A FORK IN THE SILK ROAD
By Borut Grgic And Alexandros Petersen

Georgiandaily
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Oct 29 2008
NY

Generally considered to be a small, booming post-Soviet petro-state,
Azerbaijan is a country on the maps of oil men but on the margins
of Europe and the greater Middle East. Russia’s August invasion of
Georgia, however, has caused Western decision makers to take another
look at the region, and Azerbaijan in particular.

There is an increasing realization among Western strategists and
energy producers that Azerbaijan — nexus of the Black Sea and Caspian
regions, neighbor of Russia, Iran and Turkey, and bottleneck for
Western links to the rich resources and growing markets of Central
Asia — is a pivotal point in Eurasia. And, as this month’s elections
there showed, it is a country on the brink. Partly as a function
of its geographical position, but also due to shifting dynamics of
influence in the region, the leaders and population of Azerbaijan
are being enticed to move in one of two general directions: toward
Western integration or Russian-dominated "Eurasianism."

Until now, Azerbaijan’s leadership has pursued a canny "all options
open" foreign policy, but one that was firmly oriented toward Europe
and the broader West. Its former president, Heydar Aliyev, daringly
challenged Russia’s self-proclaimed sphere of influence long before
Georgia did, by building the Baku-Tbilisi-Ceyhan oil pipeline and a
parallel line for natural gas that directly reach Western markets. Baku
actively lobbied for U.S., NATO and EU involvement in the region to
provide for Caspian maritime security and to help solve its "frozen"
conflict with Armenia over the territory of Nagorno-Karabakh.

But Azerbaijanis were disappointed by the West’s reaction to this
summer’s events in next-door Georgia, and the growing inclination in
many European capitals to capitulate to Russia in the broader Black Sea
region. While Russian tanks menaced Tbilisi, Baku began exporting oil
through Russia and Iran. Now Moscow, a longtime friend of Armenia’s
in the Karabakh conflict, has begun quietly supporting Azerbaijan’s
position in the hopes of securing a deal for all of Azerbaijan’s
available natural gas exports. In the absence of incentives or
even attention from the West, Baku is seriously considering a major
foreign-policy reversal.

This shift comes at exactly the wrong time for European and
broader Western interests. This month, a British auditing company
confirmed that the country across the Caspian from Azerbaijan,
Turkmenistan, has the world’s fourth-largest natural gas field and
probably enough total reserves to meet export commitments to Russia,
China and Europe. Kazakhstan is also stepping up its westward oil
exports. The only route for these supplies to reach Europe passes
through Azerbaijan.

Western attention has lately been focused on governance in Azerbaijan,
with election monitors from the Organization for Security and
Cooperation in Europe giving Baku a balanced progress report on
democratic development. The Oct. 15 election — which the incumbent
president, Ilham Aliyev, won handily with over 90% of the vote — for
the first time met most international standards and marked a genuine
improvement in election conduct. There were missing elements too,
namely the lack of a competitive campaigning climate. But Western
preoccupation with the election process misses the full picture
of governance in Azerbaijan and, more importantly, ignores the
geopolitical imperatives of the region.

In the past year, Azerbaijan was the world’s fastest reforming country,
according to the World Bank. It is a global leader in energy-sector
transparency and sustainable development. Both the World Bank and the
OSCE report that it has made significant strides in building viable
institutions and bolstering the independence of its judiciary —
claims that its democratic neighbor, Georgia, cannot make.

But it is Azerbaijan’s role as a regional weather vane that draws
the most Western focus. The leaders of Kazakhstan, Turkmenistan,
Uzbekistan and even Armenia look to Baku for signals of where they
should take their multivector foreign policies. Should Azerbaijan let
itself be wooed by Russia at the expense of its links to the West,
a strategic chunk of Eurasia would likely follow suit.

Western leaders must not only realize the geopolitical importance
of Azerbaijan, but take action to strengthen ties that reflect
that understanding. Above all, the EU must seek to foster conflict
resolution in the Caucasus and build links across the Caspian —
with Azerbaijan as a central partner in those efforts. After the
conflict in Georgia, the key to doing so is Turkey, Azerbaijan’s
traditional cultural and linguistic friend, and the only NATO
country to produce a serious and comprehensive plan for stability,
cooperation and development in the region. Western capitals would do
well to support Ankara’s Caucasus Stability and Cooperation Pact in
providing a workable forum for peace between Azerbaijan and Armenia,
and a resolution of tensions in Georgia which menace energy, transport
and trade links with broader Eurasia.

Despite preoccupations with U.S. presidential politics and the global
financial crisis, the West must engage Azerbaijan now. The geopolitical
fate of the Eurasian continent is at stake.

Mr. Grgic is chairman of the Institute for Strategic Studies in
Ljubljana. Mr. Petersen is adjunct fellow with the Russia and Eurasia
Program at the Center for Strategic and International Studies in
Washington.