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UKRAINE CLASH SHOWS AZERIS WHO'S BOSS AS RUSSIA TIES BIND
Bloomberg / Business Week
Nov 21 2014
By Zulfugar Agayev November 21, 2014
Peeling away former Soviet republics from their U.S. and European
allies is getting easier for Russia after its show of force in Ukraine.
Azerbaijan is changing tack after months of steering clear of the
showdown 1,500 kilometers (900 miles) away. First Deputy Premier
Yaqub Eyyubov broke the silence in September, calling Russia his
country's "closest, most fraternal" ally. As a sign of the warming
ties, Russian warships last month docked at in the capital, Baku,
for the first time in more than a year.
The nation, which provides the only westward route for central Asian
oil bypassing Russia, has grown alarmed that Ukraine was left to
fend for itself as President Vladimir Putin had his way in Europe's
biggest crisis since the Iron Curtain fell 25 years ago. That was a
"very bad" signal, according to Elnur Soltanov, head of the Caspian
Center for Energy and Environment, a research group focused on foreign
policy in Baku.
Story: Ukraine's Second City, Kharkiv, Eludes Rebel Hands
"It told everybody who is the real boss in the region, who is the real
hegemon," he said. "Ukraine is the biggest jewel among the post-Soviet
states and if Russia comes in broad daylight and occupies Ukraine and
the Western world shows this limited reaction -- it tells us that if
something goes wrong with Russia, we shouldn't trust anybody to come
and save us."
Oil Effect
As Azerbaijan redraws its foreign policy, its $74 billion economy is
being buffeted by falling crude output and an oil-market selloff.
Gross domestic product expanded 2.8 percent in the January-October
period, slowing from 5.7 percent a year earlier. Hydrocarbons, which
account for 45 percent of GDP, make up more than 90 percent of total
Azeri exports, up from 60 percent in the late 1990s, according to
the International Monetary Fund.
The Caspian Sea country is backtracking on its two-decade drive to
forge closer ties with the U.S. and Europe as tensions escalate with
Russian ally Armenia over the breakaway region of Nagorno-Karabakh.
The government has also come under greater scrutiny for its commitment
to media freedoms and human rights.
Story: All's Quiet on the Eastern Front--for Now
Azerbaijan last week shot down what it said was an Armenian helicopter
that violated its airspace, an attack that threatens to escalate the
conflict. More than 20 troops were killed in August as the skirmishes
turned the deadliest in 20 years.
With Russian troops already stationed in neighboring Georgia and
Armenia, leaders in the nation of 9.6 million people are concerned
about leaving the country's other flanks exposed after seeing the
failed efforts to counter Putin's actions in Ukraine.
'Closer Relationship'
President Ilham Aliyev has visited Putin twice in the past three
months and has recently hosted a range of senior officials from Moscow.
Video: Ukraine, Russia Need Negotiated Outcome: Kissinger
Along with Turkey and Israel, Russia is among the biggest suppliers
of weapons to Azerbaijan, selling it military hardware including T-90
battle tanks. Speaking at a meeting with Putin last year, Aliyev said
Azeri arms trade with Russia was worth $4 billion. The government in
Baku plans to increase defense spending by 27 percent next year.
"We definitely see a closer relationship between Baku and Moscow in
the past year," said Thomas de Waal, senior associate at the Russia
and Eurasia program of Carnegie Endowment for International Peace.
"The Azerbaijani elite is seeking an equal relationship with both
Russia and the West, while retaining its own economic and political
independence."
Azerbaijan's shift toward Russia is also straining relations with
the U.S. and Europe.
Video: Russia-Ukraine Deal Averts Gas Supply Disruption
Obama, OSCE
U.S. President Barack Obama in September singled out Azerbaijan as
a country where "laws make it incredibly difficult for NGOs even to
operate." The Organization for Security and Cooperation in Europe
this month urged the government to end its "ongoing and increasing
number of repressive actions against independent media and advocates
of freedom of expression," according to a statement.
After winning independence 23 years ago, Azerbaijan has developed
energy and security ties with the U.S. and the European Union. In
partnership with oil companies including BP Plc (BP/), Statoil ASA
(STL) and Exxon Mobil Corp. (XOM:US), the Caspian Sea nation built
the Baku-Tbilisi-Ceyhan pipeline, which ships Asian oil to Europe
bypassing Russia.
The country also sent troops to fight alongside U.S. forces in
Kosovo, Iraq and Afghanistan. NATO relies on Azerbaijan for a third
of non-lethal shipments to Afghanistan.
Story: Putin Is Losing Out to China in Central Asia's Latest 'Great
Game'
It also joined GUAM, a U.S.-backed alliance with Georgia, Ukraine and
Moldova. All bar Azerbaijan tied their future to the European Union
in June by signing free-trade agreements with the 28-nation bloc.
Azerbaijan rejected such an offer.
Separatist Challenges
Like the three other members of the group, Azerbaijan has struggled
to regain control over a breakaway region. The message is that
confrontation with Russia by Georgia and Moldova worsened separatist
challenges, as it did in Ukraine said Rasim Musabayov, a member of
the international relations committee in Azerbaijan's parliament.
Azerbaijan is locked in a territorial dispute with Armenia over
Nagorno-Karabakh, a conflict that erupted after the Soviet breakup
in 1991.
Although major hostilities ended with a Russia-brokered cease-fire
in 1994, no peace agreement has been signed. Armenia hosts the only
Russian military base in the region and gets Russian weapons at
discounted prices.
"Azerbaijan has drawn lessons from what has happened to Georgia,
Moldova and Ukraine," Musabayov said. "Azerbaijan realizes that it
can't get Nagorno-Karabakh resolved without Russia's involvement."
http://www.businessweek.com/news/2014-11-20/ukraine-clash-shows-azeris-who-s-boss-as-russia-ties-bind
Bloomberg / Business Week
Nov 21 2014
By Zulfugar Agayev November 21, 2014
Peeling away former Soviet republics from their U.S. and European
allies is getting easier for Russia after its show of force in Ukraine.
Azerbaijan is changing tack after months of steering clear of the
showdown 1,500 kilometers (900 miles) away. First Deputy Premier
Yaqub Eyyubov broke the silence in September, calling Russia his
country's "closest, most fraternal" ally. As a sign of the warming
ties, Russian warships last month docked at in the capital, Baku,
for the first time in more than a year.
The nation, which provides the only westward route for central Asian
oil bypassing Russia, has grown alarmed that Ukraine was left to
fend for itself as President Vladimir Putin had his way in Europe's
biggest crisis since the Iron Curtain fell 25 years ago. That was a
"very bad" signal, according to Elnur Soltanov, head of the Caspian
Center for Energy and Environment, a research group focused on foreign
policy in Baku.
Story: Ukraine's Second City, Kharkiv, Eludes Rebel Hands
"It told everybody who is the real boss in the region, who is the real
hegemon," he said. "Ukraine is the biggest jewel among the post-Soviet
states and if Russia comes in broad daylight and occupies Ukraine and
the Western world shows this limited reaction -- it tells us that if
something goes wrong with Russia, we shouldn't trust anybody to come
and save us."
Oil Effect
As Azerbaijan redraws its foreign policy, its $74 billion economy is
being buffeted by falling crude output and an oil-market selloff.
Gross domestic product expanded 2.8 percent in the January-October
period, slowing from 5.7 percent a year earlier. Hydrocarbons, which
account for 45 percent of GDP, make up more than 90 percent of total
Azeri exports, up from 60 percent in the late 1990s, according to
the International Monetary Fund.
The Caspian Sea country is backtracking on its two-decade drive to
forge closer ties with the U.S. and Europe as tensions escalate with
Russian ally Armenia over the breakaway region of Nagorno-Karabakh.
The government has also come under greater scrutiny for its commitment
to media freedoms and human rights.
Story: All's Quiet on the Eastern Front--for Now
Azerbaijan last week shot down what it said was an Armenian helicopter
that violated its airspace, an attack that threatens to escalate the
conflict. More than 20 troops were killed in August as the skirmishes
turned the deadliest in 20 years.
With Russian troops already stationed in neighboring Georgia and
Armenia, leaders in the nation of 9.6 million people are concerned
about leaving the country's other flanks exposed after seeing the
failed efforts to counter Putin's actions in Ukraine.
'Closer Relationship'
President Ilham Aliyev has visited Putin twice in the past three
months and has recently hosted a range of senior officials from Moscow.
Video: Ukraine, Russia Need Negotiated Outcome: Kissinger
Along with Turkey and Israel, Russia is among the biggest suppliers
of weapons to Azerbaijan, selling it military hardware including T-90
battle tanks. Speaking at a meeting with Putin last year, Aliyev said
Azeri arms trade with Russia was worth $4 billion. The government in
Baku plans to increase defense spending by 27 percent next year.
"We definitely see a closer relationship between Baku and Moscow in
the past year," said Thomas de Waal, senior associate at the Russia
and Eurasia program of Carnegie Endowment for International Peace.
"The Azerbaijani elite is seeking an equal relationship with both
Russia and the West, while retaining its own economic and political
independence."
Azerbaijan's shift toward Russia is also straining relations with
the U.S. and Europe.
Video: Russia-Ukraine Deal Averts Gas Supply Disruption
Obama, OSCE
U.S. President Barack Obama in September singled out Azerbaijan as
a country where "laws make it incredibly difficult for NGOs even to
operate." The Organization for Security and Cooperation in Europe
this month urged the government to end its "ongoing and increasing
number of repressive actions against independent media and advocates
of freedom of expression," according to a statement.
After winning independence 23 years ago, Azerbaijan has developed
energy and security ties with the U.S. and the European Union. In
partnership with oil companies including BP Plc (BP/), Statoil ASA
(STL) and Exxon Mobil Corp. (XOM:US), the Caspian Sea nation built
the Baku-Tbilisi-Ceyhan pipeline, which ships Asian oil to Europe
bypassing Russia.
The country also sent troops to fight alongside U.S. forces in
Kosovo, Iraq and Afghanistan. NATO relies on Azerbaijan for a third
of non-lethal shipments to Afghanistan.
Story: Putin Is Losing Out to China in Central Asia's Latest 'Great
Game'
It also joined GUAM, a U.S.-backed alliance with Georgia, Ukraine and
Moldova. All bar Azerbaijan tied their future to the European Union
in June by signing free-trade agreements with the 28-nation bloc.
Azerbaijan rejected such an offer.
Separatist Challenges
Like the three other members of the group, Azerbaijan has struggled
to regain control over a breakaway region. The message is that
confrontation with Russia by Georgia and Moldova worsened separatist
challenges, as it did in Ukraine said Rasim Musabayov, a member of
the international relations committee in Azerbaijan's parliament.
Azerbaijan is locked in a territorial dispute with Armenia over
Nagorno-Karabakh, a conflict that erupted after the Soviet breakup
in 1991.
Although major hostilities ended with a Russia-brokered cease-fire
in 1994, no peace agreement has been signed. Armenia hosts the only
Russian military base in the region and gets Russian weapons at
discounted prices.
"Azerbaijan has drawn lessons from what has happened to Georgia,
Moldova and Ukraine," Musabayov said. "Azerbaijan realizes that it
can't get Nagorno-Karabakh resolved without Russia's involvement."
http://www.businessweek.com/news/2014-11-20/ukraine-clash-shows-azeris-who-s-boss-as-russia-ties-bind