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  • U.S.-Azerbaijan Relations

    U.S.-AZERBAIJAN RELATIONS

    US Department of State
    Sept 18 2009

    Washington, DC
    September 18, 2009

    Thank you for that kind introduction and for organizing such an
    important conference. It's an honor to join you today, especially
    Deputy Foreign Minister Azimov, Ambassador Aliyev, and my friend and
    former colleague David Kramer.

    I was asked to discuss the U.S.-Azerbaijan relationship in about 15
    minutes. That reminds me of a story involving George Bernard Shaw,
    the famous author, which highlights the challenge of brevity in
    public speaking. It seems that Shaw was hosting an event one day
    in London, and the first speaker came up to him and asked him how
    long he should speak for. Shaw told him he should probably limit
    his remarks to about fifteen minutes. "Fifteen minutes!" the speaker
    replied in horror. "How am I supposed to tell them everything I know
    in fifteen minutes ?" Shaw paused, and then responded: "In your case,
    I would advise you to speak very slowly."

    In my case, you don't have to worry about me going much beyond fifteen
    minutes, even if I speak very slowly.

    Let me start by asking a simple question: why does Azerbaijan matter
    to the United States? Since you're all attending this conference, I'm
    sure you already have a good sense of the importance of Azerbaijan,
    but sometimes the obvious bears repeating.

    The U.S. views Azerbaijan as a strategic partner sitting at the
    crossroads of the Middle East, Europe, and Asia - regions whose future
    will shape American interests and foreign policy for many years to
    come. After gaining independence in 1991, Azerbaijan chose to open its
    rich oil and gas resources to Western markets and develop commercial
    partnerships with foreign investors, including U.S. companies. As a
    result, Azerbaijan has emerged as a key player for diversifying and
    securing global energy supply. Its pipelines have become main arteries
    connecting the Caspian Sea to the West. Its commitment to building
    its governing institutions and a modern economy has bolstered the
    country's stability and stimulated economic growth.

    A more stable and prosperous Azerbaijan promises a more stable and
    prosperous Caucasus. It promises more opportunities for peace in a
    complex region. And it promises a more reliable partner for fighting
    global threats - from terrorism to financial crises - which no single
    nation can overcome alone.

    That's why the United States places such importance on our relationship
    with Azerbaijan. We want Azerbaijan to succeed in becoming a
    market-based economy and a democratic state. We want it to live in
    peace with its neighbors and play a central role in bringing stability
    to the region. These goals are not only in Azerbaijan's self-interest,
    but in our common interest.

    My next question is then: how is the United States helping Azerbaijan
    achieve these objectives? Our bilateral agenda focuses on three main
    areas: security cooperation, energy, and economic and democratic
    reform.

    Security

    In the security realm, one of our highest priorities is fighting
    the threat of violent extremism. Azerbaijan - a moderate, secular
    state with a majority Muslim population - has been a key ally
    in this campaign. It has shared information, increased efforts to
    combat terrorism financing, and apprehended and prosecuted suspected
    terrorists.

    As an active participant in NATO's Partnership for Peace program,
    Azerbaijan is developing multifaceted security relationships with
    its neighbors in the region. It has made steadfast contributions
    to NATO and coalition efforts in Iraq, Afghanistan, and Kosovo,
    which, Mr. Ambassador, we greatly appreciate. In 2008, Azerbaijani
    troops completed five years of service in Iraq, often serving next
    to U.S. Marines. This year, the number of Azerbaijani peacekeepers in
    Afghanistan doubled from 45 to 90. Azerbaijan also provides valuable
    overflight, refueling, and landing rights for U.S. and coalition
    aircraft bound for Afghanistan and Iraq.

    While Azerbaijan has made critical contributions to international
    security efforts, we recognize that the country has security concerns
    closer to home. Key to long-term stability in the region is achieving a
    peaceful resolution of the Nagorno - Karabakh conflict. Let me assure
    you that the President and Secretary Clinton are committed to doing
    everything possible to support that goal. We want to see Azerbaijan and
    Armenia living side-by-side in a peace that fosters mutual prosperity.

    Towards that end, we recently announced the appointment of Ambassador
    Bob Bradtke as the next U.S. co-chair of the OSCE Minsk Group. Bob
    brings more than 36 years of Foreign Service experience to the
    position, reflecting the importance the United States places on
    this process.

    We hope that the recent progress made in talks between Presidents
    Aliyev and Sargsian will lead to tangible results when they meet
    next month. The outline of a possible settlement has been clear for
    some time, though as with all things, the devil lies in the details
    and further discussions will be needed to satisfy the concerns of
    both sides. We trust that all parties will show the political will
    necessary to close negotiations and bring the conflict to its desired
    end. And we will devote considerable time and effort towards this goal.

    Likewise, the historic steps being taken by Turkey and Armenia
    towards normalizing relations are very encouraging. Although this
    rapprochement is not linked to the Nagorno-Karabakh negotiations,
    both processes are critical for resolving the long-standing problems
    that have divided the South Caucasus and limited opportunities for
    regional growth. Settling these disputes will open doors to new levels
    of cooperation, trust, and commercial development region-wide.

    Energy

    Speaking of commercial development brings me to our next area of
    bilateral cooperation - energy. The U.S. and Azerbaijan have a long
    partnership in major strategic energy projects that have created
    linkages between West and East.

    This week Azerbaijan is celebrating the 15th anniversary of the
    "Contract of the Century," which eventually led to the construction
    of the Baku-Tbilisi-Ceyhan oil pipeline. Today this pipeline exports
    about 1 million barrels of oil per day. Having also completed the
    South Caucasus Gas Pipeline, Azerbaijan is now on the threshold of a
    new and even more promising phase of energy sector development. The
    recent signing of the Nabucco Intergovernmental Agreement was a major
    milestone for opening up a new natural gas corridor to Europe. It is
    important that Turkey and Azerbaijan build on this momentum and soon
    reach an agreement on gas pricing, transit, and any remaining issues
    needed to make the Southern Corridor a reality.

    Such projects have not only unlocked Caspian energy resources for
    the world, but have also fueled Azerbaijan's economy and secured a
    more independent economic future for the Azerbaijani people.

    I realize that some have described U.S. and Russian energy
    policies as the next Great Game in Central Asia. This depiction
    is misleading. While there are always elements of competition in
    energy matters, as in any commercial area, the U.S. does not believe
    that energy security is a zero-sum game. We can gain more by working
    together than against one another. It is our firm belief that greater
    interconnectivity maximizes diverse sources and routes, ensures better
    market pricing, and protects against supply disruptions, for the good
    of all countries.

    In that vein, we hope that Azerbaijan and its neighbors will continue
    to develop their production of oil and gas. We encourage ongoing
    discussions between Azerbaijan and Turkmenistan, Kazakhstan, Turkey,
    and other partners to find reliable, transparent ways to help this
    production reach European and other markets. And I assure you that the
    United States stands ready to keep working closely with Azerbaijan,
    our other friends in the region, and the private sector to strengthen
    and expand global energy supply.

    Economic and Democratic Reform

    While several major U.S. firms, such as Chevron and Exxon, operate
    in Azerbaijan's energy industry, we'd frankly like to see more
    U.S. investment in the non-oil sectors. American companies can
    help Azerbaijan diversify its economy by bringing new technologies
    and skill sets. I'm confident that investment will flow as long as
    Azerbaijan continues its program of economic and democratic reform,
    which is the third pillar of our shared agenda.

    Azerbaijan has already made significant strides in improving the
    country's infrastructure and regulatory environment. These efforts
    earned it the distinction of being the "Top Reformer" in the World
    Bank's Doing Business Report in 2009. Azerbaijan also became the
    first country to comply with the Extractive Industries Transparency
    Initiative, which sets the global standard for transparency in oil,
    gas, and mining. But more work remains to implement these reform
    processes and put into place the laws and institutions needed for
    businesses to thrive and oil wealth to improve the lives of all
    citizens.

    Joining the World Trade Organization - an aspiration that Azerbaijan
    has pursued and the U.S. strongly supports - promises to be one of
    the fastest ways for the country to seize the benefits of foreign
    markets and attract international investors. At the same time, WTO
    rules require world class business standards, transparency, and a
    level playing field for all enterprises - small and large.

    This means tackling the problem of corruption. Transparency
    International noted in its 2008 Corruption Perceptions Index that
    corruption remains a serious challenge in post-Soviet states, including
    Azerbaijan. Corruption effectively acts as an extra tax that weighs
    most heavily on small businesses. It corrodes the rule of law and
    cripples law enforcement. It robs citizens of the wealth derived from
    economic growth. Sadly, corruption is a common failing of human nature
    worldwide, the United States included. But a democratic government
    has the responsibility to ensure it doesn't become a failing of the
    entire system by going undetected and unpunished.

    And this begs the question: how do you fight corruption, as the
    Azerbaijani government has promised in its National Strategy, without
    an independent media that can bring problems to light? Free press
    and a strong civil society are some of the most effective tools
    for combating corruption and protecting our citizens. The continued
    detentions of opposition journalists, as well as the blocking of Radio
    Free Europe/Radio Liberty, Voice of America, and BBC broadcasts in
    Azerbaijan, have raised significant concern in these areas. We've urged
    the Azerbaijani government to consider the impact of such actions in
    terms of its broader developmental and democratic goals.

    Increased transparency in governance will help Azerbaijan realize
    the democratic principles it endorses and economic well-being it
    seeks. The United States provides technical assistance and training
    to help improve public expenditure planning, enhance the capacity
    of the commercial finance system, and strengthen private sector
    competitiveness. Our assistance activities support election reform
    and fund education for journalists. They also back NGOs that battle
    corruption and help youth groups that seek to create new spaces for
    democratic debate on the web. We believe that an active civil society
    complements the role of government and cultivates a dynamic nation.

    Conclusion

    The U.S., as a strong and steady friend of Azerbaijan, is committed
    to working together with the Azerbaijani government and its people
    to support the development of a secure, prosperous, and democratic
    state. It is increasingly obvious that Azerbaijan has become much
    more than a trading stop on the Silk Road. As Azerbaijan progresses
    down its chosen path of reform, its influence will continue to extend
    into political, economic, and cultural spheres, and its connections
    with the United States will continue to deepen.

    A strong U.S.-Azerbaijan partnership is more important today than ever
    before. There are significant global challenges which neither of us can
    tackle alone. As with all bilateral relationships, there may be times
    when our interests do not coincide. But I hope I've clearly conveyed
    where we share common ground. Whether in the realm of security, energy,
    or economic and democratic reform, we have an historic opportunity to
    transform the region and help it achieve its geopolitical and economic
    potential. We need each other to accomplish this extraordinary task,
    and I'm optimistic that we'll live up to the challenge.
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