Armenia-Azerbaijan: More Conflict or Economic Opportunity?

On September 28, the president of the unrecognized government in Nagorno Karabakh, Samvel Shahramanyan, signed a decree officially dissolving the state effective Jan. 1, 2024, and the local ethnic Armenian population was advised to consider the reintegration proposals being put forward by Azerbaijan. Although Azeri President Ilham Aliyev assured that their rights would be protected, ethnic Armenians have fled to Armenia out of fear for their lives. The Armenian government claims 100,000 out of a total of some 120,000 have fled, causing a humanitarian crisis as these refugees must be provided emergency food and shelter.

Negotiations on a peace treaty between Armenia and Azerbaijan are said to be in the works, but it is not at all clear whether this will materialize. The reality is, that the Armenian people are victims of the U.S. and NATO war drive against Russia. When Moscow and Washington do engage, as they did in 1994 in arranging the ceasefire that ended the fighting over Nagorno Karabakh, progress can be made. But this time, Washington has tried to wean Armenia away from Russia, a country on which it has been totally dependent economically and for its security. The European Union came up with totally unworkable proposals while refusing to engage with Russia. But it has done nothing to influence Baku, which has become an important source of gas since the sanctions on Russian gas.

An obvious solution would be the launching of a much needed program of economic development, through the cooperation of both Armenia and Azerbaijan, allowing residents of Nagorno Karabakh to remain in their homes. Such a perspective was raised by Kremlin spokesman Dmitry Peskov, who told reporters on Sept. 28 that a peace treaty would open the doors for implementing various transportation projects in the region, important for all three countries. He was alluding to the International North-South Transport Corridor stretching from Russia down to India, with both Armenia and Azerbaijan laying astride its path.

The nearly 30 years of conflict has left both these countries with serious communication problems. Armenia could only carry out land transportation of its foreign trade via Georgia and Iran, since its border with Turkey, an ally of Azerbaijan, was closed. And one part of Azerbaijan called Nakhchivan lies outside its main territory, between Armenia and Iran.

Well informed intelligence sources express fear that the conflict is not over and that a war between Armenia and Azerbaijan should not be ruled out. Aggressive interventions such as those made by USAID Administrator Samantha Power or the European Union only make the situation worse, given the isolation of Armenia both geographically, and politically.