Keywords

1 Introduction

A common characteristic of states is their establishment and implementation of foreign policy agendas. International development, cooperation, migration, security, and trade policy are fundamental tasks integrated into all aspects of states’ foreign policies. In its origins, the state was principally a security arrangement.Footnote 1 This has not changed.

Immense resources are often invested in efforts to maintain powerful armed forces, sophisticated intelligence services, civil and emergency defense systems, external attack and internal subversion countermeasures, and diplomacy with the aim of preserving the state. As states act on their own unique foreign policy agendas (typically influenced by equally unique and complex national goals and political ideologies), the outlines of competition crystallize. Competition is usually brought about through numerous distinctions between conceptualizations of security for one state versus security for another. Despite the existence of reasonable understandings of national security, few, if any, are universally applicable. Resultant clashes lead to security dilemmas, which remain defining features of international relations today.Footnote 2

The Cold War portrays how variation in foreign policy agendas served to generate a diversity of international (including violent and armed) conflict. The foreign policy of the United States (US) and its friends and allies focused primarily on the containment of the Soviet Union and Communism. Britain based much of its foreign policy on the threat of Communism and the impact of the Soviet Union as the world’s new great power.Footnote 3 Charles de Gaulle fashioned French foreign policy so as to oppose exclusive leadership of the Western Alliance by the US and to pursue French independence, influence, and stature.Footnote 4 Foreign policy objectives of the Soviet Union were extensive, inconsistent, dependent upon Moscow’s expansion and constriction of political contacts, and fluctuated as changes in leadership occurred.Footnote 5

The break-up of the Soviet Union into multiple states precipitated considerable shifts in foreign policy agendas. After 1991, states were forced to contend with new challenges as the “world of pro-US and pro-Soviet alliances broke down” and regional powerbrokers tested prospects for peace and reconciliation.Footnote 6 Climate change, international (nuclear) terrorism, and economic and budgetary problems beset the US, European countries, the new Russian nation, and the Soviet successor states. The biggest change was the shift from bipolarity to multipolarity. Eventually, Brazil, Russia, India, China, and South Africa—the so-called BRICS nations—and a united Europe competed against a dominant US and engaged in new modes of regional and interregional rivalry.

Russia’s “Near Abroad” became an important part of the new strategic visions and external policies of the European Union (EU) and Russia. The competitive friction between the EU and Russia in the region has, since the collapse of Soviet Communism, become a high-stakes political power game and fuelled the resurgence of a nineteenth century “Great Game.” Specifically within the Caucasus, questions presiding over the establishment of zones of influence alongside political and economic control have taken a leading position in the ongoing debate over the reorganization of the European “Common Neighbourhood” and the geopolitical positions of both the EU and Russia. Shunning the term “Common Neighbourhood,” Russia has pursued many opportunities in what it refers to as the “regions adjacent to the EU and Russian borders” or the expanse comprised of the former Republics of the Union of Soviet Socialist Republics (USSR), known collectively as the Commonwealth of Independent States (CIS)—the “CIS Area” or simply Russia’s “Near Abroad.”Footnote 7 Russia has not been reticent, especially in the past ten years, about its intentions to defend this territory.

Fixed notions of the EU and Russia’s geopolitical positions within Europe are giving way to newer and broader perceptions about the wider European space so as to replace the geostrategic dominance of one regional power with another. Some states have also managed to escape falling under the influence of the EU and Russia. Both actors have ushered in a zero sum-game that translates into the gain of one actor at the expense of another. Since 2003, the EU has sought to produce a “ring of friendsFootnote 8 surrounding the Union and its closest European neighbours, from Morocco to Russia and the Black Sea,” through the use of conditionality and institutional reform with the ultimate aim of creating or achieving stability on the European periphery.Footnote 9 Russia has established that democratization, institutional development and liberalization, and the exploitation of economic resources and opportunities by the EU by means of its ambitious external governance policies runs headlong into its own interests within a sphere overlapping its own regions of interest. The region dealt with in this chapter is seen as one of the most strategically valuable. It directly concerns the states of Georgia, Armenia, and Azerbaijan.

In this chapter, I pursue the themes of hegemonic competition, power rivalry, and security in the “Common Neighbourhood” by examining key factors in EU and Russian approaches to power projection in the South Caucasus.Footnote 10 I conduct a qualitative analysis using a longitudinal perspective to examine key factors that drive Armenia closer to the EU and Russia’s efforts to balance this through its external governance. Both the EU and Russia, as geopolitical actors, utilize a range of “carrots” and “sticks” to gain traction into this shared space. I employ a theoretical framework of geopolitical strategies to establish the context in which both the EU and Russia operate with respect to the South Caucasus and form the basis for understanding how both actors—as competing hegemons—respond to one another in their respective attempts to exert their dominance in the region. I argue that despite protracted efforts by the EU to establish its influence in the South Caucasus more generally, Russia’s geostrategic posture is better suited to secure a concrete zone of influence over the region.

2 Theoretical Framework

Prior to assessing EU and Russian power projection in the South Caucasus, I first consider the theoretical framework of the study, namely (offensive) realism. Since this chapter is not primarily a theoretical discussion, but rather the application of a theory to explain the behavior of states in a contested region, only the basic aspects of the theory, its core assumptions, and hypotheses are introduced.Footnote 11

In the Scientific Research Program of realism, five core assumptions can be determined, which feature prominently within the scientific discourse. These are namely, that (1) the central question of realism is the cause of war and the conditions leading to peace; (2) the structure of the international system is the necessary, but not always the sufficient explanation for the behavior of states; (3) the focus rests on geographically based groups, or units, as the central actors in the international system; (4) these are rational in their behavior and guided by the logic of national interest; and (5) the nation-state can be conceptualized as a unitary actor, meaning different domestic groups are neglected.Footnote 12 Since the national interest of the state (as the primary actor within an anarchic system) is survival, states aim at building capabilities to defend themselves against other states, and to maintain the general balance of power that holds the system togetherFootnote 13—in other words, realists live in a zero-sum world. Along these lines, offensive realists argue that the ultimate security is obtained once a state has the most power in the system with other states orbiting around it like satellites, and thus becoming the hegemonic power.Footnote 14

In this context it becomes evident that I perceive the EU to behave as a “state-like” actor, which is of course a highly contested view.Footnote 15 As former US Secretary of State Henry Kissinger famously remarked, “Who do I call if I want to call Europe”?Footnote 16 It is still evident that in many issues, the EU does not act like a unitary actor. However, in the South Caucasus, as I show, there is a coherent EU foreign policy aimed at expanding the EUs’ sphere of influence. Therefore, for analytical purpose, I consider the EU as a “state-like unit,” following the logic of national interest defined as obtaining power in order to survive.

The working hypothesis of this chapter is that both the EU and Russia act according to the offensive neorealist logic. They are expected to strive to expanding their power capabilities, to act as regional hegemonic powers in the South Caucasus, countering the other’s force, and finally tilting the balance of power in their respective favor. Since natural resources, size of population, and size of country are critical factors concerning the material capabilities of the state (both the EU and Russia in this case), it is expected that both have a vital interest in preventing the other from entering their neighbourhood.

3 Russia’s “Special” Sphere

Russia’s “Near Abroad,” a post-Communist term that refers to the territory extending beyond the Russian Federation and overlies the “Common Neighbourhood,” is comprised of 14 former Soviet republics of the former Soviet Union.Footnote 17 It is seen as a “special” area of interest by the Russian government and over which Russia attests that it retains a distinct responsibility.Footnote 18 Even within a few years after the Soviet Union fell, mention was made of a “Pax Russica” and a Russian “Monroe Doctrine” that underscored the former Soviet Republics as an area of special security interest for Moscow:

The territory of the former USSR [Union of Soviet Socialist Republics] is a sphere of specific vitally important Russian interests. This is based on a number of objective factors: the retained economic interdependence of states; the close scientific and cultural ties; a direct dependence of the security of Russia on the situation in the contiguous regions of the former USSR; the moral and political responsibility of Russia for the fate of the Russian speaking minorities; the exclusive role of Russia in curtailing the distribution of the military arsenals of the former USSR (including nuclear weapons and their delivery systems); the natural status of Russia as the axis of military political stability in continental Eurasia.Footnote 19

The term “Near Abroad” was first used by Russia in its “accounts of its relations with the other former republics of the Soviet Union, implying the existence of a special and unequal relationship.”Footnote 20 (Fig. 1). Russia is said to dominate the “Near Abroad,” yet many flashpoints of conflict exist that challenges the idea that Russia is the region’s single dominating authority.Footnote 21 As will also be seen, Russia is not the only actor projecting its influence in the region, and it cannot be claimed that Russia’s power is at any rate uncontested. A notable truism here can be identified. Competition between states with their own specially tailored foreign policy goals transcends the Cold War and post-Cold War periods, and thus demonstrates the continuity of great power politics.

Fig. 1
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The “Near Abroad”. Source: G. P. Harstedt and K. M. Knickrehm, International Politics in a Changing World. (London, UK and New York, NY: Pearson Higher Education, 2003)

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In 1989, the Soviet census showed that approximately 25 million ethnic Russians were living in the Soviet republics, excluding Russia.Footnote 22 This represented 17 % of the entire ethnic Russian population in the Soviet Union and was compounded by a further 11 million Russian-speaking peoples living beyond the Russian Republic. The total number of “Russians” living in what is seen as Russia’s “Near Abroad” stands at roughly 40 millionFootnote 23—about 8 % of the EU’s total population and 28 % of Russia’s total population in 2011.Footnote 24

Ethnic dimension of Russians and Russian-speaking peoples in these territories alone heavily substantiates Russia’s responsibility over its peripheral regions. Numerous complex policy problems, nonetheless, exist throughout these states adding critical dimensions that, in effect, contradict or entirely abjure Russia’s fundamental claim to or influence over the “Near Abroad.” While many ethnic Russians represent a relatively elevated figure of the total population, few actually speak Russian. Since many Russian’s have lived in the regions for extended periods of time, they may be seen as “natives” of those states and not intrinsically “Russian.” It is therefore reasonable to claim that they might not easily be used by Moscow with the view of leveraging Russian power and projecting it abroad.Footnote 25

The “unwanted legacy” of ethnic Russians living on the Russian rim extends over the Caucasus and deep into Georgia, Armenia, and Azerbaijan.Footnote 26 Russia’s attention to these states has principally been drawn by ethnic conflict between Armenia and Azerbaijan, their large oil reserves, and their competing political values. Political corruption, internal strife, and socio-economic stratification complicate this rich mixture. Indeed, little effort was needed on Russia’s part in order to pull Armenia into its sphere of influence by incorporating it into the Russia-dominated CIS. Challenges, though, persisted in executing its policy successfully as regards Georgia and Azerbaijan.

4 Competition in the “Common Neighbourhood”

The 2004 and 2007 rounds of expansion with membership inclusion of the so-called EU “newcomers” extended the EU’s borders to the Black Sea. Its expansion brought to light new and daunting questions of the geopolitical realties of a region on the threshold of the EU’s borders on which the ENP—a single policy introduced towards all of its neighbours—originally focused.Footnote 27 As the EU widened, it began to share a frontier with states that straddled the spheres of interest of both the EU and Russia. These regions became known collectively as the “Common Neighbourhood”—they include Armenia, Azerbaijan, Belarus, Moldova, Ukraine, and Georgia (Fig. 2). Within the framework of the ENP, they composed the Eastern Partnership Group (EaP)—a core group within EU foreign policy—and described as both a historical and critical space in Russia’s backyard.

Fig. 2
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The “European Neighbourhood” with Protracted Conflicts. Source: Center for Security Studies (CSS), “The European Neighbourhood,” CSS Analysis in Security Studies Policy No. 96. (ETH Zurich, Switzerland, 2012). Available at: http://www.sta.ethz.ch/CSS-Analysis-in-Security-Policy/CSS-Analysis-in-Security-Policy-Archive/No.-96-EU-Foreign-Policy-Still-in-the-Making-June-2011

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The EU confronted the uncertainties of security and insecurity of a handful of “groups”Footnote 28 of states through the ENP, by extending “the benefits of economic and political cooperation to [its] neighbours in the East while tackling political problems there.”Footnote 29 As the primary means through which the EU engages the countries in the “Common Neighbourhood,” the ENP establishes an ever-evolving venue for countries to make critical reforms as time moves on, and “align their policies and legislation with the EU with the unspoken assumption that this will help their future membership prospects.”Footnote 30

Unlike Russia, which does not have a single foreign policy toward countries in the “Common Neighbourhood,” the EU’s ENP instrument offers country-specific action plans (APs)Footnote 31 to assist with each state attracted to prospects of joining the EU and the North Atlantic Treaty Organization (NATO) at any point it the future. Focusing on such aspects of societal development as political rights and civil society follows this. These two indicators suggest that the EU has had a poor impact on the region since the APs were first put into place. As of 2007, new procedures of financing contained within the Neighbourhood Instrument combined with the Technical Assistance to the Commonwealth of Independent States (TACIS) and Mesures d’accompagnement financières et techniques—the main financial instrument of the Euro-Mediterranean partnership (MEDA) programs to support priority sectors of democracy.Footnote 32

Figures 3 and 4 show a lack of performance in the aforementioned areas. Azerbaijan reveals no change over time in its political rights rating while Georgia improved only slightly and Armenia appears to have regressed significantly. Over time, neither Azerbaijan nor Armenia have hinted at any advancement in their civil society sectors while Georgia fluctuated slightly; but fails to demonstrate any positive performance by and large. Nonetheless, given that the ENP was originally modeled on the enlargement process—that is “its raison d’être is expansion—its path dependency is strong, and Russia’s behavior has adapted accordingly.Footnote 33 Even without a single foreign policy aimed at the region, Moscow has not received the ENP as a discreet citation to the EU’s reform stimulus or regional ambitions.

Fig. 3
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Political Rights Rating for the South Caucasus—Part of the ENP East Group (EaP), 2002–2012. Source: Freedomhouse.org, “Country Ratings and Status, FIW 1973–2012.” (Washington, DC and New York, NY: 2012). Available at: http://www.freedomhouse.org/report-types/freedom-world 7 = Low, 1 = High

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Fig. 4
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Civil Liberties Rating for the South Caucasus—Part of the ENP East Group (EaP), 2002–2012. Source: Freedomhouse.org, “Country Ratings and Status, FIW 1973–2012.” (Washington, DC and New York, NY: 2012). Available at: http://www.freedomhouse.org/report-types/freedom-world. 7 = Low, 1 = High

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Russia counteracted EU integration policy in the region by “integrative constructs of its own, ranging from the Russia-Belarus constitutional ‘Union’ via the Eurasian Economic Community (EURASEC) to the military-political Collective Security Treaty Organization (CSTO).”Footnote 34 Poisoning EU-Russia relations directly, implementation of the ENP has had a number of other side effects that have soured ENP-country relations with Russia. Georgia showed its desire to cozy up to the EU with the view of enjoying the full benefits of membership early, and joined the ENP framework in June 2004.Footnote 35 Armenia and Azerbaijan expressed their eagerness to move towards the EU constellation as well and formally joined the ENP framework in 2004 with relations regulated according to the Partnership and Cooperation Agreement (PCA). Georgia has adamantly pressed for NATO membership in the past but has also struggled to resist Russian efforts to preserve its claim of responsibility over it.

All of the ENP-target countries face quite a broad array of heavy challenges in meeting the criteria set by the EU. Six are identifiable as the most prevalent. They include: (1) lack of commitment by national governments, (2) complexity of bureaucratic procedures, (3) inadequate performance with respect to the use of external assistance, (4) lack of formality in reporting progress to the EU, (5) improper assessment of national weaknesses and reasons for lack of improvement, (6) and poor development of civil society within the processes of AP implementation.Footnote 36 To add an additional reason to those noted; Russian involvement in the relations of the countries with the EU has played a decisive role.

Russia’s combination of pressure and force reached its apogee during the previous decade. During the 1990s, a political coup took place in Azerbaijan that supplanted the anti-Russian regime and instilled a pro-Russian government. Since then, Moscow has been involved in Ukraine’s 2004 national elections, the use of force in the Russo-Georgian war of 2008, and the recent Crimean crisis that began in February 2014 and lasted for roughly 3 weeks. These events call attention to Russia’s efforts in maintaining and making its presence felt in the “Common Neighbourhood.” The absence of these events would have made the EU’s path to influence in the region an easier task but not necessary a foregone conclusion. Instead, they served as direct impediments to the EU’s efforts in displacing Russia’s attempts to establish dominance in the South Caucasus in addition to other parts of the former-Soviet space.

5 European Geopolitics and Geopolitical Actors

A wide range of instruments is at the disposal of the EU and Russian governments to achieve their aims in the clash zones. Nicu Popescu and Andrew Wilson provide a thorough overview of both states as dueling blocs in the “Common Neighbourhood.” Table 1 presents a few tools employed to achieve their foreign policy goals.

Table 1 EU and Russian power projection
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The EU stands as a “project” predicated upon the idea of “re-territorialization that in part transcends but also somewhat reconfirms state-centered geopolitics.”Footnote 37 The geopoliticalFootnote 38 nature of the EU assumes different perspectives but all are used to model its evolution in terms of a “Westphalian” (state-centered), “Imperial” (Core-Europe-dominated), and “Neo-Medieval” (fragmented and regionalized) political order.Footnote 39 As a political entity aspiring to be a “force for good” that uses normative powerFootnote 40 to export its values and norms to surrounding states, the South Caucasus has been a major focus of the EU’s geopolitical power.Footnote 41 This concentration has only intensified, especially after 2004—frequently referred to by the EU as “the most successful foreign policy” move.Footnote 42 The EU has played a central role in reshaping the post-Soviet political, economic, and social landscape in and around Europe since the collapse of the Soviet order. As such, the term New Regionalism (NR) was put to use in order to understand the normative structure of the EU’s geopolitical role with a variety of programs and projects. Some of these, though, have yet to prove truly effective in achieving the EU’s goals and strategies in spite of them engineering a wonderful perception of its critical short- and long-term goals.Footnote 43

“At the center of the geopolitical imagination,” according to James Wesley Scott, “has generally figured a hegemon or powerful state with the authority, economic clout and military and/or diplomatic prowess to influence the course of international politics.”Footnote 44 As an actor in the post-Cold War political order, the EU fits this description. Although the political and military weight of Russia does not entirely match that of the former-Soviet Union, conceptualizations of Russia as a post-Cold war geopolitical power reflects a variety of perspectives entertaining political, military, and territorial factors. In short, modern Russia can be described as a manifestation of its former-Soviet hegemonic self. If the construction of the EU is to be seen as an “attempt to create a coherent political, social, and economic space within a clearly defined multinational community,”Footnote 45 then Russia’s involvement in the South Caucasus is a firm case of that state fulfilling perceptions of a neo-imperial (or hegemonic) approach much like that of the EU. It is no accident that the reification of this area has been made repeatedly in post-Cold War political rhetoric as one of principal Russian interest, and is likely to retain its potency for some time to come.Footnote 46

6 EU Power Projection in Russia’s Backyard

As stated previously, the EU has had a significant and quite a unique impact upon the states that lie beyond the traditional boundaries of Europe. In recent years, the EU has proven its capacity to act as a geopolitical and normative power even in countries with strong Soviet legacies and that lie further to the east such as those of Central Asia. After the USSR dissolved, Western Europe assisted Central and Eastern European Countries (CEECs) with their own unique transitions toward liberal-democratic societies and free(er)-market economies through conditionality that awarded compliance with “European Norms.”Footnote 47 I emphasize a dual purpose of the EU’s conditionality here when taking into account state interests of the EU through a realist lens. Table 2 presents several components of the EU’s conditionality that also act as “levers” over target stated—in this case Armenia.

Table 2 Primary EU “Levers” over Armenia
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Armenia is not the only state with which the EU is concerned in the South Caucasus. The region holds a special place in EU interests for a number of reasons, many of which have become far more palpable with the changing geopolitical order and the advent of critical new security concerns within the international system over the past two decades. Chief among these is the EU’s interest in energy diversification and the securing of alternative sources of energy, which can rightly be seen as an issue on the rise.

The South Caucasus is therefore of vital strategic importance for the transportation of oil and gas if the EU is to meet its burgeoning energy demands. The EU is interested in the region for the sake of building democracy within these states, though one cannot neglect questioning the legitimacy of the EU’s intentions in this sense. The South Caucasus’ geographic position in military and communication terms renders it an area of security ambition.Footnote 48 Georgia, Armenia, and Azerbaijan have undergone a maturation process since 1991 that has given them the flexibility to make a contribution to regional security and even the overall security architecture of the EU as well as that of the US. Fulfilling certain roles in the fight against terrorism and transnational crime has helped to establish this reality.

Despite these features, Armenia’s proximity with Turkey, Russia, and Iran in addition to its discordant relations with its smaller neighbours, presents the EU with ongoing foreign policy (and security) dilemmas. Many of these obstacles center upon five distinct matters: (1) developing a precise security architecture and process(es) of integration, (2) the resolution of ethnic, inter-state, and regional conflict, (3) the management of a web of complex relations between states and non-state actors including the EU, the US, NATO, the Organization for Security and Cooperation in Europe (OSCE), the United Nations (UN), and the Council of Europe (CoE), (4) strengthen and maintain civil society to bring about a healthy legal, political, social, and economic environment across the region, and (5) generate a positive relationship between former-Soviet Republics with Russia.

Armenia’s European aspirations can be taken as a positive and negative feature in the EU’s regional approach. On one hand, it lends the EU a degree of leverage to approach Armenia in such a way as to overcome some of the aforementioned challenges it faces. On the other hand, it produces a negative affect with Russia, arousing suspicion over the EU’s intentions not merely in the South Caucasus. Russia is impelled to react to the EU as it encroaches upon its historical area of interest—an area over which Russia established its hegemony roughly 200 years ago—and sphere of influence as it has slowly realized its status as a great power over the past decade.Footnote 49

The EU is able to provide financial support and invest in the socio-political and even economic development of the South Caucasus through its multimillion-dollar aid programs after the “Rose Revolution” in Georgia. The formation of the Organization for Democracy and Economic Development (GUAM),Footnote 50 and its relationship with NATO shows that orphaned states of the Soviet Union have the potential of moving measurably closer to Euro-Atlantic structures despite the presence and expansion of Russian forces in the area, and Russia’s use of military force against Sakaashvili’s authoritarian-style Georgia witnessed in 2008.

A paramount barrier facing the EU in its efforts to gain influence in the South Caucasus is the current Eurozone crisis and economic uncertainty that has all but removed the incentive of EU membership from the table within the framework of the ENP. With a “no vacancy” sign currently posted, the EU has virtually lost its golden “carrot” in its attempt to reform and democratize the countries that lie to the East, particularly Armenia, which in all accounts requires the most help in breathing life back into nearly every facet of its society. The question of whether the EU still retains a sharp financial instrument, a “specific and innovative feature of the ENPI [European Neighbourhood Partnership Instrument] in its cross border cooperation component,” and ability to fund other programs and pay for costly initiatives remains to be seen.Footnote 51

7 Russia’s Geopolitical Power Potential

Russia and Armenia share a special relationship. As the Soviet Union collapsed both states succeeded the political order but with significantly different impacts upon the new political environment of the post-Soviet era. The nature of Russia-Armenia relations casts doubt upon whether or not Russia retains much of its old messianic ambitions as its Soviet predecessor. Much can be said about the nature of Russia’s engagement with Armenia over the past decade. It may be said that these old ambitions are part of the motor behind Russia’s actions. Table 3 outlines some of the instruments of Russian power over Armenia.

Table 3 Primary Russian “Levers” over Armenia
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Russia’s multi-vector foreign policy, with the aim of building upon its influence in the South Caucasus and bringing Armenia closer to the Russian core, centers upon (1) military dependence, (2) political-security position in relation with Georgia and Azerbaijan, and (3) the exploitation of Armenia’s economic fragility.Footnote 52 The third and most recent period of Russia’s policy toward the Caucasus began when President Putin came to power in 2000.

The new National Security Concept and Military Doctrine are two central strategic tools in Russia’s approach to the South Caucasus with the former emphasizing the use of military power in Russia’s relations with other post-Soviet republics.Footnote 53 As many of the CIS countries faced social, political, and economic turmoil over the past 10 years, the Putin administration concerned itself with the general security and integration process of the CIS. Poor integration and security crossed paths with the resurgence of transnational terrorism that even Russia found itself vulnerable too, and with which it was inevitably forced to contend.Footnote 54 Putin could not escape the need to augment both his political and military presence around Russia if he was to achieve the preservation of a fragile “Near Abroad”—a policy referred to as “controlled destabilization,” particularly in Georgia and Azerbaijan—while simultaneously building a stronger and increasingly positive relationship with the both the EU and the US.

Russia exhibited its “Near Abroad” policy through involvement in the Nagarno-Karabakh conflict and the Abkhazian-Georgian conflict—two persistent conflicts in the region. The Armenian minority presence in Georgia gave Russia a concrete reason to keep its troops stationed in Javakheti province’s capital Ahalkelek.Footnote 55 With the establishment of a military base, Russia pulled Armenia deeper into its sphere by providing locals with employment, security, and the Armenian government with political weight over its neighbours to the south. With increased backing from its powerful Russian friend to the north, Armenia recognized and unreservedly accepted Russia as a “natural protector” of the country.Footnote 56 Diminishment of the distance between Moscow and a region of strategic interest in the face of the EU and the US projecting their own influence over it was the product of such events.Footnote 57

Russia’s strategy successfully implemented the use of Armenia to apply pressure to Azerbaijan during the Nagarno-Karabakh conflict, which began before the Soviet Union fell apart.Footnote 58 When both Armenia and Azerbaijan gained independence in 1991, the conflict spread. From this event, it became clear that support for Armenia was a preferred option for Moscow for the discernible reason that Armenia was part of the CIS and that Russia already possessed a military presence there.Footnote 59 As Georgia increasingly looked to the EU, the US, and NATO, and while Azerbaijan assumed a more pro-Turkey posture in its interstate relations, Russia realized that Armenia was its more favorable option in maintaining its strategic policy in the South Caucasus. Acting upon this view, the understanding that the Nagarno-Karabakh conflict was a means of taming Azerbaijan in light of its drift towards the Western camp was only strengthened. A consistent flow of weapons by Russian military leaders solidified a highly desirable relationship with Armenia until a Russian-backed coup in Azerbaijan successfully altered this geopolitical dynamic.Footnote 60

The development of Russian-Armenian economic relations helped to formulate a strategic partnership between the two states (Fig. 5). The use of energy as sway under Putin was made possible across the CIS but one can see this as a significant case in Armenia. Russia divided the CIS into energy “importing” and “exporting” countries, thus enabling the isolation of those states most vulnerable to Russian power. Azerbaijan is a major energy exporter while both Armenia and Georgia are heavy importers.Footnote 61 Russia’s management of Armenian assets was thought to yield a great deal of high paying jobs, employment, and improve Armenia’s overall economic condition. “Economic desperation of the 1990s,” as Ian J. McGinnty states, “necessitated the reopening of the [MedzamorFootnote 62 nuclear power] plant [MNPP] with Russian financial assistance.”Footnote 63 Russia’s state-owned Unified Energy System (RAO UES) similarly acquired six of Armenia’s nine hydroelectric plants. The result was the satisfaction of Armenians’ energy demands by an additional 33 %.Footnote 64

Fig. 5
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Conflicts and Energy Transit in the Caucasus. Source: Center for Security Studies (CSS), “Conflicts and Energy Transit in the Caucasus” CSS Analysis in Security Policy No. 39. (ETH Zurich, Switzerland, 2012). Available at: http://sta.ethz.ch/var/plain_site/storage/images/graphics/conflicts-and-energy-transit-in-the-caucasus-09-08/2294-2-eng-GB/Conflicts-and-energy-transit-in-the-Caucasus-09-08.jpg

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Russia’s acquisitions extend further still to include thermoelectric energy facilities, electronic and robotics plants, and a cement factory that has left Russia in control of around 90 % of Armenia’s energy sector.Footnote 65 As Russia gained almost complete control over Armenia’s vital energy lifeline, the policy choices of the Kocharyan administration during the 1990s were arguably based upon pure necessity and not on the best interest of Armenia’s future. In spite of the fact that the geopolitical realities of the present day differ from questions of the 1990s and the immediate aftermath of Soviet dissolution, Armenia’s deals have resulted in Russia dominating the Armenian economy, most notably in terms of its energy sector, to this day. Russia’s control over Armenia fostered greater leverage over the region and generally improved Russia’s position as a regional hegemon. The result has virtually sidelined the EU in its policy options with the view of exerting greater influence over the region much less curtailing Russia’s ambitions over both Armenia and the South Caucasus as a whole.

The EU’s soft power has not been very successful in pulling Armenia and its neighbours closer (this is prevalent in a number of ways), and the extent to which the EU can continue relying upon the “magnetism” of the EU model to reform and liberalize the states that lie to the East is dubious at best. By contrast, Russia’s use of coercion and incentives for economic benefits, political structure, open markets, and a secure energy future, has proven fruitful in tempering the effects of the EU (Fig. 6). The connection between these varying strategies and tactics are an expression of Russia’s determination to systematically eliminate impediments to its dominance that have been established by the EU. (Table 4). It is clear that Russia is able to offer the states in its “Near Abroad” with choices that have proven difficult to reject. EU and Russian soft power has swayed public opinion in the South Caucasus, with Armenians favoring integration with Russia over the EU.

Fig. 6
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Support for Russia/CIS Integration Vs. EU Integration in the EaP, 2008. Source: N. Popescu and A. Wilson, “The Limits of Enlargement-Lite: European and Russian Power in the Troubled Neighbourhood,” Policy Report—European Council on Foreign Relations (ECFR). (London, UK: European Council on Foreign Relations, 2009): 28. Available at: http://ecfr.3cdn.net/dc71693a5ae835b482_5om6bvdkn.pdf

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Table 4 Migrant workers and remittances from the six EaP countries in the EU and Russia
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8 Conclusion

To recapitulate, in this chapter I have shown the competing nature of the EU and Russia in the South Caucasus, particularly as it relates to Armenia since the collapse of the Soviet Union and the implementation of the ENP in 2003. From the discussion in the preceding text I made the claim that even though both the EU and Russia have undertaken great measures to exert their influence over the South Caucasus, Russia’s political, economic, and military posture sets it ahead of the EU in the region. This is partly due to the fact that Russia’s political visions are predominantly sustained by neo-imperial thinking whereas the EU employs multiple geopolitical methods of applying its influence. The Russo-Georgian war of 2008 and the recent events in Crimea, however, is a sharp example of Russia’s willingness and ability to intervene in the “Near Abroad” by means of intensive application of force whenever it chooses to do so, while the EU lacks the same option to strategically engage the region.

Both the EU and Russia are different actors in terms of politics but with much the same political agendas however they may appear or act in given contexts. It is evident that efforts on the part of the EU seek to create a buffer zone between its current member states and more unstable, and potentially hostile regions that stand opposite of them. However, if the soft and hard security threats are to be appropriately contained at this point, then the EU will be required not only to maintain a buffer zone but also to possess the capacity to manage it. This image is in line with the concept of dealing with the common neighbourhood through a lens of security whereby the EU attempts “to keep the outside at bay.”Footnote 66 The EU’s reading and treatment of its own neighbourhood will be the leading determinant of how it is able to project its power against Russia’s in the future.

What can confidently be said is that Russia uses Armenia’s military dependence, political-security position in relation with Georgia and Azerbaijan, and Armenia’s economic fragility as critical leveraging points in meeting the objectives of the “Near Abroad” policy in the South Caucasus. The conflict between Armenia and Azerbaijan, particularly the Nagarno-Karabakh conflict, is a case of the difference in EU-Russian policy in their shared neighbourhood. It seems likely that Russia is not interested in resolving the conflict in the region, which it can use to meet its interests and tilt its military, economic, and political weight there with the aims of improving its power position over that of the EU’s.

Russia’s interventionist policy in the CIS, including the South Caucasus where it commonly uses the power of incentives and coercion, is not going to ebb. Consequently, the nature of politics in the region and the forcefulness of Russia mean that the region has become an area of intense competition in which the EU will have to adapt further still to operate in its primary interests as a state first and foremost. Russia offers Armenia concrete benefits, such as active labor markets, reliable energy, and straightforward membership into multilateral organizations; whereas the EU offers Armenia loose options rooted in ambiguous terms like “European Neighbourhood Policy, Eastern Partnership, European Neighbourhood and Partnership Instrument, governance facility, autonomous trade preferences, and neighbourhood investment fund.”Footnote 67

The coup in Azerbaijan showed Russia’s past ability to successfully sculpt the region politically, while its recent efforts have proven its capacity to rather effortlessly wrestle control over lines of communication and pipeline routes that would transport critical energy resources to much-needed and largely under saturated markets. The Abkhazia and South Ossetia outcomes that subsequently led to Russian de facto control is testimony to the country’s military capabilities as well as its capacity in state-level hostage taking in order to exert influence over even those states that may not have been considered under the control of Moscow’s foreign policy. The acquisition of vital Armenian production facilities reconfigured the economic footing of the entire country so as to bring it under Russian control, and therefore made the country politically subservient to Moscow.

A strong bedrock of “historical and cultural affinity—the presence of Russian minorities in neighbourhood countries, the Russian language, post-Soviet nostalgia, and the strength of the Russian Orthodox Church”—exists in the region on which Russia can build its influence. This presents a slippery slope for the EU—one that may be overcome if only because the EU is not as poor as Russia, although there may be little charge to such a claim. Whereas the global economic downturn has been predicted to contain much of Russia’s activities in the South Caucasus, the EU will likely be forced to scale-down to a greater extent than Russia. Market constraints in the “Near Abroad” put Russia in a stronger position to build its influence by simply buying-out Armenia to a greater extent than it already has. As the EU symbolizes X, Y, and Z, Russia—rather than competing directly with the incentives put forward by the EU—has merely presented itself as an alternative model. This is apparent in Russia’s economic initiatives such as Moscow’s 2009 $7.5 billion USD contribution to an anti-crisis fund with the view of stabilizing and breathing life into its allies’ economies.Footnote 68

While both actors have presented concrete bases for building their respective influence in the South Caucasus, Russia has shown itself to be stronger and faster than its sluggish bureaucratic counterpart, and able to stay several steps ahead of the EU in nearly every political and economic facet. As a result, “the EU often finds its activities in the neighbourhood frustrated by Russia’s attempts to shut it out of its ‘Near Abroad.’”Footnote 69 It is clear that both actors are able to project their power in the “Common Neighbourhood.” Despite the fact that the result will be a very difficult geopolitical morass for all states located in the South Caucasus to manoeuvre, given their awkward lodgment between two competing actors, a number of critical factors suggest that Russia is, and will, remain ahead of the EU in establishing a true zone of influence over the South Caucasus and being considered the region’s hegemon.