Despite Westward pivot, Armenia remains Russian backyard to evade sanctions

According to a recent article published in Euronews, despite seemingly firm efforts to leave Moscow's sphere of influence, Armenia remains a backdoor for Russia to circumvent sanctions.

A few days ago, the EU adopted its 13th package of sanctions against Russia, expanding the list of goods that can no longer be exported to the country. 

The measures against Moscow go far beyond traditional sanctions, which historically have targeted banks and elites. 

However, Russia's economy still steadily grows. Russia can’t buy much directly from the West but despite the European technology embargo, war-related goods from the West continue to find their way into the Russian defence industry. 

The war has become a battle of materiel, with Ukraine under increasing pressure and Russia threatening to win.

This is because Russia’s war economy produces sufficient supplies — and can continue to rely on Western components, including those from Armenia, as the Caucasus country remains an important logistical hub for the Russian economy.

The numbers speak for themselves. According to the German Federal Statistical Office, German exports to Armenia rose by more than 165% in the first year of the war. 

At the same time, according to reports by the European Bank for Reconstruction and Development (EBRD) and the US think-tank Silverado, Armenian exports to Russia exploded many times over — by 187%, according to the Armenian Ministry of Finance.

A year later, in the first nine months of 2023, Armenian exports of goods to Russia increased by a further 85%, 80% of which were re-exports. 

Since the start of the war, Russia has replaced the EU as Armenia’s most important trading partner — an unflattering result. The example of Armenia shows how Russia has diversified its imports of so-called war-critical goods, which are required for weapons production, via smaller countries. 

These products, known as "common high-priority items" (CHP goods), include semiconductors, communications equipment, circuits, other computer parts and certain electrical components.