Last week, Armenia announced its intention to forgo remaining funding from Rosatom, Russia’s nuclear energy company, for the rehabilitation of Metsamor, the country’s Soviet-era nuclear power plant. The source of nearly 40% of Armenia’s electricity, the aging Metsamor also symbolizes Armenia’s historically close relationship with Russia. Rosatom is the successor of the Soviet Ministry of Atomic Energy, and, along with Gazprom and Rosneft, exemplifies the fusion of power and profit in Vladimir Putin’s Russia. It also represents significant strategic interest.
The move is a piece in the pursuit of broader political change in Armenia. In 2018, a peaceful popular uprising, sparked by impatience with corruption and incompetence, toppled the Republican Party’s administration and brought a new, non-establishment leader to power, Nikol Pashinyan. Pashinyan promised to purge the system, reform the rule of law, and bring prosperity to all Armenians, not just those at the top. But he made clear he intended to keep balancing the country’s sensitive security relationship with Russia. Armenia is locked in a decades-long frozen conflict with its much larger, richer neighbor, Azerbaijan, which also has a close relationship with Turkey. This standoff has led to a crippling economic embargo and border closure with two of Armenia’s four neighbors.
For two years, Pashinyan has tiptoed around the Russia issue. But in a single week, Pashinyan’s government has taken dramatic steps with clear implications for its relationship with the Kremlin.
Alongside the nuclear announcement, the government opened an inquiry into Gagik Tsarukyan, an oligarch, who has until now remained relatively untouched amidst the early reforms and purges. Like the Republican Party, Tsarukyan is known to have close ties with decision-makers in Moscow. But he is also a parliamentarian member and leader of “Prosperous Armenia” — the principal opposition party to Pashinyan’s “My Step.” Some have called his arrest politically motivated after Tsarukyan called out Pashinyan’s government for its failures, including demanding that it resign, in part for mishandling the response to covid-19. The setup seems disproportionate. “There’s a question of whether [Pashinyan] is cleaning up the system or settling scores,” said Maximilian Hess, head of political risk at AKE Group.
Pashinyan’s government also sacked several officials in the National Security Service (NSS). The NSS, like most security services in the ex-Soviet region, has strong behind-the-scenes influence in politics and business, contains many figures appointed in and sympathetic to the Republican Party era. It has been a sore point for reformers since the change in 2018. To add a twist: it was the NSS who arrived on the doorstep of Tsarukyan (who has ties to the NSS himself), ransacked his home (videotaping his Rolls-Royces and lions), and interrogated him for nine hours at their headquarters.
Pashinyan will not pull his country out of the Eurasian Economic Union, abandon the Collective Security Treaty Organization, or ask Russian troops to leave their bases at Gyumri and Erebuni Airport. No other country offers comparable military support in a half-hostile neighborhood. The hope is that Putin’s crowded domestic agenda will keep him busy while Armenia inches forward. Richard Giragosian, director of the Regional Studies Center, in Yerevan, says the latest moves are part of Armenia’s strategy “to strengthen its sovereignty and statehood.” The main lesson of the past few days is that Pashinyan feels he has room for maneuver, constraining malign Russian influence in domestic politics while pressing ahead with reform, modernization, and diversification of the economy.
Europe’s Edge is CEPA’s online journal covering critical topics on the foreign policy docket across Europe and North America. All opinions are those of the author and do not necessarily represent the position or views of the institutions they represent or the Center for European Policy Analysis.
