    development efforts, there seemed little to lose by joining Russia.

    But that was before the Ukraine crisis, before Western-Russian
    relations sank to their lowest point since the Cold War, and before
    the ruble started plummeting erratically - pulling down currencies
    such as the Armenian dram along with it.

    Now, as Armenia settles into its role as the smallest member of
    Russia's new Eurasian Economic Union (EEU), the country is bracing
    for what even government officials acknowledge could be a rough ride.

    "I never heard of a situation where turmoil in a partner country was a
    helpful thing," said Vache Gabrielyan, deputy prime minister and head
    of a new government ministry for international economic integration.

    "The situation, of course, has changed," he added. "But I don't yet
    see any change that fundamentally alters the choice we made."

    Armenia's decision to scrap negotiations with Europe over an
    association agreement - the sort that the E.U. recently signed with
    Ukraine, Georgia and Moldova - and join Russia's nascent trade bloc
    was announced abruptly after a September 2013 meeting between the
    president, Serge Sarkisian, and Russian President Vladimir Putin in
    Moscow. Western diplomats said they were surprised, and some members
    of the opposition said the deal was the result of Russian blackmail.

    Members of the Armenian government justified the decision as one that
    will give Armenia the opportunity to improve economic ties with both
    the E.U. and the EEU.

    "In the framework of our humble abilities, we strive to serve as a
    bridge for these two organizations," said deputy foreign minister
    Shavarsh Kocharyan, one of the key negotiators of the deal to bring
    Armenia into the EEU. Picking a side was simply a necessity, he added,
    because "nowadays, every state needs to be in an economic cooperation
    bloc. Germany, France - are they on their own? Heh."

    The idea that Armenia could help build E.U.-EEU economic ties appears
    to have some support in the Kremlin. Last week, Russia's E.U.

    ambassador told the EU Observer, a news Web site, that Armenia is
    one of several countries that could facilitate trade between Russia's
    new customs union and Europe.

    What few in the Armenian government will acknowledge, however, is
    that in choosing to side with Russia, they didn't have much choice.

    Armenia declared its independence from the Soviet Union 23 years ago.

    But Russia remains the tiny country's most vital link to the outside
    world.

    Russia hosts the largest population of Armenians outside Armenia and
    is the largest source of remittances, which accounted for more than a
    fifth of Armenia's national income last year. Russia has a monopoly
    on selling Armenia cheap gas through 2043, and state-funded Russian
    television broadcasts are how many Armenians get news and information.

    While Europe remains Armenia's largest export market, Russia is
    the key destination for non-raw-material goods, which Gabrielyan
    says will help Armenia diversify its economy - especially, he said,
    because Armenia is not yet ready to compete in Europe.

    Few public officials, even those who have criticized the president,
    discount those ties. Last month, Armenia's parliament voted
    overwhelmingly to approve joining the EEU.

    The EEU dealmaking process "was misguided and should have been done
    differently," said Vartan Oskanian, Armenia's former foreign minister
    and a member of Prosperous Armenia, parliament's second-largest party.

    But lawmakers backed EEU membership "given the importance we attach
    to Armenia's relations with Russia."

    Yet the most important factor driving Armenia's participation in
    Russia's new economic union isn't economic.

    "We have a security issue which demands us to take faster steps,"
    Kocharyan said, explaining that benefits of European association would
    take longer to realize than joining the EEU. "Such long-term projects
    are very important, but we can never exclude the possibility that
    the day after tomorrow, we may have to impose peace on our neighbors."

    Russia is Armenia's chief supplier of arms, at discounted prices, and
    maintains a military base in the country. Armenians consider that a
    vital asset in their two-decade-long, frozen conflict over the status
    of Nagorno-Karabakh, an ethnic Armenian enclave within Azerbaijan
    that declared independence as the Soviet Union was coming apart.

    There is fear of endangering the Russian military support especially
    because there is no real Western alternative. Although Armenia is
    recipient of one of the highest levels of U.S. aid per capita, that
    money isn't for buying weapons.

    But some opposition members worry that joining the EEU may undermine
    the economic and strategic security Armenia seeks to preserve through
    closer association.

    "Many Armenians think that Russia can only solicit Azerbaijan to
    join the EEU by bargaining on Karabakh," said Nikol Pashinyan, an
    opposition member of parliament who spent a few years as a political
    prisoner under Sarkisian's presidency.

    In recent years, Russia began selling arms to Azerbaijan - a
    shift Armenia believes fueled a spike in cross-border skirmishes
    last summer. And Armenia only narrowly avoided having trade with
    Nagorno-Karabakh subjected to customs tariffs in EEU negotiations.

    Pashinyan said EEU membership could also hurt deals between Armenia
    and other neighbors, such as Iran, where a rollback of sanctions could
    present lucrative opportunities to transport oil to Europe. Through
    the EEU, Russia could stymie such plans.

    Such concerns are why some government opponents maintain that joining
    the EEU is tantamount to "surrendering by our own signature . . . the
    independence we gained 23 years ago," said Raffi Hovannisian,
    the U.S.-born leader of Armenia's Heritage Party who ran for the
    presidency last year and made accusations of fraud after losing.

    When asked about such scenarios, government officials said Armenia
    will not shy away from vetoing EEU decisions it doesn't like, even
    under Russian pressure - and stressed that Armenia will still seek
    closer ties with Iran, the West and others as an EEU member.

    But even if Armenia is able to walk that geopolitical tightrope, some
    believe that by moving toward Russia, the country lost something it
    can't replace.

    "You know, yesterday, we were not Europeans, yesterday we were not
    a democratic country. But yesterday we had the hope of becoming a
    democratic country, with European standards," said Stepan Safaryan,
    a political analyst and former Heritage Party leader. "Tomorrow,
    we will not have this hope. And that is the problem."

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