Armenia Faces Delay to Joining Moscow-Led Union

Armenia rejected closer ties with Europe last year and announced instead that it was going to join the Moscow-led Customs Union, but the accession progress is going slower than its leaders hoped.

Analysts say the delay may be linked to sensitivities over the disputed territory of Nagorny Karabakh.

When President Serzh Sargsyan announced last September that Armenia was hoping to become a membership of the Customs Union, that put an end to plans for an Association Agreement with the European Union.

At a summit on May 29, the Customs Union’s three existing members – Russia, Belarus and Kazakstan – formalised an agreement to build a more comprehensive association, the Eurasian Economic Union, which should come into being next year.

On the sidelines, one aspiring Customs Union member, Kyrgyzstan, got approval to move forward to accession. The other, Armenia, did not.

Shortly afterwards, Armenian deputy economy minister Karine Minasyan, who had led the team negotiating entry, resigned. No explanation was given.

Kazak president Nursultan Nazarbaev, who chaired the meeting in his capital Astana, promised that Armenia’s membership application would be considered by July.

Back home, President Sargsyan played down concerns over the deferred progress towards membership.

“There are no obstacles in the way of Armenia joining the Customs Union. There are two or three purely technical matters concerning our trade relations,” Sargsyan told a gathering of his Republican Party after the summit. He did not specify what these issues were.

Considering how confident officials had been about imminent accession, Armenians were surprised at the delay.

Officials have now stopped making optimistic predictions about rapid entry, and analysts have begun to question whether Russia, Belarus and Kazakstan want Armenia to join at all.

“Moscow set itself the goal of stopping former Soviet republics – Ukraine, Moldova, Georgia and Armenia – from moving towards Euro-Atlantic alliances. Now that it has managed to make Armenia turn down deeper cooperation with Brussels, there is no need to hurry,” Stepan Grigoryan, director of the Analytical Centre on Globalisation and Regional Cooperation, told IWPR.

“The other members of the Customs Union – Kazakstan and Belarus – are not delighted at the prospect of Armenia joining, since Armenia will vote however the Kremlin wants it to. Apart from that, Armenia joining the union would create problems, since it lacks a border with the union and there is also the Karabakh conflict.”

Nagorny Karabakh has been run by a separate Armenian administration since the war of the early 1990s, although it is still considered part of Azerbaijan by the international community.

Although Armenia has not recognised Karabakh as an independent state, the two share the same currency and banks, and there are no border checks between them. If Armenia joined the Customs Union, the distinctions could be so blurred that Karabakh might effectively function within the trading bloc, too.

At the summit, Nazarbaev made it clear that this must not happen. He made it clear to told Sargsyan that Karabakh had no chance of being accepted into the grouping as only states with internationally-recognised borders could join. Nor, he said, could goods produced in Karabakh be traded as if they came from within the common economic area.

He said Armenia should “behave in the way you did when joining the World Trade Organisation, so as not to anger our friends in Azerbaijan, along the borders recognised by the United Nations. This is how you joined the WTO, so a precedent exists”.

Grigoryan, who previously represented Armenia in another Moscow-led bloc, the Collective Security Treaty Organisation, said he suspected the Kazak leader was speaking for all three members when he expressed reluctance to embrace Armenia immediately.

On returning to Yerevan, Sargsyan tried to play down the implications of Nazarbaev’s comments.

“Of course Nazarbaev’s comments were unpleasant,” he said. “But this does us no harm. And who said we were going to join the Customs Union together with Karabakh? That won’t happen and can’t happen, because Karabakh, by our own laws, is not part of Armenia.”

However, there is no sign that Armenia will agree to restrict the movement of goods from Karabakh, or start treating them as different from domestically-made ones. Prime Minister Hovik Abrahamyan said two weeks before the Astana summit that this was a matter of national security.

Analysts say that any moves to create divisions between Armenia and Karabakh would be unpopular.

“This is a very dangerous development. For the first time since 1992, there has been an attempt to separate Yerevan and Karabakh,” Ruben Mehrabyan, an expert from the Centre for Political and International Studies, told IWPR, referring to the year a land corridor was created between Armenia and Karabakh as the war got under way.

“There is an attempt to change the status quo. This change is not to our benefit, but it appears that the Armenian government is going along with it.”

Opposition parties mounted a fierce attack on Sargsyan, with the Armenian National Congress speaking of a diplomatic fiasco. The Heritage party called on him to “immediately halt the process of joining the Customs Union and the Eurasian Economic Union”.

Tigran Gevorgyan is a freelance journalist in Armenia.