On January 31, Armenian Foreign Minister Eduard Nalbandian held a final press conference for the year 2016, during which he also spoke about the impact of Armenia’s membership in the EAEU on strengthening relations with other countries
“Regarding the EAEU: You know there were skeptics that claimed that our membership in the EAEU will create certain problems in terms of development of economic and other relations in other formats and with other countries. But we had stated that our membership in the EAEU does not mean that we will reduce our involvement in and cooperation with other organizations or countries. And the facts speak for that.
For instance, immediately after EAEU membership and during the period following it, we signed a very important agreement with the United States of America, namely, the Trade and Investment Framework Agreement…”.
And though in this way, Minister Nalbandian tries to make a point that strengthening of relations with other countries has not suffered due to Armenia’s membership in the EAEU, the reality is different.
Failure of the agreement
Since 2010, Armenia had been negotiating the Association (Deep and Comprehensive Free Trade Area) Agreement with the European Union. In July 2013, the negotiations were completed and the agreement was ready for preliminary signing. That agreement envisaged mutual cancellation of customs tariffs between Armenia and the EU, and thereby Armenia obtained ample opportunities to access the European market.
However, in September 2013, due to Armenia’s decision to become member of the Eurasian Economic Union, the agreement negotiated with the EU failed since according to the EAEU agreement, its member countries cannot sign other trade and tariff regulation agreements with third parties. In fact, the member countries lost their independence in carrying out foreign economic policy.
This means that as a result of EAEU membership, Armenia was deprived of the opportunity to strengthen its economic relations with the 28 member countries of the European Union.
And though, in Mr. Nalbandian’s words, the EU-Armenia Framework Agreement will probably be signed in the near future, it will not include numerous provisions regulating Armenia’s trade with the EU (since it will contradict the EAEU regulations).
Note that According to a research by world famous Dutch “Ecorys” organization, Armenia would have additional 2.3% GDP growth as a result of association with the EU, and the budget revenues would increase by additional 146 million USD.
The report findings suggested that the strengthening of market competition inside Armenia would bring to additional 2.7% salary increase, and the number of highly qualified jobs in the market would increase by 7%. Poverty, both extreme and general, would suffer a significant decline.