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Adrienne Warren

Smells Like Trade Spirit: Armenia Confirms Free Trade with the EU Amid Transport Protest

Not to be outdone by Caucasian neighbour, Georgia, Armenia has today agreed on the Deep and Comprehensive Free Trade Agreement with the European Union, two days after Georgia concluded their agreement. Like its neighbour Georgia, the EU is Armenia’s biggest trading partner and the DCFTA aims to strengthen economic integration between the Caucasus and the EU. The conclusion of the agreement is an integral step in the signing of the Association Agreement with the EU, which is tipped to take place at the Eastern Partnership Summit in Vilnius in November. However,  the conclusion of the agreement comes alongside protests against the government in Yerevan. How does it all fit together? Let’s take a look…

Yerevan, Armenia Closed Market. author: PanARMENIAN_Photo. source: Flickr

Yerevan, Armenia Closed Market. author: PanARMENIAN_Photo. source: Flickr

The DCFTA is a key stepping stone for the Neighbourhood countries in deepening integration and cooperation with the European Union. As the EU elucidates:

“The DCFTA will strengthen Armenia’s economic integration with the EU by providing better market access for European and Armenian goods and services to each other’s markets. It will offer Armenia a framework for modernising its trade relations and for economic development on the basis of far reaching harmonisation of laws and regulations in various trade-related sectors. These reforms will create the conditions for Armenia to bring key sectors of its economy in line with EU standards. The improved trade opportunities brought about by the DCFTA are expected to bring economic benefits to both the EU and Armenia.”

The importance of the agreement was underscored by EU Trade Commissioner Karel De Gucht, who said:

“Today’s conclusion of negotiations on a Deep and Comprehensive Free Trade Area between the EU and Armenia paves the way for Armenia to enjoy much improved access to the EU market in more than trade in goods, which will help the country strengthen its exports, increase investment and sustain growth. In the end, it will contribute to the overall stability and prosperity of the region, and contribute to citizen’s well-being. I congratulate and thank the negotiators on both sides for their successful work. I look forward to a political confirmation of this week’s achievement at the Vilnius Summit in November this year. We will need to actively prepare for implementation.”

In spite of this success in EU-Armenian trade relations, Armenia is also facing domestic protest after the government’s decision to increase prices for public transport, which has been allayed to the increased cost of Russian natural gas. Commuters using mini-buses and buses saw fares increase by over 30 percent, from 100 to 150 drams (25 to 40 cents), while the fare for trollies doubled in price, from 50 to 100 drams.

The decision has been met with outrage from the public. The price hike went into effect on 20 July, and was met by scores of protestors around Yerevan, chanting “We are the masters of our country!”  The protesters broke through a police cordon and approached the Mayor’s office. Riot police clashed with youth activists, detaining several of them on Tuesday.

Public discord remains, as   of the Armenian Weekly explains:

“The public is unwilling to accept any increase in prices due to the staggeringly low minimum monthly wage for one person (35,000 drams, or approximately $85), coupled with high levels of unemployment, and other economic concerns.”

Martirosyan continues:

“Second, there is a lack of any apparent justification for the decision. The main reason is said to be the rise in natural gas prices (natural gas is used as fuel for public transportation in Armenia), and the expenses attributed to the technical maintenance of vehicles and the new assessed cost per passenger, published by the Yerevan Mayor’s Office.”

However, the surge of activity that the protests has brought has some positive and beneficial by-products–as Martirosyan enumerates:

“The protests have drawn mostly young people—students, NGO activists, civil society groups, etc.—who tend to be more determined and, in a positive sense, more aggressive and demanding. There is also an accompanying sense of community. This has come about through social media websites like Facebook and Twitter. In a very short period of time, several groups and events have been created as tools to bring people together and maximize organizing as a community.”

In addition, Martirosyan mentions the level of commitment of the activists, and that the protests have shed light upon other concerns about the public transport system in Yerevan, as well as consistent and positive coverage of the protests by Armenian media.

How do the the EaP countries feel about the EU…

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Graduated in International Relations and Russian. Resident of Estonia, but a citizen of the world. Most interested in contributing to the progress and education of mankind--as the primary tool of achieving global unity.

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