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Wednesday September 4, 2013 MYT 1:10:26 AM
Wednesday September 4, 2013 MYT 1:11:36 AM
Armenian President Serzh Sarksyan, who was elected for the second five-year term in the February 18 election, takes oath during his inauguration ceremony at Karen Demirchyan Sports and Concert Complex in Yerevan, April 9, 2013. REUTERS/Tigran Mehrabyan/PanARMENIAN Photo/Handout
NOVO-OGARYOVO, Russia (Reuters) - Armenia will join a customs union led by its former Soviet master Russia, President Serzh Sarksyan said on Tuesday after talks with his Russian counterpart Vladimir Putin.
Much smaller than its energy-exporting neighbours, Armenia's economy will not hugely increase the union's overall trade figures when it joins Russia, Belarus and Kazakhstan in a bloc based on ties remaining from the former Soviet Union.
But Putin welcomed the move as a diplomatic victory at a time when he is struggling to bring former Soviet republics closer together and stop Ukraine from slipping into the orbit of the European Union.
"The Russian side supports the decision by Armenia to enter the customs union ... We will fully work for this to happen," Putin said.
Yerevan's membership still must be approved by the other union members.
Russia has failed to draw Ukraine into the customs union as Kiev tries to deepen trade relations with the European Union, despite pressure from Moscow.
Russia is also in a row with customs union member Belarus over the detention of the CEO of the world's largest potash producer, Russia-based Uralkali.
Russia is Armenia's largest trading partner, and bilateral trade grew 22 percent to $1.2 billion (771.5 million pounds) last year. Most trade has been imports to the South Caucasus country, nestled between Iran, Georgia and regional rival Azerbaijan.
Russia is the biggest foreign investor in Armenia, with a total of $3 billion in investments in a country whose GDP amounted to $9.9 billion in 2012, according to the World Bank.
(Reporting By Thomas Grove; Editing by Robin Pomeroy)
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