The Economist
November 20, 2004
U.S. Edition

Small war, big mess: Nagorno-Karabakh

stepanakert

A troubled enclave

A deep-frozen conflict continues to infect the region

ARRIVE in Stepanakert, capital of Nagorno-Karabakh, and nothing
suggests it is a war zone. The streets are clean, public buildings
refurbished, there is a good hospital, a television studio, casinos,
hotels and even a fitness club. The road that links Karabakh to
Armenia may be the best maintained in the Caucasus.

In the mind of Karabakh’s Armenians, their bitter war to break free
of Azerbaijan in the early 1990s, in which some 25,000 people were
killed, is won. They have a president, a flag and a small army. “The
issue is resolved,” says Gegham Baghdasarian, editor of Demo, a local
newspaper. “The people made their statement, then defended it.” But
for Azerbaijan, the war is not over. A ten-year ceasefire is holding,
just, but thousands of Azerbaijani and Armenian troops face off
across minefields. Not only Karabakh, but seven other Azerbaijani
regions – 14% of Azerbaijan’s area all told – are occupied by the
Armenians.

Border blockades imposed by Azerbaijan and its ally Turkey have
turned Armenia into a backwater dependent on Iran and Georgia for
access to the outside world. Between the two former Soviet neighbours
there are no air, road or rail links. Azerbaijan has made sure that a
new oil pipeline from the Caspian to the Mediterranean bypasses
Armenia. About a million people on both sides were ethnically
cleansed from Armenia and Azerbaijan during the conflict. None has
returned.

Nor, despite the prosperity in Stepanakert, is life easy for the
Armenians running Karabakh. Their “republic” remains unrecognised. It
is less an independent entity than an extension of Armenia. The army
is deeply integrated with Armenia’s, the currency is the Armenian
dram, cars have Armenian number plates. Armenian “credits” and gifts
from the Armenian diaspora account for Nagorno-Karabakh’s good
infrastructure.

Shusha, near Stepanakert, illustrates the problem. Once one of the
most charming places in the Caucasus, it is now a ghost town of
gutted buildings and overgrown graveyards. Its Azeri population is
gone. Many inhabitants are Armenian refugees from Azerbaijan, living
wretchedly in what remains of ransacked apartments. Filip Noubel, an
analyst at the International Crisis Group, says that renewed war is
unlikely. But, he adds, the stand-off is being manipulated by both
governments, undermining democracy in both countries.