On the sidelines of recent NATO summit, the leader of Armenian “Velvet revolution”, current Prime Minister Nikol Pashinyan had separate talks with the European Commission president Jean-Claude Juncker and the president of the European Council Donald Tusk during which the leaders exchanged views on different issues over the further deepening of the Armenia-EU ties. The EU top officials affirmed their commitment to support Armenia’s comprehensive reform agenda. EC president Donald Tusk reaffirmed the EU’s willingness to assist in the future reforms in Armenia, promising a continued support to democracy-building efforts in the country.

“What happened in Armenia was extraordinary and, I must say,very European.The example you set was very promising, and you can expect the European Union’s support in the process of implementing reforms,” Tusk said.

Apparently, branding the “Velvet revolution” in Armenia as European-style movement wasn’t an empty statement rather than a gentle hint about the contribution that EU had in civil society development in Armenia and the investment in the youth through mobility projects in the field of education and training to encourage democratic engagement and civic participation. Undeniably, youth activists and civil society were at the core of the recent revolutionary struggle in Armenia. In this regard, the “Velvet revolution”in Armenia was unique and historic as it involved mainly youth, including schoolchildren and students, who moved to streets to challenge adult society.

After holding the talks with EU leaders, Armenian PM Nikol Pahinyan in his turn voiced sharp criticism of EU for not increasing its financial assistance to Armenia following mass protests that led to change in government which is now committed to zero tolerance approach towards corruption.

“I am surprised that certain officials in the EU haven’t noticed the ongoing changes in Armenia,” he stressed at news conference.

The EU most probably incurred Pashinyan’s reproach for providing financial aid to previous leadership, which haven’t made much progress towards democracy and economic growth, and which often vowed zero tolerance for corruption, but  its anti-corruption rhetoric was more likely an aspiration for the future rather than a practical political agenda.

Indeed, it would be unwise to dispute the veracity of the statements expressed by the EU leaders and Armenian PM, given the EU’s profound impact on Armenia’s democratization, rule of law and good governance, and Armenia’s need to diversify its foreign policy having channels open with the West,and the need for financial support to modernize itself.

To deepen understanding of the vital role EU plays in the transformation of Armenian society, we should delve into the EU’s financial support schemes Armenia benefits from.

Article 8 of the Treaty on European Union (TEU) states that ‘‘the Union shall develop a special relationship with neighbouring countries, aiming to establish an area of prosperity and good neighbourliness, founded on the values of the Union and characterised by close and peaceful relations based on cooperation’’. The EU distributes its development assistance through its external financing instruments.These are the Instrument contributing to Stability and Peace (ISP), European Instrument for Democracy & Human Rights (EIDHR), the Partnership Instrument (PI) and the three relevant geographic instruments-the Instrument for Pre-accession Assistance II (IPA), the European Neighborhood Instrument (ENI) and the Development Cooperation Instrument (DCI).

As known, EU cooperates with Armenia in the framework of the European Neighbourhood Policy and its eastern regional dimension, the Eastern Partnership. The European Neighbourhood Instrument (ENI) is the key financial instrument established in 2014 to fund the European Neighborhood Policy for the period 2014-2020. It replaces the European Neighbourhood and Partnership Instrument (ENPI) of 2007-2013. The ENI is designed to promote integration by partner countries into the EU market; economic development; good relations and bilateral and multilateral collaboration; institution and capacity building; democracy, the rule of law and human rights; and orderly and legal movement of people across the EU’s external borders.

Support through the ENI is programmed and given in three different ways:

1. Bilateral programmes covering Union support to one partner country;
2. Multi-country programmes which address challenges common to all or a number of partner countries, and regional and sub-regional cooperation between two or more partner countries;
3. Cross-Border Cooperation programmes between Member States and partner countries taking place along their shared part of the external border of the EU (including Russia).

Armenia participates also in regional programmes funded under the ENI (mainly in environment, energy, transport, culture and youth), in the Eastern Partnership Flagship Initiatives, and in initiatives open to all Neighbour countries: Erasmus+, TAIEX, SIGMA, and the Neighbourhood Investment Facility (NIF). The NIF in Armenia targets primarily investment projects in energy and transport infrastructure projects. It does so by pooling EU and Member State funds to leverage loans from European financial institutions and contributors in the ENP partner countries.

In addition to the ENI, Armenia is eligible for financial support under the EU thematic programmes: the European Instrument for Democracy and Human Rights, Instrument contributing to Stability and Peace, Civil Society Organisations and Local Authorities, Human Development and Migration & Asylum.

The priorities and indicative allocations for financial assistance to Armenia are set out in the Single Support Framework (SSF). For the programming period 2017-2020 the indicative allocation is EUR 144,000,000 to EUR 176,000,000.

Under the Support Framework the priority sectors selected for support are:

• Economic development and market opportunities (indicatively 35% of total budget);
• Strengthening institutions and good governance (indicatively 15% of total budget);
• Connectivity, energy efficiency, environment and climate change (indicatively 15% of total budget);
• Mobility and people-to-people contacts (indicatively 15% of total budget);

A key complementary support also will be provided through regional and multi-country programmes for

• capacity development/institution building and strategic communication
• ( indicatively 15% of total budget)
• civil society development (indicatively 5% of total budget).

While analyzing the Programming of the European Neighbourhood Instrument’s Single Support Framework for EU support to Armenia-2017-2020, we see that the main risks to achieving progress vis-à-vis the above-mentioned priority sector objectives are mainly the lack of the promotion and coordination of the relevant policy measures, especially concerning business environment and fair play; government commitment to the reforms in public administration, but especially in the judicial sector, fighting corruption and promoting human rights; governance, in particular   the strategy and prioritization of investments; and political will.

The latter is believed to be sine qua non of any successful anti-corruption policy. Apparently, the new Armenian government has taken a route of intense fight against corruption by making a number of scandalous disclosures, involving high-ranking officials. Other above-mentioned risks can be mitigated through investor-friendly and development-oriented policies to be carried out by the new government. Hence, the future progress towards reform objectives will justify more EU support and investments. New agreement with Armenia, known as the Comprehensive and Enhanced Partnership Agreement (CEPA) initiated by previous authorities, which promises financial assistance and trade opportunities, can become an impetus for further domestic reforms.

So, the new Armenian government should seize the momentum to strengthen the relations with EU to support the democratic aspirations of the Armenians. The EU, in its turn, should make correct use of conditionality and align its approach with Armenia’s strategic objectives.