Democracy as Strategic Capital: Armenia’s Path in a Transactional World

2026-03-20 - 11:11

Listen to the AI generated audio article. Your browser does not support the audio element. As this article was being finalized, the United States and Israel launched military strikes against Iran, dramatically escalating tensions in the Middle East. The war itself, and the political rhetoric surrounding it, appear to reinforce many of the arguments advanced here about the transformation of Western foreign policy doctrine. But events are moving quickly, and their legal, political and regional implications require separate analysis. For this reason, the present article does not attempt to incorporate those developments beyond acknowledging their relevance. Washington’s Doctrinal Shift Since the beginning of 2026, a number of developments have confirmed a dramatic transformation in American foreign policy. This transformation unfolded in stages—institutional, regional and rhetorical—which together demonstrate a structural shift away from post-Cold War universalism and norms-based foreign policy toward a more transactional and sovereignty-centered doctrine. The first and most visible development was the United States’ withdrawal in January 2026 from dozens of international institutions and multilateral frameworks. Official explanations framed the decision as a pragmatic recalibration: certain organizations were described as inefficient, politicized, or misaligned with U.S. national interests. Yet the scale of the withdrawals pointed to something deeper than administrative correction. For decades, American global leadership had been expressed through institutional architecture, shaping, funding, and legitimizing multilateral governance bodies. The January decisions indicated that institutional multilateralism was no longer the organizing principle of U.S. engagement. Instead, Washington signalled a preference for flexible coalitions, bilateral arrangements and issue-specific partnerships grounded in sovereignty and strategic autonomy rather than universal rule-setting. If the withdrawals marked a structural shift, Vice President JD Vance’s visit to the South Caucasus illustrated how that shift played out in regional diplomacy. In Armenia, Vance’s messaging focused on technological cooperation, regional connectivity and economic modernization, including discussions about positioning Armenia as a regional innovation and artificial intelligence hub. The emphasis was on strategic relevance and economic potential rather than democratic reform. References to governance, rule of law or human rights, language that had previously featured prominently in U.S.–Armenia engagement was notably absent. The subsequent visit to Azerbaijan and the signing of a Strategic Partnership Charter reinforced this recalibration. The document foregrounded energy security, transport corridors, and geopolitical alignment. Unlike earlier agreements, including the charter developed with Armenia under the previous U.S. administration and signed in January 2025, which embedded democratic development and institutional resilience as pillars of partnership, the new framework reflected a narrower strategic focus. Democracy was no longer the definitional core of alliance-building, but one element among many, and not necessarily the decisive one. The evolution of these documents is instructive. The Armenian charter reflected a worldview in which democratic reform strengthened legitimacy and long-term stability. It treated governance and civil society engagement as integral to strategic partnership. By contrast, newer agreements signal a reordering of priorities: geopolitical utility, energy transit, and regional positioning now occupy center stage. Marco Rubio’s address at the Munich Security Conference in February 2026 offered a rhetorical synthesis of these earlier developments. In Munich, Rubio argued that the world should no longer be understood primarily through the lens of a “rules-based global order,” but through the civilizational cohesion of the West. He criticized supranational governance structures and suggested that overreliance on international law can constrain sovereign decision-making. Alliances, in this framing, derive legitimacy less from universal values and more from shared heritage, strategic necessity, and cultural continuity. European reactions were telling. Many leaders welcomed the reaffirmation of U.S. commitment to transatlantic cooperation, yet expressed unease with the civilizational framing. Analysts widely interpreted Rubio’s speech as a more refined articulation of the same ideological shift earlier signalled by JD Vance in his speech at the Munich Leaders Meeting in Washington in 2025, where he criticized European governments for abandoning “Western civilization values.” Rubio’s subsequent remarks defending unilateral U.S. actions abroad reinforced the perception that strategic outcomes now outweigh institutional procedures in Washington’s foreign-policy hierarchy. Viewed sequentially, these developments—institutional withdrawals, regional diplomatic recalibration, and Munich’s rhetorical consolidation—form a coherent doctrinal trajectory. The emerging framework rests on three interlinked premises: sovereignty takes precedence over multilateral constraint; alliances are defined by strategic alignment rather than normative convergence; and institutions are instruments of convenience rather than foundational pillars of order. This shift does not represent isolationism. The United States is not retreating from global engagement but redefining its terms. The emphasis has moved from shaping universal systems toward constructing flexible, interest-based coalitions capable of advancing geopolitical objectives. For smaller states such as Armenia, operating in contested regions like the South Caucasus, this transformation carries significant strategic implications. Beyond Washington: Competing Visions of the West One of the most significant consequences of Washington’s doctrinal recalibration is the transformation of what is often described as the “collective West.” While the United States appears to be redefining alliances in increasingly transactional and civilizational terms, other Western actors continue to anchor their foreign policies in normative and institutional foundations. French President Emmanuel Macron articulated this perspective clearly in his speech at the Munich Security Conference. Macron emphasized that Europe’s strategic autonomy must serve to defend international law, democratic governance and the rules-based international order. In his framing, sovereignty and multilateralism are not contradictory but complementary: Europe must strengthen its capabilities in order to preserve the institutions and norms that underpin international stability. This position reflects a broader European consensus. European leaders repeatedly reaffirm their commitment to the rules-based international order. Speaking at the EU Ambassadors Conference in Brussels (March 9-13, 2026), President of the European Commission Ursula von der Leyen reaffirmed Europe’s commitment to defending the rules-based international order even as global power politics intensify. She warned that while the EU helped build the current international system, it must now actively defend it against challenges from major powers and geopolitical instability. She stressed that Europe will continue to “defend and uphold the rules-based system that we helped build with our allies.” Similarly, Kaja Kallas, EU High Representative for Foreign Affairs, recently warned in the Churchill Lecture at the University of Zurich that the erosion of international law and unilateral actions by major powers are undermining the global order. She argued that democratic states must actively defend the rules-based system if they want to avoid a world dominated by coercive power politics. She framed the current moment as a struggle to preserve “the rules-based global order in an era of power politics.” Together, these statements show that EU leaders still explicitly frame European foreign policy around defending multilateral institutions and international law, even while acknowledging that the system is under pressure. They also signal that Europe is actively seeking ways to reinforce the rules-based international system. Similar perspectives are voiced beyond Europe. Canadian Prime Minister Mark Carney’s speech at the World Economic Forum in Davos, for example, highlighted the need to restore trust in democratic capitalism and to reform, rather than dismantle, multilateral institutions. Carney argued that democratic economies must modernize governance frameworks, strengthen regulatory coordination, and renew the social contract underpinning open societies. Rather than questioning the legitimacy of international institutions, he emphasized their continued necessity in addressing global challenges such as climate change, trade governance, and financial stability. Together, Macron and Carney illustrate that the “collective West” is far from ideological uniformity. While Washington may be redefining alliances around sovereignty and strategic alignment, other democratic actors continue to treat governance standards, the rule of law, and institutional predictability as strategic assets. For countries like Armenia, this distinction is critical. The recalibration in Washington does not eliminate the relevance of democratic development in foreign policy. It complicates the environment in which that development operates. Significant parts of the Western ecosystem, within Europe and beyond, still evaluate partnerships through the lens of governance quality and institutional resilience. Democracy as Armenia’s Strategic Capital The transformation of American foreign policy and the growing ideological diversity of the “collective West” inevitably affect smaller states that depend on both bilateral and institutional partnerships. For Armenia, in the volatile South Caucasus and navigating post-war regional dynamics, these changes reshape the strategic environment in meaningful ways. A more transactional international environment also creates new opportunities. If Washington increasingly prioritizes sector-specific cooperation and strategic alignment, Armenia can engage the United States on pragmatic grounds such as technology development, energy diversification, and regional infrastructure connectivity. Armenia’s geographic position linking the Black Sea, Caspian basin, and the Middle East may gain renewed strategic importance in discussions around transport corridors, energy routes, and digital infrastructure. At the same time, a less rigidly values-based diplomatic environment may facilitate engagement with partners beyond traditional Western alliances. India’s growing role in Eurasian trade and defence cooperation offers diversification opportunities, while Gulf states continue to expand investment across infrastructure and logistics networks. Engagement with Asian economies, including China, may also support economic diversification. Yet this environment also carries risks. Transactional alliances are inherently contingent. If strategic alignment becomes the primary currency of international partnerships, smaller states are more exposed to abrupt shifts in great-power priorities. Armenia’s democratic trajectory has served not only as a moral claim but as a strategic differentiator within the South Caucasus. Democratic reform, an active civil society, and electoral legitimacy have strengthened Armenia’s credibility in European capitals and Washington. If democracy becomes less central to U.S. alliance-building, Armenia risks losing part of this diplomatic leverage. At the same time, fragmentation within the Western ecosystem creates space for balanced diplomacy. Europe, Canada, Australia and other democratic partners continue to frame foreign policy in normative terms. This gives Armenia room to pursue a dual-track approach: pragmatic cooperation with Washington while deepening values-based partnerships with European institutions. Armenia can therefore position itself as a bridge actor within a more diversified Western network, reducing dependence on any single doctrinal centre while preserving access to normative frameworks that support long-term stability. The most important strategic question is whether Armenia should recalibrate its domestic trajectory in response to shifts in American foreign policy. Strategically, the answer is no. Democratic development is not merely a foreign policy tool. It is the foundation of internal resilience. Transparent institutions, accountable governance, and independent courts strengthen social cohesion, economic predictability, and investor confidence. Moreover, U.S. foreign policy has historically oscillated between universalist and realist paradigms. A future administration may again place democracy and multilateralism at the center of international engagement. If Armenia dilutes its reform agenda in response to temporary geopolitical shifts, it may find itself strategically misaligned when that pendulum swings back. Maintaining democratic consolidation therefore serves both principled and pragmatic ends. It preserves Armenia’s credibility within a diversified network of democratic partners while strengthening internal governance capacity. In a world where alliances are increasingly transactional, legitimacy and institutional predictability become even more valuable strategic assets. For Armenia, remaining an island of democratic stability in a turbulent region may prove to be its most enduring competitive advantage. Also see Armenia’s Doctrine of Multi-Alignment: Strategic Partnerships, Not Alliances Nerses Kopalyan Jan 22, 2026 Armenia’s foreign and security policy realignment is reshaping regional dynamics. Nerses Kopalyan introduces the doctrine of multi-alignment to Armenia’s policy discourse, arguing that diversification is rooted in this doctrine, one that favors strategic partnerships over alliances to de-risk security and enhance statecraft. Read more Armenia’s Diversified Partnerships: Opportunities and Risks in a Fragmenting Geopolitical Order Sossi Tatikyan Mar 12, 2026 As Armenia moves away from decades of security dependence on Russia, it is building a network of partnerships across the West, Eurasia and Asia. Sossi Tatikyan explores the opportunities, and geopolitical risks, of Armenia’s emerging multi-alignment strategy in an increasingly fragmented world. Read more Armenia’s Balancing Act in a Multipolar World Hovhannes Nazaretyan Sep 25, 2025 As global power shifts toward multipolarity, Armenia faces profound uncertainty. With Russia’s retreat and ongoing regional pressures, Yerevan is pursuing a “balanced and balancing” foreign policy—deepening Western ties while engaging Iran, India, China and others—in a bold recalibration of its security and diplomacy. Read more [Beyond Borders] Column Where Pashinyan Is Right, and Where He May Be Mistaken About Georgia Olesya Vartanyan Mar 16, 2026 Speaking at the European Parliament, Armenian Prime Minister Nikol Pashinyan called for renewed political dialogue between Georgia and the EU. While the appeal underscores the importance of engagement, without concrete proposals it risks adding little to efforts to resolve Georgia’s prolonged political crisis. Read more The Other Side of the Border Olesya Vartanyan Feb 16, 2026 Conversations about reopening the Armenian-Turkish border tend to focus on trade routes, transit corridors and regional stability. Yet a border is not only a channel for goods. It is also a line between people, who have lived for decades within sight of one another without ever meeting. Read more The South Caucasus in an America-First World Olesya Vartanyan Jan 19, 2026 One year after Donald Trump’s return to the White House, the United States has turned sharply inward, opening an uneasy chapter with Europe. For the South Caucasus, this shift doesn’t necessarily signal renewed American engagement but rather a region increasingly shaped by decisions made elsewhere. Read more What a Ceasefire in Ukraine Could Mean for the South Caucasus Olesya Vartanyan Dec 22, 2025 The war in Ukraine still dominates Eastern Europe’s political agenda, but its consequences extend far beyond. In the South Caucasus, amid Georgia’s prolonged crisis, a ceasefire could become a test of political maturity, revealing which states seize new opportunities and which risk deeper isolation. Read more