Armenia in the Eurasian Economic Union: reasons for joining and its consequences

Abstract

On 3 September 2013, the president of Armenia shifted the long-praised process of initialing political association and economic integration with the European Union and announced Armenia’s decision to join the Russia-led Customs Union and participate in the processes of formation of the Eurasian Economic Union (EAEU). Practitioners and observers interpreted it either as a U-turn or as a surprise move mainly assuming that what happened was the result of Russian pressure on Armenia. However, when tensions and uncertainty eased, it became obvious that what happened was a result of complex reasons. Geopolitical constraints and socio-political problems that had accumulated in Armenia during recent years coincided with an assertive expansion of Russia’s foreign policy. This research provides a number of explanations for that political decision to understand the primary determinants of that move. It also examines the political and economic implications of Armenia’s membership of the EAEU.

Keywords:

• Armenia
• Russia
• European Union
• Eurasian Economic Union
• Eastern Partnership
• security

Notes

1. The Russian ruble had fallen to 50% of its value against US currency at the start of 2014, whereas the Armenian dram had fallen by only 17% over the same period (ARKA News Agency 2016).

2. In June 2015, the central Baghramyan Avenue of Yerevan was occupied by thousands of people who protested against the government’s decision to increase energy prices by 17%. The civic initiative, which soon became known as Electric Yerevan, initially attracted mainly young people. Protesters were particularly vocal about the reported cases of poor management, fraud, and robbery in the energy company owned by Russians. Some observers tried to trace anti-Russian sentiments at these rallies; however, it soon became obvious that the protestors demanded from the government able management of its resources. The Armenian Government responded to it by agreeing to audit the company.

3. Ruben Vardanyan has been the president of “Troika Dialog,” the Chairman of Sberbank, the general director of Rosgosstrakh, and the Chairman of Ameria Bank. He is also the coordinator of the development project “Armenia 2020,” "IDeA foundation,” and the coordinator of the council under the president of the Russian Federation for National Priority Projects.