Armenia stands at a historic crossroads where geopolitics increasingly merge with geoeconomics. Whether the country remains a transportation backwater or becomes a regional hub depends on how its diplomacy leverages geography.
From Geopolitics to Geoeconomics: A Shift in the Logic of Power
In the age of empires of the late 19th – early 20th centuries, a state’s might was measured by the size of the territories it controlled and its participation in military alliances. The Second World War discredited the Lebensraum concept of securing “living space.” Decolonization and the rise of economic interdependence after the 1960s opened the door to more peaceful competition over raw materials, markets, and advanced technologies. After the Cold War, American strategist Edward Luttwak—who coined the term “geoeconomics”—argued that conflict would persist, but its focus would shift to trade barriers, investment flows, foreign aid, and sanctions.
The Symbiosis of Geopolitics and Geoeconomics
Recent international developments show how geopolitical and geoeconomic tools reinforce each other. The U.S.’s trade war against China, sanctions on Iran, North Korea, and Russia, and the U.S, the UK, and Japan’s “debt diplomacy” are all used as tools to achieve geopolitical ends. China’s Belt and Road Initiative is a prime illustration of how an ambitious infrastructure project can boost trade (geoeconomics) while expanding influence without resorting to force (geopolitics). Control of transport arteries—sea‑lanes, straits, canals, rail corridors, pipelines, and key ports—has therefore become a powerful dual-purpose tool: geopolitical and geoeconomic motives are inseparable and mutually reinforcing.
Armenia after 2020: The Cost of Defeat
The loss of Artsakh, Azerbaijani incursions into Armenian territory, and unilateral border concessions have compromised core elements of Armenia’s national security and geopolitical standing. By capturing strategic high ground along the border, Azerbaijan aims for dominance under the pretense of border delimitation.
The declared pivot towards the West threatens to increase Yerevan’s tensions with Moscow and Tehran, and destabilize the fragile balancing it has maintained between the West and Iran since 1991.
“Trump’s Bridge”
Armenia is under severe pressure from the Turkish‑Azerbaijani alliance, which demands extraterritorial control of the so-called Meghri Corridor (the Zangezur Corridor by their definition). Until recently, Yerevan considered the U.S.’s proposal—conveyed by the U.S. Ambassador to Turkey—to place the route under a long‑term concession managed by an American private military contractor. Such an arrangement threatened to erode Armenia’s sovereignty and drag it into the Iran–Israel rivalry.
On 24 July 2025, a spokesperson for the ruling party announced that Armenia had rejected the U.S. plan “to avoid loss of sovereignty.” Regardless of the underlying motives, the decision will help:
- partially ease Armenia’s domestic trust deficit;
- allay Iran, Turkey, Azerbaijan, and Russia’s strongest objection to an extraregional military presence;
- preserve negotiating space with Baku, Ankara, and Brussels.
Yerevan thus timely recognized that acting as a minor rent‑collector would jeopardize Armenia’s sovereignty and turn it into a battlefield for external interests. The refusal is not a diplomatic triumph, but rather a sign of the complex great‑power competion now unfolding in the South Caucasus, which no longer accommodates a unipolar “mini‑world order.”
The Risk of Fragmentation
International relations theory treats violation of territorial integrity by foreign troops or non‑state armed groups as a hallmark of a “failed state.” In the 2024 Fragile States Index, Armenia ranked 89th of 175 countries—nominally mid‑range, yet on a worrying downward trajectory.
A Constructive Alternative
Given the intense external pressure, the current status quo is hardly sustainable, and a fateful decision is unavoidable. Establishing an exclusive Armenian control on the model of Russia’s Suwałki land corridor (across Lithuania and Poland) is unrealistic. A more balanced unlocking of the route—without alienating sovereignty—would combine Armenian ownership with shared responsibility for secure, uninterrupted transit.
Key elements of the proposed model imply:
- Sovereignty: The corridor remains the property of the Republic of Armenia.
- International Participation: To ensure uninterrupted transit, a multilateral monitoring council is established, which includes interested OSCE member states, as well as Iran and China. The council receives access to traffic monitoring and the necessary authority to quickly resolve disputes. The electronic e-TIR system with GPS seals is used for transportation of goods, which eliminates deliberate delays.
- Investment: Financing can be provided by a consortium of international financial institutions (e.g., the European Bank for Reconstruction and Development, the Asian Infrastructure Investment Bank, and the Eurasian Development Bank) through the issue of bonds. To create service zones (logistics terminals, free economic zones, etc.), a build-operate-transfer scheme is introduced for a period of up to twenty years without land ownership transfer.
- Security: Safety and security control is carried out by an OSCE observation mission with joint patrolling of the Armenian border service. This measure would ensure a balance of interests of Russia, Iran, Turkey, Azerbaijan, and the West, and would exclude the monopoly of an external player.
- Synergy: Simultaneously with the corridor’s launch, all automobile and railway connections should be opened in all directions: Yerevan–Razdan–Ijevan–Kazakh, Yerevan–Nakhichevan–Baku–Derbent, and Kars–Gyumri. This will help achieve real regional and interregional connectivity.
This combination of domestic guarantees and international monitoring would ensure Armenia’s territorial sovereignty and predictability for all stakeholders involved.
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Defeat in the Second Karabakh War and the ensuing territorial and resource losses have dramatically reduced Armenia’s geopolitical weight but have not yet doomed it to geoeconomic irrelevance. Transforming the Meghri Corridor from a liability into a source of resilience would free Armenia from the role of a petty rentier in regional logistics.
To achieve this, Yerevan should work with all interested parties to ensure:
- Compliance with the Suverenas in re, par in iure norm (sovereign in substance, equal in law).
- A transparent, multilateral governance architecture that honors every stakeholder’s interests.
- Comprehensive unblocking of all communications with Azerbaijan and Turkey so the Meghri Corridor becomes a competitive network link, not a “transit backyard” or fresh bone of contention.
Meeting these conditions would strengthen prospects for lasting peace in the region and advance integrated development of trans‑regional connectivity.
