The new Armenian President Serzh Sargsyan paid his first official visit to Russia on June 23-25, which was not unexpected given the importance of the relations between Moscow and Yerevan for Armenia. Russia has been Armenia’s main partner in both the political and military spheres, and the economic component of bilateral relations is continuously growing. The new presidents elected this year in both countries, Serzh Sargsyan and Dmitri Medvedev, had already met twice in March and in early June (during the unofficial CIS summit in St. Petersburg), but the current visit was their first official meeting and was to show to what extent the traditional close links between the two countries will be preserved.

In short, the three-day visit showed that Sargsyan was interested in keeping the “strategic partnership” with Russia. This was evident among other, from the fact that, besides Medvedev and Prime Minister Vladimir Putin, the Armenian President met with the heads of both chambers of the Russian parliament, and also had a special meeting, (out of record so far), with the leading political experts of Russia. As shown by the joint statement signed by the two presidents and their statement for the press, Sargsyan has reached his principal goals. Medvedev expressed his commitment to preserve bilateral relations in political and military spheres and make the economic ties even closer. “We are confident that close cooperation between Russia and Armenia is the pledge of a stable and worthy development of the whole region,” Medvedev said implying that Russia sees Armenia is its key partner in the South Caucasus, if not a privileged one. Medvedev also reaffirmed the Russian support to the Armenian approach to the solution of the Nagorno Karabakh problem, namely, that resumption of violence should be avoided, and that the political solution must be sought in the framework of the “existing format,” i.e. in the OSCE Minsk group. Thus Russia, like the other two co-chairs of the Minsk group, USA and France, opposes (as before) the efforts of Azerbaijan to involve other international bodies (e.g., the United Nations) in the peace process in Nagorno-Karabakh.

The visit had a significant economic component, too, although Sargsyan may be less satisfied with its economic results. Russia has been the largest investor in Armenia and its single largest trade partner, and the meeting with the Russian counterpart was expected to help overcome some existing difficulties. However, the impression is that optimistic declarations about growing trade and projects of increasing Russian investments in Armenia just covered failure in some important spheres. This is, first of all, the  transportation problem, as due to Russia’s closure since 2006 of the Upper Lars pass on the Georgian-Russian border, Armenia, already under embargo from Azerbaijan and Turkey, lost its only land link with Russia. However, the Russian side had no good news for Armenia in this respect, except an assurance that Moscow will guarantee the regularity of ferry traffic between the Georgian port of Poti and the Russian port of Novorossiisk. This provides an alternative to land shipments from Armenia, though this route is much more expensive. Moreover, the sides expressed their interest in re-opening the rail transit though Abkhazia, another possible land link between Armenia and Russia. However, this perspective is unlikely given the stained Russian-Georgian relations, including over Abkhazia. So, this declaration may look as a political rather than a real economic move.

The energy problems also remained mostly unclear. In particular, contrary to expectations, the actual price of Russian gas sales to Armenia in the next year were not made clear. Currently, Russia supplies gas to Armenia at US$110 per thousand cubic meters, half the price paid by Georgia. Instead, declarations about new investments in the energy sphere were made. Of specific interest was the statement about the commitment to continue cooperation in nuclear energy, including investigating uranium reserves in Armenia and possibly Russian participation in the construction of a new nuclear power station in Armenia, as the current plant at Medzamor is scheduled to be closed in 2016.   

Joint projects with Iran have also been an important component of Armenian-Russian relations, signaling Armenia’s unique position in having good relations with both Iran and Russia. This time, Yerevan and Moscow expressed their interest in constructing a new railroad connecting Armenia with Iran (the current rail link which may potentially used by Armenia goes through the Nakhichevan Auonomous Republic of Azerbaijan and is inaccessible for Armenia). The construction of the alternative Iran-Armenia railroad is possible as the Russian Railroads will run the Armenian railroads under a long-term concession agreement. On the other hand, the official statements of the summit contain no word about the three-party project of the Armenian oil refinery which would use Iranian crude, a project suggested by the previous Presidents, Vladimir Putin and Robert Kocharian, and reportedly, having successfully passed the feasibility study stage. This may be due to problems on the Iranian side.   

Finally, a very unexpected event of Sargsyan’s visit was his statement, during a meeting with the local Armenian community, about his intention to invite his Turkish counterpart, Abdullah Gul, to attend the Armenia-Turkey soccer game in Yerevan in September. Evidently, if Armenia succeeds in its efforts to open its border with Turkey, the Armenian economy, and probably, politics may be drastically re-shaped and become less dependent from Russia. Probably, by choosing Moscow as the site of this statement, the Armenian President wanted to show that his is not fully happy with the tactics of its strategic partner.