TODAY.AZ / Analytics

Armenia should cut dependence on Russia's economy

21 January 2015 [13:51] - TODAY.AZ

/By AzerNews/

By Mushvig Mehdiyev

Armenia has no room to expect any improvement in its sovereign credit rating, as long as the negative economic trend is reigning in Russia, said an influential Armenian economic expert.

"Sovereign credit rating of Armenia has been downgraded by Moody's due to the country's internal vulnerability, its extremely high-level dependence on Russia, particularly in terms of the remittances and export. At the same time, lack of further prospects because of the economic comedown in Russia has accelerated the decline in rating for Armenia," Ashot Egiazaryan, an economic expert, said in his interview with, a local Armenian media outlet.

Egiazaryan added that the sovereign credit rating of Russia was also decreasing, which means that Armenia's only way to escape from a deeper crisis is to leave the Eurasian Economic Union.

"Leaving the EEU, which has Russia as its member, is the only opportunity and chance for Armenia," he noted.

Problems in Russia subsequently cause similar challenges in Armenia and eventually the Armenian people became insolvent, said Yegiazaryan.

"In these circumstances, Armenia needs to create development prospects by building tight relations with the western countries. It is very vital to actualize the Association Agreement with the European Union and to strengthen the economic ties with neighboring Iran," he added.

However, the economist did not exclude some possible obstacles on Armenia's way towards west.

"The main impediment is Russia's base in Armenia, which allows the northern giant to put a severe pressure on the country and keep it within its zone of influence. The military base is now the main problem impeding Armenia's new economic policy and progress," Yegiazaryan said.

"Moscow tries to resolve several problems and hold some political regimes under its control in the post-Soviet countries," Yegiazaryan noted. "The army base in foreign countries is a tool of severe influence for Moscow to take advantage of the regimes in the countries for Russia's interests."

Going on with his comments about Armenia's current situation, Yegiazaryan said if a country concedes its security and independence, no one would dare to invest in that country.

"There are no investors in Armenia today. At the same time, existence of a Russian military base in its territory bears some political risks. By downgrading the ratings, the international agencies, including the Moody's, take into account not only the economic, but also the political risks," he said.

Military bases of Russia abroad, a country which is suffering from an international isolation, pose serious geopolitical risks for Azerbaijan, Georgia and Iran alongside Armenia, said Yegiazaryan.

Russian military base in Armenia has become a hot topic of discussions following the recent murder of an Armenian family by a Russian conscript serving at the 102nd Russian base in Gyumri region. The killer of seven members of the same family, including Seryozha Avetisyan, a six-month-old baby who died at the hospital on January 19, caused a great uproar in Armenia sparking harsh reactions. Many are now calling for his execution on one hand and Russian base's withdrawal on the other hand.


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