Friday, November 3, 2023 Armenian Industrial Output Shrinks Amid Soaring Exports Amenia - Workers at a textile factory in Vanadzor, August 28, 2023. Armenia’s industrial production contracted in the first nine months of this year despite continuing economic growth driven, in large measure, by re-exports of various goods to sanctions-hit Russia. The Armenian government’s Statistical Committee put its total amount at 1.84 trillion drams ($4.6 billion), down by 0.6 percent from the same period of 2022. A downturn in the country’s export-oriented mining sector appears to have been instrumental in this drop contrasting with double-digit increases in trade, other services and construction. The government data shows that wholesale and retail trade is the fastest growing sector of the domestic economy at present, having expanded by over 23 percent in January-September amid Armenia’s soaring trade with Russia. Armenia’s imports and exports jumped by roughly 48 percent, continuing a trend that began after last year’s Russian invasion of Ukraine and the resulting barrage of Western sanctions against Russia. Goods manufactured in Western countries and their allies and re-exported from Armenia to Russia clearly accounted for most of this sharp gain. They mainly included second-hand cars and consumer electronics. Armenia - Car carrier trailers line up near a customs terminal outside Gyumri, March 13, 2023 This explains why Armenian exports to Russia tripled in 2022 and doubled in January-August 2023. During the eight-month period, Russia generated half of Armenia’s overall export revenue worth $4.6 billion. Used cars became Armenia’s number one export item in the first half of this year, according to data from the national customs service reported by Hetq.am. The South Caucasus country, which has no car industry, exported $311 million worth of various vehicles, circumventing U.S. and European Union bans on their shipments to Russia. Also, its first-half exports of mobile phones, TV sets and other electronics totaled $332 million. The re-exports, coupled with other cash inflows from Russia, are the main reason why the Armenian economy expanded by 12 percent in 2022. The Armenian government and the Central Bank have forecast a 7 percent growth rate for this year. The re-exports prompted concern from EU and especially U.S. officials earlier this year. They pressed the authorities in Yerevan to comply with the Western sanctions. The authorities introduced in May mandatory government licenses for shipments of microchips, transformers, video cameras, antennas and other electronic equipment to Russia. Armenian Leaders Hit Back At Moscow Armenia - Parliament speaker Alen SImonian chairs a session of the National Assembly, November 24, 2022. Armenia’s political leadership rejected on Friday Russia’s latest claims that it is systematically “destroying” relations between the two longtime allies. The Russian Foreign Ministry spokeswoman, Maria Zakharova, made the claims on Thursday when she condemned a senior Armenian official’s participation in Western-backed peace talks on the conflict Ukraine and meeting with the chief of Ukrainian President Volodymyr Zelenskiy’s staff. She called it a “demonstrative anti-Russian gesture of official Yerevan.” Alen Simonian, the Armenian parliament speaker and a leading member of the ruling Civil Contract party, scoffed at Zakharova’s criticism. He suggested that Moscow does not want Yerevan to “communicate with partners on multilateral platforms” and is trying to maintain Armenia’s “existential dependence” on Russia. “This is apparently the ‘right allied’ approach,” Simonian wrote in a Telegram post. Echoing Prime Minister Nikol Pashinian’s recent statements, Simonian also accused the Russians of not honoring their security commitments to Armenia and recalled their past large-scale arms deals with Azerbaijan. Another member of Pashinian’s political team, Foreign Minister Ararat Mirzoyan, dismissed Zakharova’s complaints that Armenia’s state television and other pro-government media outlets have been spreading “Russophobic” propaganda. “We believe that what our Russian partners are surprised by is the consequence of what we have seen on various [Russian] airwaves,” Mirzoyan told Armenian lawmakers. He also said that the Armenian government hopes to mend fences with Moscow and “move on like partners.” “But not everything depends on one side,” added Mirzoyan. The Russian Foreign Ministry earlier deplored “a series of unfriendly steps” taken by Pashinian’s administration. Those included his assertion Armenia’s military alliance with Russia has proved a “strategic mistakes” and Yerevan’s acceptance of jurisdiction of an international court that issued an arrest warrant for Russian President Vladimir Putin in March. For its part, the Armenian side has held Moscow responsible for Azerbaijan’s recent military offensive that led to the mass of exodus of Nagorno-Karabakh’s ethnic Armenian population. The deepening rift is raising growing questions about Armenia’s continued membership in Russian-led defense and trade blocs. Pashinian said last week that he is not considering demanding the withdrawal of Russian troops from Armenia even if he it sees no “advantages” in their presence. Armenia ‘Optimistic’ As Turkey’s Erdogan Insists On Corridor For Azerbaijan • Aza Babayan • Astghik Bedevian Turkey - Turkish President Tayyip Erdogan addresses members of parliament from his ruling AK Party, Ankara, October 25, 2023. Foreign Minister Ararat Mirzoyan sounded optimistic about the normalization of Armenia’s relations with Turkey on Friday just as Turkish President Erdogan Recep Tayyip again demanded that Yerevan open a special transport corridor for Azerbaijan. Speaking at a summit of the leaders of Turkic states in Kazakhstan, Erdogan hailed Azerbaijan’s September 19-20 military operation that led to the exodus of Nagorno-Karabakh’s ethnic Armenian population and restored Azerbaijani control over the territory. “Azerbaijan put an end to the 30-year occupation of Karabakh and we are very happy with and proud of this historic achievement,” he said. “Armenia must fulfill its obligations to Azerbaijan. This includes the opening of a transport corridor that will connect Nakhichevan to western regions of Azerbaijan.” Erdogan said the corridor sought by Baku is important also because it would link Turkey to Central Asia which he described as “our ancestral homeland.” Ankara set this as a key precondition when it started normalization talks with Yerevan in early 2022. The Armenian government has ruled out any extraterritorial corridors to Nakhichevan that would pass through Armenia’s Syunik province bordering Iran. The normalization process essentially stalled last year even though the two sides reached an agreement to open the Turkish-Armenian border for their diplomatic passport holders and citizens of third countries. “I want to express optimism that we may have some good news on this front in the near future,” Mirzoyan told Armenian lawmakers. He did not elaborate. Speaking in the National Assembly earlier this week, Prime Minister Nikol Pashinian similarly expressed hope that the border agreement will be implemented soon. Pashinian attended Erdogan’s inauguration in June. His domestic critics denounced the move, saying that Ankara will not unconditionally normalize Turkish-Armenian relations even after his unilateral concessions. Another interim agreement reached by Turkish and Armenian negotiators last year called for air freight traffic between the two neighboring nations. There have been no signs of its implementation, even though the Turkish government officially allowed cargo shipments by air to and from Armenia in January 2023. German FM Calls For Renewed Armenian-Azeri Talks • Nane Sahakian Armenia - German Foreign Minister Annalena Baerbock at a news conference with her Armenian counterpart Ararat Mirzoyan, November 3, 2023. German Foreign Minister Annalena Baerbock called on Armenia and Azerbaijan to resume peace talks mediated by the European Union when she visited Yerevan on Friday. “Germany supports the territorial integrity of Armenia and Azerbaijan, and this must be the basis for all peace negotiations,” Baerbock said after meeting with her Armenian counterpart Ararat Mirzoyan. “I believe that European Council President Charles Michel’s efforts could serve as a bridge for establishing peace between the two countries. Therefore, the start of a new round of negotiations is important,” she told a joint news conference. Armenian Prime Minister Nikol Pashinian and Azerbaijani President Ilham Aliyev had been scheduled to meet, together with Michel, German Chancellor Olaf Scholz and French President Emmanuel Macron, in Spain on October 5. Aliyev withdrew from the talks at the last minute, citing pro-Armenian statements made by French officials. Michel said afterwards that the Armenian and Azerbaijani leaders will likely hold a trilateral meeting with him in Brussels later in October. That meeting did not take place either. A senior Armenian lawmaker suggested on Monday that Aliyev is now reluctant to hold further talks with Pashinian to finalize an Armenian-Azerbaijani peace accord backed by the EU and the United States. The deal would commit Baku to explicitly recognizing Armenia’s current borders. “Unfortunately, we still have serious concerns that … Azerbaijan still has, in one way or another, territorial claims to Armenia,” Mirzoyan said during the press conference with Baerbock. There are lingering fears in Yerevan that Azerbaijan could invade Armenia to open a land corridor to its Nakhichevan exclave. Baerbock, who was due to proceed to Azerbaijan on Saturday, declined to say whether Germany would support a freeze on imports of Azerbaijani gas and oil or other EU sanctions against Baku in the event of such invasion. She spoke out against any further “escalation in this region.” The German minister was also careful not to repeat her earlier condemnations of Azerbaijan’s September 19-20 offensive in Nagorno-Karabakh that forced the region’s ethnic Armenian population to flee to Armenia. She said only that the more than 100,000 Karabakh Armenians “left their homeland for security reasons” and praised the Armenian government’s response to the exodus. Baerbock also announced that Berlin will provide 9.3 million euros ($10 million) in additional humanitarian aid to the refugees. Reposted on ANN/Armenian News with permission from RFE/RL Copyright (c) 2023 Radio Free Europe / Radio Liberty, Inc. 1201 Connecticut Ave., N.W. Washington DC 20036.