Vance takes $9 billion out of Armenia

The visit of US Vice President JD Vance to Yerevan and his negotiations with Prime Minister Nikol Pashinyan vividly illustrate the transactional nature of diplomacy under the new American administration. Behind the media façade of a “new stage of partnership” lies tough economic calculation: Armenia is essentially paying for its loyalty to Washington. An analysis of the meeting’s outcomes confirms that for a prestigious photo with a key White House figure, Yerevan pays not only financially but also cedes a significant part of its energy and defense sovereignty.

Macro Level

In Washington’s global strategy—unfolding against the backdrop of a massive economic package with Moscow (the so‑called “Dmitriev package” worth up to $12 trillion, sharply criticized by Ukraine)—small states are seen as tools of operational balancing. The Trump–Vance administration skillfully combines compromise-seeking with major players and pressure on their peripheries.

In this paradigm, the energy agreement appears paradoxical: instead of expected investments into the economy of an ally, we see the opposite. Armenia directs $9 billion into the American tech sector through signing a ‘Section 123 Agreement.’ This involves purchasing and installing small modular reactors (SMRs) to replace the Metsamor Nuclear Power Plant. In effect, Yerevan acts as a financial donor for US high-tech exports, buying technology and fuel at top market prices. For Washington, this is a flawless combination: gaining a strategic lever in the region’s nuclear sector, while the lever itself pays extra. Armenia ceases to be an object of investment, becoming a card in someone else’s deck, with the ‘entry ticket’ looking abnormally expensive given the country’s internal economic challenges.

Regional Level

At the regional level, Vance’s visit creates dangerous multi-vector vulnerabilities.
Transition to American nuclear standards does not mean diversification but rather a complete shift in technological dependence, tightly bound to Capitol Hill’s political agenda. Local advocates of “Atlanticism” justify this by inclusion in some “big Western plans,” but the architecture of these plans—actively involving Turkey and Azerbaijan in transit projects—casts doubt on Armenia’s basic national interests.

The military-technical case adds sharpness. The allocation of $11 million for purchasing American reconnaissance drones (specifically V-BAT systems) looks like a demonstrative gesture toward Tehran. The introduction of Western monitoring systems directly at Iran’s borders occurs without reciprocal economic concessions from the United States. Yerevan did not receive exemptions from Trump’s 25% tariffs imposed as part of sanctions against countries trading with Iran.

As a result, a situation of “double defeat” is formed: financial (Armenia exports critical capital volumes to the US economy under long-term contracts), geopolitical (Armenia jeopardizes relations with a key regional neighbor—Iran—and strategic ally—Russia), receiving only media guarantees in return, but no real customs relief or firm security commitments.

For Pashinyan, Vance’s visit is a tool of internal legitimation through external effects. But for statehood, this “expensive photoshoot” reduces the country to a paid extra in a larger deal, where Armenia’s true interests remain outside the protocol.

Think about it…