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Exactly why is Armenia Borrowing Another 100 Million US Dollars From Russia? Interestingly, this is basically the 2nd loan for this kind Armenia has gotten from Russia since 2015.


Exactly why is Armenia Borrowing Another 100 Million US Dollars From Russia? Interestingly, this is basically the 2nd loan for this kind Armenia has gotten from Russia since 2015.

On October 12 the government that is armenian authorized a proposition to signal an understanding “between the federal government for the Republic of Armenia and also the federal Government of this Russian Federation to present a state export loan.” Armenia is by using the mortgage, which values 100 million US bucks, to buy arms that are modern Russia.

In accordance with the contract, the mortgage is usually to be paid back over 15 years (2023-2037) at a 3 percent rate of interest. Armenia should be able to utilize the loan through the duration 2018-2022.

Interestingly, this is actually the loan that is second of kind Armenia has gotten from Russia since 2015. The loan that is previous for 200 million US dollars and ended up being utilized to shop for advanced Russian tools.

Although the new contract clarifies it does not provide a list of items to be purchased that it should be used for purchasing modern arms from Russia and with the purpose to further develop friendly relations between the two countries.

The specialist community differs with its viewpoint on what the loan will undoubtedly be utilized, providing a range that is wide of. Most agree, but, that artillery, anti-tank tools, high-tech reconnaissance and interaction facilities, in addition to contemporary atmosphere protection systems will tend to be on Armenia’s grocery list.

The main question is why Armenia has sought a new loan now, given that the full amount of the previous loan has not yet spent (30 million US dollars remains unspent) from this perspective.

The ongoing hands battle between Azerbaijan and Armenia. In belated June 2017 Azerbaijan announced the purchase of the big batch of tools from Russia which, relating to officials in Baku, had been prepared to be utilized against Nagorno-Karabakh. Lower than 30 days later on the Armenian Minister of Finance Vardan Aramyan declared that Armenia is talking about a unique loan contract to purchase Russian equipment that is military.

The approval of this loan contract because of the Armenian Government took destination briefly ahead of the Armenian President Serzh Sargsyan came across their Azerbaijani counterpart Ilham Aliyev conference in Geneva on October 16. The timing of the announcement could be seen as a counterweight to Baku as the Azerbaijani side largely apply the principle of “use of force or threat of use of force” in negotiations with Armenia.

Based on some specialists the total amount of energy between Armenia and Azerbaijan ended up being restored through the prior purchase of army gear (when you look at the framework of this earlier in the day 200 million US buck loan). The further modernisation of Armenia’s military capabilities can be seen in the logic of further enforcement of Russia’s only military ally in the region, situated on the frontline of the continuously destabilising Middle East from this perspective.

Continuing the prior concept, its notable that on September 23 Mr Sargsyan finalized a legislation to ratify the establishment of an Armenian-Russian joint army team. A militarily strong Armenia could be a necessary ally in times of global uncertainties in this context.

Last but most certainly not least may be the “Chinese element.” In September, Armenian Minister of Defense Vigen Sargsyan visited Asia and consented along with his Chinese colleague to deepen military ties involving the two nations. Because of the gradual increase of Asia, this loan might be made to make sure that Armenia will not expand its army cooperation beyond current parametres.

As a result, the 100 million US buck loan purchasing contemporary hands should always be regarded as a multi-faceted mix of numerous elements, as a stability of energy and local security into the Southern Caucasus, as counterweight to threats through the center East, plus the modernisation associated with the army that is armenian.

The more fierce the armaments race between Armenia and Azerbaijan, the more dangerous the situation, which could lead to the destabilisation not only of the South Caucasus, but of a much wider Eurasian region at the same time.

The views expressed in this viewpoint editorial would be the author’s own plus don’t always mirror growing Europe’s editorial policy.



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