Trade losses mount as Armenia’s EU prospects raise Russian concerns

Russia and Armenia are projected to experience a cumulative loss of approximately six billion dollars in mutual trade turnover by the end of the year, Deputy Prime Minister of Russia Alexei Overchuk announced.

“About two billion, according to the most conservative estimates, we lost last year. This year we have a drop by the current situation [of] three billion. Obviously, we will lose somewhere around six billion by the end of the year. These are serious figures,” Overchuk stated, Caliber.Az reports per Russian media.

Despite these challenges, Russia continues to play a pivotal role in Armenia’s supply chain, covering up to 95 per cent of Armenia’s requirements for essential strategic goods such as wheat, sugar, and vegetable oil.

However, tensions loom over Armenia’s potential deeper integration with the European Union, which Russia views with concern. Overchuk warned that such a move could compel Armenia to close its airspace to Russian aircraft, mirroring the EU’s current restrictions on Russian flights.

“Look, we have no air traffic with the European Union now. The European Union has a closed sky for Russian aircraft to fly over. Will Armenia close the skies too? If you join the European Union, yes, because they will tell you in Brussels to close the sky, and you will close the sky, and you will have no choice. So what?” Overchuk remarked.

He further explained the operational ramifications of such restrictions: “Here are all these hundreds of flights per week, where will they go? Well, they will go through Tbilisi, it is clear.” Overchuk also pointed to complications at border crossings, describing how Armenian cargo trucks would transfer goods to Belarusian or Russian vehicles at the Upper Lars checkpoint before returning to Armenia.

“And it is impossible to ignore it and not to think about these issues. We are thinking about it, we are assessing it,” he added.

Meanwhile, Gohar Barseghyan, Minister for Industry and Agro-industrial Complex and member of the Board of Eurasian Economic Union (EAEU, highlighted the union’s importance as a secure platform for food supply, especially during crises like the COVID-19 pandemic. She noted that Armenia reciprocates by ensuring uninterrupted exports of fruits, vegetables, and processed products, underscoring the complementary nature of the two markets.

By Vafa Guliyeva