On February 18, Armenian Prime Minister Nikol Pashinyan stated during a meeting with the Armenian diaspora in Munich that Yerevan does not consider itself an ally of Moscow regarding Ukraine. He expressed regret about the inability to influence the conflict between Russia and Ukraine. The head of the government of Armenia, a country that became the fourth-largest exporter of semiconductors and other dual-use goods for military purposes to Russia after 2022, referred to the Ukrainian people as “friendly” in his address.
Yerevan has strategically mapped a shift towards the West, while effectively becoming a crucial logistics centre for the Kremlin to circumvent sanctions during the two-year conflict between Russia and Ukraine. In 2022, the small nation of Armenia, boasting a population of 3 million, experienced an unparalleled economic growth of 14.2%. The British newspaper The Telegraph commented on this remarkable development as follows: “But the most absurd is Armenia, whose 13% economic expansion in only 12 months makes it a candidate for third-fastest growing economy in the world.”
As Deputy Minister of Finance of Armenia Vaan Sirunyan acknowledged on November 27, 2023, the export of goods from Armenia to the Russian Federation increased by 85% in the first 9 months of 2023, with 80% of this increase attributed to re-export. The Jamestown Foundation (USA) analytical centre noted that Armenia’s foreign trade turnover grew by 69% after the start of the war in Ukraine, attributing this growth to re-exports from Armenia to Russia. According to a report from the European Bank for Reconstruction and Development, new supply chains were quickly established through Armenia in response to sanctions, with subsequent expansion taking several months. A collaborative statement by the U.S. Department of Justice, the Department of Commerce, and the U.S. Treasury categorizes Armenia as a hub for third-party intermediaries or transshipment points used to circumvent sanctions and export controls related to Russia and Belarus.
AdvertisementIn 2024, despite the public disclosure of Armenia violating sanctions against Russia, the country continues to supply Russia with sanctioned goods without a hiccup. Furthermore, according to the data published on February 17 by Robin Brooks, the director of the Institute of International Finance and a former strategist at Goldman Sachs, “Armenia’s exports to Russia have increased by 430% compared to the period before the invasion, indicating the re-export of goods from the EU and China to Russia.”
In December 2023 Brooks, who follows this topic closely, was asking “What is Brussels doing?” about EU exports to Armenia increasing by 200% since the invasion. The issue of Armenian re-export has not only attracted the attention of politicians, think tanks and prominent economists but it has also been covered in the international media over the past two years. Here are some examples:-
On 31.03.22 Canadian Geopolitical Monitor noted: “Armenia is the best-placed member of the EAEU countries to help Russia break sanctions.”
On 25.03.23 a major Ukrainian news site Unian reported: “Armenia is becoming an economic rear for the Russians, solving Moscow’s problems with the supply of sanctioned goods and weapons to the Russian market.”
On 27.03.23 The Bulgarian publication Fakti stated: “Putin’s authoritarian regime bypasses the embargoes and trade sanctions imposed by the EU, the USA, and Britain through neighbouring countries… especially Armenia.”
On 14.05.23 The Washington Post noted: “The West could turn up the heat on Armenia, from which the re-export to Russia of a range of critical goods, including electronics, has spiked.”
On 12.12.23 Swiss French-language newspaper L’Agefi: “Armenia is directly involved in the re-export of sanctioned goods to Russia.”
On 14.12.23 Israeli English-language channel I24: “Armenia is a major hub for supplying goods to the Russian Federation, bypassing Western sanctions, and serving as a base for the military-technical supply of Russian troops.”
Armenia holds significant importance for Russia as a crucial transit hub due to the diminishing reliance on other countries for re-exporting sanctioned goods. In May 2023, the French edition of Forbes labelled Armenia as the “primary conduit for evading sanctions” due to the tightening restrictions on deliveries through Turkey and Central Asia. This development emerged after Ankara assured the United States in the summer of 2022 that it would not permit the circumvention of sanctions against Russia on Turkish soil. Consequently, Turkish financial institutions began terminating their collaborations with Russian entities on a large scale. By February 2024, the newspaper “Vedomosti” highlighted that the closure of accounts for Russian companies by Turkish banks, initiated in 2022, significantly escalated.
Central Asian nations faced mounting pressure from the US and the EU to enforce sanctions against Russia following the Ukrainian invasion. Companies in the region ignoring these restrictions found themselves blacklisted by the US. Determined to assess compliance, EU Special Envoy David O’Sullivan embarked on three Central Asian visits in 2023. During his final visit in November, he expressed gratitude for the region’s efforts to curb re-exports to Russia. This followed a pledge made by the foreign ministers of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan at a Luxembourg meeting with EU representatives on October 23. They committed to assist in thwarting Russia’s attempts to bypass the sanctions.
Despite the coverage of the problem of the re-export of sanctioned goods from Armenia to Russia in the world media, the international community fails to act and Armenia gets away with it.
The Croatian publication Net noted back in May 2023 that the US and the EU, while supplying Ukraine with millions of dollars worth of weapons for the war with Russia, for unknown reasons turned a blind eye to the close partnership between Yerevan and the Kremlin. The French edition of Forbes echoes this sentiment: “If the Western community really wants a quick victory for Ukraine, it must deprive Moscow of this logistical hub as soon as possible.” In this regard, the American Jamestown Foundation reported that “no comprehensive investigation” has yet been launched into Putin’s logistical hub in Armenia. In April 2023, the British newspaper The Telegraph already called on the West to “toughen relations” with the Kremlin’s satellites: “Armenia has no special excuses when it allows itself to act as a transit point (for Russia).”
Rather than imposing limitations on the collaboration between Armenia and Russia, which goes against the interests of Washington and Brussels, the United States Agency for International Development (USAID) declared on February 17 that it would provide $15 million to Yerevan. Interestingly, the USAID announcement highlights that these funds are intended to “diminish Armenia’s economic reliance on Russia.”
