Armenia, the Russia-led Eurasian Customs Union, and the European Union: Will the Finality be Armenia’s Accession to the EU?

By Hans-Jürgen Zahorka

Since 1999 I was several times in Armenia, in journalistic missions and as Government Advisor, mainly for the EU. In 2003, during an assignment in AEPLAC (Armenian-European Political and Legal Advice Center), I had some spare time and wrote, after thorough consultations mainly with three former ministers (economy, finances) a scenario on Armenia’s accession to the EU. At this time, there was a very positive thinking towards a more active European policy in wide parts of the government and public life, and one of the „spinoff“ products following the essay I wrote was that there was soon the founding meeting of the Armenian chapter of the European Movement.

In the years to come, this article was more quoted and discussed (e.g. in Internet fora) than it could be expected. It can be seen in English on the Website of LIBERTAS – European Institute under: http://www.libertas-institut.com/de/PDF/Armenia%20ante%20portas.pdf, and in 2003 there was also a German version (it is not easy to translate as a German one’s English text into German, I remember) in ADK 1-2/2003 (Armenisch-Deutsche Korrespondenz, Vierteljahresschrift der Deutsch-Armenischen Gesellschaft), which was also published on our Website: http://www.libertas-institut.com/de/PDF/ArmeniaDE.pdf

Now we are in the situation that Russia is actively reluctant against an orientation by some of the former parts of the Soviet Union towards the EU. Besides the legitimate question, if Russia’s government does not try to turn back the wheel, it must be said that the Eurasian Customs Union as first stage of a Eurasian Union is of course, as a regional integrstion, fully legitimate – but it has to be taken into accouont that a regional integration can function only if the participant countries go voluntarily into this integration. But as we see and what has not be mentioned in detail (well, if someone wants, this is possible of course), Russia tries almost everything to „keep“ the European CIS Member States (Georgia has left the CIS in 2008) – Belarus, Azerbaijan, Armenia, Georgia, Ukraine and Moldova – on a lane leading to the Eurasia Customs Union, and later to the Eurasian Union. Belarus and Azerbaijan are not able to come closer to the EU, at least not under their present governments. Ukraine, Moldova, Georgia and Armenia have negotiated an Association Agreement which is the successor of the PCA (Partnership and Association Agreement) from the late 1990s which was valid 10 years with automatic extension until it would be replaced by ist successor agreement – the Association Agreement (AA). In addition and a „goodie“ for the economies, there is also a DCFTA – Deep and Comprehensive Free Trade Agreement which should be signed at the Summit Meeting of the Eastern Partnership end of November 2013 in Vilnius/Lithuania.

But Russia wants to prevent this: Moldovan wines can at present not be exported to Russia (for „standards‘ reasons“ – but the EU which has widely feared very high standards to food imports does continue to import Moldovan wine …, and there are indeed no Quality changes to the worse with the good Moldovan wines), Ukraine exports to Russia have been stopped at the borders by the Russian administration, until Ukraine and the EU coughed … Georgia – well, their Prime Minister said, we will consider the Customs Union, but we have at present no opinion on this – this was quite friendly to MOCKBA, but it raised a domestic furor in Georgia, and the Prime Minister will leave office soon. Anyway, Georgia had a short armed conflict in 2008 with Russia, and since then, and not only then, the relations between both are a bit suspended asymetrically, and they cannot be called „normal“. In Georgia, there is an all-party coalition in favour of more European integration, and this did not change at the last general election.

The orientation of these four Eastern Partnership countries, including Armenia, towards the EU has been evident as the EU in the framework of its European Neighbourhood Policy (ENP) has always tried to reform these former kommando economies – with a huge amount of detailed legal approximation which had and still has to be implemented. This covers among others competition and state aid policy, de-monopolization, pegging to technical EU standards and norms (which are relevant far beyond the EU), regulation of utilities and transport (rail, air traffic etc.), intellectual property rights, energy and environment law etc. Russia and its Customs Union remain advocating some key sectors, like railway, energy, telecommunications. Indeed, Russia holds all or big parts of these sectors in Armenia, and they are strategic. One has also to take into account that there are long and deep (and emotional) links in providing security from Russia for Armenia. However, one has also to ask what Russia did objectively that the Nagorno-Karabakh conflict was won by the ethnic Armenians from there in the beginning of the 1990s, and why Russia which has army bases in Armenia has now committed to provide Azerbaijan (which implicitely has threatened several times Armenia to conquer back Nagorno-Karabakh by the use of force) with arms worth several billions of euros. There were evidently Russian pressions, at present unknown in detail, on the Armenian President, to agree during a summit meeting on 3.9.2013 to include Armenia into the Eurasian Customs Union and later into the Eurasian Union. No politician would have said this without any pressions, just six weeks after four years of negotiations with the EU, having praised the objectives of these negotiations all the time. Big parts of Armenian civil society are protesting this, the European Parliament has adopted on 12.9.2013 a multi-party tabled motion quasi unanimously, and we had to state, too, that the European media did not much react on all of this…

The EU Commissioner Stefan Füle made very clear comments before the European Parliament on 11.9.2013. It is not necessary to repeat them here, just see http://europa.eu/rapid/press-release_SPEECH-13-687_en.htm. The question is what will be the finality of Armenia vis-à-vis the European Union. I know many Armenians who fit fully into the pattern one has for an EU citizen, and the whole country’s culture is on one line with the EU, and nowadays the political culture more or less, too. Now, with the DCFTA many, even uncountable new links for small and medium enterprises could emerge, and this would really bring the country Forward. The expectations are in solid double-digit numbers for the growth of the Armenian GNP, if the DCFTA will be in power, within several years. Both, the Eurasian Customs Union and the DCFTA, are not compatible, and Armenia which cannot even form a common customs territory with the Customs Union, would be worse off with having signed both. So the moment of truth approaches:
– will Armenia sign only the AA plus DCFTA (they belong together, as a double-pack), which would require some explications to Russia (if they insist),
– or will it sign only the AA and not the DCFTA (which will cut the wings of the AA in a wide, yet unknown extent, and would stall the ongoing reform efforts of the country to be on line with the social market economies of the EU, and would also endanger trade flows – Armenia has more foreign trade with the EU than with Russia; statistically it is evident, but the EU Member States are counted separately, although the EU follows one Common External Commerce Policy, art. 206 et al. TFEU/Lisbon Treaty, and is counted in other countries as one statistical unit),
– or will it sign the Customs Union Treaty only, indicating this by a non-signature of the both agreements with the EU? Then it would give green light to oligarchs, more strategic investment by Russia and on the Long run an oligarchy and no competition at least in the relevant sectors. The whole country would be set back as it would not be reformed in a continuous way. It would then opt to be on one line with the economies of Russia (which has raw materials, different from Armmenia), of the ridiculous dictator-determined one of Belarus, and of the Central Asian System – and I mean very Central Asian!. and it is not the place to speak about this now and here – of Kazakhstan. Maybe Kyrgyzstan and Tajikistan will be in the boat in some months, but this can be in no way a decision parameter for Armenia.

Nobody with some brain – sorry – could understand the latter possible decision. Only dubious and shallow words by Vladimir Putin must have induced to bring Armenia in today’s impossible position, after all. The Armenian President did not look to well and happy on the TV Screen when he came out of the meetings. What has been perceived as not too positive were the assurances given by all Armenian government officials and representatives. They should remember the fact that they cannot be pregnant only to 50%.

The long-term consequence of everything is that Armenia will forward an application to become a Member State of the EU. Maybe not within the next five years – but I exclude nothing. The security issues, at least with Turkey, can and will be solved, as they are also in the interest of Ankara, not at least in view of her EU negotiations. And the more Armenia will be uncoupled from EU growth and parallel countries like Ukraine, Moldova and above all Georgia, the more the civil society trend will be in favour of the EU. The EU is not an imperialist entity, but it has a huge centripetal potential – in economy, but also in its democratic systems. And Armenia has happily a more or less functioning civil society, which can and will have a feedback on its political system. And as the EU knows perfectly that a possible „no“ to the EU by Armenia is not the will of the people and not even of the government in Yerevan (why would they have drunk so much mulberry vodka or konjak on 24.7.2013, when the DCFTA negotiations were finished?!), the doors to the EU will not be closed. And isn’t it encouraging that e.g. in EU universities there is at present made serious research on a possible roadmap of Armenia towards an EU accession?

We will publish as a book what comes out there, for the EU must say „B“ when they say „A“. It will be on the market still this year, and it will induce any discussions. And Armenia as a European country, clearly anchoring in the standards of the Council of Europe, cannot be denied any further integration – in particular as Georgia will exactly do the same, and a double-pack is easier for the EU. And last but not least, the Russian system got some further spots of civil society influence: the Mayor elections in Moscow, but also in Ekaterinburg. Under these auspices, Mr. Putin should get the next Sakharov Prize of the European Parliament to promote inconsciously European values in Armenia – or the next medical Nobel Prize, as a Polish M.E.P. has proposed with a ;), as he opened the eyes of many with his – let’s call it: funny – behaviour towards the Eastern PArtnership countries. I look forward to heated or cool debates in the South Caucasus on these matters.

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