Armenia's Foreign Policy Diversification Amid New Geopolitical Realities

Davit Antonyan

Davit Antonyan

Associate Research Fellow, APRI Armenia

The article was originally published on Oxford Diplomatic Society.

The end of the post-Cold War order brought back the phenomenon of great power competition and fostered a realignment of both global and regional actors. With interests at stake from regions as far apart as Russia, the United States, the European Union, India, China, and the Middle East, the South Caucasus is a microcosm of the new dynamics shaped by the shifting global power order. For international relations enthusiasts, the geopolitical dynamics in the South Caucasus provide an interesting study of how the emerging multipolar world is affecting smaller states.

For the Republic of Armenia, the past four years of military and political defeats by its hostile neighbor, Azerbaijan, have sparked a rethinking of its security and foreign policy architecture. These realities included a full-scale war launched by Azerbaijan in 2020 over the self proclaimed, Armenian-populated Nagorno Karabakh Republic, incursions into its sovereign territory by Azerbaijan in 2021 and 2022, and a military takeover and ethnic cleansing of Nagorno-Karabakh, an ethnically Armenian region, by Azerbaijan in 2023. 

Since independence from the Soviet Union in 1991, Armenia has traditionally pursued a Russia-first foreign policy while maintaining friendly ties with the US, EU, Iran, and NATO. This relationship was historically aimed at balancing Turkey’s influence over the South Caucasus; however, as Turkey’s foreign policy grew independent of the West, and Azerbaijan and Turkey assumed a more important role for both Russia and the West given their strategic resources (i.e., oil and gas) and infrastructure, the balance of power in the region started to shift against Armenia. This made it necessary to reassess Armenian’s security reliances to shield the country from further aggression by Azerbaijan amid the regional and global turmoil.  

Meanwhile, Azerbaijan made efforts to diversify its foreign policy beyond its traditional reliance on Turkey in order to attract the international community’s support. This included stronger military cooperation with Israel and Pakistan, connectivity partnerships with Russia and Iran, and economic and energy initiatives with the US, EU, and UK. Azerbaijan’s strategic diversification of its security, foreign policy, and economy might help explain the international community’s muted response to its repeated violations of international law and normalization of the threat of and actual use of force to settle geopolitical problems against Armenians. 

After four difficult years and amid the shifting balance of power, the time has come for Armenia to intensify the comprehensive diversification of its security and foreign policy. The motivation behind this diversification is to strengthen the interest of diplomatic partners in Armenia’s development and success while enhancing its own internal resilience—thus deterring any attempts at its erosion. The current diversification strategy pursued by Armenia is multifold and provides a strong starting point for making up for the less active diversification of the past three decades. 

For one, it is intensively fostering rapprochement with preexisting diplomatic partners such as the EU, US, UK, and Georgia— engaging them in economic and political sectors key to Armenia’s resilience. Moreover, Armenia is expanding its diplomatic relations with the EU and France, and forming a strong partnership with India, to include new prospects for security and defense. It has signed contracts worth hundreds of millions of US dollars with Indian defense contractors, invited a European Union Monitoring Mission to its border with Azerbaijan to contribute to human security, and purchased military equipment from France. Armenia will also reportedly receive 10 million euros in non-lethal military support from the European Peace Facility. Finally, it has expanded the dynamics of its relations with nontraditional partners such as the United Arab Emirates while opening new diplomatic relations with Saudi Arabia. 

This wave of diversification follows growing dissatisfaction with Russia, its traditional partner. There is dissatisfaction, both in government and among citizens, that Russia does not fulfill its security obligations to Armenia under their alliance framework, especially during the 2021 and 2022 Azerbaijani incursions. At the same time, however, Russia’s influence on Armenia’s economy is strong: 40% of exports from Armenia, 70% of remittances to Armenia, and gas and electricity distribution infrastructure are all under Russian control, in addition to the import of significant materials such as grain, gas, nuclear fuel, and petroleum products. 

Given these dependencies and its primary goal of survival, Armenia’s diversification strategy is multilayered. As a small, landlocked country, it relies on partners such as Iran and Georgia for access to global markets (as borders with Turkey and Azerbaijan are closed), while also still being in the immediate neighborhood of Russia. In its diversification strategy, straying too far in any one direction is likely to earn at best, the ire, and at worst, the retaliation, of far larger regional powers. And with any significant geopolitical shock, Armenia’s dependencies can become its vulnerabilities—especially in key strategic areas such as defense, trade, food, or energy. 

Given this delicate situation, this author believes the next phase of the diversification agenda should be tailored around a strategy of “addition, not subtraction.” This includes expanded relations with the Global South and initiatives with foreign partners in key sectors where Armenia currently displays a weakness or overreliance on just one partner. All the while, this will avoid the complete rupture of relations with Russia that might come as a result of becoming embroiled in the Russia/West divide. 

In trade, Armenia should foster a diversification of export partners for local producers. The advances made in gaining access to the Chabahar port in Iran and further development of trade relations with India can serve this purpose. The new EU–Armenia Partnership agenda, announced in February 2024, sets out the areas where the bilateral relation can further strengthen, including in improving Armenia’s market standards for locally-produced goods. In energy, as Gabriella Kchozyan wrote in Issue No.10 of the Diplomatic Dispatch, Armenia should open up to more diverse partners to revamp its nuclear power capabilities while also diversifying its own energy production to add more renewable capacities. In tourism and culture, Armenia can target the growing middle and upper-middle classes of India, East Asia, and the Arab world.  

By engaging them in strategic sectors of development, Armenia can build a multilayered patchwork of international partners who add complementary value to its national development. In parallel, this will strengthen its security architecture by bringing in diverse defense partners. These partners can provide strategic military equipment and help implement faster reforms to the Armed Forces. Over time, and with a good deal of strategic foresight, this positive-sum-oriented approach to its foreign policy diversification can build up Armenia’s deterrence and prosperity. 

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