It may still be only on the drawing board, but Russian Prime Minister Vladimir Putin’s proposed Eurasian Union, an economic bloc of former Soviet republics, already is stirring concern in Armenia about the future of Yerevan’s independence from Moscow.
In an October 3 commentary in the daily Izvestia, Putin, who plans to run for Russia’s presidency next year, described the bloc as allowing its members “a higher degree of integration” on “a new … political and economic basis,” without a return to the Soviet past.
So far, the Armenian government has not elaborated about its plans to join the bloc, but conjecture runs strong.
In what has been touted as a first step toward realizing Putin’s plan, on October 18 Armenia and seven other former Soviet republics signed an agreement to create a free trade zone within the Commonwealth of Independent States, the club of ex-Soviet republics that could, conceivably, serve as a launch pad for Putin’s new union. Armenia also appears to have put aside earlier reluctance about another potential building block for the Eurasian Union, a customs union between CIS members.
Prime Minister Tigran Sarkisian has praised the Eurasian Union, saying that it shows “perspective” and “goes with the times.” President Serzh Sargsyan himself has not yet released an official comment, but a televised remark by Union of Armenians of Russia Chairman Ara Abrahamian, a prominent businessman, that Armenian President Serzh Sargsyan allegedly told him that he approved of the Eurasian Union, has been interpreted widely to mean that Armenia will sign on with the plan.
The idea, however, has outraged some Armenian opposition members, who believe that Russia’s only goal is “to increase dependence [among former Soviet republics], and create multi-[layers of] dependence” on Moscow.
“The goal is not the creation of a European-Union-like structure with several equally powerful countries as members, but to simply not allow CIS [Commonwealth of Independent States] countries get too carried away and deepen their relationships with the West, which might lead to less dependence,” argued Styopa Safarian, head of the opposition Heritage Party’s parliamentary faction.
The nationalist Armenian Revolutionary Federation, a onetime government coalition member, echoes that view. Armenia’s economy itself will probably “neither win nor lose” from membership in the Eurasian Union, but the union could endanger Armenia’s “independence” from Moscow, predicted MP Artsvik Minasian, an economist by background.
Russia currently ranks as Armenia’s largest economic partner, with $3 billion worth of investments in the country, according to government data. Russian firms control 80 percent of Armenia’s energy resources, account for two out of three of its telecommunications companies and now hold a 30-year management contract for its railway.
Strategic ties play a role, too: Moscow has a 49-year agreement for the stationing of troops at Gyumri in northern Armenia.
Safarian contends that, by joining the Eurasian Union, Armenia would just add one more block to that pillar of influence, at the risk of any EU-friendly economic development track and, possibly, anticipated western investments. Last year, Armenia and the European Union started negotiations on an Association Agreement that would provide the opportunity for a free trade area and a simplified visa regime.
“Of course, the European Union invests only in countries that are predictable, share the same set of values, and sees a future with those countries,” claimed Safarian. “If we join this [Eurasian] union, we will once and forever be out of that value field and, consequently, will also be left out of major investment projects.”
The European Union has made no statement about Putin’s Eurasian Union, but has stressed that the CIS free trade zone has no impact on a member country’s ties with the EU.
“[T]here is no problem or incompatibility between negotiating a deep and comprehensive free trade agreement and being in association with the European Union on the one side and having free trade agreements with other countries on the other side," Gunnar Wiegand, who oversees the South Caucasus for the European Commission’s European Neighbourhood Policy, commented on October 26, reported RFE/RL.
One senior MP from the governing Republican Party of Armenia dismisses fears that the Eurasian Union could spell an end to Armenia’s economic freedom of maneuver. “This is just a premature panic. That’s all,” Deputy Parliamentary Speaker Samvel Nikoyan commented to EurasiaNet.org.
Another Republican parliamentarian, Shirak Torosian, a member of the Foreign Affairs Committee, believes, however, that “the Putin-submitted plan is innocent only at first glance.”
“We have to think very carefully not to fall into another -- this time, final -- trap,” Torosian said, in reference to controversial economic deals, such as the shares-for-debt swap that gave Russia control over five Armenian state-run companies, including the Hrazdan thermo-electric power station, as compensation for Soviet-era debt. Torosian added that his opinion does not reflect the Republican Party’s view.
Some analysts view the Eurasian Union as a more mundane phenomenon, however. Economist Tatul Manaserian, head of the Alternative economic research center, notes that the Union would not be “a new thing,” and could introduce competition to help Armenia “fight against the import monopoly” which, he argues, poses the greater threat to the country’s economy.
Ultimately, predicted independent political analyst Yervand Bozoian, the proposed Eurasian Union “will get into a deadlock before it reaches us.” For now, he said, it looks like “nothing more than just an election campaign promise [by Putin] to rebuild the Soviet Union.”
Gayane Abrahamyan is a reporter for ArmeniaNow.com in Yerevan.
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