OLD WINE IN NEW BOTTLE?

    Baku appears to offer more substantial ideas to break the
    impasse in the Karabakh negotiations, but Yerevan needs to
    be cautious.

Armenian News Network/Groong
July 24, 2002

by Groong Research & Analysis Group


Azerbaijan's recent unofficial offers, discussed with a former top
Armenian negotiator, indicate Baku's retreat from previously stated
policy of maintaining a full blockade of Armenia until a final
settlement is achieved. Reportedly Baku is proposing normalization of
trade relations with Armenia before a final solution is achieved. It
appears that Baku is implicitly reconciling with the idea that
Karabakh may become part of Armenia; and that not all territories
under Armenian control will be returned.


Jirayr Libaridian, former Armenian president Levon Ter-Petrossian's
foreign policy advisor and chief negotiator on Karabakh, visited Baku
on June 2 and met with high-ranking Azerbaijani officials, reportedly
to collect material for an upcoming book on the Karabakh Conflict.
Libaridian, who resigned in 1997 and returned to the United States,
subsequently met with Nagorno Karabakh Republic (NKR) president Arkady
Ghukasian in Stepanakert and with Armenia's foreign minister Vartan
Oskanian in Yerevan. Libaridian passed to the Armenian officials a new
step-by-step offer from Azerbaijan to resolve the Karabakh conflict.
The offer may represent the end of Azerbaijan's expectations to find a
resolution through a so-called "land swap" deal, and offers Armenians
an opportunity to evaluate the current merits of a stepwise solution.

According to Libaridian the Azerbaijani leadership is again interested
in pursuing a modified "phased" (or so-called "step by step") formula
to peace in Karabakh. Armenian president Robert Kocharian's
administration has consistently insisted on a "package" deal, which
would settle all contentious issues, most significantly a final status
for Nagorno Karabakh, in a single accord. The difference of the two
approaches formed the core of the dispute in 1997-1998 between
then-Prime Minister Kocharian and former President Ter-Petrossian,
culminating in the latter's resignation in February 1998. Kocharian
was subsequently elected president in April 1998, after promising to
stick to a "package" deal.

The first phase of the new Azerbaijani offer proposes that Armenians
would return four out of seven outlying districts - Fizuli, Jibrayil,
Zangelan and Gubatly - currently held as a security buffer zone, in
exchange for Azerbaijan officially opening its borders with Armenia.
Talks about the status of Karabakh are indefinitely postponed. The
other three regions around Karabakh that are currently also under
Armenian control, - Agdam, Lachin and Kelbajar, - would remain in
Armenian hands until a final settlement is reached.

On June 14, Azerbaijani president Heidar Aliyev broke a year-long
policy of denying the existence of the so-called "Paris principles",
which were reportedly agreed upon by him and Kocharian in Paris in
March 2001.  According to Aliyev, Kocharian allegedly backed out of
the Paris Principles where they agreed to swap Armenia's southern
Meghri region in exchange for Karabakh and the Lachin corridor.
Kocharian and the Foreign Ministry of Armenia flatly deny that such a
swap has ever been agreed to. The Armenian side has, for the last
year, accused Aliyev of denying and reneging on the Paris Principles,
and have on numerous occasions stated that Armenia was ready to go
forward with the Karabakh negotiations based on the Paris principles
which did not include a land exchange, but the opening of borders,
secure corridors, and "horizontal" ties between Stepanakert and Baku.

Due to the conflicting statements and interpretations from the two
presidents and the secrecy surrounding the negotiations, the lack of
authoritative information available has raised suspicions in Armenia
and Azerbaijan.  Both presidents have encountered fierce domestic
resistance, and even charges of treason from their oppositions for
compromising their countries' sovereignty. As both presidents now head
into re-election season, the lack of progress towards a final peace
weakens their authority and they may be looking for alternative
solutions.

Aliyev's sudden shift in policy on June 14 possibly indicates an end
to Azerbaijan's expectations of reaching a Karabakh solution based on
an exchange of territories with Armenia; otherwise put, the
Azerbaijani interpretation of the Paris principles.

Regardless of the details of the Paris principles, a "land swap" deal
based on the exchange of the Meghri region vs Karabakh and Lachin
makes no sense for Armenia either from a geopolitical, logical, or
negotiating perspective.

There is a quasi-total Armenian consensus that if the Meghri region is
ever "given up", the consequences on Armenia will be detrimental.
Armenia cannot remain a long-term viable state without its border with
Iran. Throughout the post-soviet period, with the Turkish and
Azerbaijani borders blockaded and shut, with ongoing instability,
corruption and unfriendly alliances signed by the weak state of
Georgia, Iran's steady neutrality in regional conflicts and stability
as a trading partner has been a lifeline for the fledgling Armenian
economy and energy sector.  Furthermore, given Armenia's historical
fear of Pan-Turkism, Turkey's official policy of rationalizing and
justifying the Genocide of Armenians in 1915 and its two subsequent
invasions of Eastern Armenia in 1918 and 1920, a deal trading
Armenia's border with Iran would be diametrically incompatible with
the geopolitical North-South alliance, which Russia and Iran are
slowly building with the participation of, among others, Armenia.
Armenia can ill afford the loss of a border with Iran.

During Soviet times, Azerbaijan had unfettered access to Nakhichevan
by road and rail through the Meghri region without having sovereignty
over it. In a similarly internationalized example, Russia's access to
Kaliningrad since the break-up of the USSR in 1991 has not meant
having sovereignty over transport routes through Latvia, Lithuania or
Belarus. This is rather a simple matter of bilateral transportation
agreement between states. Furthermore, currently Azerbaijan already
has access to Nakhichevan through Iran, without needing sovereignty
over Iranian territory. If Azerbaijan were to normalize relations with
Armenia, it knows that Armenia has strong incentive to allow the use
of its roads again.  Moreover, such a relationship would be mandated
on the states as a matter of course as they become WTO members.

Even as the variants of the "Paris principles" lose their potential,
far too many loose ends and disagreements remain.  Polls show that
there is reasonable support for a "step by step" solution in both
Armenia and Azerbaijan (56% in Azerbaijan, 30% in Armenia, see RFE/RL
Caucasus Report - 15 July 2002, Volume 5, Number 24). President Aliyev
may have abandoned the Paris Principles to return to a step-by-step
negotiation in an attempt to break the deadlock for any progress which
may help his bid for re-election.

But Baku's proposal for a first step returning Fizuli, Jibrayil,
Zangelan, and Gubatly in exchange for opening borders is far too
ambitious in an atmosphere of zero confidence between Armenia and
Azerbaijan. It may prove to be too many steps in one step for both
Armenia and Azerbaijan.

Fizuli, Jibrayil, Zangelan, and Gubatly buffer the entire southern
flank of Karabakh's territory, protecting heavily populated regions of
the province. Returning Zangelan and Gubatly would also bring
Azerbaijan's forces back on the border of Armenia's southern region of
Meghri, from where they used to shell the city of Kapan and threaten
transportation and communication links between Armenia and Iran.
Without a comprehensive peace agreement in sight, Armenia and Karabakh
might find Baku's first offer as too risky from a security standpoint
and hard to sell to the Armenian people.

On the other hand, if relations are normalized and the proposed
exchange of territories occurs peacefully, will there be any pressure
on Armenia, - and Azerbaijan as well, - to continue negotiations on
the final status of Karabakh in the future? The Azerbaijani
authorities could face stiff domestic resistance to such an offer,
which could be seen as a de-facto capitulation of Karabakh, Lachin and
Kelbajar to Armenia.  Such a perception by the Azerbaijani public
could play into the hands of the radical opposition and undermine
Aliyev's re-election bid.

Should "step-by-step" negotiations be considered by Armenia?
Conditionally, and only one careful step at a time. If, as the Baku
and Yerevan Press Club polls (supported by the Open Society Institute)
claim, there is indeed 30% popular support for a step-by-step solution
towards peace in Armenia, then Armenia should consider a trial step as
a confidence building measure between the two nations.  Perhaps an
exchange of occupied territories and civilian repatriation for the
frontline districts of Shahumyan with Fizuli, accompanied by a lifting
by Azerbaijan of its veto on diplomatic and transportation links
between Armenia and Turkey, and a more cooperative stance between
Armenia and Azerbaijan in international organizations, where they are
both members, could provide a more realistic first step.

In this first step, Armenia should also test Azerbaijan's commitment
to continued peaceful negotiations. All agreements must clearly and
explicitly state, and must be agreed to and guaranteed by the external
mediators, - especially the co-chair countries of the OSCE Minsk Group
- and other interested international bodies, that Azerbaijan's
remilitarizing of any returned territories or initiating armed
hostilities at any time will mean the end of negotiations and would
trigger an international-legal redrawing of borders.

The "Shahumyan for Fizuli" step would be granted a timeframe of 36
months to show the goodwill and peaceful intents on both sides. This
first step would also explicitly mandate that Azerbaijan agrees to
starting negotiations on a final status for Karabakh before any
further steps between the two parties.

A successful first step would break the current Karabakh peace process
deadlock.  It would also break the massive inertia which has set in on
both sides of the Armenian-Azerbaijani frontline and negotiating
table, where, in time, progressively smaller concessions have become
ever more intractable. A small first step such as "Shahumyan for
Fizuli" would not predetermine the outcome of the negotiations, and
would not endanger the security balance on the ground. It would,
however, leave both sides enough incentive to continue with a second
step: Armenians would want to negotiate a final status for Karabakh as
well as open borders and normal trade relations with Azerbaijan;
Azerbaijan would negotiate the return of currently occupied
territories and repatriate internally displaced persons. Most
importantly, it would leave both sides with better hope and confidence
in each other's ability and will to advance towards peace.


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OLD WINE IN NEW BOTTLE?

    Baku appears to offer more substantial ideas to break the
    impasse in the Karabakh negotiations, but Yerevan needs to
    be cautious.

Armenian News Network/Groong
July 24, 2002

by Groong Research & Analysis Group


Azerbaijan's recent unofficial offers, discussed with a former top
Armenian negotiator, indicate Baku's retreat from previously stated
policy of maintaining a full blockade of Armenia until a final
settlement is achieved. Reportedly Baku is proposing normalization of
trade relations with Armenia before a final solution is achieved. It
appears that Baku is implicitly reconciling with the idea that
Karabakh may become part of Armenia; and that not all territories
under Armenian control will be returned.


Jirayr Libaridian, former Armenian president Levon Ter-Petrossian's
foreign policy advisor and chief negotiator on Karabakh, visited Baku
on June 2 and met with high-ranking Azerbaijani officials, reportedly
to collect material for an upcoming book on the Karabakh Conflict.
Libaridian, who resigned in 1997 and returned to the United States,
subsequently met with Nagorno Karabakh Republic (NKR) president Arkady
Ghukasian in Stepanakert and with Armenia's foreign minister Vartan
Oskanian in Yerevan. Libaridian passed to the Armenian officials a new
step-by-step offer from Azerbaijan to resolve the Karabakh conflict.
The offer may represent the end of Azerbaijan's expectations to find a
resolution through a so-called "land swap" deal, and offers Armenians
an opportunity to evaluate the current merits of a stepwise solution.

According to Libaridian the Azerbaijani leadership is again interested
in pursuing a modified "phased" (or so-called "step by step") formula
to peace in Karabakh. Armenian president Robert Kocharian's
administration has consistently insisted on a "package" deal, which
would settle all contentious issues, most significantly a final status
for Nagorno Karabakh, in a single accord. The difference of the two
approaches formed the core of the dispute in 1997-1998 between
then-Prime Minister Kocharian and former President Ter-Petrossian,
culminating in the latter's resignation in February 1998. Kocharian
was subsequently elected president in April 1998, after promising to
stick to a "package" deal.

The first phase of the new Azerbaijani offer proposes that Armenians
would return four out of seven outlying districts - Fizuli, Jibrayil,
Zangelan and Gubatly - currently held as a security buffer zone, in
exchange for Azerbaijan officially opening its borders with Armenia.
Talks about the status of Karabakh are indefinitely postponed. The
other three regions around Karabakh that are currently also under
Armenian control, - Agdam, Lachin and Kelbajar, - would remain in
Armenian hands until a final settlement is reached.

On June 14, Azerbaijani president Heidar Aliyev broke a year-long
policy of denying the existence of the so-called "Paris principles",
which were reportedly agreed upon by him and Kocharian in Paris in
March 2001.  According to Aliyev, Kocharian allegedly backed out of
the Paris Principles where they agreed to swap Armenia's southern
Meghri region in exchange for Karabakh and the Lachin corridor.
Kocharian and the Foreign Ministry of Armenia flatly deny that such a
swap has ever been agreed to. The Armenian side has, for the last
year, accused Aliyev of denying and reneging on the Paris Principles,
and have on numerous occasions stated that Armenia was ready to go
forward with the Karabakh negotiations based on the Paris principles
which did not include a land exchange, but the opening of borders,
secure corridors, and "horizontal" ties between Stepanakert and Baku.

Due to the conflicting statements and interpretations from the two
presidents and the secrecy surrounding the negotiations, the lack of
authoritative information available has raised suspicions in Armenia
and Azerbaijan.  Both presidents have encountered fierce domestic
resistance, and even charges of treason from their oppositions for
compromising their countries' sovereignty. As both presidents now head
into re-election season, the lack of progress towards a final peace
weakens their authority and they may be looking for alternative
solutions.

Aliyev's sudden shift in policy on June 14 possibly indicates an end
to Azerbaijan's expectations of reaching a Karabakh solution based on
an exchange of territories with Armenia; otherwise put, the
Azerbaijani interpretation of the Paris principles.

Regardless of the details of the Paris principles, a "land swap" deal
based on the exchange of the Meghri region vs Karabakh and Lachin
makes no sense for Armenia either from a geopolitical, logical, or
negotiating perspective.

There is a quasi-total Armenian consensus that if the Meghri region is
ever "given up", the consequences on Armenia will be detrimental.
Armenia cannot remain a long-term viable state without its border with
Iran. Throughout the post-soviet period, with the Turkish and
Azerbaijani borders blockaded and shut, with ongoing instability,
corruption and unfriendly alliances signed by the weak state of
Georgia, Iran's steady neutrality in regional conflicts and stability
as a trading partner has been a lifeline for the fledgling Armenian
economy and energy sector.  Furthermore, given Armenia's historical
fear of Pan-Turkism, Turkey's official policy of rationalizing and
justifying the Genocide of Armenians in 1915 and its two subsequent
invasions of Eastern Armenia in 1918 and 1920, a deal trading
Armenia's border with Iran would be diametrically incompatible with
the geopolitical North-South alliance, which Russia and Iran are
slowly building with the participation of, among others, Armenia.
Armenia can ill afford the loss of a border with Iran.

During Soviet times, Azerbaijan had unfettered access to Nakhichevan
by road and rail through the Meghri region without having sovereignty
over it. In a similarly internationalized example, Russia's access to
Kaliningrad since the break-up of the USSR in 1991 has not meant
having sovereignty over transport routes through Latvia, Lithuania or
Belarus. This is rather a simple matter of bilateral transportation
agreement between states. Furthermore, currently Azerbaijan already
has access to Nakhichevan through Iran, without needing sovereignty
over Iranian territory. If Azerbaijan were to normalize relations with
Armenia, it knows that Armenia has strong incentive to allow the use
of its roads again.  Moreover, such a relationship would be mandated
on the states as a matter of course as they become WTO members.

Even as the variants of the "Paris principles" lose their potential,
far too many loose ends and disagreements remain.  Polls show that
there is reasonable support for a "step by step" solution in both
Armenia and Azerbaijan (56% in Azerbaijan, 30% in Armenia, see RFE/RL
Caucasus Report - 15 July 2002, Volume 5, Number 24). President Aliyev
may have abandoned the Paris Principles to return to a step-by-step
negotiation in an attempt to break the deadlock for any progress which
may help his bid for re-election.

But Baku's proposal for a first step returning Fizuli, Jibrayil,
Zangelan, and Gubatly in exchange for opening borders is far too
ambitious in an atmosphere of zero confidence between Armenia and
Azerbaijan. It may prove to be too many steps in one step for both
Armenia and Azerbaijan.

Fizuli, Jibrayil, Zangelan, and Gubatly buffer the entire southern
flank of Karabakh's territory, protecting heavily populated regions of
the province. Returning Zangelan and Gubatly would also bring
Azerbaijan's forces back on the border of Armenia's southern region of
Meghri, from where they used to shell the city of Kapan and threaten
transportation and communication links between Armenia and Iran.
Without a comprehensive peace agreement in sight, Armenia and Karabakh
might find Baku's first offer as too risky from a security standpoint
and hard to sell to the Armenian people.

On the other hand, if relations are normalized and the proposed
exchange of territories occurs peacefully, will there be any pressure
on Armenia, - and Azerbaijan as well, - to continue negotiations on
the final status of Karabakh in the future? The Azerbaijani
authorities could face stiff domestic resistance to such an offer,
which could be seen as a de-facto capitulation of Karabakh, Lachin and
Kelbajar to Armenia.  Such a perception by the Azerbaijani public
could play into the hands of the radical opposition and undermine
Aliyev's re-election bid.

Should "step-by-step" negotiations be considered by Armenia?
Conditionally, and only one careful step at a time. If, as the Baku
and Yerevan Press Club polls (supported by the Open Society Institute)
claim, there is indeed 30% popular support for a step-by-step solution
towards peace in Armenia, then Armenia should consider a trial step as
a confidence building measure between the two nations.  Perhaps an
exchange of occupied territories and civilian repatriation for the
frontline districts of Shahumyan with Fizuli, accompanied by a lifting
by Azerbaijan of its veto on diplomatic and transportation links
between Armenia and Turkey, and a more cooperative stance between
Armenia and Azerbaijan in international organizations, where they are
both members, could provide a more realistic first step.

In this first step, Armenia should also test Azerbaijan's commitment
to continued peaceful negotiations. All agreements must clearly and
explicitly state, and must be agreed to and guaranteed by the external
mediators, - especially the co-chair countries of the OSCE Minsk Group
- and other interested international bodies, that Azerbaijan's
remilitarizing of any returned territories or initiating armed
hostilities at any time will mean the end of negotiations and would
trigger an international-legal redrawing of borders.

The "Shahumyan for Fizuli" step would be granted a timeframe of 36
months to show the goodwill and peaceful intents on both sides. This
first step would also explicitly mandate that Azerbaijan agrees to
starting negotiations on a final status for Karabakh before any
further steps between the two parties.

A successful first step would break the current Karabakh peace process
deadlock.  It would also break the massive inertia which has set in on
both sides of the Armenian-Azerbaijani frontline and negotiating
table, where, in time, progressively smaller concessions have become
ever more intractable. A small first step such as "Shahumyan for
Fizuli" would not predetermine the outcome of the negotiations, and
would not endanger the security balance on the ground. It would,
however, leave both sides enough incentive to continue with a second
step: Armenians would want to negotiate a final status for Karabakh as
well as open borders and normal trade relations with Azerbaijan;
Azerbaijan would negotiate the return of currently occupied
territories and repatriate internally displaced persons. Most
importantly, it would leave both sides with better hope and confidence
in each other's ability and will to advance towards peace.

© Copyright 2002 Armenian News Network/Groong. All Rights Reserved.