Armenia’s exports to Russia raise concerns over sanctions circumvention
Despite deteriorating political relations between Armenia and Russia, bilateral trade has flourished, leaving Western partners wondering over Yerevan’s approach to sanctions.
In the aftermath of the sanctions against Moscow, Armenia’s exports to Russia tripled in 2022 and then doubled between January and August 2023, providing ground for accusations about the South Caucasus country’s compliance with the Western sanctions regime.
While the political relations of Armenia with Russia have largely deteriorated in the last few years, bilateral trade with Russia flourished.
Risky trade partner
Since Armenia’s accession in 2014 to the Russian-led Eurasian Economic Union, Russia has become Armenia’s number one trading partner. Russia’s share in foreign exports of Armenia further increased in the aftermath of the invasion of Ukraine.
In 2023, trade with Russia accounted for over 35% of the country’s foreign trade, compared with the EU’s 13% share in the total.
The Armenian economy’s high dependency on its trade with Russia has made it practically impossible for the country to join the sanctions against Moscow without risking unprecedented economic downfall.
This growing economic dependency on the Russian market does not, however, impede the Armenian government’s attempts to slowly shift the country’s geopolitical orientation towards the West.
Quite the contrary, the tensions between the Kremlin and Yerevan, including Armenia’s open disagreement with the Kremlin’s war of aggression, continue to grow in parallel with the increase of trade numbers.
Many in Armenia are worried that the Kremlin can use Armenia’s economic dependency as political leverage, with recent opinion polls conducted by the International Republican Institute (IRI) showing that 40% of Armenians view Russia as the most significant political threat to their country, after Turkey and Azerbaijan.
Meanwhile, Russia has in recent months already blocked on several occasions the import of Armenian products on its ground checkpoint with Georgia.
