On November 24, Armenia and the European Union signed a Comprehensive and Enhanced Partnership Agreement in Brussels. The occasion stood in stark contrast to the moment in 2013 when Yerevan refused to sign an EU association agreement and instead announced it would be joining the Eurasian Customs Union (now the Eurasian Economic Union or EEU). 

With the new EU framework agreement, Armenia has now achieved what Ukraine and Georgia could not: the benefits of both EEU and EU integration. Why was the scenario from 2013 not repeated? And what is Yerevan’s secret for successfully navigating contradictory integration efforts?

In the South Caucasus, foreign policy cannot be reduced to a diametric choice between Russia and the West, or a competition of value systems. It is instead driven by a need for external diversification. The region is poorly integrated due to the unresolved ethno-political conflicts in all three republics of Armenia, Azerbaijan, and Georgia. As a result, the republics leverage their relationships with outside players to bolster their national interests. 

Armenia has a reputation as a stalwart Russian ally. It doesn’t merely participate in Eurasian integration projects, but hosts a Russian military base on its territory. Indeed, Armenia’s refusal to sign an EU association agreement in 2013 was widely interpreted as a directive from Moscow. Yet there are some important nuances. For one, the EU insisted that any agreement would preclude Armenia from further Eurasian integration. Yerevan’s decision was also made against the backdrop of the impending Ukraine crisis, when Kiev was still a contender to join the Customs Union.

Nonetheless, Yerevan’s perceived closeness with Moscow has never kept it out of EU initiatives such as the European Neighborhood Policy and the Eastern Partnership. In 2005, Armenia signed a NATO partnership plan to be renewed every two years. The fifth and latest version was ratified in early 2017 and during that time Armenian forces have taken part in NATO operations from Kosovo to Afghanistan to Iraq. Yerevan has also sought closer ties with its neighbors, Iran and Georgia. 

At first glance, Georgia’s foreign policy seems diametrically opposed to Armenia’s. Since 2004, it has moved purposefully toward the West, declaring its intention to join NATO and signing an EU association agreement in 2014. However, Georgia too is seeking a more multi-vectoral foreign policy. This was typified in November 2017 when it ratified a free trade agreement with China—the first of its kind in the region. 

The reason for Georgia’s interest is straightforward. Tbilisi anticipates significant investment from and trade with China, evermore important as its share of trade with the EU declines. The same logic applies to its decision to lift Iranian visa requirements and to open a Belarusian embassy in Tbilisi. Georgia has also made overtures to Russia despite territorial disputes and deep suspicion. It has both economic and security interests in reestablishing limited ties, especially after a recent incident in which a terrorist cell infiltrated Tbilisi. 

The outlier is Azerbaijan. It enjoys the strongest economic status in the Caucasus and a reputation as an important energy player, yet refrains from integration, whether European or Eurasian. Baku positions itself as a partner of both Russia and select EU countries (particularly in Eastern Europe), as well as the EU as a whole. Even as it declines to sign framework agreements with Brussels, Azerbaijan maintains its ties to Europe through the Eastern Partnership. Baku also carefully balances between Iran, Israel, and the Palestinian Authority, building bilateral ties with each. It is a two-way street: external powers don’t limit themselves to any one country in the Caucasus. 

The foreign policy agendas of Armenia, Azerbaijan, and Georgia are dictated not by abstract values but by specific pragmatic considerations. Recall that in the nineties Georgia joined the Commonwealth of Independent States and assented to Russian military bases and border patrol on its territory. Only after a severe break in relations did Georgia declare that it was ready to knock on NATO’s door.

Similarly, Armenia’s interest in the EU serves a pragmatic end. From an economic perspective, Europe is a crucial partner for technological development and trade. Yerevan also understands the political implications of ingratiating itself with Europe. It seeks to prevent Baku and Ankara from monopolizing the Nagorny Karabakh debate in Brussels. 

At the same time, neither the EU nor NATO is willing to provide a security guarantee to Armenia, while Russia’s offer of security is material—a base on Armenia’s border with Turkey and Moscow’s help in settling the Karabakh conflict. Breaking with Russia would leave Armenia exposed on both fronts. Thus, its decision to enter the Customs Union and later the EEU. The EU’s “either/or” ultimatum overlooked the complex nature of foreign policy in the Caucasus. Yerevan chose Russia as a reliable guarantor of security. There is a popular joke in Armenia: when faced with a decision between the EU and the Customs Union, Armenia chose the Collective Security Treaty Organization.

Why then did Armenia and the EU sign a new framework agreement after the failure of the association agreement? Simply put, expectations were diminished. The Comprehensive and Enhanced Partnership Agreement (CEPA) does not contain free trade arrangements in order to respect the EEU’s trade jurisdiction. The compromise that made CEPA politically palatable to Russia and Armenia also stripped the agreement of any real economic impact.

Still, Armenia’s ability to navigate contradictory integration efforts may prove instructive for other post-Soviet republics. Signing CEPA became possible when all negotiating parties rejected the ultimatum of “either/or” and acknowledged that Armenia has no alternative to the Russian defense umbrella. Yerevan may also become a space for dialogue between Russia and the EU. It performed a similar role for Russian-Georgian relations in 2009.

Four years ago, Armenia’s failure to sign the EU Association Agreement was an early indication of the impending Ukraine crisis. Now, an Association Agreement-lite has been signed. While this doesn’t represent a normalization of relations between Russia and the EU in the post-Soviet space, it’s important symbolically. Rather than an “either/or” approach to integration, the EU and Russia are gradually moving in a “both/and” direction.

This material is a part of “Minimizing the Risk of an East-West Collision: Practical Ideas on European Security” project, supported by the UK Foreign and Commonwealth Office.

  • Sergei Markedonov