In a new analysis, Ukrainian political analyst Igor Tsalenko, head of the Analysis and Strategy Center in Ukraine, highlights the ways in which Russia has been using Armenia since the beginning of the war to circumvent sanctions imposed by the United States and the European Union.
Read Igor Tsalenko’s analysis:
On February 18, Armenian Prime Minister Nikol Pashinyan, during a meeting with the Armenian diaspora in Munich, Germany, announced that Yerevan is not an ally of Moscow regarding the Ukrainian issue. He emphasized his regret that he cannot influence the conflict between Russia and Ukraine. The head of the Armenian government, which after 2022 became the fourth largest exporter of semiconductors and other dual-use goods for the military needs of the Russian Federation, referred to the Ukrainian nation as “friendly” in his speech.
Official Yerevan, actively creating the impression of reorientation towards the West, has functioned as one of the Kremlin’s main logistics centers to bypass sanctions imposed in the two years of Russia’s war with Ukraine.
In 2022, Armenia’s GDP, with a population of 3 million, increased by an unprecedented 14.2%. The British Telegraph commented on this: “the most illogical thing is Armenia’s economic growth, making it a candidate to rank third among the fastest-growing economies in the world.”
On November 27, 2023, Armenian Deputy Minister of Economy Vahan Sirunyan admitted that over a period of more than 9 months in 2023, exports of goods from Armenia to Russia increased by 85%, of which 80% were reexports. Emphasizing the exponential increase in Armenia’s foreign trade turnover by 69% since the start of the war in Ukraine, the American think tank Jamestown Foundation also warned of the re-export of sanctioned products from Armenia to Russia. And Jim O’Brien, director of the sanctions coordination office at the US State Department, directly stated that Washington categorizes Armenia as a country aiding Russia in bypassing sanctions.
In 2024, the discussion on the problem continued, but this did not prevent Armenia from supplying sanctioned goods to its belligerent neighbor. Robin Brooks, director of the Institute of International Economics and former strategic analyst at Goldman Sachs, published updated data on February 17: “Armenia’s exports to Russia increased by 430% compared to the period before the invasion, which essentially constitutes re-export of EU and Chinese products to Russia.”
For two years, the issue of Armenian reexports has been noted not only by politicians, think tanks, and top economists but also by international media outlets.
In March 2022, a month after the Russian invasion of Ukraine, the Canadian analysis site Geopolitical Monitor reported that “Armenia is the country best positioned to help Russia avoid sanctions.”
The situation has not improved even after a year of Western sanctions against the Kremlin. In March 2023, the Ukrainian website Unian reported that “Armenia becomes an economic crutch for the Russians, solving problems for Moscow by supplying goods and weapons – under sanctions – to the Russian market.”
According to the Bulgarian news network Fakti, “Putin’s authoritarian regime bypasses the sanctions and embargoes imposed by the EU, the US, and Britain through neighboring countries, particularly Armenia.”
The Washington Post predicted in May 2023 that “the West could increase pressure on Armenia, from which re-exports to Russia of a series of critical goods have surged.”
However, by the end of the year, as reported by the Swiss L’Agefi, “Armenia is directly involved in the re-export of goods subject to sanctions to Russia.”
The use of Yerevan by Moscow as an ally to circumvent sanctions has also been recognized in the Middle East. In December 2023, the Israeli television network l24 stated that “Armenia is a significant hub for supplying goods to Russia, bypassing Western sanctions, as well as a military-technical supply base for Russian troops.”
Armenia is so crucial to Russia as a transit hub because Putin can hardly rely on anyone else almost besides it (i.e., Armenia) in the field of re-exporting goods subject to sanctions.
In May 2023, the French edition of Forbes described Armenia as “the main channel for circumventing sanctions,” as “restrictions on supplies through Turkey and Central Asia are tightening.”
In the summer of 2022, Ankara promised the US not to allow the bypassing of sanctions against Russia on Turkish territory. Subsequently, Turkish financial institutions began massively cutting ties with their Russian counterparts. And in February 2024, even the Russian newspaper Vedomosti noted that Turkish banks had begun closing accounts of Russian businesses since 2022, “but now this process has intensified.”
After the outbreak of the war in Ukraine, Central Asian countries have also repeatedly received warnings from the United States and the EU about the need to comply with sanctions against Russia.
Businesses that – despite the restrictions – continued to collaborate with Moscow were included in the US sanctions list. To ensure compliance with the sanctions regime against the Russian Federation, the EU’s special envoy David O’Sullivan made three visits to Central Asia in 2023. During his last visit, which took place in November, he thanked the countries of the region for their assistance in reducing re-exports to Russia. A month earlier, in October 2023, the foreign ministers of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan, in a meeting with EU representatives in Luxembourg, pledged to help combat Russia’s efforts to circumvent imposed sanctions.
Despite worldwide media coverage of the problem of re-exports of sanctioned goods from Armenia to Russia, the international community has not taken any action, and Armenia has not suffered any consequences.
The Croatian website Net emphasized in May 2023 that the US and the EU, which supplied weapons worth millions to Ukraine for the war against Russia, inexplicably turned a blind eye to the close cooperation between Yerevan and the Kremlin. The publication is almost echoed in the French edition of Forbes: “If the Western community really wants a quick victory for Ukraine, it should deprive Moscow of this logistics center as soon as possible.”
From this perspective, the American Jamestown Foundation reported that “no comprehensive investigation has been launched” regarding Putin’s logistics center in Armenia.
In April 2023, the British Telegraph called on the West to “be tough on some former Soviet satellites.” As it stated, “Armenia has no excuse when it allows itself to operate as a transit point as a third country” (for Russia).
Instead of imposing restrictions on Armenia-Russia cooperation, which contradicts the interests of Washington and Brussels, the United States Agency for International Development (USAID) announced on February 17 the allocation of $15 million to Yerevan.
It is noteworthy that in its statement, USAID emphasizes that these funds aim to “reduce Armenia’s economic dependence on Russia.”
Translated from philenews.com
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