Report and Video: New Developments in the South Caucasus and the Role of Russia

By Maryia Hushcha

On January 16, the IIP held a public discussion titled ‘New Developments in the South Caucasus and the Role of Russia’. It featured Leila Alieva from Oxford University and Alexandra Dienes from Friedrich Ebert Foundation in Vienna. The panel was moderated by Hannes Swoboda from the International Institute for Peace.


The conflicts in the South Caucasus have lately been overshadowed by the conflicts in Ukraine and in the wider Middle East. Nevertheless, they continue. The two break away regions of Georgia, namely Abkhazia and South Ossetia, have been de facto under Russian occupation since the 2008 Russo-Georgian war. The conflict over Nagorno-Karabakh, an enclave in Azerbaijan with majority of ethnic Armenians living in it, is also far from being peacefully resolved, with the most recent violation of the ceasefire happening in 2016. Despite these lingering conflicts, the region’s security environment has been relatively stable lately. Can this stability in the South Caucasus be guaranteed in long-term? Does it mean that conflict resolution efforts by local and international actors have been moving forward? How does the recent revolution in Armenia, that is also referred to by many as the Velvet Revolution, play into this picture?

The strategic importance of the region was higher in the 1990s, according to Leila Alieva. This was mainly due to the importance of oil in international politics. Major oil contracts were signed back then, such as the Contract of the Century on developing Azerbaijani oil fields in the Caspian Sea. However, in the post-oil era of today the international interest to the South Caucasus has declined.  

Nevertheless, the Velvet Revolution in Armenia that came as a surprise to many political observers reinvigorated this interest. It led to a former oppositional parliamentary and civic activist Nikol Pashinyan taking the post of Prime Minister in 2018. Armenia, that is heavily dependent on Russia, both politically and militarily, has gone through a revolution largely because of two factors. Besides numerous failures of the former government, the revolution was possible because Russia underestimated the importance of soft power that the West and its democracy promotion efforts have had on the Armenian public. Also, it underestimated how much different younger generations of Armenians were from older generations. Young Armenians grew up in an independent country and thus they were free from nostalgia for the Soviet Union and were also willing to protest against the injustices committed by the government. Despite the success of the revolution, it will be hard for the new Prime Minister to consolidate its success, mainly because of the presence of the lingering Nagorno-Karabakh conflict which gives a strong leverage to Russia both over Armenia and Azerbaijan. A new arms race could also start. Russia and Israel will continue to supply Azerbaijan with weapons, while the United States’ National Security Advisor John Bolton has recently stated that Washington was ready to replace Moscow, were the latter to terminate its arms trade contracts with Armenia under the new government in Yerevan. 

Leila Alieva suggests three ways of how Nagorno-Karabakh conflict can be resolved. First, the West should become more active in the region. The second option would be to divide spheres of influence between the US and Russia. Thirdly, the countries in the region should look for solutions that would not involve external actors, thereby developing a sense of independency in conducting international politics. If the latter process were to happen, deconstruction of traditional threats and more normative certainty in the region would be some of its important outcomes.

What is remarkable about the South Caucasus, is that the dividing line between Russia- versus West-oriented states cuts right through it. While Armenia is a member of the Russia-led Eurasian Economic Union as well as the Collective Security Treaty Organization, Georgia has conducted pro-Western foreign policy, with NATO membership having been the number one goal for a series of Georgian governments. Despite the apparent consensus of Georgian elites about this direction of Georgia’s foreign policy as well as NATO’s support for it, Russia has been a veto player in Georgia, mainly due to its control of Abkhazia and South Ossetia. While the two regions are far from being reunited with the rest of Georgia, there have been a number of positive developments with regard to their engagement with the rest of Georgia, such as in trade and humanitarian issues which Moscow did not oppose.

Speaking about possible solutions of conflicts in the South Caucasus, Alexandra Dienes disagrees with Leila Alieva on the suggestion that conflict resolution should not involve external actors. She argues that the role of the OSCE format in the Georgian conflict that has been running since 2008 and is known as Geneva discussions, has still a lot to offer.


Some of the issues addressed in the Q&A session were the following:

- The role of Armenian diaspora in Armenia’s politics: Diaspora is an important external actor on Armenia’s socio-political scene. The Armenian diaspora in Russia supports stronger ties between Yerevan and Moscow, voicing fears about Armenia drifting too far to the West. At the same time, the Armenian diaspora in the West has also been active. The concert of a famous Armenian-American heavy metal band System of a Down in Armenia can be considered an example of soft power efforts by the Armenian diaspora living in the West.

- Georgia’s democratic development. Georgia’s pro-Western and pro-democratic orientation is clear. Tbilisi declared NATO membership its foreign policy priority. It has also signed the Association Agreement with the European Union which has facilitated stronger trade, investment and political and social relations between Georgia and the EU. Nevertheless, some issues that are in contradiction with democratic principles stand out. Among those are lack of acceptance of gay rights by the Georgian society, high-level corruption, and the oligarchic structure of the elite circles in Georgia. 

- The role of other important players in the region, such as the United States and Iran. Iran appears to be more supportive of Armenia than of Azerbaijan in the Nagorno-Karabakh conflict, not least because of Azerbaijan’s close relations with Israel, as well as mutual suspicion between Baku and Tehran, with the former one being a secular Islamic country and the latter a religious one. What concerns the US, the sanctions regime it imposed on Russia is helpful, since with an economically weak Russia the countries in the South Caucasus can be more proactive in their policies towards the West.

- Ways to resolve the conflicts in the South Caucasus. The experts differed in their opinions on this issue. Alexandra Dienes suggested that the OSCE was the only venue where progress could happen, especially on the Georgian conflict. The OSCE can play an important role in promotion of trade and humanitarian issues between Tbilisi government and the break away territories. This could lead to their gradual reintegration with the rest of Georgia, thereby also providing a face-saving option for Russia to withdraw from the region. On the other hand, Leila Alieva suggested that more interaction among the countries in the region without the involvement of external actors was necessary. During the Soviet Union the three South Caucasus republics had relations mainly with the center-Moscow but not among themselves. They therefore failed to understand their regional interdependency. Regaining this understanding could potentially lead to new solutions to the existing conflicts. 

Watch the full video of the event below.