Spero News
Feb 22 2007

Azerbaijan looks westward

What may now be changing is President Ilham Aliyev’s policy of
maintaining a special relationship with Russia as he balances US and
Iranian ambitions.

The geopolitical landscape in the South Caucasus appears to be
shifting in a fundamentally westward direction, a change triggered by
the Russian announcement in December that Gazprom, Russia’s massive
state-owned energy consortium, would dramatically raise the price of
natural gas exports to Azerbaijan. The shift, which is being
described by analysts in Baku as a reorientation of Azerbaijan’s
foreign policy "towards the West" and a "unique opportunity," was
spelled out in a strongly worded Wall Street Journal
opinion-editorial on 19 January written by Foreign Minister Elmar
Mammadyarov.

In unusually frank terms, the foreign minister – known for his
careful use of language – spoke of a "defining moment for Azerbaijan
and the South Caucasus as a whole," and in comments aimed at Russia,
complained of "market bullies" and emphasized that Azerbaijan must be
guided by its national interest.

What may now be changing is President Ilham Aliyev’s policy of
maintaining a special relationship with Russia as he balances US and
Iranian ambitions. Even his opponents often admit that Aliyev,
inaugurated as Azerbaijan’s president in 2003, has inherited the
skills of his late father, Heydar. The elder Aliyev was a cagey
politico and former KGB general who deftly balanced his country’s
powerful neighbors, Russia and Iran, as well as the distant US
superpower, in a way that benefited Azerbaijan’s national interest.

Keeping US bases out of Azerbaijan while accepting US assistance in
modernizing its military; refusing to denounce Iran’s nuclear program
but keeping a watchful eye on Iranian influence in the region; and
maintaining cordial ties with Russia have been hallmarks of Ilham
Aliyev’s foreign policy.

But the Russian announcement that it would more than double the price
of natural gas to Azerbaijan was interpreted as "more than just a
market message" by the foreign minister, who reminded readers of
similar actions by Gazprom in Ukraine last year, as well as in
Georgia and Belarus.

"In response," he wrote, "we have decided to stop buying Russian gas
as well as to stop using the Russian pipeline to export Azerbaijani
oil to Europe"- an apparent reference to the Baku-Novorossiisk
pipeline that has been utilized for many years. The timing of
Gazprom’s – and Russian President Vladimir Putin’s – actions has not
been clearly explained, although it is widely assumed in Baku that
the origins stem from the breakdown in relations between Russia and
its South Caucasus neighbor Georgia.

The Georgian genesis
While Russia is rarely accused of subtlety in its foreign policy, the
Georgians cast subtlety aside when they arrested four Russian
military officers and 10 Georgians on charges of espionage in late
September – a move that touched off a war of words with the Kremlin
and led to the evacuation of Russian diplomatic personnel from
Tbilisi and suspension of air service to Moscow.

This episode was the capstone to a continuing struggle with Russia
over Georgia’s difficulties with breakaway South Ossetia and Abkhazia
– two pro-Russian regions nominally a part of Georgia where Russian
peacekeeping troops operate. It is a continuing reminder that Georgia
is militarily weak and has limited room for maneuver, even when its
own territorial integrity is involved. In November, the
self-proclaimed Republic of South Ossetia held elections in which
Eduard Kokoity, the de facto president, won a landslide victory. A
simultaneous referendum for independence garnered similar results,
although neither the referendum nor the presidential vote has been
recognized by the international community. In December, non-binding
measures in Russia’s lower house of parliament – the State Duma –
called for recognition of both South Ossetia and Abkhazia. The
measures passed unanimously.

The spy scandal and the South Ossetian vote were preceded in March by
Russia’s ban on Georgian wine and spring water imports, major sources
of export revenue in Georgia, as well as the cutoff of gas deliveries
to Georgia after a pipeline explosion in January – an event that
Russia insisted was beyond its control, but that Georgian President
Mikhail Saakashvili charged was an act of "serious sabotage from the
side of the Russian Federation."

South Caucasus analysts almost unanimously agree that the real reason
for the sanctions, if not the explosion, has been Georgia’s embrace
of EU and NATO integration, in part to counteract continuing Russian
military influence in the two breakaway regions.

Amid the unraveling of relations between Russia and Georgia and
despite the successful color revolution in Tbilisi – which was dead
on arrival in Baku in 2005 – Azerbaijan continues to integrate its
economy with Georgia’s and has discussed the sale of Azerbaijani
natural gas to Georgia via Azerbaijan’s Shah Deniz field in the
Caspian Sea. The Shah Deniz is not yet fully developed, although the
Azerbaijani Foreign Ministry estimates that eventually it could
produce up to 16 billion cubic meters of gas a year, although export
to Georgia has been delayed in part by Azerbaijan’s domestic needs
now that it has refused to purchase natural gas from Gazprom.

Thus, Putin has witnessed for some time the growing ties between
Azerbaijan and Georgia despite his policy of isolating Georgia and
punishing it for a variety of geopolitical sins.

Gazprom’s lopsided price structure is an oddity, at least on the
surface, given its argument that it seeks only fair market rates for
natural gas. Ukraine pays US$130 per 1,000 cubic meters, the result
of intensive negotiations during the 2005 gas crisis there, and even
Kremlin-friendly Belarus was recently subjected to a drastic spike in
gas charges that was negotiated down to US$110 per 1,000 cubic meters
at the beginning of this year. But Tbilisi has something new in
common with Baku: both are being charged a crippling US$230, in line
with European market prices but a hardship especially for
resource-poor Georgia. Armenia’s price of US$110 is also the subject
of recrimination in Azerbaijan, still in a technical state of war
with Armenia over separatist Nagorno-Karabakh.

The issue of Karabakh hangs like a shroud over almost any discussion
of Azerbaijan’s relations with its neighbors, and when Mammadyarov
wrote in his article that the "frozen conflicts in the region" should
be resolved "in adherence to the principle of territorial integrity
of all three South Caucasus states," this was a clear message to
Moscow that not only does Azerbaijan feel that Russia has given undue
support to Armenia, but that Baku endorses the Georgian position on
retaining sovereignty over South Ossetia and Abkhazia.

Possible Azerbaijani retaliation
In an effort to apply retaliatory pressure, a member of Azerbaijan’s
parliament – the Milli Majlis – has called for a revision of the
terms of Russia’s use of the Gabala radar station in northern
Azerbaijan. The Gabala station is reported to have the ability to
track ballistic missile trajectories in the southern hemisphere and
much of Asia, and is a critical link in Russia’s early warning
system. The current lease, which expires in 2012, calls for yearly
payments of US$7 million to Azerbaijan for use of the station.
Pro-government lawmaker Zahid Oruj told reporters recently in Baku
that he intended to raise the issue formally in March.

The chill in Russo-Azerbaijani relations is exacerbated by the recent
decision of the Azerbaijani National Television and Radio
Broadcasting Council (NTRBC) to end local television broadcasting
privileges for Russia’s state-owned Channel One and Rossiya (RTR)
networks. However, Russian networks have not been singled out. The
NTRBC says that Azerbaijan is merely complying with international
broadcast standards and in the Russian case is responding to a lack
of access for Azerbaijani television in the Russian Federation. These
decisions have coincided with the Azerbaijani government’s shutdown
of local independent television network ANS, one of Azerbaijan’s most
popular media sources, which was taken off the air by the NTRBC for
nearly three weeks late last year in what became for opposition media
and much of the international community a test case of freedom of
speech in Azerbaijan.

Meanwhile, in an obliquely worded press release, the Russian Foreign
Ministry stated on 12 February that it would "follow attentively" the
development of enhanced economic and transportation ties between
Azerbaijan, Georgia and Turkey. This came on the heels of the
announcement last week of funding for the ambitious Kars-Tbilisi-Baku
railway project, which will link Turkey, Georgia and Azerbaijan with
a new railroad, making it easier for Azerbaijani and Georgian
passengers and goods to reach destinations in Europe via Turkey. The
railroad will bypass both Russia and its closest partner in the
region, Armenia.

Not all Azeri elites are interpreting recent events as a watershed.
Leila Aliyeva, one of Azerbaijan’s most respected political
scientists, told ISN Security Watch that the foreign minister’s
article was not so much a radical shift, but rather "a maneuver, or
reminder, that our course is integration in the West, which in fact
has never changed."

The notion that Azerbaijan had previously arrived at a permanent
rapprochement with Russia, which has now been perhaps fatally
damaged, "never reached a critical point," she said.

In a telephone interview last week with ISN Security Watch,
Azerbaijan’s consul general in Los Angeles, Elin Suleymanov, also
stressed that the country’s future would be found with pragmatism and
Western integration. He echoed the foreign minister’s view that
Gazprom’s decision was a largely political message.

"Azerbaijan’s policy at its core is based on its independence,"
Suleymanov said. "We base our relations with our neighbors on our
interests. Attempts by other states to impose their will on
Azerbaijan will be rejected."

This article was written by Karl Rahder who has taught US foreign
policy and international history at colleges and universities in the
US and Azerbaijan. In 2004, he was a Visiting Faculty Fellow in
Azerbaijan with the Civic Education Project, an academic program
funded by the Soros Foundations and the US Department of State. He is
currently based in Chicago.

Based in Zurich, Switzerland, the Center for Security Studies (CSS)
at the Swiss Federal Institute of Technology (ETH Zurich), provides
via the International Relations and Security Network a wide range of
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security environment.

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