Wednesday, January 20, 2021

Armenia Should Look to China for Help and Adjust Its Policies to Get It, Parvanyan Says

Paul Goble

            Staunton, January 17 -- Still in shock from its losses in the Qarabagh fighting, Armenia is reviewing its foreign policy priorities, Mger Parvanyan says; and on the of the directions it should be looking as it works to recover from the fighting and boosts is economic and geopolitical position is China even if that requires a change in its foreign policy positions.

            The economist at the Yerevan Center for Political and Economic Strategic Research says that too many Armenians are locked into the past and wondering whether they have no choice but to turn to Russia or might be able to gain support from  Europe and especially France (

            But in a new essay entitled “The Development of Economic Relations Between Armenia and China,” Paranyan argues that the development of such ties is “the real way out of the economic crisis in Armenia.” On the one hand, China could be an important market for Armenia; and on the other, China could invest in Armenia as a bridge to Iran and the Middle East. 

            The pandemic inflicted massive losses on the Armenian economy, and the recent defeat in the war over Qarabagh compounded those. Most likely, the national GDP fell by eight percent over the last year, and in the absence of outside assistance, it is likely to continue to decline in 2021.

            Yet another problem Armenia faces that other countries do not yet is rapidly rising prices, the Yerevan economist says. These could make any moves toward recovery more difficult unless Armenia gets help from outside so that it can restore greater fiscal discipline. The problem is that its traditional partners for various reasons don’t appear to be available.

            Russia and Europe each have their own problems, and many Armenians are deeply suspicious about further Russian involvement given its failure to defend Armenia against Azerbaijan. And Europeans are far away and focused ever more on their own recovery rather than on anyone else’s.

            As if these problems were not enough, Parvanyan continues, there is another and even more “negative” factor at work: “political instability and uncertainty.” Unless those are resolved quickly, Armenia is unlikely to see any growth at all in the coming months even as the economies of other countries make a comeback after the pandemic passes.

            Armenia thus needs to look in new directions for help. The most promising of these is China which could provide both a market for Armenian goods and a source of outside investment. Unfortunately, at the present time, Yerevan “does not have a strategy” for approaching Beijing and thus lags far behind Tbilisi and Baku in that regard.

            Over the last three years, Yerevan has expressed interest in becoming part of China’s “one road, one path” project linking Asia and Europe, but it has not done much to advance that cause. It has also made only limited investments in the Persian Gulf-Black Sea transportation corridor which would make it attractive for Chinese involvement.

            But the biggest problem in this regard, the economist says, is that “big economics is based on geopolitics.” China is not going to help Armenia unless Armenia sides with China on issues of concern to Beijing. To get help from Beijing, Armenia will need to stop speaking out on human rights abuses in China.

            That Armenia could even think of doing so given its longstanding concern with human rights issues and the importance of these to its critically important diaspora underscores just how dire a situation Yerevan finds itself in – and it shows that the outcome of the Qarabagh war may have even larger consequences than anyone is now thinking about.

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