Armenia’s Fragile Democratisation: A New Role for the EU?

When Armenia embarked on its quest for democratic transformation after the 2018 Velvet Revolution, it was evident that any deterioration of the country’s fragile security situation would impede its path towards democratisation.

Armenia’s defeat in the 2020 war with Azerbaijan in the disputed territory of Nagorno-Karabakh traumatised Armenian society and shook the foundations of the country’s still nascent democracy. While the 44-day conflict did not derail the political reform process, it certainly had a slowing effect on it. Armenia’s political transformation underwent another major shock in September 2023 with Azerbaijan’s takeover of Nagorno-Karabakh, resulting in the flight of almost all of the region’s ethnic Armenian population – some 120,000 people – to Armenia. Therefore, Armenia’s situation remains shaped by the critical connections between democracy and security, as it combines a lingering demand for democratisation and persisting security vulnerabilities.

In a precarious and uncertain context, the European Union (EU) has an important role to play in consolidating Armenia’s reform process and anchoring democracy in the country. To that end, the bloc should combine increased assistance with stricter political conditionality and, crucially, offer Armenia new perspectives for closer integration with the EU.

Another political crisis born of security threats

The escalation in September 2023 appeared to vindicate the words of Armenian Prime Minister Nikol Pashinyan, who had stated earlier in the year that “there is no internal threat to democracy in Armenia; only external ones”. Protests erupted in the country, threatening the survival of the democratically elected government and Armenia’s reform process. The government’s inability to defend the Armenian population in Nagorno-Karabakh, compounded by Azerbaijan’s threats against Armenia proper, caused further unrest in the country.

As in the wake of the 2020 defeat, the opposition called for the prime minister to resign, labelling him “Armenia’s biggest threat”. The numerous protests that followed Azerbaijan’s takeover of Nagorno-Karabakh led to arrests and detentions and fears of a crackdown on human rights in Armenia. This only heightened political and societal polarisation, which has long been a factor undermining both the country’s democratic discourse and the functioning of its institutions. The situation also led to concerns about possible terrorist attacks and coups against the government.

Armenia’s threatened security has been impacting the country’s political life in other ways as well, including Azerbaijani and Russian hybrid attacks against the country’s constitutional order and democratic institutions. This was acknowledged by the European Parliament in its October 2023 resolution on the situation in Nagorno-Karabakh.

Crucially, as in 2020, recent circumstances have put a major halt to key reforms, notably in the sphere of the rule of law. In particular, reforms to Armenia’s law-enforcement institutions were undermined by the appointment of officials who were perceived to have an anti-reform stance but were loyal to Pashinyan. Armenia’s constitutional reform is also affected by the country’s precarious situation. Given the current political instability, little progress is expected in this respect, as there is no appetite to rock the boat by organising the national referendum that would be required to amend the Armenian constitution. In addition, the current context adversely affects progress on other key reforms, for instance those related to the justice sector, which have yet to be completed and fully implemented.

Last but not least, Armenia’s security and socio-economic vulnerabilities exacerbate pre-existing weaknesses in the political transformation process. This applies in particular to civil society, which remains structurally dependent on external funding and whose access to the policymaking process remains fragile in the absence of a culture of dialogue or formal mechanisms for consultation. In addition, after the COVID-19 pandemic and the 2020 war, many Armenian civil society organisations (CSOs) were already forced to shift to emergency and relief operations, a trend that is likely to continue in light of the need to integrate the massive inflow of refugees from Nagorno-Karabakh.

Adjusting EU support for Armenia’s political transformation

In recent years, EU support for Armenia’s political transformation has evolved in response to the country’s fast-changing context. Further adjustments are needed to address the complex and multifaceted nature of the political challenges currently faced by Armenia.

EU support for democratisation in Armenia has become particularly prominent since the 2018 Velvet Revolution. The EU backed political transformation through the promise of unprecedented funding. The sum of €211 million was allocated for the period from 2017 to 2020, with the bulk of the funds allotted after the revolution: EU assistance per capita in 2019 and 2020, at €22.40 in each year, was almost twice what it had been in 2017.

By the start of the 2020s, a new legal framework for EU-Armenia relations, the Comprehensive and Enhanced Partnership Agreement (CEPA), had been signed. When it entered into force in March 2021, the agreement created the institutional structures for political cooperation: the EU-Armenia Partnership Council, the Parliamentary Partnership Committee, and the Civil Society Platform. Having survived the political shock of defeat in the 2020 war, Pashinyan’s newly re-elected government was keen to advance its cooperation with the EU through a road map aimed at implementing CEPA and advancing wide-ranging political reforms.

The EU’s support for this process materialised through political statements and significant financial assistance. The union identified building accountable institutions as a key priority of EU assistance to Armenia in 2021–2027. Throughout the first two years of this period, the EU supported Armenia in strengthening institutions and good governance, reforming law enforcement and the justice sector, and protecting human rights, including by bolstering the capacities of the Armenian Human Rights Defender’s Office. During this period, EU assistance also addressed public administration reform and sought to build citizens’ trust in public institutions, with a special focus on the new Ministry of Interior and on police and migration service reform. Further assistance was envisaged to support constitutional reform in the country.

In the current context, the EU has a key role to play in ensuring that the reform momentum is not lost. An important element in this respect is the development of civil society in Armenia and its active contribution to the reform process. The EU’s encouragement of a bottom-up approach to Armenia’s democratisation has become prominent since 2014 through the union’s systematic engagement with civil society. As part of the 2021–2027 road map for EU engagement with civil society, the EU seeks to help promote an enabling environment for CSOs, support their participation in policy processes, and improve their capacity to engage effectively in these processes. The road map was to take into account the situation after the COVID-19 pandemic and the events of 2020, both of which negatively affected civil society; it will also guide the EU’s engagement with Armenian CSOs in light of the country’s new political reality.

However, to make a genuine contribution to Armenia’s political transformation, the EU should address systemic issues. The polarisation that has repeatedly affected the country since the Velvet Revolution and has recently been reignited has important implications for the reform process. Yet, the EU’s role in defusing political tensions has been limited to a few statements, mostly by the European Parliament.

Likewise, the EU’s contribution to the development of a vibrant and impactful civil society has yet to fully materialise. The EU is the largest donor to civil society in Armenia and sponsors a wide range of activities: 31 projects totalling €31.3 million in 2021, within which 140 CSOs received additional funding via sub-granting mechanisms. However, representatives of Armenian CSOs at times prefer to turn to other sources of funding because of the high level of detail in the funding calls published by the EU. This leaves almost no space for CSOs to develop original initiatives in response to existing societal needs.

In addition, EU support for democracy has long remained disconnected from the broader geopolitical and socio-economic context. This is despite the tight links that have existed between Armenia’s political course and security environment since the country’s independence. The EU needs to increase its engagement on issues that are not directly related to democracy promotion yet have direct implications on Armenia’s political trajectory, in particular security threats. Given the EU’s focus on brokering a peace deal between Armenia and Azerbaijan since 2021, EU support for Armenia’s democratisation has appeared to take a back seat. However, these processes are interlinked: despite its efforts, the EU failed to prevent Azerbaijan’s incursions into Armenia’s internationally recognised territory and its military attack against the Armenians of Nagorno-Karabakh, threatening the Armenian state and its reform process. The EU’s future policy towards Armenia should support the country’s political transformation within the new security context.

A new phase in EU-Armenia relations?

The new geopolitical reality on the ground, despite its profound impact on Armenia, opens a space for a more comprehensive EU effort to support the country’s democratisation. The EU can help safeguard Armenia’s fragile democracy through renewed engagement in three ways: fostering peace, supporting the political transformation, and upgrading the EU-Armenia partnership.

First of all, the EU has a major role to play in continuing its efforts to establish peace in the region. In light of persistent threats to Armenia’s security, which could jeopardise the country’s democratic course, the EU needs to continue its mediation between Armenia and Azerbaijan while reconsidering the ‘both-side-ist’ approach to the conflict resolution process it has taken since summer 2021. In this period, the EU has given a lukewarm response to Azerbaijan’s violations of the tripartite peace agreement that ended the 2020 war, including attacks against Armenia proper in September 2022. Although the EU did rather rapidly deploy a civilian border mission in Armenia at the end of 2022, no further deterrents to Azerbaijani military threats have followed.

Similarly, the blockade imposed on the Armenians of Nagorno-Karabakh since December 2022 has generated almost no response from the EU, further emboldening Azerbaijan to occupy the region through military means in September 2023. The EU’s neutral-arbiter approach to conflict resolution has triggered criticism in Armenia, as the union has sidelined support for a democratising country by placing it on an equal footing with its increasingly authoritarian adversary. Crucially, Azerbaijan’s open reluctance to engage in EU-led talks – as illustrated by Azerbaijani President Ilham Aliyev’s cancellation of his participation in an October 2023 summit in Granada – and continuous threats against Armenia’s territorial integrity blatantly expose the EU’s need to reconsider its mediation strategy.

The provision of non-lethal support to Armenia through the European Peace Facility and the extension of the EU Mission in Armenia – moves that were discussed in November 2023 as part of the second EU-Armenia political and security dialogue – would, if they materialised, be important steps to support the country’s territorial integrity. This support could be combined with increased EU backing for Armenia’s integration into regional connectivity projects, such as the electricity cable under the Black Sea, in line with the Armenian authorities’ Crossroads of Peace project.

Furthermore, given the intransigence of Azerbaijan’s political leadership, EU efforts should not only target the highest political level, as has been the case since 2021 under the auspices of European Council President Charles Michel. The EU should also place societies at the core of peace-building efforts. More specifically, the union should seek to enable a dialogue between civil society, the media, and policymakers from all sides, as was done under the European Partnership for the Peaceful Settlement of the Conflict over Nagorno-Karabakh, established in 2012. This could be done by using the budget of the EU4Peace Programme or the additional €800,000 mobilised at the Granada summit for confidence building. Focusing on civil society actors in this process would strengthen the connection between two processes that are both critical for Armenia: democratisation and peace building.

In light of the EU’s pledge to help its partners in the neighbourhood to strengthen their resilience against such threats, concrete support to address hybrid threats is imperative for the survival of Armenia’s political institutions. Besides, integrating the refugees from Nagorno-Karabakh is a major challenge for Armenia not only in socio-economic but also political terms. While the EU and its member states have so far mobilised more than €50 million for urgent assistance to refugees, the EU institutions have allocated less than some individual member states, for instance France, which has assigned €12.5 million. The EU needs to do more in terms of funding to enable the socio-economic and political integration of refugees in Armenia.

Second, in addition to helping mitigate the security threats faced by Armenia, the EU has a key role to play in supporting the country’s political transformation directly. The EU should continue to support the building of accountable institutions, as has been done on human rights protection, and the implementation of reforms in such areas as the judiciary and anti-corruption, based on strict conditionality, again as in the field of human rights. In the past, the EU’s continuous engagement, despite shortfalls in the reforms process, as well as its weak conditionality, was seen as undermining reforms of law enforcement and electoral democracy. For instance, the EU extended assistance on police reform to Armenia despite evidence of human rights breaches by the police and a lack of meaningful conditionality for amendments to the electoral code.

The EU should further support the development and sustainability of Armenian CSOs by shifting to core funding for these organisations, as is currently being tested in some other countries. The EU should back the creation of a structured mechanism for the consultation and participation of Armenian CSOs in the policymaking process, including in the preparation of key EU-Armenia instruments, such as human rights budget support and the corresponding indicators.

The EU should also promote the development of a culture of dialogue between the authorities and civil society. In addition, the EU is in a position to help defuse current political tensions and reduce polarisation by extending to Armenia the use of instruments such as the European Parliament’s Jean Monnet Dialogue for Peace and Democracy. This would help build confidence and strengthen a democratic culture in the country.

Third and most importantly, recent developments in and around Armenia raise the need for a fundamentally upgraded partnership between the EU and Armenia. Yerevan is keen on closer cooperation with the EU and its member states, as demonstrated by its intensified diplomatic efforts in recent months. The EU is a major partner for Armenia in its quest for a post-Russia foreign policy. In the medium term, the EU could offer to upgrade CEPA to an Association Agreement (AA) similar to those signed by Georgia, Moldova, and Ukraine. Such an option is currently not on the table as the two sides insist on the need to implement CEPA first.

Crucially, an AA would have far-reaching implications for Armenia because of the trade component – the Deep and Comprehensive Free-Trade Area (DCFTA), which forms an integral part of the AAs signed by the EU and its Eastern partners. On joining the Russia-driven Eurasian Economic Union (EAEU) in 2015, Armenia lost sovereignty over trade policy. Therefore, signing an AA would first require Armenia to leave the EAEU. If the country makes such a decision, the AA would not require lengthy negotiations because Armenia already negotiated such an agreement with the EU between 2010 and 2013. CEPA’s political component is modelled on the 2013 draft agreement and could therefore be used as a basis for the AA.

Opting for an AA based on the EU-Ukraine agreement would signal a radical shift in Armenia’s foreign policy and would most likely also require the country to leave the Collective Security Treaty Organisation (CSTO). Armenia’s membership in this organisation did not prevent the attacks against the country or the Armenians of Nagorno-Karabakh, a major disappointment expressed by Pashinyan in his October 2023 speech in the European Parliament. Although the Armenian government has not taken any official steps to quit the CSTO, it refused to participate in the organisation’s most recent meetings and military training exercises, and Pashinyan has openly raised the prospect of leaving the bloc.

If Armenia does decide to leave the EAEU and the CSTO and enter negotiations for an AA, the most secure pathway to democratisation the EU could offer Armenia would be the prospect of EU membership, as for Georgia, Moldova, and Ukraine. For the first time, the Armenian authorities have explicitly outlined Armenia’s European aspirations. A prospect of EU membership would contribute to consolidating Armenia’s democratic course by providing a long-term horizon for political reforms. At the same time, given current divisions in the EU over the prospect of enlargement, as illustrated in the case of Ukraine, one can hardly expect this scenario to materialise soon, even if Armenia submits a formal request for membership.

In the meantime, the EU should offer Armenia other incentives to motivate it to stay on the reform path in a difficult security context. In particular, the EU could engage Armenia in a visa liberalisation process similar to those completed with Moldova, Georgia, and Ukraine in 2014 and 2017. In 2022, Armenia indicated its willingness to start a visa liberalisation dialogue, and the EU recently agreed to “explore options” to that effect.

EU member states that are reluctant to lift the obligation on Armenian citizens to obtain a visa to visit the passport-free Schengen Area – including France, Armenia’s staunchest supporter in the EU – should understand that a visa-free regime is crucial in the current context for two reasons. First, the process of eliminating the Schengen visa obligation would contribute to consolidating Armenia’s democratisation process. This is because the EU requires visa liberalisation partners to adopt and implement key reforms in political areas where domestic change has been selective or incomplete, such as the fight against corruption. Enhanced judicial and law-enforcement cooperation with EU member states and bodies could also trigger further reforms. Second, by increasing people-to-people contacts, a visa-free regime would increase Armenians’ exposure to the EU’s practices and societal models.

The new reality in Nagorno-Karabakh has brought many additional challenges for Armenia’s democratic course. At the same time, the high degree of volatility in regional security also creates new opportunities for more assertive EU policies on both democracy support and peace building.

Authors

 

This publication was produced with the financial support of the European Union. Its contents are the sole responsibility of the authors and do not necessarily reflect the views of the European Union.