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Post-war Armenia: New remedies for old maladies

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՛՛The Republic of Armenia is the guarantor of the security of Artsakh՛՛,- is stated in the National Security Strategy of the Republic of Armenia updated last year. The current political realities which emerged after the recent war over Nagorno-Karabakh destroyed Armenia’s security system which has lasted for more than two and half decades,thuscreating absolute uncertainty.  The current situation not only causes existentialmeances for the Armenianness of Artsakh, but also create new threats for the actornessof the Republic of Armenia for the long run. The problematic demarcation issues with the Republic of Azerbaijan, the reopenning of the regional communication routes and also the assymetric dependence on Russia create real threats for Armenia’s sovereignty. The ongoing concerns around these problems pave necessary ground for the spread of frustration in the society which is reflected in the statementscalling for deepenening integration with Russia, even worse to become a part of Russia.

Unfortunately, it is now really difficult for the Armenian side to acknowledge that the status quo had been succesfullty kept due to the fragile geopolitical equilibrium. But the reality dramatically changed in 2014-2015 when the USA started withdrawing from Afghanistan and the Middle East andshifting its attention towards the East Asia.  Moreover, the downing of the Russian fighting jet by Turkey resulted in new state of affairsin the region. This new period was symbolized for the Armenian side by the April war back in April, 2016 and then reached its peak in the recent war of 2020.  Several important traits of this new era have been either misinterpreted or ignored by the Armenian side.  The most important one is the new nature of the Russo-Turkish relations which are product of the above-mentioned events starting since 2014, which are aimed at filling the power vacuum gap in the Middle East by the Russo-Turkish tandem.

The state of the art of the Russo-Turkish bilateral relations is excellently described by th MFA of Russia S. Lavrov as ‘sui generis cooperation and competition’. Ignoring this fact and presuming that the possible war could have the repetition of the April War by its scale, and the Russian side should have been interested in the maintance of the status quo albeit deviated, speaks about the Armenian side’s underestimation of the current realities around Armenia and Nagorno-Karabakh and the wider region in general. The existing consensus between Turkey and Russia over the Nagorno-Karabakh conflict, is obviously shaped by their attempts of redistributing the spheres of influence in the entire region thus trying to keep all extraregional actors and first of all the West out. Unfortunately, it led to devastating consequences for the Armenian side.  The geopolitcal myopia of the Armenian side resulted in the unprecedented destruction, seen last time a century ago again by the performance of the same Russo-Turkish pair, which then led to the partition and sovietization of Armenia. The claims stemming from  the Armenian side, including the ruling elite,  that the war prepration rests only with the Turkish-Azerbaijani alliance and for the Russian side it was undesirable and unexpectable, causes doubt based upon the bellow-suggested explanations.

First of all, it’s necessacry to recall that the post-elections demostrations which started in Belarus, a OSCT/EAEU member state and a close neighbor of Russia, should have been worrying, if of course there were directed against the Kremlin and were sponsored by the West. And in light of these events, the opening of  so-called ”second frontier” against Russia in the South Caucasus  should have induced Russia to keep the balance in Nagorno-Karabakh conflict at any cost, at least by supporting the weaker party – Armenia- by solving the problem of supplies in advance, avoiding possible blockades of Armenia.Another  nuance which deepens the concern that the war wasn’t surprise for Russia, was the post-election revolutionary situation in Kyrgyzstan, another Russian sphere of influence, which happened in the beginning of October, when the war in Nagorno-Karabakh was at its height. Though the Kremlin-backed Russian media channels and prominent analysts were doing everything to show that there was a Western conspiracy working against Russia at the same time in Belarus, Nagorno-Karabakh and Kyrgyzstan, however in reality this anti-western paranoia doesn’t find reasonable ground as in all three dimensions Russia’s stance has strengthened in the result.

Finally, the last fragment which attracts attention, is the timing of the war. The period of presidential elections campaign of the USA, when both the ruling administration and Biden’s team were fully busy with the election preparations, and France alone couldn’t counterbalance Russia and restrain Turkey at the same time. The preelection timing was an ideally calculated as the polls of the previous period showed that Trump didn’t have chances for reelection. This fact wasn’t the most desirbale option for Russia and Turkey given the isolationist nature of Trump’s foreign policy, on the one hand, and Biden’s tough stance against Russia and Turkey on the other hand. Overall, the aforementioned developments have shaped the current state of affairs in the South Caucasus having devastating effects for Armenia. It’s out of question that Russia, possessing huge amount of resources and tools at its disposal,could react to this conflict properly in order not to harm its ally’s – Armenia’s interests,  if, of course, it was stemming from its intersts and agenda in the region. 

Since the collapse of the Soviet Union, Armenian-Russian relations have evolved in a wrong way, making Armenia’s position more vulnerable and causing assymetric dependence on Russia. This has been conditioned because of the Armenian-Azerbaijani conflict over Nagorno-Karabakh and Turkish denial of the Armenian Genocide, which have kept borders of Armenia with these counties closed. The fact of being landlocked and having 2 out of 4 borders closed, staying out of the regional economic projects and also having tensions between Iran and the West, which makes the southern border unreliable, have created favorable conditions for Russia to establish total control over Armenia, shaping that vary mindset of the Kremlin towards Armenia:Where can  they escape? (Акудаониденутся?).Moreover, after the second Karabakh war, domestic excitements, alarms and worrying in Armenia, pave the ground for the expansion of the thoughts ranging from joining the Union State of Belarus and Russia up to joining Russian Federation as one of its entities like Tatarstan or Chechnya.  This delusive and apathetic discourse, which is being encouragedboth by the Russian media channels and some pro-Kremlin politicians and parties, needs to be neutralised only by increasingArmenia’s substantiveness as a fully functional subject of Internationa law. Certainly, the economic, military and political security state should have been totally different, if Armenia’s leadership lacking legality and legitimacy, didn’t aleinate the strategically important facilities to Russia back in the beginning of 2000s.The so-called program ‘property for debt’and later deals passedalmost all major and important facilities of the Armenian economy under control of Russia. Two strategically important facilities could and today also can change Armenia’s economic, political and security environment mostly reducing its isolation and increasing prospects of economic prosperity. These are Iran-Armenia railway and Iran-Armenia-Georgia gas pipeline.

Railway

Armenia’s assymetric dependence on Russia can be solved solely based on diversification and due to involvement of other actors as well, which will expand Yerevan’s area of maneuver.  But this diversification shouldn’t be fragile as the one back in 2000s labelled as ‘assymetic complementarity’, which again emphasized the iportant role of Russia. In that concept Russia wasn’t regarded as ‘primus inter pares – first among equals’, but it can be deescribed as ‘Russia and the rest’. Given the existing complicated relations with Turkey, in the role of primary actors involved in the Armenia’s foreign policy spectrum are Iran, China and the EU. The construction of Iran-Armenia railway has huge potential to solve a few real problems. Firstly, Armenia gains stable access to the Iranian market. Then, with th already existing railway web in Iran, Armenia gains access not only to the Central Asia but also to China. On the other hand, joining the Iranian railway, Armenia reaches the Persian Gulf and Indian ocean. In the result, Armenia becomes an important connecting ring in this whole chain between the Georgian and Iranian ports securing links between the Eastern Europe and East Asia. Iran and Armenia solve their isolation problem in some extent, while China gets an opportunity to join the Eastern Europe by sea avoinding dependence on Russia. As a result, this project and its geoeconomical influence allow Armenia to increase the role of Iran and China in the regional affairs thus creating leverage for her benefit. The fact that the existing Armenian-Georgian railway works, there is a need to build up Tabriz-Yerevan section. Doubtless, this project should be substantiated economically, which will will increase Armenia’s economic attractiveness. Last year, China and Iran signed a strategic partnership agreement, which envisages 400 bln USD Chinese investment in the development of Iran’s infrastructures over the next 25 years. The railway and roads systems compose important part of this infrastructure complex. The upgrade of Iranian facilities are aimed at solving Iran’s isolation and openinng new opportunities for China. Iran’s MFA J. Zarif announced during his last visit to Armenia, that the territorial integrity of the Republic of Armenia is a red light for Iran, thus highliting the vital importance of border with Armenia. It is’ot secret that if Armenia loses its southern border with Iran, then Azerbaijan and Turkey establish land contact, which isolates Iran from the North and puts an end to the existence of the Armenian statehood in general. Therefore, taking into account security importance of railway for Iran and Armenia, as well as economic attraction for Eastern Europe and China, the question of this project should receivea majorpriority for Armenia.

Gas pipeline

The next project of strategic importance, which will change the regional politics, economy and security, is the Iran-Armenia-Georgia gas pipeline. In 2005, when the Iran-Armenia gas pipeline was in the process of negotiation, Alexander Ryazanov, a vice-president of  Gazprom, declared that if Gazprom wasn’t involved in that project, it’s uncertain where this gas would flow. Certainly, this idea should have scared Armenia’s that time administration, which not only didn’t have domestic support due to corruption and authoritarian levels, but also it [the administration] had many fears that the Nagorno-Karabakh  status quo could have been changed in favor of Azerbaijan by Russian intervention. As a result, the operation of the Iraian-Armenian pipeline alongside with other facilities, including the railway of Armenia, were passed to Russia thus trying to accomodate Russia in all possible ways. In the following years, Russian Gazprom also obtained the right to operate the whole gas system of Armenia. Moreover, in December 2013, then president Serzh Sargsyan signed an agreement with his Russian counterpart, according to which, Armenia was obliged to buy gas from Gazprom until 2043. It’s worthless to mention about legality and nonsense nature of this agreement. It’s worth reminding, that a similar gas deal with Russia cost Ukraine’s former Prime-Minster Yulia Tymoshenko 7 years in prison.

Thus, the Armenian side did everything to deprive itself of having diversified gas sources. The Iranian gas pipeline has huge potential not only to liberalize Armenian domestic market, establishing fair competition, but also to provide Armenia with transit fees increasing economic attractivenessof Armenia. The Iranian gas pipeline has great potential to change the energy market of Georgia as well as reducing its dependence on Azerbaijan. Moreover, given the EU depdendence on Russian gas, it’s logical to have the Iranian gas pieplines reached to Europe crossing the Black Sea. Initial destination can be Romania. First of all, given its geographical proximity with Ukraine and Moldova, these countries may solve their gas dependence problem on Russia.On the other hand, the end destination of the pipeline can be France, which can regain its balance vis-a-vis Germany. In addition, this project may attract Turkmenistan’s attention as well, as it receives an alternative channel for the TransCaspian pipeline.

Overall, this ambitious project will solve Armenia’s and Georgia’s energy, economic, political security issues, reducing their  vulnerable  position in the region. It will change Russia’s stance in the region, thus changing also its foreign policy behavior, perception of Armenia and Georgia as well.  Armenia will solve the asymmetric devastatingdependence problem and also will have a chance to break Turkis-Azerbaijani isolation. With this project, Islamic Republic will recieve a chance to connect with Europe and to break thr isolation, which is ncessary for for the EU an Iran.  Finally, the European Union can get a free hand vis-a-vis Russia.

I am a Brussels-based independent analyst covering the South Caucasus, EU-Russia, EU-Armenia, Nagorno-Karabakh conflict, Eastern Partnership. I am also a policy advisor with strong interest in European Public Affairs in the areas of Tech adn start-ups, Large-scale infrastructures, energy and associations. I am holding MA in EU Studies from the College of Europe, Belgium.

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Eastern Europe

Latvia developed new tasks for NATO soldiers

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Member of the Latvian Saemas’ national association “Everything for Latvia!” and Freedom”/LNNK Jānis Dombrava stated the need to attract NATO troops to resolve the migration crisis. This is reported by la.lv.  In his opinion, illegal migration from the Middle East to Europe may acquire the feature of an invasion. He believes that under the guise of refugees, foreign military and intelligence officers can enter the country. To his mind, in this case, the involvement of the alliance forces is more reasonable and effective than the actions of the European border agencies. Dombrava also noted that in the face of an increase in the flow of refugees, the government may even neglect the observance of human rights.

The Canadian-led battlegroup in Latvia at Camp Ādaži consists of approximately 1512 soldiers, as well as military equipment, including tanks and armoured fighting vehicles.

Though the main task of the battlegroup in Latvia is country’s defence in case of military aggression, Latvian officials unilaterally invented new tasks for NATO soldiers So, it is absolutely clear, that Latvian politicians are ready to allow NATO troops to resolve any problem even without legal basis. Such deification and complete trust could lead to the full substitution of NATO’s real tasks in Latvia.

It should be noted that NATO troops are very far from being ideal soldiers. Their inappropriate behaviour is very often in a centre of scandals. The recent incidents prove the existing problems within NATO contingents in the Baltic States.

They are not always ready to fulfill their tasks during military exercises and training. And in this situation Latvian politicians call to use them as border guards! It is nonsense! It seems as if it is time to narrow their tasks rather than to widen them. They are just guests for some time in the territory of the Baltic States. It could happen that they would decide who will enter Latvia and who will be forbidden to cross the border!

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Changes are Possible: Which Reforms does Ukraine Need Now?

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Photo: Robert Anasch/Unsplash

The past 16 months have tested our resilience to sudden, unexpected, and prolonged shocks. As for an individual, resilience for a country or economy is reflected in how well it has prepared for an uncertain future.

A look around the globe reveals how resilient countries have been to the COVID-19 pandemic. Some have done well, others less so. The costs of having done less well are almost always borne by the poor. It is for this reason the World Bank and the international community more broadly urge—and provide support to—countries to undertake economic and structural reforms, not just for today’s challenges but tomorrow’s.

One country where the dialogue on reform has been longstanding and intense is Ukraine. This is particularly true since the economic crisis of 2014-2015 in the wake of the Maidan Revolution, when the economy collapsed, and poverty skyrocketed. Many feared the COVID pandemic would have similar effects on the country.

The good news is that thanks to a sustained, even if often difficult, movement on reforms, Ukraine is better positioned to emerge from the pandemic than many expected. Our initial projection in the World Bank, for example, was that the economy would contract by nearly 8 percent in 2020; the actual decline was half that. Gross international reserves at end-2020 were US$10 billion higher than projected. Most important, there are far fewer poor than anticipated.

Let’s consider three reform areas which have contributed to these outcomes.

First, no area of the economy contributed more to the economic crisis of 2014-2015 than the banking sector. Powerful interests captured the largest banks, distorted the flow of capital, and strangled economic activity. Fortunately, Ukraine developed a framework to resolve and recapitalize banks and strengthen supervision. Privatbank was nationalized and is now earning profits. It is now being prepared for privatization.

Second, COVID halted and threatened to reverse a five-year trend in poverty reduction. Thanks to reforms of the social safety net, Ukraine is avoiding this reversal. A few years back, the government was spending some 4.7 percent of GDP on social programs with limited poverty impact. Nearly half these resources went to an energy subsidy that expanded to cover one-in-two of the country’s households.

Since 2018, the Government has been restructuring the system by reducing broad subsidies and targeting resources to the poor. This is working. Transfers going to the poorest one-fifth of the population are rising significantly—from just 37 percent in 2019 to 50 percent this year and are projected to reach 55 percent in 2023.

Third, the health system itself. Ukrainians live a decade less than their EU neighbors. Basic epidemiological vulnerabilities are exacerbated by a health delivery system centered around outdated hospitals and an excessive reliance on out-of-pocket spending. In 2017, Ukraine passed a landmark health financing law defining a package of primary care for all Ukrainians, free-of-charge. The law is transforming Ukraine’s constitutional commitment to free health care from an aspiration into specific critical services that are actually being delivered.

The performance of these sectors, which were on the “front line” during COVID, demonstrate the payoff of reforms. The job now is to tackle the outstanding challenges.

The first is to reduce the reach of the public sector in the economy. Ukraine has some 3,500 companies owned by the state—most of them loss-making—in sectors from machine building to hotels. Ukraine needs far fewer SOEs. Those that remain must be better managed.

Ukraine has demonstrated that progress can be made in this area. The first round of corporate governance reforms has been successfully implemented at state-owned banks. Naftogaz was unbundled in 2020. The electricity sector too is being gradually liberalized. Tariffs have increased and reforms are expected to support investment in aging electricity-producing and transmitting infrastructure. Investments in renewable energy are also surging.

But there are developments of concern, including a recent removal of the CEO of an SOE which raised concerns among Ukraine’s friends eager to see management independence of these enterprises. Management functions of SOE supervisory boards and their members need to remain free of interference.

The second challenge is to strengthen the rule of law. Over recent years, the country has established—and has committed to protect—new institutions to combat corruption. These need to be allowed to function professionally and independently. And they need to be supported by a judicial system defined by integrity and transparency. The move to re-establish an independent High Qualification Council is a welcome step in this direction.

Finally, we know change is possible because after nearly twenty years, Ukraine on July first opened its agricultural land market. Farmers are now free to sell their land which will help unleash the country’s greatest potential source of economic growth and employment.

Ukraine has demonstrated its ability to undertake tough reforms and, thanks to the COVID-19 pandemic, has seen the real-life benefits of these reforms. The World Bank looks forward to providing continued assistance as the country takes on new challenges on the way to closer European integration.

This article was first published in European Pravda via World Bank

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Liberal Development at Stake as LGBT+ Flags Burn in Georgia

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Photo: Protesters hold a banner depicting U.S. Ambassador to Georgia Kelly Degnan during a rally against Pride Week in Tbilisi, Georgia July 1, 2021. Credit: REUTERS/Irakli Gedenidze

Protests against Georgia’s LGBT+ Pride parade turned ugly in Tbilisi on July 5 when members of the community were hunted down and attacked, around 50 journalists beaten up and the offices of various organizations vandalized. Tensions continued the following day, despite a heavy police presence.

On the face of it, the Georgian state condemned the violence. President Salome Zourabichvili was among the first with a clear statement supporting freedom of expression, members of parliament did likewise and the Ministry of Internal Affairs condemned any form of violence.

But behind the scenes, another less tolerant message had been spread before the attacks. Anxiety about this year’s events had been rising as a result of statements by the government and clergy. Prime Minister Irakli Garibashvili suggested the march “poses a threat of civil strife.” The Georgian Orthodox Church meanwhile condemned the event, saying it, “contains signs of provocation, conflicts with socially recognized moral norms and aims to legalize grave sin.”

For many, these statements signified tacit approval for the abuse of peaceful demonstrators. Meanwhile, the near-complete absence of security at the outset of the five-day event was all too obvious in Tbilisi’s streets and caused a public outcry. Many alleged the government was less focused on public safety than on upcoming elections where will need support from socially conservative voters and the powerful clergy, in a country where more than 80% of the population is tied to the Georgian Orthodox Church.

The violence brought a joint statement of condemnation from Western embassies. “Violence is simply unacceptable and cannot be excused,” it said. The Pride event was not the first and had previously been used by anti-gay groups. Violence was widespread in 2013 — and the reality of attacks against sexual minorities in Georgia remains ever-present.

In a socially conservative country such as Georgia, antagonism to all things liberal can run deep. Resistance to non-traditional sexual and religious mores divides society. This in turn causes political tension and polarization and can drown out discussion of other problems the country is marred in. It very obviously damages the country’s reputation abroad, where the treatment of minorities is considered a key marker of democratic progress and readiness for further involvement in European institutions.

That is why this violence should also be seen from a broader perspective. It is a challenge to liberal ideas and ultimately to the liberal world order.

A country can be democratic, have a multiplicity of parties, active election campaigns, and other features characteristic of rule by popular consent. But democracies can also be ruled by illiberal methods, used for the preservation of political power, the denigration of opposing political forces, and most of all the use of religious and nationalist sentiments to raise or lower tensions.

It happens across Eurasia, and Georgia is no exception. These are hybrid democracies with nominally democratic rule. Armenia, Georgia, Kyrgyzstan, and others have increasingly more in common, despite geographic distance and cultural differences.

Hungary too has been treading this path. Its recent law banning the supposed propagation of LGBT+ materials in schools must be repealed, European Commission President Ursula von der Leyen said on July 7. “This legislation uses the protection of children . . . to discriminate against people because of their sexual orientation . . . It is a disgrace,” she said.

One of the defining features of illiberalism is agility in appropriating ideas on state governance and molding them to the illiberal agenda.

It is true that a mere 30 years since the collapse of the Soviet Union is not enough to have built a truly liberal democratic state. Generations born and raised in the Soviet period or in the troubled 1990s still dominate the political landscape. This means that a different worldview still prevails. It favors democratic development but is also violently nationalistic in opposing liberal state-building.

Georgia’s growing illiberalism has to be understood in the context of the Russian gravitational pull. Blaming all the internal problems of Russia’s neighbors has become mainstream thinking among opposition politicians, NGOs, and sometimes even government figures. Exaggeration is commonplace, but when looking at the illiberal challenge from a long-term perspective, it becomes clear where Russia has succeeded in its illiberal goals. It is determined to stop Georgia from joining NATO and the EU. Partly as a result, the process drags on and this causes friction across society. Belief in the ultimate success of the liberal agenda is meanwhile undermined and alternatives are sought. Hybrid illiberal governments are the most plausible development. The next stage could well be a total abandonment of Euro-Atlantic aspirations.

Indeed what seemed irrevocable now seems probable, if not real. Pushback against Georgia’s Euro-Atlantic choice is growing stronger. Protesters in front of the parliament in central Tbilisi violently brought tore the EU flag. Twice.

The message of anti-liberal groups has also been evolving. There has been significant growth in their messaging. The anti-pride sentiment is evolving into a wider resistance to the Western way of life and Georgia’s Western foreign policy path, perhaps because it is easily attacked and misrepresented.

To deal with this, Western support is important, but much depends on Georgian governments and the population at large. A pushback against radicalism and anti-liberalism should come in the guise of time and resources for the development of stronger and currently faltering institutions. Urgency in addressing these problems has never been higher — internal and foreign challenges converge and present a fundamental challenge to what Georgia has been pursuing since the days of Eduard Shevardnadze – the Western path to development.

Author’s note: first published at cepa

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