SUBMISSION AND DESPAIR – How come Armenia started talking about benefits of opening communications in the region?

Forty-four days, and every day is a victory. Forty-four days made the whole world convinced of the political, military, and economic power and leadership of Azerbaijan in the region, which changed priorities, plans, and forecasts for decades ahead...

The second Karabakh war is not only liberation of the Azerbaijani lands from the 30-year occupation, but the untying of many political and, especially, economic nodes in the region, which can have a considerable impact on the development of all neighboring countries.

The only but late opportunity

For Azerbaijan, this means additional opportunities for various economic spheres, a significant contribution to the overall picture of economic development. Still, one mustn’t forget that even without this, the country has been maintaining leadership in all economic positions in the region for many years.

This is while for Armenia - the occupier and the losing side- no matter how paradoxical it may sound, the Karabakh conflict resolution will bring the biggest economic dividends. It is Armenia, which, after three decades, finally got a chance to rejoin the world economic system through new transport hubs to attract foreign investment, and it is now easier even to ask for help (Armenia does this best of all).

Recently, Armenian Economy Minister Vahan Kerobyan told reporters that the resumption of transport communication between Armenia, Turkey, and Azerbaijan “will significantly improve the opportunities and competitiveness of our undertakings.” He said that according to the estimates of the World Bank, the Asian Development Bank, and the Armenian government, the resumption of transport communication among these countries will ensure the growth of Armenia’s GDP even despite the pandemic.

A bit earlier, Russian Deputy Prime Minister Alexei Overchuk told reporters that Russia, Armenia, and Azerbaijan are determined to unblock economic and transport links in the region. According to Deputy Prime Minister of Armenia Mher Grigoryan, unblocking the ties “will have a positive effect, but it is too early to predict the exact growth of trade among the countries as a result of this.”

This is both amusing and sad. Thirty long years, thousands of deaths, devastation, and chaos - what else had to happen for Armenia to finally realize and accept that hostility with Azerbaijan destroyed its economy, throwing most of its population into poverty, from which it won’t get out so soon?!..

A fairy tale is a lie, but there is a hint in it

Today is the first time that the Armenian government gives optimistic forecasts, indicating the expected GDP growth in almost double digits. In fact, the country's economy will need to literally “rise from the ashes” - to build many industries from scratch, to work for a long time to convince investors of the stability of the domestic political situation, to ask international organizations for new loans. The country has virtually no savings of its own - $3.1 billion “don’t count,” considering that the country has three times more debts - Armenia’s national debt already exceeds $9 billion. As of September 1, Azerbaijan’s foreign exchange reserves exceeded $53 billion with a debt of $7.8 billion.

At the same time, the Statistical Committee of Armenia published official data for January-July 2021, according to which, despite the 5.2% growth in economic activity recorded for seven months, in July, this indicator grew by only 0.2%. In fact, this means that the growth rate of economic activity has decreased several times. According to Armenian economist Suren Parsyan, “apparently, with such a decreasing rate, the ‘forecast’ of the economy minister on ensuring double-digit economic growth was just another marketing step to attract people’s attention. It is impossible to achieve double-digit growth just by creating positive expectations.”

The economist is convinced that against this background, it makes no sense to look for investment flows and a dynamically developing economy, “since all this is just a lie.” “The reality is that our economy is currently in an inertial state. And the 5.2% growth was provided solely due to the last year’s poor indises and the mining sector,” Parsyan notes.

The choice is yours

So, everyone knows that the Armenian economy is in deplorable state. Is there a chance for it to somehow rectify the situation? Of course, yes - a lot has been written and said at various levels that the opening of communications in the region, in particular, the Zangazur corridor, will benefit all countries of the region.

The Zangazur corridor includes not only rail but also automobile communication. In terms of railroad, it is about the Horadiz-Agbend highway, the 44 km Zangazur section, the Armenia-Ordubad, and Ordubad-Nakhchivan-Yerevan, Yerevan-Gyumri-Kars sections.

Speaking recently during the general debate at the 76th session of the UN General Assembly, Azerbaijani President Ilham Aliyev once again stressed that transport projects can become one of the areas serving peace and cooperation in the region. “In this context, the Zangazur corridor, which will connect the main part of Azerbaijan with the Nakhichevan Autonomous Republic and Turkey, will create new opportunities for our region,” the head of state stressed.

Undoubtedly, the opening of communications through Zangazur is also very beneficial for Armenia, at least because it will finally receive a railway connection with Iran, with one of its main economic partners. In fact, Armenia is getting out of the 30-year blockade, into which the country drove itself, and gets a real chance to restore its economy and at least somehow solve social problems. The only thing that Armenia needs to do to this end is to finally focus on these problems and abandon the crazy ideas of revanchism - indeed, for Armenia, this is a waste of time, energy, and money.

President Ilham Aliyev emphasized that Azerbaijan has created new realities in the South Caucasus region, and everyone should take this into account. Armenia must choose between regional cooperation and unlawful, groundless territorial claims to its neighbors.

Let’s hope that the above statement of the Armenian economy minister is the first glimpses of a reasonable approach regarding further economic coexistence with the rest of the regional countries and submission before Azerbaijan’s absolute leadership position. Although history has taught us not to trust our neighbors...

Expert Nigar Guluzada