WASHINGTON, D.C — On Nov. 15 the Senate Foreign Relations Subcommittee on European Affairs held a hearing entitled, “A Pivotal Moment for the Eastern Partnership: Outlook for the Ukraine, Moldova, Georgia, Belarus, Armenia, and Azerbaijan.” The majority of the hearing was spent discussing the political situation in the Ukraine, and to a lesser degree Moldova, Georgia, and Belarus. Armenia and Azerbaijan largely avoided the spotlight, despite the fact that Azerbaijan had just concluded an embarrassingly fraudulent presidential election. However, the hearing was conducted in the framework of the upcoming European Union (EU) Eastern Partnership Initiative and the signing or initialing of frameworks and agreements at the upcoming summit at Vilnius, November 28-29.
Armenia had been expected to sign an agreement at Vilnius, as well as Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU. However, last month Armenia decided to join the rivaling economic bloc, Russia’s Custom Union. No doubt, Armenia’s decision was shocking to the EU and the United States. Below is the exchange between Subcommitte Chairman Senator Christ Murphy (D-CT) and Assistant Secretary of State Victoria Nuland regarding Armenia:
Senator Chris Murphy (D-CT): Is an associations agreement, initialing or signing, mutually exclusive from joining a customs union, for instance, you know obviously we were surprised by Armenia’s decision to do an about face and join the customs union, does that mean we give up Armenia as a potential partner down the road with the EU?
Assistant Secretary of State Victoria Nuland: There’s nothing in the association’s agreement that precludes any Eastern partnership states from continuing to have strong trade relations with Russia or any of the CU countries.
There are provisions in the Customs Union that preclude Custom Union members from associating with anybody else. So you know the Armenians had a difficulty choice to make, they have made it. It doesn’t change the fact that both the European Union and the United States will continue to try to build our economic trade relationship with Armenia. We think that there is more that we can do together. But they are not going to able to have the benefits of an association agreement under Customs Union rules.
Senator Murphy: I just think that’s important to pint, is that the decision to join yourselves with the EU not only opens yourself up to the benefits of that association but does not foreclose your ability to continue to negotiate trade agreements with a multitude of other nations. Once you are in the Customs Union, you are locked in and you’ve essentially tie your economy to one country and one country only.
Let me just ask one additional question with respect to Armenia. Given the fact that this was to some people a surprise that they chose to abandon efforts to joint he EU, what lessons are there to potentially be learned from Armenia’s decision to reorient itself toward the Customs Union with respect to the tools that Russia used that worked with respect to he other offers the EU made that worked or in this case did not work. What lessons are there from the Armenian experience if any?
A/S Nuland: I think we’re still going to be learning the lessons over time. But for reasons of geography, political choice, economics, history, Armenia has for quite a long time been significantly more dependent, in economic terms and security terms, on its big neighbor and frankly…didn’t …well I won’t speak for the government of Armenia but as we have spoken to them, they found it a very difficult choice given how knitted together they are with Russia. We, as you know, for 35 years since the fall of the Berlin Wall have been seeking to provide all of the countries of Central Europe, Eastern Europe, the former Soviet space, with a broad section, cross section, of economic, and partner options, and to diversify the way they think about heir economies, they way they think about their energy future, and to provide them the security, if they want it, to make independent choices. That’s the most important trajectory as we continue to work with these countries in the future.