Forbidden fruit

Fresh fruit and vegetables are a mainstay of Armenia’s economy, with over 90% of its produce being exported to Russia. The country’s agricultural produce market is also thriving, according to official figures, with an additional 10,000 tons of produce exported so far this year than in the same period last year.

Or at least that was the case until Russia’s agricultural produce regulator announced that it had detected higher levels of pesticide residue on Armenian tomatoes and apples than are permitted by the regulations of the Eurasian Economic Union (EAEU), the Russian-led trade bloc of which Yerevan has been a member for a decade.

In a letter dated 4 July, Rosselkhoznadzor’s deputy head Anton Karmazin said that the regulator had not even received a promise to investigate the situation, despite the Armenian side being informed about the excessive pesticide levels on 5 June.

Describing the situation as “incomprehensible” but declining to comment further on the ban, Armenian fruit and vegetable producer Green Farmer confirmed to Novaya Gazeta Europe that it was among those temporarily forced to halt its exports to Russia.

Armenia’s Food Safety Inspection Agency said that it had already started negotiating with the Russian side to lift the ban. “At this moment, control measures have been introduced for exporters, and we have already taken steps to address the issues,” an agency spokesperson told Novaya Europe.

Kremlin anger

The first indication that Russia was prepared to ban the import of Armenian products for political reasons came last year. Yerevan’s relations with the Kremlin, which rapidly deteriorated following the Second Karabakh War in 2020, further worsened after Azerbaijan regained control of the disputed territory in 2023, driving ethnic Armenians out of the region into Armenia in September.

Since then, Russia and Armenia have traded increasingly bad-tempered barbs, with Armenia even accusing its nominal ally of “taking Nagorno-Karabakh” from it and “returning it to Azerbaijan”. Armenia has since then also distanced itself from the Collective Security Treaty Organization (CSTO), a Russia-led defence alliance made up of post-Soviet states, though it has yet to make a final decision to leave it once and for all.

In April 2023, Russia banned Armenian dairy products, claiming they were too unhealthy for Russian consumers, a claim that Armenia’s agricultural produce watchdog rejected out of hand. A year later, and with the ban largely still in place, Armenian lawmaker Sisak Gabrielyan expressed outrage that Armenian supermarket shelves were fully stocked with Russian dairy products, and demanded Yerevan take tit-for-tat measures.

Following Azerbaijan’s recapture of Nagorno-Karabakh last year, Russia began to refuse Armenian trucks permission to pass through the vital Lars checkpoint on the Russian–Georgian border — which forms part of the only viable land route connecting Armenia to Russia. In total, some 35 Armenian trucks were turned back at the border within 48 hours, more than in the entire previous year.

“It was very obvious that the closure of the Lars road was politically motivated. They didn’t even allow flower trucks in,” economic journalist Seda Hergnyan told Novaya Europe.

‘Western promises’

In an interview with Russian tabloid Komsomolskaya Pravda in June, Russian Deputy Foreign Minister Mikhail Galuzin indirectly warned Armenian officials not to be taken in by what he called “illusory Western promises”, adding that attempts to pivot away from Moscow to Europe could actually end up harming Armenia’s economy, and threatening its independence and security.

“The severing of economic ties with Russia would mean Armenian businesses losing their main market,” Galuzin said, describing Yerevan’s recent “unfounded criticism of Russia” as both “unconstructive and short-sighted”.

Russia is by far Armenia’s biggest trading partner, and trade between the two countries skyrocketed following Russia’s full-scale invasion of Ukraine in 2022, which saw its almost total isolation from the West. Indeed, last year saw a 43% rise in Armenia’s trade turnover with Russia, with re-exporting sanctioned goods to the country playing a crucial role in that increase.

In addition to that, there are currently some 4,500 Russian-owned companies in Armenia, and Russian Prime Minister Mikhail Mishustin claimed last year that Russia was the source of almost half of Armenia’s foreign investment.

Armenia is itself highly reliant on foodstuffs imported from Russia, including essentials such as wheat and cooking oil, over 98% of which are currently supplied by Russia, according to World Bank data.

Russia’s Deputy Prime Minister Alexey Overchuk also warned Yerevan in June that it risked losing its tariff-free access to the Russian market — as well as other economic privileges — if it sought to join the European Union, stressing that membership of both the EU and the EAEU were “incompatible”.

When Armenian Prime Minister Nikol Pashinyan made that as an economic union, the EAEU should not be politicised, Moscow accused Yerevan of attempting to “sit on two chairs.”

Resisting Russia

Armenia is not the only country to have seen its economic interests suffer following a policy disagreement with Russia. The same approach has been applied to other allies as well — earlier this year, for example, Russia halted imports of Ecuadorian bananas over a deal the country struck to sell some of its Soviet-era military hardware to the United States, which planned to ship the weapons to Ukraine to bolster its military’s ongoing fight against the Russian invasion.

Moscow also raised similar trade barriers in 2006 when it banned the import of all wines from Georgia and Moldova for several years, claiming they contained unsafe amounts of heavy metals and pesticides, just weeks after both countries made significant steps to embrace the European Union.

Russia again imposed an embargo on imports from Moldova on health grounds last year, this time targeting its fruit and vegetables. The ban came amid worsening relations with the country’s pro-European President Maia Sandu, who expressed her surprise at the move, and pointed out that Moldova continued to export its goods to the EU, despite its far higher quality standards than Russia.

Perhaps most outrageously, Russia banned the import of Dutch flowers in 2015, after the findings of an investigation into the downing of flight MH17 over eastern Ukraine in 2014 were made public, indicating clear evidence of Russian involvement in the tragedy, which killed 298 people.

Nevertheless, as Russia is home to the biggest Armenian diaspora in the world and the ties between the two countries run deep, Armenia is particularly vulnerable to this form of Kremlin strong-arming, which may only intensify as long as Yerevan pursues its pro-Western pivot. Indeed, Armenia’s attempts to diversify its economy have yet to bear much fruit, and a wide-ranging Russian ban on Armenian imports could have catastrophic effects on the regionally isolated, landlocked nation.

As its border with Azerbaijan is closed due the conflict over Nagorno-Karabakh, Armenia currently only trades with three of its four neighbours — Georgia,Turkey and Iran. At a trilateral summit held in Brussels in April, the US and the EU jointly allocated nearly €335 million of grants and funding to Armenia earmarked for supporting small businesses, infrastructure development, and energy diversification.

Yerevan-based economist Suren Parsyan noted that the funding was a small price to pay for Armenian economic security. “It is crucial that the West provides new investment packages for Armenia’s economic diversification as the opposite process has been taking place in recent years,” Parsyan told Novaya Europe.

Economic journalist Seda Hergnyan expressed scepticism about Yerevan’s ability to make swift inroads to other foreign markets, however. “Sudden changes are difficult to achieve, and in general, over the past 10 or more years, there has been constant talk about economic diversification, with no real result,” Hergnyan told Novaya Europe, adding, “On the contrary, we’re actually getting deeper into the Russian market.”