A new situation emerged in the South Caucasus after the end of the 44-day Karabakh War in the autumn of 2020. The war took the lives of thousands of people on both sides. Its outcome determined some issues, left others unresolved, and created some new ones. The wounds and pains of the war on families, towns and villages will take a long time to heal. However, the new situation, and developments since the end of hostilities on 10 November 2020, also present Armenia and Azerbaijan with new options, particularly in the area of connectivity.
Breaking the impasse and stagnation of the last thirty years is neither simple nor easy, but among decision makers and opinion shapers on both sides there is a sense that this is now possible to achieve. This will have huge impact on the two countries, on the third country in the region – Georgia, as well as on the region’s regional partners, including Russia, the EU, Turkey and Iran. It is therefore necessary for those concerned to contribute so that the region can move forward speedily.
A difficult start, but now no more time to waste
Armenia and Azerbaijan, together with Russia, on 9-10 November 2020 signed the trilateral declaration that formally ended the 44-day Karabakh War. A second document was signed by the three countries on 11 January 2021, the main purpose of which was to elaborate on the implementation of Clause 9 of the 9-10 November trilateral agreement which provides for “unblocking all economic and transport connections in the region”, and established a working group on the issue of restoration of transportation corridors. The group chaired by the Deputy Prime Ministers of Armenia, Russia and Azerbaijan held its first meeting in Moscow on January 30, 2021 where it was also decided to set up expert subgroups with the participation of representatives of the relevant agencies of the three sides to work on the railway, automobile and intermodal transportation, including security, border, sanitary and veterinary, regulatory controls. The work of the working group and the sub groups has been sluggish. However, at their meeting in Sochi on 26 November 2021 the leaders of Armenia, Azerbaijan and Russia adopted another statement reaffirming commitment to implementation and unconditional observance of all the provisions of the 9-10 November 2020 and 11 January 2021 statements and agreed to intensify joint efforts aimed at the immediate resolution of the remaining issues.
Clearly, there is now no time to lose. Under immediate consideration is the crucial “Yeraskh-Julfa-Ordubad-Meghri-Horadiz” railway and a possible motor highway connecting Azerbaijan with Nakhchivan via Armenia’s Syunik region. Armenian Prime Minister Nikol Pashinyan stated after the meetings in Sochi and Brussels at the end of last year that the sides confirmed their earlier decisions on the construction or rehabilitation of the “Yeraskh-Julfa-Ordubad-Meghri-Horadiz” railroad, which is 340 km long. In Armenia, a ten-person expert group headed by an Adviser to the Prime Minister, former Armenian Ambassador to Iran Artashes Tumanyan, has been established to oversee the project. The Armenian side has already announced its calculations of the costs of the project - the government will spend $226 mln – 5 mln USD on the restoration of the Yeraskh-Nakhchivan railway (up to the Azerbaijan border), which is a couple of hundred meters long, and $221 million on the Meghri section, which is 45 km long. The period of construction work on the Armenian side will last between 2-3 years.
The railroad to Azerbaijan’s Nakhchivan region has been one of Baku’s highest post-war priorities. Azerbaijan started constructing the 110-km Horadiz-Agband railway in February 2021. The plan is for the railway going along the Azerbaijani-Iranian border to be part of the rail link connecting Azerbaijan to Nakhchivan via southern Armenia. The foundation of the construction of the Horadiz-Jabrayil-Zangilan-Aghband highway was laid on October 26, 2021 in a ceremony attended by the presidents of Azerbaijan and Turkey. President Aliyev, speaking in December 2021, announced that the railway line from the Azerbaijani territories to the Armenian border is expected to be ready toward the end of 2023, suggesting that Baku was progressing fast and expressing a hope that “by that time, Armenia will complete their part of the homework”. Azerbaijani officials have not yet stated what will be the cost of restoration of this railway.
For the moment discussions on the road connection is proving more problematic, as the sides are still discussing the possible and preferable ways for connections between Azerbaijan and its Nakhchivan exclave via Armenia’s Syunik region, Armenia and Russia via Azerbaijan territory and Armenia and Iran via Nakhchivan. It is therefore anticipated that in the first phase the rail connections will be unblocked, which would be a positive, even if incomplete, step.
A lot of the problems related to the implementation of the opening up of these transport routes is the lack of trust between the sides – a result of decades of conflict and animosity.
The announcement of the intention to establish a border delimitation and demarcation commission, is in this regard, a positive step. Issues related to the safety and security across the transport route are also not yet clear enough to be satisfactory to both sides. And the heated debate about the nature of the transport route – with different interpretations being given to the concept of a transport “corridor” – has brought this issue to the fore, and the matter needs to be resolved if the envisaged routes are to be opened. But whilst these are all difficult problems, they are also problems that can be solved if the sides show enough good will and flexibility.
Of course, there is no guarantee that economic co-operation between Armenians and Azerbaijanis will decrease tensions enough that it will allow the sides to go forward to a final, comprehensive and peaceful settlement of the conflict between them, but it for sure will be a positive factor, and has the potential of bringing the sides quickly to transform confrontation into co-operation, and to replace tensions and daily incidents with a stable environment. Restoration of transport communication links will create opportunities to unblock the region and make it more accessible to the world, whilst at the same time it will create interdependence between Armenia and Azerbaijan, which will also contribute to the region’s long term stability.
A vision of the region as an interconnected hub of prosperity
Whilst not underestimating the challenges that face Armenia and Azerbaijan as they seek to redefine the relationship between them, it is also possible to visualise the future of the region – interconnected within itself and with the wider global processes, and a hub of prosperity between East and West, North and South.
One may say that the current international situation, with unprecedented levels of tension between the US and China, the West and Russia, and an endless string of regional disputes that have the potential to grow quickly into serious conflict, is not conducive for connectivity and co-operation. On the other hand, the current international situation makes the quest for safe, secure and speedy routes for transport and communications even more necessary. That makes the prospect of turning the South Caucasus from an epicentre of conflicts into a haven for trade and co-operation even more attractive. And in seeking this Armenia and Azerbaijan are not alone. Georgia is keen to be part of the process too, and its good relations with the other two countries makes it uniquely placed to play a positive role.
The main external player in the region, including through its involvement in securing an end to the 44-day Karabakh war, and in its aftermath, is Russia. Moscow has its own interests in the region, in both the security and the economic dimensions, including huge investments both in Armenia and Azerbaijan. Future regional co-operation will allow Russia, which has already increased its military capability in the region, to do the same on the economic field, enlarging its investment portfolio in the South Caucasus, and also facilitating its transport roads to the South.
Another beneficiary from the regional stability and prosperity is the EU, which now has its own co-operation frameworks with the South Caucasus republics, and which continues to invest heavily in the region, both politically and financially. The European Commission’s decision to provide Armenia with up to 2,6 billion euros of financial package is significant. As for Azerbaijan, the EU now considers the country to be its strategic partner, at least in the energy sector, but Baku has complained that in contrast the EU post-war financial assistance to Azerbaijan only totals 150 million euros.
It is also very clear that other nearby countries, including Iran, Turkey, the Central Asian Republics and even the Arab countries of the Gulf, can all benefit quickly and substantially from an opening up of the region. This is therefore an all-win situation. It must be embraced.
Five important next steps
In support of building future connectivity between Armenia and Azerbaijan and beyond them to the wider region and the rest of the world five practical steps, being discussed in the framework of the Joint Liaison Group on Confidence Building Measures in support of lasting peace in the South Caucasus, can be considered:
- A comprehensive study on how to work towards a great leap forward
It is in the interest of both Armenia and Azerbaijan, and of their regional and international partners, that plans for the opening up of connectivity in the South Caucasus are ambitious. They must however also be based on facts and realistic calculations. For this reason, it is important that a major comprehensive study is commissioned as soon as possible that will consider different options and scenarios, mainly from a financial, economic, social and environmental perspective to provide all interested sides with both a base line of the point of departure and a road map for the future.
- A regional development fund, with the participation of the major countries and financial institutions which can ensure that progress is not stalled because of lack of funds
In parallel, work should start on the establishment of a regional development fund, using the latest best practices approaches, including through the involvement of the private sector. The fund should include the major international financial institutions, as well as the countries of the region.
- Widening the process of people-to-people contacts, with more opportunities for interaction
The process of connectivity needs to be seen also through the prism of people-to-people contacts. The impact on families and local communities needs to be constantly monitored and assessed, and border communities in particular need to be prepared for what will be a seismic change in their life. A regional commission, with the representatives of border communities should be set up to study, monitor and follow this process and recommend remedial action where necessary.
- South Caucasus Economic forum that will be held annually alternating between the three countries
We propose the holding of a major annual event: The South Caucasus Social and Economic Forum, to be held alternating between the three countries of the region with participation from governments, universities, think tanks, civil society and business. The forum can become an annual feature in the calendar of the region where new ideas are launched and discussed.
- Joint economic zone on the Armenia-Azerbaijan-Georgia border
Whilst the focus at the moment in the connectivity debate is on the transport corridor “Yeraskh-Nakhchivan-Horadiz”, the connectivity agenda should be perceived from a wider perspective. In this regard the three countries of the region should consider the establishment of a Special Economic Zone near the point where the border between the three countries meets near the so called Red Bridge. The area, part of which is at the moment a dangerous minefield, should be cleaned and should be rehabilitated to be turned into a showcase for regional trade and industrial co-operation.
The noise and smell of war has dominated life in the South Caucasus for more than three decades. A generation has grown up knowing nothing else, and the next one is following. This trend needs to be broken. We owe it to this and future generations to work for peace and co-operation in the region, and the opportunities that are within the grasp of the people of the region should not now be squandered. Connectivity is a key factor in building the future and we should all contribute to make this a successful process.
This joint op-ed was prepared by Johnny Melikian, a Senior Fellow at the think tank Orbeli Research Analytical Center in Yerevan and Ramazan Samadov, an independent expert based in Baku, as part of the work of the Joint Liaison Group on Confidence Building Measures in Support of lasting peace in the South Caucasus – an initiative co-ordinated by LINKS Europe, with the support of the European Union.
For further information on the work of the Joint Liaison Group you may contact: In Baku Ahmad Alili (+994 50 266 07 28); In Yerevan Benyamin Poghosyan (+374 99 532870); in Tbilisi George Simonishvili (+995 599 96 98 75) In EU Maximiliaan van Lange (+31 638540975). The secretariat of the Joint Working Group is provided by LINKS Europe (email@example.com).