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What will be the implications of Armenia’s efforts to reformat its foreign policy after the capitulation in Garabagh?

Author:

15.12.2020

The crushing defeat of Armenia in Garabagh forces the Armenian society to look for ways of further existence. At the same time, these attempts are made both by the opposition and the authorities. Although sometimes they are diametrically opposite, they still have a common principle, meaning that Armenia does not want to come to terms with its defeat and will continue to seek the recognition of the former separatist regime in Daghlig Garabagh.

 

Pashinyan's program: a straw for a drowning man

On November 18, Armenian Prime Minister Nikol Pashinyan published on his Facebook account the agenda of the government for the first half of 2021. Among the priority tasks, he singled out the assistance to the victims of the war in Daghlig Garabagh, restoration of infrastructure in the region, as well as the return to negotiations under the auspices of the OSCE Minsk Group.

Pashinyan also intends to reform the armed forces, amend legislation, cope with the coronavirus pandemic and improve the economy. At the same time, on November 12, Pashinyan confirmed his intention to seek the international recognition of Daghlig Garabagh, which he calls an "absolute priority".

“Our biggest mistake was that we thought we could extend time indefinitely,” Pashinyan said at the first online press conference after the conclusion of the trilateral peace agreement. He actually admitted that the negotiation process was used to extend time in order to prevent the transfer of the occupied territories to Azerbaijan. Now, Yerevan makes it clear that it will do everything to get a status for the territories populated by Armenians in order to claim independence in the future.

The Armenian opposition insists on holding early elections and actually does not hide its revanchist sentiments to revise the outcome of the November 10 agreement. Although it’s impossible practically, this may indicate that the political forces claiming power in Armenia try to completely dissociate themselves from the incumbent Armenian leadership. Perhaps in the future they will insist on revising the results of the second Garabagh war in any possible form.

 

Armenian economy: from crisis to crisis

Even during the hostilities, experts and observers stated that the war would place a heavy burden on the Armenian economy, which was in a very bad state anyway. Over the past thirty years, Yerevan has spent huge funds for military purposes, including the purchase of weapons, construction of fortifications, barracks, weapons depots, etc. Only through long-term loans received from Russia, Armenia was able to purchase weapons worth over half a billion dollars.

Yet Armenians did not use some of the expensive Russian weapons at all. For example, the Su-30MK fighters, which did not play any role in this war.

Armenia didn’t get a chance to pay off the debts as it lost weapons worth up to $3 billion due to the crushing blow caused by the Azerbaijani Army in Garabagh. Thus, the years of forced austerity measures to ensure maximum spendings on weaponization of the army turned to be the years of self-deception.

At the same time, Yerevan was borrowing funds not only to meet its military needs. A great deal of loans were issued for the implementation of socio-economic programs. As a result, Armenia's total debt portfolio exceeded $8 billion. To pay off the state debt in 2013 and 2015, Yerevan issued Eurobonds at 6.25% and 7.5% per annum, respectively. And 2020 and 2025 were set as the payment years for foreign currency bonds (Eurobonds).

With the resumption of hostilities in the occupied territories of Azerbaijan, the yield on Armenian bonds with maturities until 2025 and 2029 decreased by 4.5 and 3.5%, respectively. This is an additional burden on the country's national debt. According to experts, the amount of external debt in Armenia has already exceeded $4,300 per capita. This means that every dying elderly Armenian, every Armenian soldier killed in Garabagh, has redirected his debt to another family member. Every newborn in Armenia, while still in the cradle, is burdened with a debt.

Earlier, Armenian President Armen Sarkissian was forced to frankly admit that “the wounded (Armenian) economy is overwhelmed by huge social problems. As a result of the large flow of refugees (…), Armenia is experiencing a humanitarian catastrophe. In parallel, there is a difficult situation with the coronavirus pandemic." Being outside of all major regional economic projects, the leading international companies are not interested in Armenia any more. It seems it will be very difficult to get out of the current economic situation.

 

Armenia at a crossroads again

Facing a total loss, the Armenian authorities and the opposition suddenly began to look for someone to blame. As several times before, they found the external forces guilty.

The main criticism, primarily from the opposition forces, was directed towards Russia because Armenia largely entrusted its security to Russia and hoped that Moscow would fight for the interests of Armenia in Daghlig Garabagh. The Armenian authorities deliberately disoriented the society with false expectations that in the event of the outbreak of hostilities in the conflict zone, Russia will not only support Armenia but will also fight for it. These expectations did not come true. Then there were increasing demands from the opposition to review the relations with Moscow and pay more attention to the Western vector. The representatives of the Armenian political elite began to use the dissatisfaction of France and the US with the results of the signed agreement to increase the involvement of these countries in the final phase of the settlement.

At the same time, Armenia is trying to use the active involvement of France in this process as a leverage to include the idea of the status of Daghlig Garabagh in the post-conflict agenda, which enables the Armenian authorities to also promote the idea of Western support for the Armenian position.

The recognition of the so called Daghlig Garabagh Republic is an integral part of the new French policy towards the Daghlig Garabagh settlement. On November 19, the French Senate received a draft resolution on the recognition of the "independence" of Daghlig Garabagh. The draft was drawn up by five senators representing different factions. It is quite obvious that if France decides to take such a step, it will have to revise the principle of inviolability of the territorial integrity of states. In addition, France recognises the ‘Republic’, it will automatically be dropped off the OSCE Minsk Group and is unlikely to return, because it ceases to be an impartial player in the region, openly expressing the interests of Armenia. Apparently, nobody in Yerevan cares about the fate of Paris. For the anti-Russian lobby in Yerevan, the main thing now is to get support to its policy for the reorientation of Armenia from a pro-Russian to a pro-Western vector.

Unfortunately, French parliamentarians were not alone in demonstrating a pro-Armenian position. Earlier the Dutch parliament called on its government to make a proposal on imposing sanctions against the leadership of Azerbaijan. It claimed that the last outbreak of violence in Daghlig Garabagh "was initiated by Azerbaijan with the support of Turkey."

Supporters of Armenia’s pro-Western orientation immediately mentioned this fact as Europe’s support for the Armenian position expecting that it will help them promote the delusional idea of the recognition of the so called Daghligh Garabagh Republic through European channels.

 

With an eye on Moscow

It is no secret that some well-known political circles in Yerevan try hard to gradually turn Armenia towards the West. The Armenian leadership demonstrates a positive, albeit latent, attitude to the this trend. However, the deterrent factor is the expected violent reaction from Moscow. A day after the joint appeal of Washington and Paris to Moscow regarding "clarifications" regarding recent agreements, the director of the Russian Foreign Intelligence Service, Sergei Naryshkin, made a statement. He said that “the leading NATO countries are trying to hide their irritation with the agreement reached with the active participation of Russia between Azerbaijan and Armenia on a ceasefire in Daghlig Garabagh. The US and its allies are annoyed that the war has been stopped with the mediation of Moscow. After all, this actually nullified their many years of work to oust Russia from the Transcaucasus.

“Neither Washington nor the united Europe wants to come to terms with the existing balance of power in the region. In attempt to upset the balance, they could not find anything better than inciting discord between the peoples of Azerbaijan and Armenia,” Naryshkin said.

In fact, Naryshkin's statement was addressed to Yerevan rather than Washington and Paris, considering the former’s active flirting with the West, which does not comply with the reached agreement.

"Those who are trying to slow down the implementation of the trilateral agreement between Moscow, Yerevan and Baku on Garabagh should understand that the alternative to this document is a war," Russian President Vladimir Putin said on November 20 at a meeting on a peacekeeping mission in the region. Everyone understands that it is Armenia that is trying to slow down the process. It is Armenia which does not want to disarm, instead burning the houses, chopping down trees, provoking tension on religious grounds. Warning against a new war with Azerbaijan, Putin once again makes it clear that the time when Yerevan tried to play an independent party in the conflict is over. In principle, Putin himself talks about the conflict in the past tense. We yet to know the reaction of Yerevan to the words and actions of the Russian leadership.

Apparently, no one is seriously interested in the reaction of Yerevan given the current state of the country.



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