In recent years, Azerbaijan has increasingly focused on strengthening its ties with Central Asian countries, driven by shared historical, cultural, and economic interests. As these nations navigate a rapidly changing global landscape, new cooperation formats are emerging that promise to deepen relationships, enhance regional stability, and foster economic growth.
One of the most significant developments in Azerbaijan's cooperation with Central Asian countries is the formation of trilateral and multilateral cooperation frameworks. These frameworks extend beyond bilateral relations to encompass broader regional cooperation involving multiple countries. A prime example is the upcoming Azerbaijan-Turkey-Turkmenistan Business Forum, scheduled to be held in Istanbul on September 10, 2024. This forum aims to explore market and investment opportunities, support brand integration into the international arena, and develop commercial relations among the three countries. Such forums are critical in facilitating dialogue among business leaders, government officials, and entrepreneurs, laying the groundwork for more comprehensive economic cooperation.
Azerbaijan has participated in two consultative meetings of Central Asian leaders and serves as a crucial link in the realization of significant projects such as the Middle Corridor and the Green Corridor. One potential drawback of this cooperation format is the risk of developing relationships in a unilateral manner, driven by the European Union's demand for energy resources and rare earth metals from Central Asian countries. However, current trends suggest that Central Asian countries may now be poised to increase their importance for Azerbaijan and other countries in the South Caucasus and Turkey, particularly in the context of expanded cooperation with South Asian nations.
On August 15, a ministerial meeting in the "Azerbaijan-Uzbekistan-Afghanistan" format was held. The parties held trilateral negotiations on issues of developing trade, transport and logistics, and developing mineral deposits. It is possible to expect that this format will continue to exist, as the parties discussed various areas of cooperation.
At this stage, in addition to this format, several other cooperation frameworks involving Central Asian and South Caucasus countries exist:
- Turkey-Azerbaijan-Turkmenistan: Focuses on promoting energy and economic cooperation, but in addition there are other topics that are discussed within this format.
- Azerbaijan-Iran-Turkmenistan: Involved expanding gas exports from Turkmenistan to Azerbaijan under a SWAP agreement.
- Georgia-Azerbaijan-Kazakhstan: The countries have established a joint venture to promote the Middle Corridor.
- Georgia-Azerbaijan-Kazakhstan-Uzbekistan: These countries have signed a memorandum to establish a reinsurance pool.
- Azerbaijan-Kazakhtan-Uzbekistan: These countires signed a memorandum to integrate electocity systems.
Relevance of the Multilateral Cooperation Framework
Multilateral cooperation frameworks, such as those Azerbaijan is developing with Central Asian countries, play a crucial role in strengthening regional integration and security. In the context of global politics and economics, these formats enable countries to respond more effectively to challenges that cannot be addressed at the bilateral level. Multilateral frameworks provide a platform for sharing experiences, coordinating efforts, and collectively solving problems. Theoretically, multilateral formats can be seen as tools for promoting a regional security complex where countries collaborate to prevent conflicts, coordinate energy security activities, and develop common economic strategies.
This approach fosters trust between countries, which is particularly important in regions with historical or geopolitical tensions. Additionally, multilateral formats ensure more efficient use of resources, whether natural resources, infrastructure, or human capital. Joint projects and initiatives enable countries to achieve synergies, where the overall effect is greater than the sum of individual contributions. This is especially significant in the context of globalization, where national economies are becoming increasingly interdependent.
However, despite these potential benefits, skepticism exists regarding the effectiveness of such multilateral formats. Critics argue that these frameworks may be challenging to manage effectively due to the diverse political and economic interests of the participating countries. Concerns also arise over the possibility of economic power asymmetry within the group, where stronger states could dominate, potentially sidelining the needs and priorities of smaller nations. Moreover, there is a risk that these cooperation formats could become overly dependent on external factors, such as the demands of the European Union or China, undermining their long-term sustainability and autonomy.
Furthermore, historical tensions and unresolved disputes among some Central Asian countries may pose significant challenges to achieving deep and lasting cooperation. These underlying issues could impede the development of trust and prevent the full realization of the benefits that multilateral cooperation is intended to bring. Additionally, the reliance on ambitious infrastructure projects, such as the Middle Corridor, may encounter practical obstacles related to funding, political will, and regional stability.
Future Prospects for the Development of Multilateral Cooperation Frameworks
One promising aspect of future multilateral cooperation is the deepening ties between Azerbaijan, Uzbekistan, and Afghanistan, exemplified by their recent trilateral meeting on August 15, 2024, organized by Afghanistan's Ministry of Industry and Trade. This meeting highlighted the potential for enhancing trade-economic and transport-logistic connections among these nations. Future cooperation in sectors such as hydrocarbon and mineral production, with Uzbekistan showing significant interest in Afghanistan's resources, suggests a likely strengthening of economic integration. This trilateral cooperation is part of a broader vision to incorporate Afghanistan into Central Asian trade networks, which could be pivotal for the region's long-term economic development.
The strategic focus on infrastructure development, particularly in transport and logistics, is likely to continue shaping regional cooperation. The proposed Termez-Mazar-i-Sharif-Kabul-Peshawar railway stands out as a future project with significant potential. This railway could connect Uzbekistan and Afghanistan to Pakistan, providing Uzbekistan with crucial access to maritime shipping routes. Successful implementation of such infrastructure projects could significantly enhance the region’s trade capabilities and economic integration.
Energy Cooperation: The Future Cornerstone of Regional Relations
Energy cooperation is expected to remain a foundational element of Azerbaijan’s relationships with Central Asian countries, especially Kazakhstan and Turkmenistan. The Caspian Sea, with its abundant hydrocarbon resources, will continue to be a focal point for future collaboration. The ongoing developments around the "Dostluk" field, Turkmenistan and Azerbijan signed an agreement to jointly develop a long-disputed Caspian gas, what could suggest a future where these nations play a pivotal role in securing energy supplies for Turkey and Europe. As this cooperation deepens, Azerbaijan and Turkmenistan could further solidify their positions as key players in the regional energy market.
Additionally, Kazakhstan, Azerbaijan, and Uzbekistan have made significant strides toward integrating their energy systems through a memorandum of cooperation signed on May 1, 2024, during the Tashkent International Investment Forum. This agreement aims to enhance energy trade and cooperation among the three nations, focusing particularly on the development of renewable energy sources and the export of green energy to European markets.
The memorandum outlines plans to connect the energy systems of the three countries, facilitating efficient energy trade. A critical component of this integration involves the construction of high-voltage cables, including a submarine cable beneath the Caspian Sea, to link their energy grids.
Looking ahead, Azerbaijan, Kazakhstan, and Uzbekistan are likely to explore more advanced energy infrastructure projects to streamline the flow of energy to European markets. Expanding energy networks and developing new transit routes that bypass traditional bottlenecks could increase the security and reliability of energy supplies, ensuring long-term regional energy stability.
Expanding Trade and Economic Integration
The prospects for future economic integration within the trilateral cooperation frameworks are promising. In June 2023, Turkmenistan ratified a significant agreement with Azerbaijan and Turkey that emphasizes trade and economic cooperation. This agreement is designed to strengthen trade ties and facilitate mutual investments across various sectors, including goods and services, energy, agriculture, and logistics. This framework sets a precedent for future collaborations within a new multilateral framework Azerbaijan-Kazakhstan-Turkmenistan. As these agreements expand, focusing on sectors like goods and services, agriculture, and logistics, they will likely create a more favorable environment for mutual investments.
Investment opportunities in agriculture, transport, and tourism are poised for growth, with Azerbaijan continuing to seek engagement with Central Asia, including potential investments in Afghanistan. The groundwork laid by the first meeting of the Joint Working Group on Economic Cooperation between Azerbaijan and Afghanistan in 2019 is expected to lead to increased trade and investment activities, signaling Azerbaijan’s ongoing commitment to deepening its economic influence in the region.
Transport and Logistics: A Vision for Revitalizing the Silk Road
The revival of the Silk Road routes will likely remain a central theme in Azerbaijan's future cooperation with Central Asian countries. Connectivity projects, such as the Termez-Mazar-i-Sharif-Kabul-Peshawar railway, will be instrumental in boosting trade flows and providing vital maritime access to landlocked nations like Uzbekistan. Azerbaijan’s strategic position on the Trans-Caspian International Transport Route (TITR), or Middle Corridor, positions it as a key player in the continued efforts to link Europe and Asia.
These connectivity projects are not just about trade facilitation; they represent a broader vision for regional integration. Improved logistics networks among Azerbaijan and Central Asian states will be critical in leveraging geographic advantages to drive economic growth, with ongoing discussions likely to lead to concrete developments in rail and road infrastructure.
Strategic Pathways to Regional Rapprochement
In conclusion, the evolving trilateral and multilateral cooperation frameworks between Azerbaijan and Central Asian countries represent a strategic approach to regional integration and economic growth. These initiatives, driven by shared interests in energy, trade, transport, and logistics, have the potential to significantly enhance regional stability and prosperity. As these partnerships continue to develop, they are likely to create new opportunities for collaboration, ensuring that the involved nations can collectively navigate the complexities of a rapidly changing global landscape and secure a more interconnected and prosperous future. However, the success of these frameworks will depend on addressing inherent challenges and potential drawbacks, such as managing diverse interests, avoiding dependency on external powers, and overcoming historical tensions, to achieve truly sustainable and equitable regional cooperation.
Written by: Eldaniz Gusseinov
Eldaniz Gusseinov, is a Non-Resident Research Fellow at Haydar Aliyev Center for Eurasian Studies of the Ibn Haldun University, Istanbul.
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