For the Eastern Partnership (EaP) countries, stability requires a restoration of public trust, renewed civic engagement and returns from socio-economic reforms. This necessitates the strengthening of democratic institutions and countering corruption, based on linkage between democratisation and economic development.

From that perspective, one of the more promising strategies for these countries rests with a reliance on the energy sector. And although the six Eastern Partnership countries are characterised by a wide variance in energy profiles, Georgia, Moldova, Ukraine and Belarus stand out as strategic energy transit states. While Azerbaijan is the leading energy producer among the group, Armenia has an operational nuclear power plant, allowing it to export electricity.

The EaP countries have an opportunity for greater resilience to offset their geopolitical vulnerability and increase their significance to both Russia and the EU.

Yet for each country, there is a need for reform of their energy sectors, with a focus on connectivity, consumption, and new ‘green’ technologies. But the potential from such reforms offers a degree of energy security sufficiently robust to withstand any Russian resumption of “weaponising” energy as leverage to put pressure on the EaP countries.

Country-specific trends

The unexpected success of Armenia’s “Velvet Revolution” in 2018 demonstrates the inherent instability of authoritarian regimes in the post-Soviet space. The Armenian government pursues ambitious reforms, conducts free elections, fights corruption and initiated judicial reform. But Armenia is careful to concentrate on domestic reform and avoids altering its security ties to Russia. Although Armenia benefits from a Comprehensive and Enhanced Partnership Agreement (CEPA) with the EU, it still must implement the EU-driven reforms, meaning that the government must meet the expectations of both its population and the EU, while reassuring Russia that it is not a threat.

A landlocked, resource-poor country, Armenia’s energy sector relies on hydroelectricity and nuclear power, which allows it to export electricity to Georgia and Iran, and to develop renewable and ‘green’ energy. But Armenia remains over-dependent on Russia for most of its gas imports and for helping run its outdated nuclear power plant.

After years of authoritarian rule and repeated elections marred by voting irregularities, Azerbaijan initiated some limited reforms last year and replaced long-serving officials with a younger group of Western-educated specialists. Although parliamentary elections were again neither free nor fair, there is some hope for reform. However, the Nagorno Karabakh conflict remains both a burden and an excuse for setbacks in democratisation.

As an energy producer, with gas reserves that have overtaken oil as its primary resource, Azerbaijan has strengthened its energy significance, through the Baku-Tbilisi-Ceyhan (BTC) oil pipeline, and the new Trans-Adriatic Pipeline (TAP) gas pipeline to South-Eastern Europe. While reluctant to cooperate with the EU, the energy sector is one area for collaboration. While the country neglects renewable energy, the larger problem is the lack of diversification in the heavily energy-dependent economy.

As one of the more authoritarian EaP countries, reforms in Belarus have been tentative, as long-time President Lukashenko has focused on consolidating power. Facing an election this year, there may be pressure for reform, although change in leadership is unlikely, given the weak and repressed opposition. Nevertheless, Lukashenko succeeds in balancing between Russia and the EU, resisting Russian pressure for integration, while retaining independence to engage the EU.

Like Armenia, challenges for Belarus stem from a lack of natural resources and dependence on Russian energy. Although Belarus has recently started to export electricity, its thermal power stations rely on imported fuel, and Russia’s Gazprom holds control of the Northern Lights pipeline and its leverage over gas to Belarus will increase as Russia pursues new pipelines to Europe.

Georgia’s strategy and foreign policy remain centred on the closest possible cooperation with West, with aspirations for full membership in both the EU and NATO. Although tension with Russia over its military support for two separatist regions continues, mounting instability and deepening political polarization is an even more pressing concern.

As an energy transit state, Georgia remains a vital regional hub. Even though the country seeks greater diversification of gas supplies imported from Russia and Azerbaijan, the development of Azerbaijan’s gas deposits and the planned expansion of pipeline networks from Azerbaijan to Turkey and to Europe will bring further benefits to Georgia.

Faced with deep political division and polarization, Moldova is challenged to find consensus and compromise between rival political camps, especially after the collapse of a stridently pro-European government last year. The country is also struggling with a fragile political system, informal networks of corruption and problems in the judicial system, raising the likelihood of protests and possible revolution if there is no improvement. Although the country remains committed to the EU, stability is further undermined by its own unresolved Transnistrian conflict, where Russia also holds a strong influence.

The main threats to the Moldovan energy sector stem from its dependency on energy imports, limited energy connections with neighbours and energy inefficiency. Yet, there is some promise from further integration with the Ukrainian electricity market and expanded connections to the Romanian network, as well as the potential construction of a gas pipeline to Romania and the increased capacity of renewable energy.

Politics in Ukraine shifted overnight with the 2019 victory of Volodymyr Zelensky for the presidential office, riding a wave of voter disappointment and popular demands for change. Yet, early optimism diminished as the government’s pro-European narrative was not matched by its reforms, and the challenges from the ongoing war in Eastern Ukraine, economic weakness and corruption overwhelmed the new leadership.

Ukraine and Russia have reached a new five-year agreement for Russian gas exports through Ukraine. The country has also achieved greater energy independence from Russia by decreasing consumption and diversifying gas supplies from EU countries, including LNG via Poland. The biggest challenge for Ukraine thus lies in the ability to implement EU legislation in the field of energy, which in previous years significantly lagged regarding the integration with neighbouring countries in the gas and electricity sectors.

 

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