Armenian-Russian Tension and the Limits of Borrowed Growth

The Armenian-Russian tension hurts no one more than the government itself. Since 2018, the bulk of Armenia’s exports has gone exclusively toward the EAEU and Russia, financial ties have grown closer, and capital investment has risen. As a result, walking away from the Russian market today would cost more than it would have a few years ago. It is also worth noting that the safety cushion absorbing economic shocks has shrunk, because the banking system, the main engine of the economy, posted a 13% contraction in the first quarter of 2026 against 27% growth in the same period a year earlier. Most of the recent growth rested on capital that came from abroad. The way out is to rely on our own strength: diversified ties, a strong farm sector, and the Switzerland model rather than Singapore, built on high-value, low-weight goods.

Further reading on these topics

• A Harvest With Nowhere to Go: How Armenia’s Economy Got Stuck at the Russian Border
• The Growth Wave Stalled: What the New GDP Figures Reveal

Alpha News · 29 min