Armenia wants to escape Russia’s embrace and knows how to achieve this. The Kremlin also knows this. The game now being played between the two will determine whether it succeeds in building new relationships or remains within Putin’s orbit.
The tug-of-war became serious after Armenia’s Prime Minister Nikol Pashinyan was re-elected in June and has become fiercer since he announced plans to apply for EU membership. The idea is that the years-long process will ultimately raise Armenian prosperity and security. The problem is that in the meantime, the country’s foreign trade is deeply entwined with Russia.
Recognizing Yerevan’s dilemma, the Russian President has publicly pressed Nikol Pashinyan to make a rapid choice between the European Union and the Eurasian Economic Union (EAEU) by holding a referendum. Moscow argues the two blocs are incompatible, while realizing that its influence is only likely to decline (trade dropped steeply in the first half of this year).
Although the five-nation EAEU offers Armenia a market of roughly 180 million people, it no longer guarantees politically neutral or predictable market access. Moscow restricted Armenian exports in May, while Armenia remains a full member of the bloc. Pashinyan personally asked Putin to lift the ban; and has now officially asked to the bloc to lift Moscow’s unilateral trade restrictions.
As Russia weaponizes trade, the immediate question for Armenia is whether it can diversify fast enough to achieve freedom of choice and withstand further retaliation. This is a familiar dilemma. In 2013, it confronted the same choice between the EU’s Deep and Comprehensive Free Trade Area (DCFTA) and a Russia-led Customs Union that later folded into the EAEU. The same structural incompatibility applied then as now, and it settled the matter: Yerevan abandoned Brussels and joined Moscow’s bloc.
That decision was shaped by Armenia’s isolated geography and political pressure from Russia, which remained its dominant security partner, energy supplier, and major export market. At that time, Armenia’s borders with Turkey and Azerbaijan were closed, and its principal land routes ran through Georgia and Iran. But Yerevan’s EAEU membership did nothing to aid its trade diversification.
More than a decade later, the strategic equation has changed. Armenia is not only opening borders with former rivals, but also deepening trade and transport links. The country has declared what is termed a multi-vector foreign policy, and regional connectivity ambitions that are increasingly aligned with the United States’ interests to unblock the crossroads of Eurasia.
There has been a rare geopolitical shift in the South Caucasus: the emergence of the Trump Route for International Peace and Prosperity (TRIPP) and Russia’s weakened regional position have created opportunities that did not exist in 2013. However, it does not immediately change the fact that Russia is Armenia’s largest trading partner and the top export market for Armenian alcohol, beverages, fruits, vegetables, fish, and seafood. Yet, Yerevan could achieve a lessened reliance on Moscow, both as a trading partner and a physical gateway to Eurasia if it is given sufficient time.
In this matter, the EU’s tailor-made measures liberalizing around 80% of Armenian exports to the EU and temporarily suspending import duties for a broad range of Armenian products provide rapid relief for Yerevan. These terms will apply for two years from the regulation’s entry into force and cover almost 99% of Armenia’s food-sector exports to Russia and more than 91% of beverages and spirits. The €52m ($60m) the EU granted Armenia as immediate financial assistance will also help.
The shift is already visible. Trade turnover between Armenia and Russia fell by 20.5% in the first five months of this year compared to the same period last year, and Russia’s share of Armenia’s total trade turnover fell from 35.1% to 28%. Meanwhile, Armenia’s exports to the EU exceeded $516m in the first half of 2026, marking an increase of more than 80% year-on-year. Armenia is also redirecting exports to the UAE, exploring new markets in Azerbaijan, Central Asia and the Gulf.
But this should not be mistaken for the success of diversification. The real challenge is whether Armenia can convert temporary EU access into durable commercial relations before the two-year window closes. That means building viable EU supply chains, securing buyers and logistics, adapting the Armenian exporters and producers to competition in new markets, and ensuring that exports remain profitable rather than merely replacing one subsidized or familiar market with another.
If Armenia can build those alternatives, Russia’s ability to weaponize market access will diminish, and Yerevan will be better positioned to make its eventual geopolitical choice on its own terms. The goal is not an immediate economic break with Russia, but a reduction in the cost of dependence. The two-year EU window should therefore be treated not as a temporary rescue package but as a deadline.
Nino Lezhava is a research analyst based in Georgia and a Non-Resident Fellow for the Transatlantic Defense and Security Program at CEPA, specializing in Euro-Atlantic relations, geopolitical competition, the wider Black Sea region, and the Caucasus.
Europe’s Edge is CEPA’s online journal covering critical topics on the foreign policy docket across Europe and North America. All opinions expressed on Europe’s Edge are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
