Europe steps up support in Armenia to counter Russian vacuum

A story from The Steppe #5

Following a meeting in Brussels on April 5 between Armenian Prime Minister Nikol Pashinyan, European Commission President Ursula von der Leyen, and U.S. Secretary of State Antony Blinken, Armenia clinched a major funding package to help shore up its economy, totalling €270 million from the EU and $65 million from the U.S. The move is being seen as recognition for the South Caucasus country’s pivot towards closer integration with the West and growing concerns over Russian control of its infrastructure and industries.

While the assistance aims to support Armenia's democratic reforms, combat corruption, and enhance various economic sectors, it is also to reduce its economic dependence on Moscow and increase its economic resilience in the face of possible shocks.

Armenia has sought closer ties with the EU and U.S. in recent years, marking a departure from its historical alliance and economic union with Russia. However, this shift has strained relations with the Kremlin, which has voiced concerns over increased Western influence in the region. With Armenia’s deep structural dependencies on Russia, especially in sectors like energy, agriculture and mining, the latest tranche of funding is just the start of a long process to help Armenia increase its access to Western markets.

According to Tigran Grigoryan, a political analyst based in Armenia and head of the think tank Regional Center for Democracy and Security,

“These funds will primarily support Armenia’s efforts towards economic diversification. They will serve to kick off the standardization processes, aid in beginning the search for new markets, facilitate government reforms already underway, and contribute to infrastructure development as well."