Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.
I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm drilling down on two issues: In light of Azerbaijan's lightning takeover of Nagorno-Karabakh, what can the EU do for Armenia now? Plus, is Brussels capable of slapping more sanctions on Moscow?
Also, last week, I sat down with the European Commission's vice president for values and transparency, Vera Jourova. In the interview, she said that to unblock EU funding, Hungary must meet set conditions on reforming its judiciary and ensuring the protection of fundamental rights.
Brief #1: What Now For EU-Armenia Relations?
What You Need To Know: On October 18, Armenian Prime Minister Nikol Pashinian will address the full plenary of the European Parliament. It comes just a month after Azerbaijan's military carried out an offensive that overwhelmed breakaway ethnic Armenian forces in Nagorno-Karabakh. Baku now controls territory that has been under ethnic Armenian rule for decades, forcing up to 100,000 ethnic Armenians to flee Karabakh for Armenia.
It also comes at a time when the European Union is getting increasingly engaged in a diplomatic settlement between Baku and Yerevan -- while pondering what its relations with Armenia might look like in the future. In the coming weeks, European Council President Charles Michel is expected to host Pashinian and Azerbaijani President Ilham Aliyev in Brussels for talks.
For Brussels, it is important to get this peace process started, after the failure of the trio to meet in the Spanish city of Granada on October 5, along with French President Emmanuel Macron and German Chancellor Olaf Scholz. Aliyev backed out, reportedly after his request that Turkey participate in the talks to counter France's supposed pro-Armenian bias was denied. The Turkish president, Recep Tayyip Erdogan, stayed away from Spain altogether, focusing on the congress of his Justice and Development Party that took place a couple of days later. Despite the snag, Michel remains an acceptable interlocutor to both sides and, for the EU and the United States, the ultimate goal would be to have some sort of peace treaty, preferably by the end of the year.
Deep Background: EU leaders, officials, and diplomats are now wondering what to with Armenia, especially as Pashinian made it clear that he wants closer ties with Brussels. In a statement issued after the Granada meeting on behalf of the Armenian leader, Macron, Michel, and Scholz, they "expressed their support to the strengthening of EU-Armenia relations, in all its dimensions, based on the needs of the Republic of Armenia."
EU officials have told me on background that the European Commission, the bloc's top executive body, now has an "internal reflection exercise" ahead of it on how to best help Armenia. Brussels has already provided 10.5 million euros ($11 million) in immediate humanitarian support and will soon provide another 15 million euros to help support the Armenian government.
There has also been talk among EU officials of setting up some sort of macro-financial assistance to Yerevan with regular payment cycles, similar to what Brussels has done to aid Moldova and Ukraine. But what Armenia also needs is security, with Yerevan fearing that Azerbaijan might make more military advances in the future. Earlier this year, the EU began an unarmed monitoring mission in Armenia, along parts of the border with Azerbaijan, and while more people could be added to boost the mission capacity from today's 150 people, they will remain unarmed. Armenia might also explore options of getting money from the European Peace Facility (EPF), the same pot the EU is using to purchase arms and other military gear for Ukraine.
Drilling Down:
- There are, however, two considerable hurdles to pass: Firstly, the EU is wary of antagonizing Azerbaijan and handing over EPF cash could be seen as too much of a risk. And secondly, there is Armenia's relationship with Russia. Yerevan is still a member of the Moscow-dominated Eurasian Economic Area, as well as the Collective Security Treaty Organization (CSTO) military alliance. Yerevan's commitment to the latter probably makes EPF funding difficult.
- Many in Brussels think that Armenia is slowly pivoting away from Russia. Speaking on background as they are not permitted to speak on the record, a senior EU official recently told me, "It strikes me that Armenia has perhaps made a very accurate conclusion that the security guarantees that they have been given in the past by Russia are not worth the paper they are written on."
- An obvious indicator of that was Armenia's recent decision to ratify the International Criminal Court's Rome Statute, which could obligate the country's authorities to arrest Russian President Vladimir Putin if he were to visit the country.
- More long-term, Armenia could hope to upgrade its current Comprehensive and Enhanced Partnership Agreement (CEPA) with the EU to something more like the association agreements that Georgia, Moldova, and Ukraine enjoy.
- An upgraded agreement could also pave the way for Armenian citizens to benefit from the current visa-facilitation agreement with the EU to full visa liberalization.
- Then there is the question of punishing Azerbaijan. A recent discussion paper, authored by the EU's diplomatic corps, EEAS, and seen by RFE/RL, noted it was possible to enact "sanctions in case serious human rights violations are committed."
- A European Parliament resolution, passed on October 5, called for the EU to impose sanctions on Azerbaijanis responsible for human rights violations in Nagorno-Karabakh and reconsider the "strategic partnership" with Azerbaijan in the field of energy.
- Despite the resolution garnering considerable media attention, it's worth noting that the resolution was nonbinding for member countries and EU institutions and the bloc is unlikely to take any significant punitive measures against Baku. Hungary has already indicated as much in public, and countries such as Austria, Bulgaria, Greece, Italy, and Romania -- interested in buying Azerbaijani gas or getting access to even more lucrative Turkmen gas through Azerbaijan -- would likely block such a measure.
Brief #2: Can The EU Muster Up More Sanctions Against Russia?
What You Need To Know: There was a time, not long ago, when a substantial amount of EU diplomats' time was devoted to designing and adopting sanctions against Russia. Immediately after the country's full-scale invasion of Ukraine on February 24, 2022, the bloc imposed its first sanctions package and, to date, another 10 have followed. Those sanctions have targeted the Russian oil, mining, lumber, and coal industries; have closed EU airspace and ports for Russian-flagged flights and vessels; have cut Russian banks off from the international SWIFT bank-payment system; and have imposed asset freezes and visa bans on over 1,800 individuals and firms, including President Putin and many in his closest circle.
The period of frenzied sanctions work in Brussels is now over. And it is already slowing down. In 2023, only two rounds have been adopted, with the latest agreed at the end of June. Some diplomats are saying that there isn't that much left to target, whereas others are pointing to the increasing difficulty in getting all 27 member states to come to an agreement -- the most recent package only saw the light of the day after almost eight weeks of negotiations.
So, it comes as no surprise that, in her big "state of the European Union" address, European Commission President Ursula von der Leyen didn't mention Russian sanctions at all. EU sources -- speaking on the condition of anonymity as they weren't authorized to speak on the record -- told me that only a handful of member states had mentioned more Russian sanctions.
Deep Background: The sands are shifting within the European Union. Migration has crept up to the top of the agenda again, with a 28 percent jump in asylum requests in the bloc this year, compared to the same time period in 2022, according to data from the European Union Agency for Asylum (EUAA). With the populist leftist party Smer winning the most votes in Slovakia's recent parliamentary elections and now looking set to form the next government, Hungary could have a new ally in its fight against further Russian sanctions. On the campaign trail, Smer's leader, former Prime Minister Robert Fico, said no more weapons will be sent to Ukraine and praised Moscow.
Despite this reluctance, EU sanctions experts are holding preliminary talks and it's possible that a new package could be presented to member states, most likely some time in November. A lot will depend on what other priorities there are, vis-a-vis Ukraine, which need to be adopted before 2023 is rung in. For example, all the member states need to give the green light in order for Kyiv to start EU accession talks in December. Plus, there will be an EU drive to reach agreement on a 20 billion-euro ($21 billion) fund to pay for military aid for Ukraine over the coming years, and then another proposal of 50 billion euros to finance the country's reconstruction between 2024 and 2027. And on top of that, more sanctions. Not everything will get over the line in 2023.
Drilling Down:
- If there is a new sanctions proposal, what will it contain? The best bet is to look at two sanctions discussion papers, seen by RFE/RL, recently produced by perhaps the two biggest Russian sanctions hawks, Lithuania and Poland. Their proposals are likely the maximum the bloc would go.
- Perhaps the four most obvious areas for new measures, which are mentioned in both papers, would be liquefied petroleum gas (LPG), liquefied natural gas (LNG), steel, and diamonds.
- The last sector is perhaps the most realistic to target. Raw diamond exports from Russia in 2021 were worth $4.5 billion and amounted to 1 percent of all Russia's total exports. Belgium, home to the European "diamond capital," Antwerp, has long been opposed to clamping down on Russia's diamond business, arguing that it would hurt itself more than Russia. EU action also hinges on whether the Group of Seven (G7) leading economies can find a global solution to the issue.
- Even if such measures were implicated, there still might be too many loopholes, as Russian diamonds could be rerouted from Antwerp directly to Dubai and the Indian city of Surat. Governments in the United Arab Emirates and India would be unlikely to align with such sanctions.
- Poland remains the main EU importer of LPG from Russia, followed by the Netherlands. So even if Warsaw has indicated that it is ready to cease LPG imports, the question remains as to whether other countries will be willing. As winter is approaching and energy prices remain high, there doesn't seem to be much appetite within the EU to target LPG and LNG. Russian imports of the latter into the bloc even increased this year compared to 2022, with Belgian, French, and Spanish ports reportedly seeing more trade.
- Lithuania is pushing for harsher EU measures against the Russian nuclear sector, which would prohibit EU companies from signing contracts with Russian nuclear giant Rosatom, investing in the Russian civil nuclear energy sector, and from importing enriched uranium from Russia. While some member states might be persuaded on halting business with Rosatom or staying out of the Russian nuclear business, stopping uranium imports from Russia would likely be a bridge too far. In the first four months of 2023, the bloc's two biggest member states, France and Germany, imported Russian-enriched uranium worth 134.5 million euros and 12.3 million euros, respectively.
- And what about steel products? Sanctions were introduced in October 2022, but both Belgium and Italy pushed for wind-down periods lasting two years, something that is unlikely to change. There is some wiggle room, with the possibility that different types of iron products could be added to the sanctions list to tighten existing loopholes, such as with steel sheets and pig iron.
- So, what might fly? There could be some new sanctions against the Russian laser industry and a widening of the EU ban to provide Russia with IT consultancy services, which for now largely concerns the installation of computer hardware and software. The sale to Russia of European cloud-computing technologies, for example, is not covered by any sanctions.
- Then there is a whole list of components made in the EU that can be used in Russian military hardware. These parts -- for example, small drones, electric motors, generators, and sensors -- might not often make the headlines, but experts say blocking their export could make it harder for the Russian military to function.
Looking Ahead
On October 20, European Commission President von der Leyen and European Council President Michel will travel to Washington to meet U.S. President Joe Biden for the first EU-U.S. summit in nearly two years. The wars in Ukraine and Israel will feature prominently on the agenda, although China is likely to grab the headlines, as Brussels is set to announce anti-subsidy investigations against Chinese steelmakers.
Also, look out for the Berlin Process summit in Albania's capital, Tirana, on October 16. The Berlin Process was an initiative of yearly summits first launched in 2014 to improve cooperation between various EU member states and the six Western Balkans EU hopefuls (Albania, Bosnia-Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia). This is, however, the first time the summit is being held in one of the six Western Balkan countries. No big announcements are likely, but there could be an increased push from countries such as Albania and North Macedonia to speed up their EU accession paths.
That's all for this week. Feel free to reach out to me on any of these issues on Twitter @RikardJozwiak, or on e-mail at jozwiakr@rferl.org.
Until next time,
Rikard Jozwiak
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