Pragmatic benefit is being substituted with political narratives: Igor Yushkov

Igor Yushkov, expert at the Financial University under the Government of the Russian Federation, commented to Alpha News on the possible costs to Armenia of severing ties with the Eurasian Economic Union (EAEU) and moving closer to the European Union.

“A trade war with Russia is, of course, fraught with at least two kinds of costs for Armenia. First, there’s the loss of traditional markets for the goods Armenia sells. This really does concern agricultural products as well as a number of other goods. It’s a big question whether Armenia will be able to enter the EU market and, more importantly, establish itself there over the long term, because the European Union is known for its strict requirements. Import restrictions are introduced there regularly, since the standards are quite different from those in the EAEU space. The second aspect concerns Armenia’s supplies. And here, of course, energy takes center stage. Oil products and fuel can still be replaced, because they’re easy to transport, yes, they’d be more expensive, but physically they can at least be delivered, but the question of gas remains open, since transporting it requires infrastructure. Right now, almost all the gas supplied to Armenia comes from Russia, and on terms very favorable to Armenia, close to cost price. First, because we’re part of the EAEU, there are no export duties. Accordingly, the price would be at least 30% higher if Armenia, for example, weren’t part of the EAEU. And what’s being discussed now is exactly that: if Armenia moves closer to the European Union, at some point it will have to leave the EAEU. That means Gazprom will have to pay an export duty on gas supplies to Armenia, and the price should rise by 30% accordingly,” the expert believes.

According to the Alpha News interviewee, the actions of Armenia’s political leadership are driven not by benefit to the state, but by political ambitions.

“These are purely the political ambitions of Armenia’s leadership. That is, they tell everyone these stories: that we’re now going to live like in Europe, that prosperity will increase, that we’ll be accepted into the European Union. Although, again, we see that there are countries that have been unable to join for decades, Turkey, for instance. And in that respect, the prospects of Armenia joining the European Union are also very, very murky. And it’s this political storytelling that’s being substituted for real pragmatic benefit,” Yushkov concluded.