Armenia, Azerbaijan, and Georgia: Political
Developments and Implications for U.S.
Interests

Jim Nichol
Specialist in Russian and Eurasian Affairs
May 1, 2012
Congressional Research Service
7-5700
www.crs.gov
RL33453
CRS Report for Congress
Pr
epared for Members and Committees of Congress

Armenia, Azerbaijan, and Georgia: Political Developments and Implications

Summary
The United States recognized the independence of Armenia, Azerbaijan, and Georgia when the
former Soviet Union broke up at the end of 1991. The United States has fostered these states’ ties
with the West in part to end their dependence on Russia for trade, security, and other relations.
The United States has pursued close ties with Armenia to encourage its democratization and
because of concerns by Armenian Americans and others over its fate. Close ties with Georgia
have evolved from U.S. contacts with its pro-Western leadership. Successive Administrations
have supported U.S. private investment in Azerbaijan’s energy sector as a means of increasing the
diversity of world energy suppliers. The United States has been active in diplomatic efforts to
resolve regional conflicts in the region. As part of the U.S. global counter-terrorism efforts, the
U.S. military in 2002 began providing equipment and training for Georgia’s military and security
forces. Troops from all three regional states have participated in stabilization efforts in
Afghanistan and Iraq. The South Caucasian troops serving in Iraq departed in late 2008. The
regional states also have granted transit privileges for U.S. military personnel and equipment
bound for Afghanistan.
Beginning on August 7, 2008, Russia and Georgia warred over Georgia’s breakaway regions of
Abkhazia and South Ossetia. Russian troops quickly swept into Georgia, destroyed infrastructure,
and tightened their de facto control over the breakaway regions before a ceasefire was concluded
on August 15. The conflict has had long-term effects on security dynamics in the region and
beyond. Russia recognized the independence of Abkhazia and South Ossetia, but the United
States and nearly all other nations have refused to follow suit. Russia established bases in
Abkhazia and South Ossetia—in violation of the ceasefire accords—that buttress its long-time
military presence in Armenia. Although there were some concerns that the South Caucasus had
become less stable as a source and transit area for oil and gas, Kazakhstan and Turkmenistan are
barging oil across the Caspian Sea for transit westward, and the European Union still plans to
build the so-called Nabucco pipeline to bring Azerbaijani and other gas to Austria.
Key issues in the 112th Congress regarding the South Caucasus may include Armenia’s
independence and economic development; Azerbaijan’s energy development; and Georgia’s
recovery from Russia’s August 2008 military incursion. At the same time, concerns may include
the status of human rights and democratization in the countries; the ongoing Armenia-Azerbaijan
conflict over the breakaway Nagorno Karabakh region; and ongoing threats posed to Georgia and
the international order by Russia’s 2008 incursion and its diplomatic recognition of South Ossetia
and Abkhazia. Congress may continue to oversee the region’s role as part of the Northern
Distribution Network for the transit of military supplies to support U.S. and NATO operations in
Afghanistan. Some Members of Congress and other policymakers believe that the United States
should provide greater support for the region’s increasing role as an east-west trade and security
corridor linking the Black Sea and Caspian Sea regions, and for Armenia’s inclusion in such
links. They urge greater U.S. aid and conflict resolution efforts to contain warfare, crime,
smuggling, and terrorism, and to bolster the independence of the states. Others urge caution in
adopting policies that will increase U.S. involvement in a region beset by ethnic and civil
conflicts.

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Armenia, Azerbaijan, and Georgia: Political Developments and Implications

Contents
Most Recent Developments ............................................................................................................. 1
Background...................................................................................................................................... 1
Overview of U.S. Policy Concerns.................................................................................................. 1
Regional Responses After the September 11, 2001, Terrorist Attacks on the
United States .................................................................................................................... 4
Support for Military Operations in Iraq and Afghanistan ................................................... 4
Azerbaijan and the Northern Distribution Network (NDN)................................................ 5
U.S. Policy After the August 2008 Russia-Georgia Conflict .............................................. 5
The External Security Context of the South Caucasus .................................................................... 8
Russian Involvement in the Region........................................................................................... 8
Military-Strategic Interests.................................................................................................. 8
Caspian Energy Resources ................................................................................................ 10
The Roles of Turkey, Iran, and Others..................................................................................... 11
The Armenia-Turkey Protocols of 2009............................................................................ 11
Iran .................................................................................................................................... 12
Others ................................................................................................................................ 13
Obstacles to Peace and Independence ........................................................................................... 14
Regional Tensions and Conflicts ............................................................................................. 14
Nagorno Karabakh Conflict .............................................................................................. 14
Civil and Ethnic Conflict in Georgia................................................................................. 18
Economic Conditions, Blockades, and Stoppages................................................................... 26
Recent Democratization Problems and Progress..................................................................... 27
Armenia............................................................................................................................. 27
Azerbaijan ......................................................................................................................... 29
Georgia.............................................................................................................................. 35
U.S. Aid Overview......................................................................................................................... 36
The Millennium Challenge Account........................................................................................ 37
U.S. Assistance After the Russia-Georgia Conflict ................................................................. 38
U.S. Security Assistance.......................................................................................................... 39
Security Assistance to Georgia Since the August 2008 Conflict....................................... 40
The Regional States and NATO ........................................................................................ 42
U.S. Trade and Investment............................................................................................................. 44
Georgia and Russia’s Accession to the WTO .......................................................................... 45
Energy Resources and U.S. Policy .......................................................................................... 46
Building the Baku-Tbilisi-Ceyhan and South Caucasus Pipelines.................................... 47
Other Export Pipeline Proposals ....................................................................................... 48
Regional Energy Cooperation with Iran............................................................................ 50
Legislation ..................................................................................................................................... 51

Figures
Figure 1. Map of Caucasus Region................................................................................................ 55

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Tables
Table 1. U.S. Foreign Aid to the South Caucasus States, FY1992 to FY2011, and the
FY2012 Request ......................................................................................................................... 51
Table 2. U.S. Assistance to the South Caucasus, FY1992-FY2001............................................... 53
Table 3. U.S. Assistance to the South Caucasus, FY2002-FY2010 (and Totals, FY1992-
FY2010)...................................................................................................................................... 53
Table 4. U.S. Humanitarian Assistance to Nagorno Karabakh Provided by the U.S.
Agency for International Development and Other Agencies, and Totals for Budgeted,
Obligated, and Expended Funding, FY1998-FY2011 ................................................................ 54
Table 5. The $1 Billion in Added Aid to Georgia by Priority Area................................................ 55

Contacts
Author Contact Information........................................................................................................... 56

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Armenia, Azerbaijan, and Georgia: Political Developments and Implications

Most Recent Developments
In early April 2012, Azerbaijani security forces reportedly carried out operations against several
terrorist cells in towns in the northern part of the country. In Ganja, one security officer was killed
by a suicide bomber, said to be the first such bombing in Azerbaijan. Authorities alleged that the
cells were part of the “forest brothers” Islamic terrorist group, largely based in the trans-border
Dagestan republic of Russia. Azerbaijani state television reported that some of the Azerbaijanis in
the group had been trained at al Qaeda-affiliated Islamic Movement of Uzbekistan camps in
Pakistan and had then fought with Taliban forces in Afghanistan against coalition forces and in
Dagestan. Other training had been received at al Qaeda camps in Iran and Syria. In early 2011,
the “forest brothers” group allegedly had decided to carry out jihad in Azerbaijan by targeting
Shiite mosques and shrines; Christian churches; Jewish synagogues; and police, defense, and
security offices.1
Background
Armenia, Azerbaijan, and Georgia are located south of the Caucasus Mountains that form part of
Russia’s borders (see Figure 1). The South Caucasus states served historically as a north-south
and east-west trade and transport “land bridge” linking Europe to the Middle East and Asia, over
which the Russian Empire and others at various times endeavored to gain control. In ancient as
well as more recent times, oil and natural gas resources in Azerbaijan attracted outside interest.
All three peoples can point to periods of past autonomy or self-government. After the Russian
Empire collapsed in 1917, all three states declared independence, but by early 1921 all had been
reconquered by Russia’s Red (Communist) Army. They regained independence when the Soviet
Union collapsed at the end of 1991.2
Overview of U.S. Policy Concerns
By the end of 1991, the United States had recognized the independence of all the former Soviet
republics. The United States pursued close ties with Armenia, because of its profession of
democratic principles, and concerns by Armenian-Americans and others over its fate. The United
States pursued close ties with Georgia after Eduard Shevardnadze (formerly a pro-Western Soviet
foreign minister) assumed power there in early 1992. Faced with calls in Congress and elsewhere
for a U.S. aid policy for the Eurasian states, then-President George H. W. Bush sent the
FREEDOM Support Act to Congress, which was signed with amendments into law in October
1992 (P.L. 102-511). Appropriations under the authority of the FREEDOM Support Act are
currently included in the State Department’s Assistance to Europe, Eurasia, and Central Asia
(AEECA) Account.

1 Open Source Center, Central Eurasia: Daily Report (hereafter CEDR), April 25, 2012, Doc. No. CEP-950068.
2 For background, see CRS Report RS20812, Armenia Update, by Carol Migdalovitz; CRS Report 97-522, Azerbaijan:
Recent Developments and U.S. Interests
, by Jim Nichol; and CRS Report 97-727, Georgia [Republic]: Recent
Developments and U.S. Interests
, by Jim Nichol.
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U.S. policy toward the South Caucasus states
The Caucasus Region:
has included promoting the resolution of
Basic Facts
conflicts between Armenia and Azerbaijan
over Azerbaijan’s breakaway Nagorno
Area: The region is slightly larger than Syria: Armenia is
11,620 sq. mi.; Azerbaijan is 33,774 sq. mi.; Georgia is
Karabakh (NK) region and between Georgia
26,872 sq. mi.
and its breakaway regions of Abkhazia and
South Ossetia (resolving these latter conflicts
Population: 17.03 million, slightly less than Kazakhstan;
Armenia: 2.97 m.; Azerbaijan: 9.49 m.; Georgia: 4.57 m.
became much more difficult following the
(CIA, The World Factbook, July 2012 est.). Over 1 million
August 2008 conflict; see “The August 2008
people from the region are migrant workers in Russia
Russia-Georgia Conflict,” below). Since 1993,
and elsewhere.
U.S. emissaries have been detailed to try to
GDP: $135.48 billion: Armenia: $17.95 b.; Azerbaijan:
settle these conflicts. Congressional concerns
$93.02 b.; Georgia: $24.51 b. (CIA, The World Factbook,
about the NK conflict led to the inclusion of
2011 est., purchasing power parity).
Section 907 in the FREEDOM Support Act,
which prohibits U.S. government-to-government assistance to Azerbaijan, except for non-
proliferation and disarmament activities, until the President determines that Azerbaijan has taken
“demonstrable steps to cease all blockades and other offensive uses of force against Armenia and
NK.” Provisions in FY1996, FY1998, and FY1999 legislation eased the prohibition by providing
for humanitarian, democratization, and business aid exemptions (on waiver authority enacted in
2002, see “Regional Responses After the September 11,” below).
Some observers argue that developments in the South Caucasus are largely marginal to U.S.
strategic interests. They urge great caution in adopting policies that will heavily involve the
United States in a region beset by ethnic and civil conflicts, and some argue that, since the
European Union has recognized the region as part of its “neighborhood,” it rightfully should play
a major role. Some observers argue that the U.S. interest in democratization and human rights
should not be subordinated to interests in energy and anti-terrorism.3
Other observers believe that U.S. policy requires more active engagement in the region. They
urge greater U.S. aid and conflict resolution efforts to contain warfare, crime, smuggling, and
Islamic extremism and to bolster the independence of the states. Some argue that such enhanced
U.S. relations also would serve to “contain” Russian and Iranian influence and that close U.S. ties
with Azerbaijan could benefit U.S. relations with other Islamic countries. They also point to the
prompt support offered to the United States by the regional states in the aftermath of the
September 11, 2001, attacks by Al Qaeda on the United States. Some argue that energy resources
in the Caspian region are a central U.S. strategic interest, because Azerbaijani and Central Asian
oil and natural gas deliveries could somewhat lessen Western energy dependency on Russia and
the Middle East (see below, “Caspian Energy Resources”).
In his annual worldwide threat assessment, Director of National Intelligence James Clapper
testified in January 2012 that tensions related to separatist conflicts in the South Caucasus would
continue. He raised concerns that heightened rhetoric and recurring violence along the line of
contact between Armenian and Azerbaijani armed forces could “escalate the situation with little
warning.” He also cautioned that possible plans by Saakashvili to retain some power by becoming

3 U.S. House of Representatives. Committee on Foreign Relations. Subcommittee on International Organizations,
Human Rights, and Oversight. Ideals vs. Reality in Human Rights and U.S. Foreign Policy: The Cases of Azerbaijan,
Cuba, and Egypt
, July 12, 2007; U.S. Commission on Security and Cooperation in Europe. Energy and Democracy,
July 23, 2007.
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the prime minister after a scheduled 2013 presidential election could contribute to domestic
tensions in Georgia.4
The United States has endeavored to reassure Azerbaijan that it continues to be a “strategic
partner” in counter-terrorism cooperation and energy security and has appeared to balance these
U.S. interests against its concerns about democratization in Azerbaijan. According to some
observers, relations between the United States and Azerbaijan had cooled after the Administration
supported efforts in 2009-2010 by Armenia and Turkey to improve relations that Azerbaijan
opposed and after President Aliyev was not invited to the U.S. Nuclear Security Summit in April
2010. Also, according to this view, Azerbaijan may have pursued closer working relations with
Russia in the wake of the August 2008 Russia-Georgia conflict, which showed that Russia
remained a major power in the region. Countering such an assessment, Azerbaijan continues
troop support for NATO operations in Afghanistan (see below, “Support for Military Operations
in Iraq and Afghanistan”) and plays an increasingly significant role as part of the Northern
Distribution Network for the transit of U.S. and NATO supplies to Afghanistan. Also, Azerbaijan
has reiterated its intentions to step up supplies of oil and gas to Europe.
To underline the significance of U.S.-Azerbaijan relations, then-Secretary of Defense Robert
Gates visited Azerbaijan in June 2010 and Secretary of State Hillary Clinton visited in July 2010,
and President Obama met with President Aliyev on the sidelines of the U.N. General Assembly in
September 2010. On December 15, 2010, purportedly to discount some adverse Wikileaks press
reports, Secretary Clinton reportedly called President Aliyev to reassure him that the United
States continues to view Azerbaijan as its important strategic partner and is determined to deepen
bilateral ties.
During her July 4, 2010, visit to Azerbaijan, Secretary Clinton stressed that Azerbaijan was an
important bilateral partner of the United States. She claimed that Azerbaijan had made
“tremendous progress” in democratization and respect for human rights since its independence,
but that “there is a lot of room for improvement” on such problems as restrictions on the media
and civil society. She argued that such progress also has been a slow and incomplete process in
the United States. She stated that “speaking personally, for myself, I would like to see [Section
907] repealed, but that’s up to the [U.S. Congress]. And until the Congress agrees, then we will
continue to waive its effects on Azerbaijan.”5 President Obama also stressed the importance of
U.S.-Azerbaijani relations when he met with President Aliyev on September 24, 2010. President
Obama expressed his appreciation for Azerbaijan’s contributions to supporting the NATO mission
in Afghanistan. The two presidents discussed regional security issues and ongoing energy
cooperation and pledged to develop closer bilateral ties.6
U.S.-Azerbaijani relations appeared to generally improve—with some fits and starts—during
2011-2012 with the recess appointment of Ambassador to Azerbaijan Matthew Bryza, after more
than a year without an ambassador (the appointment expired at the end of the year, however).

4 U.S. Senate, Select Committee on Intelligence, Hearing on “World Wide Threats,” U.S. Intelligence Community
Worldwide Threat Assessment: Statement for the Record, James R. Clapper, Director of National Intelligence
, January
31, 2012.
5 U.S. Department of State. Remarks by Secretary Clinton: Joint Press Availability With Azerbaijani Foreign Minister
Mammadyarov
, July 4, 2010. She did not directly respond to a question about why she thought democratization was
advancing rather than declining.
6 The White House, Office of the Press Secretary, Read-out of President Obama’s Meeting with Azerbaijani President
Ilham Aliyev
, September 24, 2010.
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Perhaps reflecting tensions associated with U.S. criticism of human rights developments, in April
2011 Azerbaijan canceled participation in the U.S.-Azerbaijani military exercise Regional
Response, planned for May 2011 (similarly, a 2010 military exercise was cancelled for reasons
also subject to speculation of being linked to the status of bilateral ties). Azerbaijani Deputy
Foreign Minister Araz Azimov and Assistant Secretary of State Andrew Shapiro met in Baku in
June 2011 for the 12th session of the U.S.-Azerbaijan security dialogue. Also, Azerbaijan
participated in Romania in early August 2011 with U.S. forces in Black Sea Rotational Force
training activities, and then in San Antonio, TX, in training for infantry officers.7 In October
2011, Deputy Secretary of State William Burns visited the three South Caucasian states. In Baku,
he reportedly stated that “Azerbaijan is an important U.S. ally,” praised Azerbaijan’s troop
support in Afghanistan and its important role in the diversification of energy exports to Europe,
and stressed that resolving the NK conflict is a priority U.S. interest.8 In late 2011, the United
States backed Azerbaijan’s successful bid for a two-year term on the U.N. Security Council
(UNSC). In April 2012, the Obama Administration “re-launched” meetings of the U.S.-
Azerbaijan Intergovernmental Commission on Economic Cooperation, which had last convened
in 2008. At the session in Washington, DC, Azerbaijani co-head Samir Sharifov reported that
President Aliyev had instructed the delegation to “intensify efforts” to expand the current
“strategic partnership” between the two countries.
Regional Responses After the September 11, 2001, Terrorist Attacks on the
United States

In the wake of the September 11, 2001, terrorist attacks in New York and Washington, DC, the
former Bush Administration obtained quick pledges from the three South Caucasian states to
support Operation Enduring Freedom (OEF) in Afghanistan, including overflight rights and
Azerbaijan’s and Georgia’s offers of airbase and other support. Congressional attitudes toward
Azerbaijan and Section 907 shifted, resulting in presidential waiver authority being incorporated
into Foreign Operations Appropriations for FY2002 (H.R. 2506; P.L. 107-115). The President
may use the waiver authority if he certifies that U.S. aid supports U.S. counter-terrorism efforts,
supports the operational readiness of the Armed Forces, is important for Azerbaijan’s border
security, and will not harm NK peace talks or be used for offensive purposes against Armenia.
The waiver may be renewed annually, and 60 days after the exercise of the waiver, the President
must report to Congress on the nature of aid to be provided to Azerbaijan, the military balance
between Armenia and Azerbaijan and the effects of U.S. aid on that balance, the status of
Armenia-Azerbaijan peace talks, and the effects of U.S. aid on those talks. The waiver authority
has been exercised annually.
Support for Military Operations in Iraq and Afghanistan
Azerbaijan and Georgia were among the countries that openly pledged to support the U.S.-led
Operation Iraqi Freedom (OIF), with both offering the use of their airbases, and to assist the
United States in rebuilding Iraq. Both countries agreed to participate, subject to U.S. financial
support, in the multinational stabilization force for Iraq. In August 2003, both Azerbaijan and
Georgia dispatched forces to Iraq. Azerbaijan’s 150 troops pulled out in late 2008. Georgia

7 U.S. Embassy in Baku, Azerbaijan, Office of Public Affairs, Media Advisory: Azerbaijani, U.S. Troops Train Side-by-
Side in Romania
, August 3, 2011.
8 Open Source Center, Central Eurasia: Daily Report (hereafter CEDR), October 19, 2011, Doc. No. CEP-950087.
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augmented its troops over time until 2,000 were serving in 2007-2008, the third-largest number of
troops in Iraq, after the United States and the United Kingdom. Virtually all of these troops were
pulled out in August 2008 in connection with the Russia-Georgia conflict. Armenia began sending
personnel to Iraq in January 2005. Armenia’s 46 personnel were pulled out in late 2008.
In Afghanistan:
• Azerbaijan deployed troops to serve with the International Security Assistance
Force (ISAF) in late 2002, and 94 were deployed as of early 2012. In February
2012, President Aliyev pledged during a visit with NATO Secretary-General
Anders Fogh Rasmussen in Brussels that Azerbaijan would provide aid to help
Afghanistan build up its security forces.
• On November 16, 2009, Georgia sent 173 troops for training in Germany before
their scheduled deployment at the end of March 2010 to support ISAF. These
troops were boosted to 925 in mid-2010. Currently, 935 Georgian troops are
deployed, and 15 Georgian troops have been killed. On December 20, 2011, the
Georgian legislature approved sending an added battalion of 749 troops, boosting
the size of its contingent to 1,685 troops by late 2012. Georgia will then be the
largest contributor to ISAF among non-NATO member countries (surpassing
Australia with 1,550 troops). The opposition Labor Party in Georgia is one of the
few parties that opposes troop deployments to Afghanistan and calls for the
troops to be recalled.
• In January 2010, Armenia sent 40 troops for training in Germany before their
deployment to Kunduz, Afghanistan, to serve with German forces. The number
of troops was increased to 45 at the end of 2010. Currently, 126 Armenian troops
are deployed in Kunduz and Balkh provinces.
Azerbaijan and the Northern Distribution Network (NDN)
Azerbaijan and Kyrgyzstan reportedly are the main overflight, refueling, and landing routes for
U.S. and coalition troops bound for Afghanistan, and Azerbaijan also is a major land transport
route for military fuel, food, and construction supplies. According to former Ambassador to
Azerbaijan Matthew Bryza, in recent years, “virtually every U.S. soldier deployed to Afghanistan
has flown over Azerbaijan,” well over 100,000 troops.9 He also reported that over one-third of all
non-lethal equipment, fuel, clothing, and food used by U.S. troops in Afghanistan transited by
ground and sea through the Port of Baku. The Azerbaijani route is one of several routes through
Russia, the South Caucasus, and Central Asia to Afghanistan—together termed the NDN—that
have supplanted supply routes through Pakistan.
U.S. Policy After the August 2008 Russia-Georgia Conflict
Strong U.S. support for Georgia is reflected in the U.S.-Georgia Charter on Strategic Partnership,
signed in January 2009, which states that “our two countries share a vital interest in a strong,
independent, sovereign, unified, and democratic Georgia.” The accord is similar to a U.S.-
Ukraine Charter signed in December 2008 and a U.S.-Baltic Charter signed in 1998 with Estonia,

9 U.S. Embassy, Baku, Azerbaijan, Speech to Plenary Session for Caspian Oil and Gas Show 2011 Ambassador
Matthew Bryza
, June 8, 2011; Ambassador Matthew Bryza, Press Conference, December 29, 2011.
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Latvia, and Lithuania. In the security realm, “the United States and Georgia intend to expand the
scope of their ongoing defense and security cooperation programs to defeat [threats to global
peace and stability] and to promote peace and stability.” Such cooperation will “increase
Georgian capabilities and ... strengthen Georgia’s candidacy for NATO membership.” In the
economic realm, the two countries “intend to pursue an Enhanced Bilateral Investment Treaty, to
expand Georgian access to the General System of Preferences, and to explore the possibility of a
Free-Trade Agreement.” Energy security goals include “increasing Georgia’s energy production,
enhanc[ing] energy efficiency, and increas[ing] the physical security of energy transit through
Georgia to European markets.” In the realm of democratization, the two countries “pledge
cooperation to bolster independent media, freedom of expression, and access to objective news
and information,” and to further strengthen the rule of law. The United States pledged to train
judges, prosecutors, defense lawyers, and police officers.10 Then-Deputy Assistant Secretary
Bryza stressed that the charter did not provide security guarantees to Georgia. According to some
observers, the Charter aimed to reaffirm the United States’ high strategic interest in Georgia’s
fate, to counter perceptions that the United States (and the West) had acquiesced to increased
Russian dominance in the South Caucasus.11
Some in Georgia expressed concern that the “reset” in U.S.-Russian relations pursued by the
Obama Administration could lead the United States to downgrade ties with Tbilisi, or even make
concessions to Russia at Georgia’s expense. At the U.S.-Russia summit in July 2009, President
Obama stated that one area where the two presidents “agreed to disagree” was on Georgia, where
he stressed that he had “reiterated my firm belief that Georgia’s sovereignty and territorial
integrity must be respected.”12 Perhaps in order to calm the concerns of some Georgians over the
“reset,” Vice President Joseph Biden visited Georgia in late July 2009 to emphasize the U.S.
commitment. Secretary Clinton visited Georgia on July 5, 2010. She urged Georgians not to focus
on the past, possibly referring to the Russia-Georgia conflict, but to be “focused on what you can
do today and tomorrow to improve your lives ... by building your democracy and opening your
economy and providing more justice and social inclusion.” While stating that the United States
continued to call for Russia to pull back its troops to their positions on August 6, 2008 (in line
with the six-point ceasefire agreement; see below), she also “strongly urged” Georgia to “not be
baited or provoked into any action that would give any excuse to the Russians to take any further
aggressive movements.”13 Vice President Biden revisited Georgia in July 2010—as in 2009, just
after a U.S.-Russia summit—to reassure Georgia of U.S. commitments.
In 2011-2012, there were further high-level U.S.-Georgia bilateral visits. In January 2011,
President Saakashvili met with President Obama during a U.S. visit, and reportedly gave the U.S.
President a report detailing Georgia’s defense needs. In August 2011, the U.S. Commander of the
European Command and NATO’s Supreme Allied Commander, Admiral James Stavridis, visited
Georgia to discuss Georgia-NATO cooperation and Georgia’s participation in ISAF. According to
some reports, Presidents Obama and Saakashvili briefly met on the sidelines of the opening of the
U.N. General Assembly in New York in September 2011. Some congressional delegations also
visited.

10 U.S. Department of State. U.S.-Georgia Charter on Strategic Partnership, January 9, 2009.
11 David J. Smith, “US-Georgia Charter is Historic,” Potomac Institute for Policy Studies, January 12, 2009.
12 The White House. Office of the Press Secretary. Press Conference by President Obama and President Medvedev of
Russia
, July 6, 2009.
13 U.S. Department of State. Remarks by Secretary Clinton: Joint Press Availability With Georgian President
Saakashvili
, July 5, 2010; Remarks at a Town Hall With Georgian Women Leaders; July 5, 2010.
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During his state visit to the United States in January 2012, President Saakashvili met with
President Obama, who praised efforts in Georgia to increase the honesty of police, the rule of law,
and free market reforms, and called for free elections in the future. He stated that these
democratic and free market reforms could serve as examples for other Eurasian countries. He
reiterated the call in the Charter for exploring a free trade agreement, and thanked Saakashvili for
Georgia’s troop contributions in Afghanistan. He mentioned in a press conference that the two
presidents had discussed “strengthen[ing] our defense cooperation,” and he voiced continuing
support for Georgia’s NATO aspirations. In response at the press conference, President
Saakashvili stated that “we are grateful for elevating our defense cooperation further and talking
about Georgia’s self-defense capabilities and developing it.”14 Russian Prime Minister Putin and
others in Russia denounced what they inferred was a change in U.S.-Georgia defense ties,
although the Administration claimed that its defense cooperation policy toward Georgia had not
changed (but see directly below, and below in “Security Assistance to Georgia Since the August
2008 Conflict”).
At his confirmation hearing, Ambassador-designate to Georgia Richard Norland stated that the
United States would continue to call for the pull-back and reduction of Russian troops in the
occupied regions to pre-conflict numbers. U.S. priorities in Georgia included support for its
democratization, and he acknowledged that there were “deep concerns” about the harassment of
prospective opposition candidates and parties in the run-up to the autumn legislative election. He
also stressed that the conduct of the elections would be a “litmus test” of Georgia’s readiness for
NATO membership. He stated that at the January 2012 U.S.-Georgia summit, the two presidents
had
agreed to enhance [defense cooperation] programs, to advance Georgian military
modernization reform and self-defense capabilities.... Sustaining robust bilateral security and
defense cooperation with Georgia will also remain a high priority.... Our plans for security
assistance and military engagement with Georgia are to support Georgia’s defense reforms,
to train and equip Georgian troops for participation in the ISAF mission and to advance
Georgia’s NATO interoperability.15
Some observers have called for a reevaluation of some aspects of U.S. support for Georgia. These
critics have argued that many U.S. policymakers have been captivated by Saakashvili’s
charismatic personality and pledges to democratize and have tended to overlook his bellicosity.
They have warned that U.S. acceptance of Georgian troops for coalition operations in
Afghanistan must not lead to U.S. defense commitments to Georgia, and a few have suggested
that the United States should not unquestionably back Georgia’s territorial integrity, but should
rather encourage reconciliation and the consideration of options short of the near-term
reintegration of the regions into Georgia. Other observers have called for a more robust U.S. and
NATO effort to resupply Georgia with defensive weaponry so that it might deter or resist Russian
aggression (see also below, “U.S. Security Assistance”). At the same time, most observers advise
against extending diplomatic recognition to breakaway regions without an international
consensus.16

14 The White House, Office of the Press Secretary, Remarks by President Obama and President Saakashvili of Georgia
After Bilateral Meeting,
January 30, 2012.
15 Hearing of the Senate Foreign Relations Committee, Federal News Service, March 21, 2012.
16 Alexander Cooley and Lincoln Mitchell, “No Way to Treat Our Friends: Recasting Recent U.S.-Georgian Relations,”
The Washington Quarterly, January 2009, pp. 27-41; Lincoln Mitchell, Uncertain Democracy: U.S. Foreign Policy and
Georgia’s Rose Revolution
(Philadelphia: University of Pennsylvania Press, 2009); “A Georgia-Russia War Discussion
(continued...)
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The External Security Context of the South
Caucasus

Russian Involvement in the Region
After Vladimir Putin was elected president in 2000, Russia appeared to place great strategic
importance on increasing influence in the South Caucasus region. Several developments over the
next few years appeared to jeopardize Putin’s influence efforts, however. These included the “rose
revolution” in Georgia that appeared to usher in democratic reforms, NATO’s increased ties with
the regional states, the completion of the Baku-Tbilisi-Ceyhan oil pipeline and an associated gas
pipeline, Russia’s ongoing concerns about security in its North Caucasus regions (including
Chechnya), and Russia’s agreement to close its remaining military bases in Georgia. These
challenges to Russian influence, however, appeared to be reversed as a result of the August 2008
Russia-Georgia conflict.
The Russian leadership has appeared to place its highest priority on exercising influence in the
region in the military-strategic sphere and slightly less priority on influence in the economic
sphere (particularly energy) and domestic political spheres. Russia has viewed Islamic
fundamentalism as a growing threat to the region, but has cooperated with Iran on some issues to
counter Turkish and U.S. influence. Russia has tried to stop ethnic “undesirables,” drugs,
weapons, and other contraband from entering its borders. It has quashed separatism in its North
Caucasus areas while backing it in the South Caucasus.
The South Caucasian states have responded in various ways to Russian influence. Armenia has
close security and economic ties with Russia, given the unresolved NK conflict and concerns
about Turkey. Azerbaijan has been concerned about Russia’s ties with Armenia and has limited
Russia’s military presence. At the same time, Azerbaijan has appeared to value having
cooperative relations with Russia to increase its options and leverage in diplomacy and trade.
Georgia has suffered from trade restrictions imposed by Russia and has no formal diplomatic
relations with Russia since the Russia-Georgia conflict.
Military-Strategic Interests
Russia’s armed presence in the South Caucasus has been multifaceted, including thousands of
military base personnel, border troops, and until 2008, “peacekeepers.” The first step by Russia in
maintaining a military presence in the region was the promulgation of the Commonwealth of
Independent States (CIS) Collective Security Treaty (CST) in 1992, which pledges members to
consult in the event of a threat to one or several members, and to provide mutual aid if attacked
(current members include Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and
Uzbekistan). Russia also secured permission for two military bases in Armenia and four in
Georgia (on the latter bases, see below). The total number of Russian ground forces troops in

(...continued)
between Gordon Hahn and Johnson’s Russia List,” Russia: Other Points of View, October 17, 2008, at
http://www.russiaotherpointsofview.com; Paul Saunders, “Help Has Strings Attached,” Washington Times, December
17, 2009; Samuel Charap and Cory Welt, “A New Approach to the Russia-Georgia Conflict: The United States Needs a
Comprehensive Conflict Policy,” Center for American Progress, October 18, 2010.
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Armenia has been estimated at about 3,200, and an additional number of Air Force personnel.17 In
addition, Russian border troops guard Armenia’s borders with Turkey and Iran.
During a visit by Russian President Dmitriy Medvedev to Armenia in August 2010, Armenia
agreed to extend the basing agreement with Russia to the year 2044. In the basing accord, Russia
also pledged that its forces would help safeguard Armenia’s national security and that it would
supply more modern weaponry for Armenia’s armed forces. Although some officials in Armenia
hailed the accord as providing greater assurance that Russia would intervene if Azerbaijan began
operations against NK, Medvedev argued during a September 2010 visit to Azerbaijan that the
accord was not aimed against Azerbaijan. Azerbaijan’s Deputy Foreign Minister Araz Azimov
similarly dismissed views that the accord meant that Russia would militarily support Armenia in
the event of new NK conflict. Georgian Foreign Minister Grigol Vashadze, however, criticized
the accord as strengthening Russia’s military influence in the region, as compromising Armenia’s
independence, and as raising tensions that are inimical to the settlement of the NK conflict.18
In addition to the Russian troops in the South Caucasus, about 88,000 Russian troops are
stationed nearby in the North Caucasus, and some naval forces of the Caspian Sea Flotilla are
located in Astrakhan in Russia. In 1993, Azerbaijan was the first Eurasian state to get Russian
troops to withdraw, except at the Qabala (Gabala) radar site in northern Azerbaijan. Giving up on
closing the site, in January 2002 Azerbaijan signed a 10-year lease agreement with Russia
permitting up to 1,500 troops there. Reportedly contentious talks are underway to renew this
lease. Russian and Azerbaijani defense ministries are negotiating as of late April 2012 to renew
this lease, with Azerbaijan purportedly demanding a lease increase from the present $7 million
per year to $300 million. Armenia has offered to host the radar if the talks fail.
After the September 11, 2001, terrorist attacks in the United States, Russia stepped up its claims
that Georgia harbored Chechen terrorists (with links to Al Qaeda) who used Georgia as a staging
ground for attacks into Chechnya. The United States expressed “unequivocal opposition” to
military intervention by Russia inside Georgia. Georgia launched a policing effort in its northern
Pankisi Gorge in late 2002 that somewhat reduced tensions with Russia over this issue. In April
2006, Azerbaijan convicted 16 people on charges that they had received terrorist training from Al
Qaeda operatives in the Pankisi Gorge. Since 2009, Russia has renewed its allegations that the
Gorge harbors terrorists. Georgia has rejected these allegations as false and raised concerns that
they might serve as a pretext for new Russian violations of Georgia’s territorial integrity.
Some Russian and regional observers have speculated that in case of a possible U.S.-Israeli
military action against Iran, Russia would take advantage of the operation to move militarily
against the South Caucasus. Russia might quickly secure an air and land route through Georgia to
its military facilities in Armenia, and occupy the rest of the region, ostensibly to safeguard
southern Russia from Iranians fleeing into the South Caucasus or to protect against other claimed
disorder, these observers warn.19

17 The Military Balance, International Institute of Strategic Studies, March 7, 2011.
18 Azerbaijan Press Agency, September 8, 2010.
19 Nikoloz Devdariani, “Russia to 'Cut Military Transport Corridor' Through Georgia?” Georgia Today, April 13, 2012;
CEDR, April 13, 2012, Doc. No. CEP-950045.
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Russian “Peacekeepers” and Bases in Georgia
Russia’s mediation of ceasefires between Georgia and its breakaway regions in the early 1990s
resulted in agreement by the parties on the presence of Russian military “peacekeepers” in
Abkhazia and South Ossetia. Russia’s “peacekeeping” role at that time received at least tacit
approval from world governments and international organizations, with the proviso that the U.N.
and the Organization for Security and Cooperation in Europe (OSCE) also provide monitoring.
For many years, Georgian authorities voiced dissatisfaction with the role of the “peacekeepers” in
facilitating a peace settlement and called for them to either be replaced or supplemented by a
wider international peacekeeping force (see “Civil and Ethnic Conflict in Georgia” ).
In the early 1990s, Georgia was pressured by Russia to agree to the long-term presence of four
Russian military bases. By the late 1990s, however, many in Georgia were calling for the bases to
close, and this received support from European countries during talks over amending the
Conventional Armed Forces in Europe (CFE) Treaty. In 1999, Russia and Georgia agreed to
provisions of the amended CFE Treaty calling for Russia to reduce weaponry at its four bases in
Georgia, to soon close two of the bases, and to complete negotiations on the status of the other
two bases. NATO signatories hesitated to ratify the amended Treaty until Russia satisfied these
and other conditions. One base was soon closed and Russia claimed that it had closed another. In
November 2007, the Russian Foreign Ministry proclaimed that it had closed the last base and that
Russia had “fully” accomplished its obligations to Georgia on the withdrawal of military
facilities.
Not even one year had passed, however, before Russia announced—following the August 2008
Russia-Georgia conflict—that two army brigades would be deployed to new military bases in
Abkhazia and South Ossetia. In addition to these army brigades, Russian border troops were
deployed along regional borders with Georgia, along which engineer brigades were creating
revetments, trenches, and minefields. A part of the Black Sea Fleet also was deployed to
Ochamchire in Abkhazia. The British publication The Military Balance reports that as of early
2012 there are 7,000 Russian military troops in Abkhazia and South Ossetia.20
Caspian Energy Resources
Russia has tried to play a dominant role in future oil and gas production and transportation in the
Caspian Sea region. A major lever has been the prices it charges the South Caucasian countries
for gas. In 2006, Russia charged all three regional states much more for gas. Armenia agreed to
relinquish various energy assets to Russian firms as partial payment for this price increase. Some
critics have alleged that Russia now has virtual control over Armenia’s energy supplies. Russia
again hiked gas prices in 2007. Georgia negotiated an agreement to receive some Azerbaijani gas
via the new South Caucasus Pipeline (SCP, see “Building the Baku-Tbilisi-Ceyhan and South
Caucasus Pipelines,” below) and another small existing pipeline. It also agreed to continue to
purchase some higher-priced gas from Gazprom. Russia’s requests for higher prices and
reductions in the amounts of gas and electricity supplied to Azerbaijan led President Aliyev to
announce that the country would no longer purchase Russian gas. Following the August 2008
Russia-Georgia conflict, Gazprom’s arrangement with Georgia involving the transit of Russian
gas to Armenia remained in place. Armenia pays a share of gas to Georgia as a transit fee.
According to BP, Russia in 2010 provided 7.4 billion cubic feet of gas to Georgia and 45.6 billion

20 The Military Balance, International Institute of Strategic Studies, March 7, 2012.
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cubic feet of gas to Armenia. Georgia receives a much greater share of its gas—36.4 billion cubic
feet of gas in 2010—from Azerbaijan than from Russia, according to BP. (See also, “Energy
Resources and U.S. Policy,” for information on Russia’s efforts to gain control of regional energy
resources and infrastructure.)
The Roles of Turkey, Iran, and Others
The United States has generally viewed Turkey as able to foster pro-Western policies and
discourage Iranian interference in the South Caucasus states, even though Turkey favors
Azerbaijan in the NK conflict. Critics of Turkey’s larger role in the region caution that the United
States and NATO might be drawn by their ties with Turkey into regional imbroglios. Turkey seeks
good relations with Azerbaijan and Georgia and some contacts with Armenia, while trying to
limit Russian and Iranian influence. Azerbaijan likewise long viewed Turkey as an ally against
such influence, and as a balance to Armenia’s ties with Russia (see below for recent
developments). Georgia has an abiding interest in ties with the approximately 1 million Georgians
residing in Turkey and the approximately 50,000 residing in Iran, and has signed friendship
treaties with both states. Turkey is one of Georgia’s primary trade partners. New pipelines
delivering oil and gas westward from the Caspian Sea reflect cooperation between Azerbaijan,
Georgia, and Turkey.
Armenia is a member of the Black Sea Economic Cooperation Organization, along with Turkey,
and the two states have established consular relations. Obstacles to better Armenian-Turkish
relations have included Turkey’s rejection that there was an Armenian genocide in 1915-1923 and
its support for Azerbaijan in the NK conflict.
The Armenia-Turkey Protocols of 2009
In September 2008, Turkey’s President Abdullah Gül visited Armenia, ostensibly to view a soccer
game, and this thaw contributed to the two countries reaching agreement in April 2009 on a “road
map” for normalizing ties, including the establishment of full diplomatic relations and the
opening of borders. After further negotiations, Turkish Foreign Minister Ahmet Davutoglu and
Armenian Foreign Minister Edvard Nalbandian initialed two protocols “On Establishing
Diplomatic Relations,” and “On Development of Bilateral Relations” on August 31, 2009, and
formally signed them on October 10, 2009. New Secretary of State Clinton reportedly met with
Turkish leaders in March 2009 in Ankara to encourage them and President Obama reportedly
actively supported the negotiators during a meeting in Istanbul in April 2009.21 The protocol on
diplomatic relations called for the two sides to establish embassies in each other’s capitals within
two months after the mutual legislatures approved the protocols and after the exchange of the
articles of ratification of the protocol. The protocol on foreign relations called for the two sides to
“agree to open the common border within two months after the entry into force of this Protocol,”
that is, after ratification of the protocols by the legislatures of the two states, to “implement a
dialogue on the historical dimension with the aim to restore mutual confidence between the two
nations, including an impartial scientific examination of the historical records and archives to
define existing problems and formulate recommendations,” and to undertake other cooperative

21 David Phillips, Diplomatic History: The Turkey-Armenia Protocols, Institute for the Study of Human Rights in
collaboration with the Future of Diplomacy Project, Harvard Kennedy School, March 2012.
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efforts.22 A ruling of the Armenian constitutional court on January 18, 2010, that the protocols
could not affect Armenia’s policy on genocide recognition was criticized by the Turkish
government as not being in conformity with the text of the protocols. The Armenian government
stated that the ruling did not affect the conditions of the protocols. Azerbaijan strongly criticized
Turkey for moving toward normalizing relations with Armenia without formally linking such a
move to a peace settlement of the NK conflict. This criticism quickly elicited pledges by Turkey’s
leaders that the Turkish legislature would not approve the protocols until there was progress in
settling the NK conflict. On April 22, 2010, the ruling Armenian party coalition issued a
statement that “considering the Turkish side’s refusal to fulfill the requirement to ratify the accord
without preconditions in a reasonable time, making the continuation of the ratification process in
the national parliament pointless, we consider it necessary to suspend this process.”23
Perhaps reflecting the repair of Azerbaijani-Turkish ties, in August 2010, Azerbaijan and Turkey
signed a strategic partnership and mutual assistance agreement. The 10-year accord agreement
specifies that if one of the sides is attacked by a third country, the sides will provide reciprocal
aid. Other provisions call for the sides to cooperate to eliminate threats to national security; to ban
the operation of groups threatening the independence, sovereignty, and territorial integrity of the
other side; to prevent their territories from being used for acts of aggression against the other side;
and to cooperate in defense industry production, holding joint military exercises, and training
army specialists.
Iran
Iran’s goals in the South Caucasus include discouraging Western powers such as Turkey and the
United States from gaining influence (Iran’s goal of containing Russia conflicts with its
cooperation with Russia on these interests), ending regional instability that might threaten its own
territorial integrity, and building economic links. A major share of the world’s ethnic Azerbaijanis
reside in Iran (The World Factbook estimates about 12 million; other estimates are far higher), as
well as about 200,000 Armenians. Ethnic consciousness among some “Southern Azerbaijanis” in
Iran has grown. Azerbaijani elites fear Iranian-supported Islamic extremism and object to Iranian
support to Armenia. Baku banned the pro-Iranian Islamic Party of Azerbaijan (IPA) in 1995. To
block the West and Azerbaijan from developing Caspian Sea energy, Iran long has insisted on
either common control by the littoral states or the division of the seabed into five equal sectors.
There is some trade between the two countries, reportedly between $240 million and $300 million
in turnover in 2011, but amounts have been declining.
In recent months, Iran has boosted its diplomacy in the region, perhaps to counter growing
international concern about its nuclear programs and to counter U.S. influence. Iran has proposed
to build a railroad link to Armenia and another to Azerbaijan. The latter railroad will permit not
only greater trade with Azerbaijan but also with Russia. Iran sells some gas to Armenia, and
Azerbaijan sells some gas to Iran. Iran’s efforts to improve relations with Azerbaijan have
appeared to be complicated, however, by its reported suppression of rising dissent among

22 Ministry of Foreign Affairs of Armenia. Protocol on the Establishment of Diplomatic Relations between the Republic
of Armenia and the Turkish Republic and the Protocol on the Development of Mutual Relations Between the Republic
of Armenia and the Turkish Republic
, August 31, 2009, at http://www.armeniaforeignministry.com/pr_09/
20090831_protocol.pdf. See also The Turkish Weekly, August 31, 2009.
23 “Armenia Suspends Normalization of Ties with Turkey,” BBC News, April 22, 2010.
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Armenia, Azerbaijan, and Georgia: Political Developments and Implications

“Southern Azerbaijanis” as well as alleged support for Islamic extremism in Azerbaijan. U.S.
policy aims to contain Iran’s threats to U.S. interests in the region.24
Azerbaijan’s relations with Iran were roiled in February 2012 when Iran accused Azerbaijan of
harboring Israeli intelligence agents who had crossed the Azerbaijani-Iran border to carry out
operations, allegedly including assassinations of Iranian nuclear scientists. That same month,
Azerbaijan sentenced seven individuals it had arrested in 2008 that it claimed had been trained in
Iran to carry out terrorism, including plans to bomb the Israeli embassy. In late February,
Azerbaijan confirmed that it had reached a large arms deal with Israel, but stated that the weapons
purchase was aimed not against Iran but to “liberate” occupied territories. Attempts to ease
Azerbaijani-Iranian tensions included a meeting between the foreign ministers of Iran,
Azerbaijan, and Turkey in Nakhichevan, Azerbaijan, on March 7 and a trip by Defense Minister
Safar Abiyev to Tehran on March 12, 2012. Abiyev stressed that Azerbaijani territory would not
be used to launch attacks on Iran. Two days later, however, the Azerbaijan National Security
Ministry announced that nearly two dozen terrorists trained in Iran had been arrested, who had
been planning attacks on Israeli and U.S. embassies and other Western interests, and at the end of
the month, the ministry reported that two other Iranian spy networks had been uncovered in 2011.
Also in late March 2012, Iran increased its accusations that Azerbaijan was providing Israel with
military access to launch attacks on Iran after such allegations appeared in Western media. In
early April, Iran arrested some individuals it claimed were Israeli agents being directed from an
unnamed nearby country, presumably Azerbaijan. On April 12, Azerbaijani media reported that
the government had arrested several Iranians and Azerbaijanis involved in weapons and drug
smuggling from Iran. Some Iranian extremists have threatened violence against Azerbaijan if it
follows through with hosting the Eurovision music competition in May 2012.
Others
Among non-bordering states, the United States and European states are the most influential in the
South Caucasus in terms of aid, trade, exchanges, and other ties. U.S. and European goals in the
region are broadly compatible, involving integrating it into the West and preventing an anti-
Western orientation, opening it to trade and transport, obtaining energy resources, and helping it
become peaceful, stable, and democratic. As part of its European Neighborhood Policy, the EU
signed Action Plans with the three regional states in November 2006 that it hoped would foster
both European and regional integration. The EU took the international lead in mediating the
August 2008 Russia-Georgia conflict and in deploying observers after the ceasefire (see “The
August 2008 Russia-Georgia Conflict,” below). The EU launched an Eastern Partnership program
in 2009 to deepen ties with the South Caucasus states. Under the program, the EU plans “deep
and comprehensive free trade agreements with those countries willing and able to enter into a
deeper engagement, gradual integration in the EU economy, and ... easier travel to the EU through
gradual visa liberalization.”25 Some observers have viewed these objectives as being set back by
the EU’s recent economic problems.
The South Caucasus region has developed some economic and political ties with other Black Sea
and Caspian Sea littoral states, besides those discussed above. Azerbaijan shares with Central
Asian states common linguistic and religious ties and concerns about some common neighbors

24 See CRS Report RL32048, Iran: U.S. Concerns and Policy Responses, by Kenneth Katzman.
25 EU. European Commission. “Eastern Partnership,” at http://ec.europa.eu/external_relations/eastern/index_en.htm.
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(Iran and Russia). The South Caucasian and Central Asian states are concerned about ongoing
terrorist threats and drug trafficking from Afghanistan. Central Asia’s increasing ties with the
South Caucasus make it more dependent on stability in the wider region.
Obstacles to Peace and Independence
Regional Tensions and Conflicts
Ethnic conflicts have kept the South Caucasus states from fully partaking in peace, stability, and
economic development since the Soviet collapse in 1991, some observers lament. The countries
are faced with ongoing budgetary burdens of arms races and caring for refugees and displaced
persons. Other costs of ethnic conflict include threats to bordering states of widening conflict and
the limited ability of the region or outside states to fully exploit energy resources or trade and
transportation networks.
U.S. and international efforts to foster peace and the continued independence of the South
Caucasus states face daunting challenges. The region has been the most unstable part of the
former Soviet Union in terms of the numbers, intensity, and length of its ethnic and civil conflicts.
The ruling nationalities in the three states are culturally rather insular and harbor various
grievances against each other. This is particularly the case between Armenia and Azerbaijan,
where discord led to the virtually complete displacement of ethnic Armenians from Azerbaijan
and vice versa by the early 1990s, so that younger Armenians and Azerbaijanis now have no
memories of a more diverse past. The main languages in the three states are dissimilar (also, those
who generally consider themselves Georgians—Kartvelians, Mingrelians, and Svans—speak
dissimilar languages). The borders of the countries do not coincide with eponymous ethnic
populations. Separatist NK relies on economic support from Armenia, and Abkhazia and South
Ossetia from Russia.
Nagorno Karabakh Conflict
In 1988, the Nagorno Karabakh (NK) Autonomous Region of Azerbaijan petitioned to become
part of Armenia, sparking armed conflict between ethnic Armenians and ethnic Azerbaijanis. In
December 1991, an NK referendum (boycotted by local ethnic Azerbaijanis) approved NK’s
independence and a Supreme Soviet was elected, which in January 1992 futilely appealed for
world recognition. A ceasefire agreement was signed in July 1994 by Armenia, Azerbaijan, and
NK Armenians (and mediators Russia and Kyrgyzstan), and the sides pledged to work toward a
peace settlement. The conflict over the status of NK has resulted in about 15,000 casualties and
hundreds of thousands of refugees and displaced persons in Armenia and Azerbaijan. According
to the OSCE, an average of about 30 troops and civilians have been killed each year along the
137-mile “line of contact” and along the Armenia-Azerbaijan border dividing the conflicting
sides.26
The “Minsk Group” of concerned member-states of what is now termed the OSCE was
established in 1992 to facilitate peace talks. The United States,27 France, and Russia co-chair the

26 “Facilitating Dialogue: Interview with Ambassador Andrzej Kasprzyk,” OSCE Magazine, January /2010.
27 The status of the U.S. envoy was downgraded in 1993. In early 2006, the State Department eliminated the post of
(continued...)
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Minsk Group, and other participants include (besides Armenia and Azerbaijan) Belarus, Germany,
Italy, Portugal, the Netherlands, Sweden, Finland, and Turkey. An OSCE high-level planning
group composed of military officers also was set up to plan for multi-national peacekeeping after
a peace agreement is signed. In 1995, the OSCE chairman-in-office appointed a personal
representative to help facilitate a peace settlement, including by carrying out monitoring missions
along the line of contact and the Armenia-Azerbaijan border. This personal representative is based
in Tbilisi, Georgia, and has small staffs in Yerevan, Armenia; Baku, Azerbaijan; and NK.
The U.N. High Commissioner for Refugees (UNHCR) has reported that at the beginning of 2011,
there were still about 3,300 people considered refugees or displaced persons in Armenia. Armenia
has granted citizenship and acted to permanently house most of the ethnic Armenians who fled
Azerbaijan. UNHCR has reported that at the beginning of 2011, there were still about 595,000
people considered refugees or displaced persons in Azerbaijan.28 The non-governmental
International Crisis Group estimates that about 13%-14% of Azerbaijan’s territory, including most
of NK, is controlled by NK Armenian forces (The World Factbook estimates about 16%).29
The Minsk Group reportedly has presented four proposals as a framework for talks, but a peace
settlement has proved elusive. Since 2005, officials in both countries have reported negotiations
on a fourth “hybrid” peace plan calling for initial agreement on “basic principles.” In November
2007, then-Under Secretary of State Nicholas Burns, Russian Foreign Minister Sergey Lavrov,
and French Foreign Minister Bernard Kouchner presented the foreign ministers of Armenia and
Azerbaijan with a draft text—Basic Principles for the Peaceful Settlement of the Nagorno-
Karabakh Conflict
—for transmission to their presidents. These officials urged the two sides to
accept the Basic Principles (also termed the Madrid principles, after the location where the draft
text was presented) that had resulted from three years of talks and to begin “a new phase of talks”
on a comprehensive peace settlement.30
On November 2, 2008, Russian President Medvedev hosted talks in Moscow between Armenian
President Serzh Sarkisyan and Azerbaijani President Ilkham Aliyev on a settlement of the NK
conflict. A joint declaration signed by Aliyev and Sarkisyan (also termed the Meindorf declaration
after the castle where talks were held) upheld a continued mediating role for the Minsk Group,
but the talks represented Russia’s intention to play the major role in mediating the conflict, some
observers argue. The joint declaration was the first document on the NK conflict signed by the
leaders of Armenia and Azerbaijan since the ceasefire in 1994.

(...continued)
U.S. Special Negotiator for Eurasian Conflicts and divided its responsibilities among the Deputy Assistant Secretary of
State and the Office of Caucasus Affairs and Regional Conflicts. In 2009, a separate post of U.S. OSCE Minsk Group
Co-Chair was filled by Ambassador Robert Brodtke.
28 U.N. High Commissioner for Refugees, Armenia: Statistical Snapshot, at http://www.unhcr.org/cgi-bin/texis/vtx/
page?page=49e48d126; Azerbaijan: Statistical Snapshot, at http://www.unhcr.org/cgi-bin/texis/vtx/page?page=
49e48d1e6.
29 Nagorno-Karabakh: Viewing the Conflict from the Ground, International Crisis Group, September 14, 2005; CIA,
The World Factbook. Azerbaijan, at https://www.cia.gov/cia/publications/factbook/geos/aj.html. A map on the website
of the “Government of the NK Republic,” shows a map that includes the occupied areas as well as the bulk of the
former NK Autonomous Region. See http://www.karabakh.net/engl/gov?id=1.
30 U.S. Department of State. Office of the Spokesman. Media Note: Support for Basic Principles for Peaceful
Settlement of the Nagorno-Karabakh Conflict, November 29, 2007.
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As “updated” by the presidents of the co-chairing countries in July 2009 at L’Aquila, France, the
Basic Principles call for the phased return of the territories surrounding NK to Azerbaijani
control; an interim status for NK providing guarantees for security and self-governance; a
corridor linking Armenia to NK; future determination of the final legal status of NK through a
legally binding expression of will; the right of all internally displaced persons and refugees to
return to their former places of residence; and international security guarantees that would include
a peacekeeping operation.31 The co-chairs presented the “updated” Madrid principles to President
Aliyev in Baku in December 2009 and to President Sarkisyan in Yerevan in January 2010.
President Medvedev hosted Aliyev and Sargisyan in Sochi, Russia in late January 2010, and the
two sides reportedly agreed on many parts of a preamble to an agreement. In mid-February 2010,
Azerbaijani Foreign Minister Mamedyarov announced that Baku accepted many of the elements
of the “updated” Madrid principles. In July 2010, the Russian and French foreign ministers and
the U.S. deputy secretary of state issued a statement criticizing Armenia and Azerbaijan for not
overcoming their differences to reach a peace agreement, and deploring recent negative trends,
including violence along the line of contact that resulted in several casualties and bellicose
statements by officials.
On September 8, 2010, the Minsk Group co-chairs crossed the line of contact separating NK
Armenian and Azerbaijani armed forces, a variation on the periodic OSCE monitoring of the line
of contact and the Armenian-Azerbaijan border. Reportedly, U.S. co-chair Robert Bradtke stated
that the crossing—the first since 2001—underlined that the ceasefire should be respected, that the
line is not a permanent border, and that eventually civilians will cross the line after a peace
settlement.32
At the December 1-2, 2010, summit meeting of the OSCE, hopes that the attending presidents of
Armenia and Azerbaijan would hold talks and make progress in resolving the NK conflict proved
unfounded. The co-chairs of the Minsk Group and the two presidents instead issued a statement
that called for “more decisive efforts to resolve the NK conflict.” The presidents pledged to seek a
final settlement based on international law.33
Meeting in Sochi, Russia, on March 5, 2011, Presidents Medvedev, Sargisyan, and Aliyev issued
a statement vowing “to tackle all disputable issues peacefully and to probe incidents along the
ceasefire line together under the aegis of the OSCE Minsk Group co-chairs and with assistance
from the OSCE chairman-in-office’s special envoy.”34 On March 9, 2011, the Minsk Group co-
chairs condemned ceasefire violations along the line of contact that occurred before and after the
Sochi meeting, including the alleged sniper shooting of an Azerbaijani child. On March 17, 2011,
a prisoner exchange occurred, as agreed to by Presidents Aliyev and Sargisyan at Sochi, but the
next day, a sniper allegedly killed a member of the NK Self-Defense Army. The chairman-in-
office of the OSCE reiterated past calls by the OSCE and others for the removal of snipers from
the line of contact. On March 17, 2011, Azerbaijani Defense Minister Safar Abiyev reportedly
stated that the “worthlessness” of the Minsk Group talks had forced Azerbaijan to build up its

31 The White House. Joint Statement on the Nagorno-Karabakh Conflict by U.S. President Obama, Russian President
Medvedev, and French President Sarkozy at the L’Aquila Summit of the Eight
, July 10, 2009.
32 Azerbaijan Press Agency, September 15, 2010.
33 OSCE, Astana Summit, Joint Statement by the Heads of Delegation of the OSCE Minsk Group Co-Chair Countries
and the Presidents of Azerbaijan and Armenia, December 1, 2010.
34 Meeting with Presidents of Armenia and Azerbaijan, President of Russia, March 5, 2011, at http://eng.kremlin.ru/
news/1859.
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military capabilities in order to “take serious and necessary measures to liberate” NK and
surrounding areas.35
In late March 2011, the Minsk Group co-chairs released the executive summary of a report of
their findings and recommendations following an October 2010 Field Assessment Mission to the
occupied areas surrounding NK. The last such assessment had been carried out in 2005. The new
report appeared to generally echo the findings of the 2005 report that most of the “towns and
villages that existed before the conflict are abandoned and almost entirely in ruins,” although
some land was being farmed. They reported that there are an estimated 14,000 persons living in
small settlements and in the towns of Lachin and Kelbajar, for the most part ethnic Armenians
who were relocated from elsewhere in Azerbaijan, and who “live in precarious conditions, with
poor infrastructure, little economic activity, and limited access to public services.” The “harsh”
living conditions, the co-chairs emphasized, reinforced their view that “only a peaceful,
negotiated settlement can bring the prospect of a better, more certain future to the people who
used to live in the territories and those who live there now.”36
In May 2011, the presidents of the United States, France, and Russia issued a statement on the
sidelines of a Group of Eight (group of industrialized nations) meeting in Deauville, France, that
urged the Armenian and Azerbaijani presidents to finalize agreement on the Basic Principles at an
upcoming late June 2011 meeting in Kazan, Russia. At this meeting, Presidents Sargisyan and
Aliyev issued a joint statement that agreement had been reached on some issues and that further
talks would be held. Many observers had heightened expectations of progress, perhaps illustrated
by President Obama’s phone calls to the Armenian and Azerbaijani presidents before the meeting
to urge them to reach a settlement. A couple of weeks later, President Medvedev, reportedly
disappointed that there had been scant progress at the talks, sent letters to the two leaders calling
for suggestions on how to move the talks forward.
The presidents of Armenia and Azerbaijan denounced each other’s perceived unwillingness to
settle the NK conflict during the celebratory anniversary meeting of the Commonwealth of
Independent States in Dushanbe, Tajikistan, in early September 2011. Mutual denunciations also
were delivered at the late September 2011 opening session of the U.N. General Assembly. In his
speech, President Sargisyan alleged that Azerbaijan had tried during the Kazan talks to “reject[]
the previously elaborated arrangement and … in fact, to break down the negotiation process.” In
his speech, Azerbaijani Foreign Minister Eldar Mammadyarov protested that “Azerbaijan still
maintains its interest, motivation and patience in this very hard and sensitive process of
negotiations. We believe that the international community will convince the Armenian side to
respect the generally accepted norms and principles of international law and cease abusing the
right of Azerbaijanis to live within their own territory.”37
In October 2011, the Minsk Group co-chairs issued a statement after talks with Presidents Aliyev
and Sargisyan that the two presidents had agreed in principle on some border incident
investigation procedures that the presidents had called for developing at their meeting in Sochi in

35 Interfax, March 17, 2011.
36 OSCE, Minsk Group, Executive Summary of the Report of the OSCE Minsk Group Co-Chairs’ Field Assessment
Mission to the Occupied Territories of Azerbaijan Surrounding Nagorno-Karabakh
, March 24, 2011.
37 CEDR, September 26, 2011, Doc. No. CEP-964113; Embassy of Azerbaijan in the United States, Statement by Elmar
Mammadyarov, Minister of Foreign Affairs, at the General Debate of the sixty-sixth session of the United Nations
General Assembly
, September 27, 2011; United Nations, U.N. News Center, Armenia and Azerbaijan Express Views on
Nagorno-Karabakh During U.N. Debate
, September 27, 2011.
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March 2011. A call for finalizing these procedures was issued at the OSCE Ministerial Council
Meeting in Vilnius in early December 2011.
Before a planned meeting of the Armenian and Azerbaijani presidents in Sochi, Russia, on
January 23, 2012, President Aliyev stressed that “no one wants war, least of all Azerbaijan, which
has made such great achievements. However, this does not mean that negotiations ... will be
focused on the prevention of war.”38 At the Sochi meeting, the two presidents issued a joint
statement requesting Russia to act to facilitate humanitarian ties between the two countries. The
co-chairs of the OSCE Minsk Group also presented the Armenian and Azerbaijani presidents with
a draft plan for setting up a group to investigate incidents along the line of contact, and the
presidents called for further work on the plan. In March 2012, however, President Sargisyan
reportedly condemned Azerbaijan for refusing to further discuss such an incident investigation
mechanism or other “confidence building” measures, allegations that Azerbaijan has rejected.39
In late March 2012, Azerbaijani presidential administration official Ali Hasanov acknowledged
that Baku regards the talks mediated by the president of Russia as the most significant means to
settle the NK conflict, given Russia’s close ties to Armenia. Hasanov claimed that Russia has
overwhelming influence over Armenia, and appeared to argue that Azerbaijan’s major goal is to
persuade Russia to use its influence to settle the conflict.40
Civil and Ethnic Conflict in Georgia
Several of Georgia’s ethnic minorities stepped up their dissidence, including separatism, in the
late 1980s and early 1990s, resulting in the loss of central government control over the regions of
South Ossetia and Abkhazia. Some observers argued that Russia’s increasing controls over South
Ossetia and Abkhazia over the years transformed the separatist conflicts into essentially Russia-
Georgia disputes. Most residents of Abkhazia and South Ossetia had been granted Russian
citizenship before the August 2008 Russia-Georgia conflict and most had appeared to want their
regions to become independent or parts of Russia.41
U.S. diplomacy long appeared to urge Georgia to work within existing peace settlement
frameworks for Abkhazia and South Ossetia—which allowed for Russian “peacekeeping”—while
criticizing some Russian actions in the regions. This stance appeared to change during 2008,
when the United States and other governments increasingly came to support Georgia’s calls for
the creation of alternative peace settlement mechanisms, particularly since talks under existing
formats had broken down.
This U.S. policy shift was spurred by increasing Russian actions that appeared to threaten
Georgia’s territorial integrity. Among these, the Russian government in March 2008 formally
withdrew from CIS economic sanctions on Abkhazia, permitting open Russian trade and
investment. Of greater concern, President Putin issued a directive in April 2008 to step up

38 Interfax, January 16, 2012.
39 Interfax, March 6, 2012; March 16, 2012; CEDR, April 2, 2012, Doc. No. CEP-950107.
40 CEDR, March 29, 2012, Doc. No. CEP-950123.
41 Vladimir Socor, Eurasia Insight, November 20, 2006. According to an issue of the Rossiyskoye Voyennoye
Obozreniye
(Russian Military Review) published by the Defense Ministry in early 2008, 80% of residents of Abkhazia
were citizens of Russia at that time, and most had voted in the December 2007 Russian legislative election. CEDR,
April 21, 2008, Doc. No. CEP-358004.
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government-to-government ties with Abkhazia and South Ossetia. He also ordered stepped up
consular services for the many “Russian citizens” in the two regions. He proclaimed that many
documents issued by the separatist governments and businesses which had been established in the
regions would be recognized as legitimate by the Russian government. A meeting of the U.N.
Security Council (UNSC) on April 23, 2008, discussed these Russian moves. Although the UNSC
issued no public decision, the United States, Great Britain, France, and Germany stated that same
day that they “are highly concerned about the latest Russian initiative to establish official ties
with ... Abkhazia and South Ossetia without the consent of the Government of Georgia. We call
on the Russian Federation to revoke or not to implement its decision.”42 (For other Russian
actions during 2008 specific to a breakaway region, see “Developments in Abkhazia Before
August 2008,” “Developments in South Ossetia Before August 2008,” or “The August 2008
Russia-Georgia Conflict,” below.)
Developments in Abkhazia Before August 2008
In July 1992, Abkhazia’s legislature declared the region’s effective independence, prompting an
attack by Georgian national guardsmen. In October 1992, the UNSC approved sending a U.N.
Observer Mission in Georgia (UNOMIG), the first to a Eurasian state, to help the parties reach a
settlement. Russian and North Caucasian “volunteers” (who reportedly made up the bulk of
Abkhaz separatist forces) routed Georgian forces in 1993. Georgia and Abkhazia agreed in April-
May 1994 on a framework for a political settlement and the return of refugees. Russian troops
(acting as CIS “peacekeepers”) were deployed in a zone between Abkhazia and the rest of
Georgia. The conflict resulted in about 10,000 deaths and over 200,000 displaced persons, mostly
ethnic Georgians.
The U.S. Deputy Assistant Secretary of State worked with the Special Representative of the U.N.
Secretary General and other “Friends of the Secretary General” (France, Germany, Russia, the
United Kingdom, and Ukraine) to facilitate a settlement. Sticking points in talks included
Georgia’s demand that displaced persons be allowed to return to Abkhazia, after which an
agreement on autonomy for Abkhazia would be negotiated. The Abkhazians insisted on
recognition of their independence as a precondition to large-scale repatriation.
In July 2006, a warlord in the Kodori Gorge area of northern Abkhazia, where many ethnic Svans
reside, foreswore his nominal allegiance to the Georgian government. The Georgian government
quickly sent forces to the area and defeated the warlord’s militia. Georgia claimed that only police
were deployed in the Gorge, but Abkhazia asserted that military troops were present, in violation
of the cease-fire agreement. Regular Georgia-Abkhazia peace talks were suspended in October
2006. Abkhazia called for Georgia to remove the government representatives and alleged military
forces.
The United States and others in the international community raised concerns when the Russian
foreign and defense ministries announced on April 29, 2008, that the number of “peacekeepers”
in Abkhazia would be boosted up to the maximum permitted under ceasefire accords. The
ministries claimed that the increases were necessary to counter a buildup of Georgian “military
forces” and police in the Kodori Gorge, which they alleged were preparing to attack the de facto
Abkhaz government. It was also troubling that 400 Russian paratroopers were deployed to
Abkhazia that Russian officials reportedly stated would be fully armed in order to repulse

42 “Germany, Great Britain, France, U.S.A. and Germany Passed Communiqué,” Black Sea Press, April 24, 2008.
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possible Georgian attacks on Abkhazia.43 In late May 2008, Russia announced that about 400
railway construction troops were being sent to Abkhazia for “humanitarian” work. These
troops—whose role is to facilitate military positioning—reportedly left Abkhazia at the end of
July 2008 after repairing tracks and bridges. According to former Deputy Assistant Secretary
Bryza, the railway was used in August by Russia when its troops moved into Georgia.44
Developments in South Ossetia Before August 2008
In 1989, the region lobbied for joining its territory with North Ossetia in Russia or for
independence. Repressive efforts by former Georgian President Gamsakhurdia triggered conflict
in 1990, reportedly contributing to an estimated 2,000-4,000 deaths and the displacement of tens
of thousands of people. In June 1992, Russia brokered a cease-fire, and Russian, Georgian, and
Ossetian “peacekeeping” units set up base camps in a security zone around Tskhinvali, South
Ossetia. Reportedly, the units totaled around 1,100 troops, including about 530 Russians, a 300-
member North Ossetian brigade (which actually was composed of South Ossetians and headed by
a North Ossetian), and about 300 Georgians. OSCE monitors did most of the patrolling.
In 2004, President Saakashvili increased pressure on South Ossetia by tightening border controls
and by breaking up a large-scale smuggling operation in the region that allegedly involved
Russian organized crime and corrupt Georgian officials. He also reportedly sent several hundred
police, military, and intelligence personnel into the region. Georgia maintained that it was only
bolstering its peacekeeping contingent up to the limit of 500 troops, as permitted by the cease-fire
agreement. Georgian guerrilla forces also reportedly entered the region. Allegedly, Russian
officials likewise assisted several hundred paramilitary elements from Abkhazia, Transnistria, and
Russia to enter. Following inconclusive clashes, both sides by late 2004 ostensibly had pulled
back most undeclared forces. In November 2006, a popular referendum was held in South Ossetia
to reaffirm its “independence” from Georgia. After October 2007, no more peace talks were held.
The August 2008 Russia-Georgia Conflict
Simmering long-time tensions erupted on the evening of August 7, 2008, when South Ossetia
accused Georgia of launching a “massive” artillery barrage against its capital, Tskhinvali, while
Georgia reported intense bombing of some Georgian villages in the conflict zone by South
Ossetian forces. Georgia claims that South Ossetian forces did not respond to a ceasefire appeal
but intensified their shelling, “forcing” Georgia to send in troops that reportedly soon controlled
Tskhinvali and other areas.45
On August 8, Russia launched large-scale air attacks across Georgia and dispatched seasoned
troops to South Ossetia that engaged Georgian forces in Tskhinvali later in the day. Reportedly,
Russian troops had retaken Tskhinvali, occupied the bulk of South Ossetia, reached its border
with the rest of Georgia, and were shelling areas across the border by the morning of August 10.
Russian warplanes bombed the outskirts of the capital, Tbilisi, as well as other sites. Russian

43 ITAR-TASS, May 6, 2008.
44 Pavel Felgenhauer, Eurasia Daily Monitor, June 12, 2008; U.S. Department of State. Foreign Press Center. Briefing:
The Situation in the Republic of Georgia and its Implications for the Caucasus, August 19, 2008.
45 See also CRS Report RL34618, Russia-Georgia Conflict in August 2008: Context and Implications for U.S. Interests,
by Jim Nichol.
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ships landed troops in Georgia’s breakaway Abkhazia region and took up positions off Georgia’s
Black Sea coast.
On August 12, Medvedev declared that “the aim of Russia’s operation for coercing the Georgian
side to peace had been achieved and it had been decided to conclude the operation.... The
aggressor has been punished and suffered very heavy losses.”46 Medvedev endorsed some
elements of a European Union (EU) peace plan presented by visiting French President Nicolas
Sarkozy. On August 15, the Georgian government accepted the French-brokered six-point cease-
fire that left Russian forces in control of South Ossetia, Abkhazia, and “security zones” in
undisputed Georgian territory.47 The six points include commitments not to use force, to halt
hostilities, to provide full access for humanitarian aid, to withdraw Georgian forces to the places
they were usually stationed prior to the conflict, to withdraw Russian forces to positions prior to
the outbreak of hostilities (although they were permitted to implement security measures in the
zone of the conflict until international monitors were in place), and to open international
discussions on ensuring security and stability in Abkhazia and South Ossetia.
Much of the international community condemned President Medvedev’s August 26 decree
officially recognizing the independence of South Ossetia and Abkhazia.48 Nicaragua, Venezuela,
Nauru, and Vanuatu are the only countries that have followed suit in extending diplomatic
relations to Abkhazia and South Ossetia.
On September 8, 2008, visiting French President Nicolas Sarkozy and Russian President Dmitriy
Medvedev signed a follow-on ceasefire accord that fleshed out the provisions of the six-point
peace plan. Among its provisions, it stipulated that Russian forces would withdraw from areas
adjacent to the borders of Abkhazia and South Ossetia by October 11; that Georgian forces would
return to their barracks by October 1; that international observers already in place from the U.N.
and OSCE would remain; and that the number of international observers would be increased by
October 1, to include at least 200 observers from the EU, and perhaps more later. The EU called
for Russia to permit these observers to patrol in Abkhazia and South Ossetia. Russia’s position
has been that these observers cannot patrol in the regions without the approval of the regions, and
the regional leaders have refused to permit such patrols. Although Sarkozy strongly implied that
the international conference would examine the legal status of Georgia’s breakaway Abkhazia and
South Ossetia, Medvedev pointed out that the regions had been recognized as independent by
Russia on August 26, 2008, and stated that disputing this recognition was a “fantasy.”49

46 ITAR-TASS, August 12, 2008. On September 11, Prime Minister Putin stated that Georgia’s aggression was answered
by “a well-deserved mighty punch” by Russia. ITAR-TASS, September 11, 2008.
47 See CRS Report RL34618, Russia-Georgia Conflict in August 2008: Context and Implications for U.S. Interests, by
Jim Nichol, August 29, 2008.
48 The EU fact-finding mission on the causes and outcome of the Russia-Georgia conflict stated that according to
overwhelmingly accepted principles of international law, “only former constituent republics such as Georgia but not
territorial sub-units such as South Ossetia or Abkhazia are granted independence in case of dismemberment of a larger
entity such as the former Soviet Union. Hence, South Ossetia did not have a right to secede from Georgia, and the same
holds true for Abkhazia.... Recognition of breakaway entities such as Abkhazia and South Ossetia by a third country ...
runs against Principle I of the Helsinki Final Act which states “the participating States will respect each other’s
sovereign equality and individuality ... including in particular the right of every State to juridical equality, to territorial
integrity and to freedom and political independence.” The fact-finding mission also pointed out that the founding
documents of the Commonwealth of Independent States, to which Georgia belonged from 1993 to 2008, called for
upholding the territorial integrity of the members. Council of the European Union. Report of the Independent
International Fact-Finding Mission on the Conflict in Georgia
, September 2009, Vol. 1, p. 17; Vol. 2, pp. 127-146.
49 CEDR, September 28, 2008, Doc. No. CEP-950425; CEP-950440.
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Many observers have argued that Russia aimed both to consolidate control over South Ossetia
and Abkhazia and to depose Georgian President Saakashvili when it launched the August 2008
military incursion into Georgia. Russia hoped to achieve this latter goal either directly by
occupying Georgia’s capital of Tbilisi and killing or arresting Saakashvili, or indirectly by
triggering his overthrow, according to these observers. They state that Saakashvili’s survival as
the popularly elected president is a major accomplishment of the diplomacy led by the EU that
ended Russia’s offensive. They also suggest that the current political stability may indicate that
Georgia has made at least some democratization progress (see “Recent Democratization Problems
and Progress”).50
By October 1, 2008, the EU Monitoring Mission (EUMM) had deployed over 200 monitors and
Russia announced on October 9 that its troops had withdrawn from buffer zones. Georgia has
maintained that Russian troops have not pulled out of Akhalgori, a district that Russia asserts is
within South Ossetia’s Soviet-era borders, and the Kodori Gorge, and that no Russian military
bases are permitted in the regions. In December 2008, Russia objected to continuing a mandate
for about 200 OSCE observers in Georgia—including some observers authorized before the
August 2008 conflict and some who were added after the August 2008 conflict—and they pulled
out on June 30, 2009. Similarly, in June 2009 Russia vetoed a UNSC resolution that extended the
UNOMIG mandate, and they pulled out of Abkhazia. The EUMM is now the sole international
group of monitors. It reported in early 2012 that the number of staffers was 300 (of which 200 are
monitors); that Sweden, Germany, and Romania are the largest contributors of monitors; and that
the monitors are based in three field offices near the contested borders.51
According to Assistant Secretary of Defense Alexander Vershbow and Assistant Secretary of State
Philip Gordon, the EUMM has been effective at debunking several allegations made by Russia
and the separatist regions that ceasefire violations have been committed by Georgia. The United
States and the EU continue to call for unrestricted access to Abkhazia and South Ossetia in order
to monitor the ceasefile. Vershbow and Gordon have praised Georgia’s cooperation with the
EUMM, including Georgia’s agreement with the EUMM at the beginning of 2009 to report all
movements of its security forces near the administrative borders and to permit unannounced
inspections of its military facilities. They contrast this cooperation to the refusal of Russia,
Abkhazia, and South Ossetia to permit patrols in the regions.52 In late April 2012, Abkhazia
declared that the head of the EUMM was persona non grata, including because he advocated for
the EUMM to patrol inside the breakaway regions. Abkhazia boycotted a planned meeting of the
incident prevention group (see below), because the EUMM head normally would attend.
An international conference to discuss security, repatriation, and status issues related to the
conflict held its inaugural session in Geneva on October 15, 2008. Facilitators at the talks include

50 U.S. House of Representatives. Committee on Foreign Affairs. Hearing on U.S.-Russia Relations in the Aftermath of
the Georgia Crisis. Testimony of Daniel Fried, Assistant Secretary of State for European and Eurasian Affairs,
September 9, 2008. Saakashvili also highlighted this Russian aim during his testimony to the Georgian legislative
commission investigating the causes of the conflict. See “Saakashvili Testifies Before War Commission, Analysts
Comment,” The Messenger (Tbilisi), December 1, 2008. Georgia’s Ambassador to the United States, Davit
Sikharulidze, argued that Russia’s “aim was to overthrow the [Georgian] government and it would have come true but
for the U.S. interference.” CEDR, December 1, 2008, Doc. No. CEP-950233. Russia officially has denied such an aim.
51 EUMM. Mission Facts and Figures, at http://www.eumm.eu/en/about_eumm/facts_and_figures.
52 U.S. Senate. Committee on Foreign Relations. Subcommittee on Europe. Hearing on Georgia: One Year After the
August War. Testimony of Alexander Vershbow, Assistant Secretary of Defense for International Security Affairs, and
Testimony of Philip H. Gordon, Assistant Secretary for European and Eurasian Affairs, August 4, 2009.
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the U.N., the EU, and the United States. Russia, South Ossetia, and Abkhazia reject any
challenges at the conference to the claimed independence of the breakaway regions. Russia has
insisted at these meetings and elsewhere that the international community impose an arms
embargo on Georgia. Russia also has insisted at these meetings that Georgia sign non-use-of-
force agreements with the breakaway regions. In March 2010, Russia stated that, as a preliminary
to the signing of such agreements, Georgia, South Ossetia, and Abkhazia could provide written
pledges of the non-use of force to the United Nations (see below).53
Among significant Geneva conference meetings:
• In February 2009, the sides agreed to set up an “incident prevention and response
mechanism” along the South Ossetian border with the rest of Georgia in order to
defuse tensions before they escalate. On April 23, the first meeting of the
Georgia-South Ossetia Incident Prevention and Response Mechanism was
convened in the Georgian town of Ergneti, with the participation of the Georgian
and South Ossetian sides, as well as representatives of the Russian Ministry of
Defense, the OSCE and the EU.
• The May 2009 Geneva conference meeting almost broke up, with Russia
delaying proceedings until a report was issued by the U.N. Secretary General on
Abkhazia. The report, issued after the Russia walkout on May 19, was deemed
suitable and proceedings resumed on May 20. At issue was a Russian demand
that the acronym UNOMIG not appear in the report. Although dropping the
acronym, the U.N. Secretary General nonetheless stressed that “the ceasefire
regime ... has continued to erode. Heavy military equipment and military
personnel [from Russia] have remained in the Mission’s area of responsibility.”54
The next month, Russia vetoed the continuation of UNOMIG.
• At the July 2009 Geneva conference meeting, the sides discussed setting up an
incident prevention group to resolve issues such as cross-border travel between
Abkhazia and the rest of Georgia. A meeting in Gali to establish the group was
held on July 14, 2009.
• At the October 14, 2010, meeting, Russia announced that it was pulling its troops
out of the town of Perevi, Georgia, near the border with South Ossetia. The
troops pulled out on October 18, 2010. Russia has declared that this pullout
marked its complete fulfillment of the ceasefire accords.55 South Ossetia refused
to discuss problems of refugees and displaced persons after a Georgian-
sponsored resolution on the return of displaced persons and refugees to South
Ossetia was approved by the U.N. General Assembly in September 2010.

53 Samuel Charap and Cory Welt, A More Proactive U.S. Approach to the Georgia Conflicts, Center for American
Progress, February 2011; CEDR, July 28, 2010, Doc. No. CEP-6001.
54 U.N. Security Council. Report of the Secretary-General Pursuant to Security Council Resolutions 1808 (2008), 1839
(2008) and 1866 (2009) S/2009/254
, May 18, 2009. See also Georgian Ministry of Foreign Affairs. Information for the
Press on the Issues Discussed During the Fifth Round of the Geneva Discussions
, May 19, 2009.
55 The Georgian Foreign Ministry issued a statement that the withdrawal of Russian troops from Perevi was welcome
but was “just a miniscule step in comparison with commitments envisaged by the ceasefire agreement of August 12,
2008, which Russia still has to comply with.” Statement of the Ministry of Foreign Affairs of Georgia on the
Withdrawal of the Russian Armed Forces
, Ministry of Foreign Affairs of Georgia, October 19, 2010.
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• In March 2011, the sides praised the regular monthly meetings of the incident
prevention and response mechanisms groups, which had resulted in the exchange
of people who had been detained or imprisoned on grounds of illegally crossing
the borders. The sides also praised the high level of cross-border traffic that had
been facilitated by the work of the incident prevention groups.
• At the June 7, 2011, meeting, Georgia raised concerns about alleged Russian
terrorist attacks and plans (see below) and stated that it might reconsider
participation in the Geneva conference if the terrorism persisted. Abkhazia and
South Ossetia threatened to no longer participate in discussions over the
repatriation of displaced persons. Russia reiterated support for the rejection by
the breakaway regions of calls for EU observers or other international monitors
to be permitted to patrol in the regions.
• At the December 14, 2011, meeting, the moderators, the United States, and
Georgia argued that if binding nonuse-of-force agreements are signed, they
logically should include provisions for international monitors to patrol in the
breakaway regions, a stance rejected by Russia, South Ossetia, and Abkhazia.
Georgia and South Ossetia agreed to exchange over two dozen detainees who
allegedly had illegally crossed disputed borders. The prisoner exchange—under
the aegis of the incident prevention mechanism—took place at the end of
December 2011.
• At the March 29, 2012, meeting, Russia reportedly assured Georgia that its
planned September 2012 Caucasus military exercise would not include troops in
Abkhazia and South Ossetia. Georgia pointed to the planned exercise in calling
for Russia to make a nonuse-of-force pledge to Georgia (see below). The next
Geneva meeting is planned for June 8, 2012.
In late 2010, President Saakashvili gave speeches at sessions of the European Parliament and the
OSCE in Astana, Kazakhstan, pledging the non-use of force except in cases of self-defense. At
the European Parliament, he stated that
to prove that Georgia is definitively committed to a peaceful resolution of its conflict with
[Russia] we take today the unilateral initiative to declare that Georgia will never use force to
restore its territorial integrity and sovereignty.… We commit ourselves not to use force in
order to reunite our illegally divided country, neither against the occupation forces, nor
against their proxies.
In an interview about the pledge, he stated that “we must display strategic patience, which can
lead not only to the complete liberation of our territory but also to reconciliation with Russia.”56
South Ossetia and Abkhazia followed suit with oral statements, but Russia refused to issue such a
pledge on the grounds that it is not a party to the conflict.
The International Crisis Group (ICG), a non-governmental organization, estimated in June 2010
that there may be fewer than 30,000 people residing in South Ossetia, and that the population
continues to decline (a 1989 census, taken before the beginning of conflict, reported a regional
population of 98,500). The ICG suggests that the region is increasingly less able to govern or

56 President of Georgia’s Address to European Parliament Members, Mikheil Saakashvili, The President of Georgia, at
http://www.president.gov.ge/index.php?lang_id=ENG&sec_id=228&info_id=5857; Le Figaro, November 23, 2010.
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sustain itself economically, and so must rely on Russian aid and thousands of Russian
construction and government workers, troops, and border guards that are deployed there.57
At the December 1-2, 2010, summit meeting of the OSCE, the United States and Russia clashed
over the principle of Georgia’s territorial integrity. The United States called for reestablishing an
OSCE Mission in Georgia that would have a mandate that included the breakaway areas, but
Russia refused. Language in the final declaration recognizing territorial integrity as a core
principle of the OSCE was deleted.
In early March 2011, Assistant Secretary of State Philip Gordon reiterated the U.S. position that
Georgia’s territory is “occupied” by Russian troops. He explained that
we don’t know what else to call it. We respect Georgia’s sovereignty and territorial integrity.
We believe that Russia used disproportionate force and remains present in what we consider
to be sovereign Georgia. So it’s not meant to be a particular provocation, it’s just a
description of what we think the situation is and we’ve very active in the Geneva talks and
bilaterally with Russia to try to bring about an end to what we consider to be a military
occupation.58
On June 2 and June 6, 2011, Georgia announced that it had apprehended Russian terrorist
infiltrators who were planning attacks in Georgia, including against the NATO Liaison Office in
Tbilisi. Georgia alleged that Russian security agencies were behind the planned attacks. Russia
termed these allegations “artificially fabricated arrays of data.”59 In late July 2011, the
Washington Times alleged that the U.S. intelligence community had backed up a Georgian claim
that Russian intelligence operatives had orchestrated a bombing in September 2010 near the U.S.
Embassy in Tbilisi.60
The Tagliavini Report on the Origins and Outcome of the August 2008 Conflict
On September 30, 2009, a special EU fact-finding mission led by Swiss diplomat Heidi Tagliavini
released a report on the origins and outcome of the August 2008 Russia-Georgia conflict. On the
one hand, the mission concluded that “open hostilities began with a large-scale Georgian military
operation against the town of Tskhinvali [in South Ossetia] and the surrounding areas, launched in
the night of 7 to 8 August 2008. Operations started with a massive Georgian artillery attack.” The
mission also argued that the artillery attack was not justifiable under international law. However,
it also argued that the artillery attack “was only the culminating point of a long period of
increasing tensions, provocations and incidents” by the parties to the conflict. On the other hand,
the mission suggested that “much of the Russian military action went far beyond the reasonable
limits of defense,” and that such “action outside South Ossetia was essentially conducted in
violation of international law.” In Abkhazia, actions by Russian-supported militias in the upper
Kodori Valley “constituted an illegal use of force ... not justified under international law.” The
mission likewise asserted that actions by South Ossetian militias “against ethnic Georgians inside

57 International Crisis Group. South Ossetia: The Burden of Recognition, June 7, 2010.
58 U.S. Embassy, Bratislava, Slovakia, Assistant Secretary of State for Europe Phil Gordon in Bratislava: The U.S.
Relationship With Central Europe Under the Obama Administration
, March 3, 2011.
59 Ministry of Foreign Affairs of the Russian Federation, June 13, 2011.
60 Washington Times, July 27, 2011; Maka Gurgenidze, “CIA Reportedly Concluded Bombing of U.S Embassy in
Tbilisi has Ties to Moscow,” CACI Analyst, August 3, 2011.
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and outside South Ossetia, must be considered as having violated International humanitarian law
and in many cases also human rights law.”61 Commenting on the release of the report, a U.S. State
Department spokesman stated that “we recognize that all sides made mistakes and
miscalculations through the conflict last year. But our focus is on the future.”62
Economic Conditions, Blockades, and Stoppages
The economies of all three South Caucasus states greatly declined in the early 1990s, affected by
the dislocations caused by the breakup of the Soviet Union, conflicts, trade disruptions, and the
lingering effects of the 1988 earthquake in Armenia. Gross domestic product (GDP) began to
rebound in the states in the mid-1990s. Investment in oil and gas resources has fueled economic
growth in Azerbaijan at the expense of other sectors of the economy, although there are efforts to
strengthen non-oil sectors. Problems of poverty and regional conflict have contributed to high
emigration from all three states, and remittances from these émigrés have provided major support
for the remaining populations.
The global economic downturn that began in 2008 hampered Armenia’s economic growth and
added to Georgia’s economic stresses in the wake of the August 2008 conflict. Azerbaijan’s
energy revenues, although reduced, helped it weather the downturn with continued GDP growth.
The influx of international assistance to Georgia ameliorated to some degree the impact of the
conflict and the world economic crisis. In October 2010, Russia announced a $500 million loan to
Armenia to assist it in economic stabilization and recovery.63 Perhaps surmounting the downturn,
all the regional economies reported GDP growth in 2011. Despite the downturn, major economic
accomplishments in recent years have included the reduction of a high rate of poverty in
Azerbaijan and the World Bank’s 2012 assessment that Georgia has made the most progress
among 183 countries in making business regulatory reforms and now ranks 16th worldwide in the
overall ease of doing business.
Transport and communications obstructions and stoppages have severely affected economic
development in the South Caucasus and stymied the region’s emergence as an East-West and
North-South corridor. Since 1989, Azerbaijan has obstructed railways and pipelines traversing its
territory to Armenia.64 According to the U.S. Embassy in Baku, Azerbaijan’s Nakhichevan
exclave “is blockaded by neighboring Armenia.” Since 2006, Russia has severely restricted
agricultural trade and land, air, and sea links with Georgia. Russia hinders Azerbaijan’s use of the
Volga-Don Canal to reach world shipping channels. Russia has at times cut off gas supplies to
Georgia. During the August 2008 Russia-Georgia conflict, Russia’s effective blockade of
Georgia’s Black Sea ports disrupted trade shipments to and from Armenia. In the wake of the
conflict, gas transit from Russia to South Ossetia via other Georgian territory was disrupted, with
each side blaming the other, until service was restored in late January 2009. In late August 2009,

61 Report of the Independent International Fact-Finding Mission on the Conflict in Georgia, Vol. 3.
62 U.S. Department of State. Daily Press Briefing, September 30, 2009.
63 ITAR-TASS, October 20, 2010.
64 Armenia long opposed the construction or revamping of a section of railway from Kars, Turkey, to Tbilisi (and
thence to Azerbaijan) that would bypass Armenia, arguing that an existing section of railway from Kars that transits
Armenia into Georgia could be returned to service “in a week.” The Export-Import Bank Reauthorization Act of 2006
(P.L. 109-438) prohibits the Bank from guaranteeing, insuring, or extending credit in support of any railway
construction that does not traverse or connect with Armenia and does traverse or connect Baku, Tbilisi, and Kars. Work
on the railway began in late 2007 and is planned to be completed in 2013.
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Russia completed construction of a 110-mile gas pipeline from North Ossetia to South Ossetia to
avoid transiting Georgia. Trans-border road traffic between Georgia and the regions of South
Ossetia and Abkhazia is severely restricted. Armenia criticizes Georgia’s refusal to reopen a
section of railway transiting the country to Abkhazia and Russia.
Turkey closed its land borders with Armenia in 1993. These obstructions have had a negative
impact on the Armenian economy, since it is heavily dependent on energy and raw materials
imports. Turkey’s closure of land borders in effect barred direct U.S. shipments of aid through its
territory to Armenia. Foreign Operations Appropriations for FY1996 (P.L. 104-107) and Omnibus
Consolidated Appropriations for FY1997 (P.L. 104-208)65 have mandated U.S. aid cutoffs (with a
presidential waiver) to any country which restricts the transport or delivery of U.S. humanitarian
aid to a third country. These provisions were designed to convince Turkey to allow the transit of
U.S. aid to Armenia. (See also above, “The Roles of Turkey, Iran, and Others.”)
Azerbaijani Civil Aviation official Arif Mammadov reportedly warned in late March 2011 that
Azerbaijan could shoot down airplanes that have not received Azerbaijani permission to land at
the airport in Stepanakert (Xankandi), the capital of NK. Armenia’s defense ministry reportedly
responded that its air defenses were capable of protecting the country’s airspace. Then-U.S.
Ambassador Bryza reportedly condemned the idea of attacking civilian aircraft and the
Azerbaijani Foreign Ministry pledged that the country would not attack civilian aircraft.66
Recent Democratization Problems and Progress
According to the NGO Freedom House, in 2010 Armenia and Georgia ranked as “partly free,”
while Azerbaijan ranked as “not free,” in terms of political rights and civil liberties. Armenia and
Azerbaijan were assessed as having very restricted political rights, where elections have been
marred by serious irregularities. Armenia’s government was assessed as slightly better in
respecting civil liberties than was Azerbaijan’s, where the media have been severely restricted.
Georgia was assessed as improving in civil liberties over the past year due in part to increasing
media diversity. Among the disputed territories, Nagorno Karabakh (NK) and South Ossetia were
judged to be “not free,” while Abkhazia was judged to be “partly free.” NK was judged to have
declined in political rights in 2010, “due to the complete absence of opposition candidates in the
May 2010 parliamentary elections.”67
Armenia
Municipal elections for Yerevan were held in May 2009, the first in which the capital’s mayor
was indirectly elected rather than appointed by the president. The ruling Republican Party (HHK)
secured 35 of 65 seats in the city council, which resulted in the HHK incumbent previously
appointed by the president being reinstated as mayor. Opposition parties viewed the election as
fraudulent. The NGO International Foundation for Electoral Systems (IFES) reported that “while
there were some progressive elements in the work of local polling commissions … these were
offset by egregious violations…. The prevalence of unauthorized persons both inside and around

65 P.L. 104-208, §559, amends the Foreign Assistance Authorization Act of 1961.
66 CEDR, March 23, 2011, Doc. No. CEP-950100; April 11, 2011, Doc. No. CEP-950112; “Azerbaijan Threatens To
Shoot Down Karabakh Planes,” RFE/RL, March 16, 2011.
67 Freedom in the World, Freedom House, February 13, 2011.
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the polling stations which served to intimidate voters and poll workers alike played a large role in
determining the final, announced results of the vote.”68 In December 2009, co-rapporteurs for
Armenia at the Parliamentary Assembly of the Council of Europe (PACE) raised concerns that an
Armenian legislative report on a violent crackdown on protests after the March 2008 presidential
election had largely exonerated the government, but called for reform recommendations made by
the report to be implemented.69
Starting in February 2011, the Armenian National Congress (ANC), an alliance of opposition
parties formed in 2008, launched a series of demonstrations inspired by developments in the
Middle East. On March 1, 2011, the ANC held a reportedly large demonstration in Yerevan where
former President Levon Ter-Petrosyan publicized a list of demands against the government,
including freeing “political prisoners,” facilitating an international examination of government
actions after the 2008 election, permitting rallies in Yerevan’s Liberty Square, raising salaries and
social benefits, ousting the prime minister, and “get[ting] the process of NK conflict resolution
back on track.”70 In mid-March 2011, opposition Heritage Party founder Raffi Hovhannisyan
began a two-week hunger strike to protest against what he claimed was increasing government
repression against the opposition and to call for early presidential and legislative elections. On
March 17, 2011, the ANC held another reportedly large rally in Yerevan that the authorities
permitted to be held in Liberty Square. That same day, the authorities released two opposition
activists who had been jailed since 2008. Subsequently, the government granted amnesties to
additional prisoners who had been sentenced in relation to the March 2008 protest, and launched
a new effort to investigate the events of March 2008. In response to these moves, at a rally in
Yerevan on May 31, 2011, Ter-Petrosyan stated that the ANC was ready for “dialogue” with the
government.
The ANC joined talks with the government in July 2011, but ceased meeting with government
officials in late August 2011, after police clashed with youth activists on August 9 and arrested
one ANC member. Besides demanding the release of the arrested ANC member, Ter-Petrosyan
has reiterated his call for the government to agree to early legislative and presidential elections.
At ANC rallies in late 2011, Ter-Petrosyan again stressed that Serzh Sarisyan should resign.
In anticipation of legislative elections scheduled to be held on May 6, 2012, and presidential
elections scheduled for early 2013, a new electoral code was approved in June 2011 that included
several reform suggestions by the Council of Europe’s advisory Venice Commission and the
OSCE’s Office of Democratic Institutions and Human Rights (ODIHR). Reforms included steps
to form a more non-partisan electoral administration and the specification of conditions under
which election results might be invalidated. However, the Venice Commission and ODIHR called
for added reforms, including easing restrictions on becoming a candidate for election, ensuring
the separation of state and party structures, improving the transparency of vote counting, and
improving complaint and appeal procedures.71 Also in anticipation of the May 2012 legislative

68 “IFES, an Observer of the Yerevan, Armenia Elections, Comments on the Poll,” IFES, June 1, 2009, at
http://www.ifes.org/Content/Publications/Comments/2009/Jun/IFES-an-Observer-of-the-Yerevan-Armenia-Elections-
Comments-on-the-Poll.aspx.
69 PACE. “Recommendations of Armenian Parliamentary Committee Provide ‘a Comprehensive Although Not
Complete’ Response to March 2008 Crisis,” News, December 22, 2009; “PACE Co-Rapporteurs Welcome Willingness
of Armenian Authorities to Draw Up Reform ‘Roadmap,’” News, March 25, 2010; Armenia Needs a Clear Roadmap of
Reforms in Order to Consolidate Democracy,” News, May 14, 2010.
70 CEDR, March 2, 2011, Doc. No. CEP-964045.
71 Council of Europe, European Commission For Democracy Through Law, European Commission For Democracy
(continued...)
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election, the opposition Heritage Party and the ARF deputies in the legislature introduced a bill in
January 2012 calling for the elimination of single member district voting and the transition to a
proportional (party list) system to elect all deputies. Several opposition parties and blocs not
represented in the legislature indicated support for the bill. Backers of the bill argued that voting
in single member districts was controlled by local officials who carried out the wishes of the
Sargisyan government, while voting via national party lists might increase the chances that more
opposition deputies could be elected. At the end of February 2012, the bill was rejected by the
majority deputies belonging to the ruling coalition (Republican Party of Armenia, Prosperous
Armenia, and Law-Governed Country), although a few Prosperous Armenia deputies reportedly
supported the bill.
At a rally on Freedom Square on March 30, 2012, Ter-Petrosyan stated that if the ANC was
victorious in the upcoming legislative election, it would raise the question of President
Sargisyan’s ouster at the first meeting of the new legislature. The ANC also would set up a
commission to investigate the 1999 assassinations and the disruption of protests in 2008, and
would seek to replace all members of the Constitutional Court, he pledged.
Eight parties and the Armenian National Congress bloc were approved to run on party lists for 90
seats in the May 6, 2012, legislative election. In addition, 155 candidates were registered to run
for 41 seats in single-mandate constituencies. Official campaigning began on April 8.
On April 13, 2012, President Sargisyan signed a state of emergency bill into law. The law
provides for the president to declare an emergency and call out the police and armed forces in
situations threatening the constitutional order or in cases of terrorism or civil conflict. Some
opponents of the law have denounced it for allegedly unconstitutionally enhancing presidential
power and warn that it might be used to suppress protests after the upcoming legislative election.
Azerbaijan
During a July 2010 visit to Azerbaijan, Secretary Clinton stated that the country had made
“tremendous progress” in democratization since it gained independence and reported that the
United States was providing democratization assistance to facilitate a free and fair legislative
election in November 2010.72 The U.S. Department of State issued a statement on November 8,
2010, just after the election, that while peaceful, the election “did not meet international
standards.” The State Department remarked that the inclusion of record numbers of domestic
observers and an increase in the number of female candidates were improvements over past
elections, but reported that observers from the U.S. embassy witnessed “serious violations of
election procedures, including ballot box stuffing.” The State Department urged that the
Azerbaijani government “focus now on adjudicating election grievances fairly, transparently, and
expeditiously [in order to ensure] accountability for officials who are suspected of interfering
with the proper conduct of elections.”73 The next day, the Azerbaijani Foreign Ministry criticized
the State Department’s assessment, viewing it as less favorable than that issued by the OSCE. The

(...continued)
Through Law (Venice Commission) and OSCE ODIHR Draft Joint Opinion on the Electoral Code of Armenia Adopted
on 26 May 2011
, Opinion No. 611 / 2011, September 29, 2011.
72 U.S. Department of State, Hillary Rodham Clinton, Secretary of State, Joint Press Availability With Azerbaijani
Foreign Minister Mammadyarov
, July 4, 2010.
73 U.S. Department of State, Press Statement: Parliamentary Elections in Azerbaijan, November 8, 2010.
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Foreign Ministry claimed that the OSCE monitoring report, while noting some shortcomings,
“show[ed that] the elections have gained the people’s confidence.”74 On December 15, 2010,
purportedly to discount some adverse Wikileaks press reports, Secretary Clinton reportedly called
President Aliyev to reassure him that the United States continues to view Azerbaijan as its
important strategic partner and is determined to deepen bilateral ties.
The November 2010 Milli Majlis Election
In June 2010, the Azerbaijani Milli Majlis (National Assembly) approved a bill calling for it to
coordinate its yearly agenda with the presidential administration. Oppositionists criticized the law
as further demonstrating that the legislature was controlled by the executive branch of
government.
A constituency-based election for Azerbaijan’s 125-member Milli Majlis was held on November
7, 2010. Candidates wishing to run were required to gather 450 signatures. About 1,400
individuals were nominated by parties or by voter initiatives or self-nominations, but only about
1,100 reportedly submitted the required signature sheets and other information. Electoral officials
accepted all of the prospective candidates of the ruling New Azerbaijan Party (NAP) but rejected
many from other parties and blocs, so that 690 candidates appeared on the ballot (43 of these
were registered after appealing initial rejections, and 52 registered candidates dropped out). These
rejections seriously impacted the ability of the opposition to field candidates in more than a few
constituencies. While the NAP was able to field candidates in 111 constituencies, the opposition
PFP-Musavat bloc, for instance, could only field candidates in 38 constituencies. In addition to
candidates nominated by parties, 387 were self-nominated “independent” candidates or were
nominated by voter initiative groups, although many of these candidates in fact were members of
parties. Historically, most independents who have won election have supported the NAP in the
legislature.75
In the run-up to the election, three major developments appeared to assure that the ruling NAP
would retain or increase its dominance in the legislature: (1) media, assembly, and campaign laws
and practices greatly restricted the ability of opposition parties to publicize their concerns and
counter claims of the ruling party; (2) the numerous opposition parties failed to unite and instead
ran as party blocs and as individual parties; and (3) rising incomes for most of the population may
have predisposed a large measure of support for the ruling party, despite some stresses caused by
the global economic downturn. According to the OSCE and some NGOs, restrictions on an open
campaign environment and a free and fair vote included reducing the number of campaign days to
about three weeks; eliminating an electoral provision permitting individuals to run by submitting
a financial deposit; doing away with public financing of elections; denying the holding of
campaign rallies except in far-flung, officially approved locations; filing of defamation lawsuits
and carrying out other harassing measures against journalists; providing dominant representation
to the ruling NAP on electoral commissions and expert electoral appeal panels; and allowing
opaque military voting. As a result of these restrictions, there were no public debates between

74 Azerbaijan Press Agency, November 10, 2010.
75 One local non-governmental organization (NGO) reported that there were myriad efforts by local officials and others
to pressure citizens not to endorse the candidacy of oppositionists and to force prospective opposition candidates to
drop out of the race. Parliamentary Elections in the Republic Of Azerbaijan: Report on the Stage of Candidate
Nomination and Registration
, Democracy Learning Public Union, October 22, 2010.
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candidates and virtually no television coverage of opposition candidates except for four minutes
of time permitted for candidates to set forth their platforms.
Perhaps a factor in the election, on October 13, 2010, the ruling NAP asserted that the merger of
Musavat Party and the Azerbaijan Popular Front “was made on an order from [the West] and aims
at misleading public opinion.” The NAP also claimed that Isa Gambar, the head of the Musavat
Party, was a traitor to the country because he had signed a declaration at an NGO conference in
Potsdam, Germany, with Aram Manukyan, chairman of the Armenian National Movement, on the
peaceful settlement of the NK conflict. Ali Ahmadov, the deputy chairman of NAP, reportedly
stated that Musavat “cannot count on the Azerbaijani people [in an election] and rely on
Armenians.” Gambar argued that the declaration, which was also signed by the head of Georgia’s
Republican Party, David Usupashvili, did not harm Azerbaijan’s security.76
According to the Central Electoral Commission, about 50% of 4.9 million registered voters
turned out, and most voted for members of the NAP. The NAP increased its number of seats in the
Majlis from 61 in 2005 to 74 in 2010.77 The number of nominal independents also increased from
37 in 2005 to 39 in 2010. Nine minor parties won 12 seats, down from 20 in 2005. One
opposition party candidate—İgbal Agazade of the Umid (Hope) Party—won a seat in the new
Majlis. The Popular Front-Musavat bloc, which had won six seats in 2005 (as individual parties),
won no seats in 2010. All winning parties except the Umid Party signed a statement proffered by
the NAP declaring that the campaign and election represented progress in democratization.
According to one report, about two-thirds of the deputies of the outgoing Majlis were reelected.
Many of the reelected and new members are officials or are related to current officials, according
to this report.78
OSCE election monitors reported that the election was peaceful but “was not sufficient to
constitute meaningful progress in the democratic development of the country.” They stated that
“fundamental freedoms of peaceful assembly and expression were limited and a vibrant political
discourse facilitated by free and independent media was almost impossible. A deficient candidate
registration process, a restrictive political environment, unbalanced and biased media coverage,
disparity in access to resources to mount an effective campaign, misuse of administrative
resources as well as interference by local authorities in favor of candidates from the ruling party
created an uneven playing field for candidates.” The OSCE monitors assessed voting procedures
negatively in 11% of 1,247 polling stations visited, but among these were “serious violations and
important procedural shortcomings,” including ballot-box stuffing, the appearance of seemingly
identical signatures on voter lists, and the lack of inking of fingers to help prevent multiple
voting. The vote count was assessed negatively in over 30% of 152 polling stations visited. In one
case, the monitors received a filled-out precinct results sheet before the election that closely
matched what the precinct reported after the race. The court of appeals and the Supreme Court
rejected all complaints by opposition candidates about the election.79 The Election Monitoring

76 CEDR, October 18, 2010, Doc. No. CEP-950077; October 14, 2010, Doc. No. CEP-950086; Azerbaijan Press
Agency
, October 13, 2010. On the Friedrich Naumann Foundation for Freedom, which sponsored the conference at
which the parties signed the declaration of cooperation, see “Declaration of ELDR Member Parties in the South
Caucasus,” at http://www.freiheit.org/webcom/show_article.php?wc_c=617&wc_id=17117&wc_p=1.
77 The NAP won 56 seats on November 6, 2005, and 5 more seats in repeat elections held on May 13, 2006.
78 CEDR, November 8, 2010, Doc. No. CEP-950216.
79 OSCE, Office for Democratic Institutions and Human Rights, International Election Observation, Republic of
Azerbaijan, Parliamentary Elections, 7 November 2010, Statement of Preliminary Findings and Conclusions
,
November 8, 2010; Republic Of Azerbaijan Parliamentary Elections, 7 November 2010, Final Report, January 25,
(continued...)
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and Democracy Studies Center, a local NGO, alleged that their monitors witnessed ballot-box
stuffing in over one-fourth of polling places it covered.80
Ramiz Mehdiyev, the head of the presidential administration, hailed the election as a “triumph of
democracy,” as viewed by most international observers, but stated that “the position of OSCE
[election monitors] was of a subjective nature…. To a certain extent, these [were] ideas voiced on
the basis of certain directives.”81
Opposition Musavat Party head Isa Gambar alleged that only about 15% of voters had turned out
and that massive vote fraud had occurred, while other members of his party speculated that the
results were at least partly due to lack of party work at the local level outside of Baku.82
Addressing the newly elected NAP deputies just before the convocation of the Milli Majlis on
November 29, 2010, President and NAP head Aliyev hailed the election as “held in a fully
transparent and democratic manner,” and stated that “the Milli Majlis has a very important role
and function in the contemporary development of Azerbaijan…. The parliamentary election
shows once again that our citizens wish to see deserved representatives.… I hope that during next
five years the Milli Majlis and certainly, its leading force, the New Azerbaijan Party, will
contribute to the future development of our country.”83 President Aliyev reappointed all of the
members who held top posts in the previous legislature, including Oqtay Asadov, who was
reappointed speaker. The three Reform bloc deputies (including the heads of the Great Creation
and Justice parties and the United Popular Front of Azerbaijan) announced that they would form a
Reform “opposition” faction in the legislature.
The 2011-2012 Protests
Accusing foreign-based NGOs of fomenting dissent, on March 7, 2011, the Justice Ministry sent
the U.S.-based National Democratic Institute (NDI) a letter referencing permissible actions of
NGOs in the country, and police reportedly closed down NDI’s Baku office in mid-March 2011.
The Cabinet of Ministers subsequently issued a new regulation requiring foreign NGOs applying
for registration in Azerbaijan to swear to uphold “national spiritual values and not [to] carry out
political or religious propaganda.” They also are forbidden to carry out activities in NK.84 NDI
reportedly was permitted to resume some activities in Azerbaijan in late 2011.
An Internet-launched “great people’s day” protest was planned for March 11, 2011, reportedly
supported by thousands of Internet users. Organizers of the protest stated that the date was set to

(...continued)
2011.
80 Preliminary Statement on the Results of the Monitoring of the 7 November 2010 Elections to the Milli Majlis
(Parliament) of the Republic of Azerbaijan
, Election Monitoring and Democracy Studies Center, November 8, 2010.
See also the report of the Democracy Learning Public Union, a local NGO, Parliamentary Elections in the Republic Of
Azerbaijan: Report on the Stage of Candidate Nomination and Registration
, October 22, 2010.
81 CEDR, November 17, 2010, Doc. No. CEP-950.
82 CEDR, November 23, 2010, Doc. No. CEP-950130; Azerbaijan Press Agency, November 24, 2010.
83 President of Azerbaijan, Ilkham Aliyev Met With MPs of the Ruling Party Elected to the Milli Majlis, November 29,
2010.
84 “NDI: National Democratic Institute Has Not Been Asked to Close in Azerbaijan,” APA News Service, March 11,
2011; CEDR, March 24, 2011, Doc. No. CEP950161.
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commemorate the date a month previously that Egyptian President Hosni Mubarek had been
ousted. In the days leading up to March 11, up to a dozen or more Internet users reportedly were
detained, and some allegedly were held secretly. One organizer, Bakhtiyar Hajiyev, a Harvard-
educated resident of Ganja, was arrested on March 4, 2011, on charges of draft evasion. Several
dozen people were arrested on March 11, and some received prison sentences of a few days. The
next day, the Musavat Party held a protest at Baku’s Fountain Square that reportedly involved
several hundred people, but many were prevented from entering the square and several activists
were detained in advance or arrested the day of the protest.
In the run-up to the Internet-launched protest, authorities reportedly deployed military troops in
Baku and teachers at universities and secondary schools reportedly were ordered to lecture their
students not to attend protests or otherwise become involved in “anti-Azerbaijani” actions. On
March 9, 2011, the Interior Ministry claimed that the protests were fomented by “radical
oppositionists” financed by foreign countries aiming to trigger further “color revolutions” in
Soviet successor states. Various Azerbaijani officials stated that it would be unpatriotic to protest
while Azerbaijan is at war with Armenia and that heavy Internet users were mentally ill. Baku
State University allegedly forbade students from leaving the campus on March 11. Reacting to
Internet intimations that another protest might be held on March 14, the university closed and
deployed police to the campus. This protest did not materialize. On March 18, youth branches of
the Popular Front Party, the Hope Party, the Civic Solidarity Party, Democratic Party, Musavat,
and various youth groups issued a statement calling on the security services to halt arrests of
opposition youth and other activists. The next day, authorities arrested some officials of the Baku
branch of Moscow Open University on grounds of fomenting dissent.
The government detained several opposition activists ahead of a planned April 2, 2011, protest by
the Public Chamber; a coalition of non-partisan politicians, members, and officials of the
opposition Popular Front, Musavat, and National Independence parties; and sympathetic NGOs.
Those attempting to gather on April 2, 2011, to call for the government's resignation, new
legislative elections, and the freedom of speech and assembly were forcibly dispersed and several
people were arrested. The U.S. Embassy in Baku raised concerns about the government actions.85
Commenting on the protests, on April 15, 2011, President Aliyev stated that since the turmoil of
the early 1990s, the “Azerbaijani nation” has not supported the political elements leading the
protests. He averred that “Azerbaijan is so powerful, [its] socio-political stability is so strong ...
[the] Azerbaijani nation said ‘no’ to those who try to hinder our activity, damage successful
development of Azerbaijan and who are sometimes ordered by foreign forces.”86
The Public Chamber announced that it planned another protest in Baku on April 17, 2011.
Authorities denied the group permission for the requested venue. Police control was tightened
before the planned protest and dozens who attempted to protest were detained.
In early May 2011, a protest against the ban on wearing the hijab in public schools by 150 or
more people at the Education Ministry was forcibly suppressed. Reportedly, 65 were detained,
with the government claiming that the protest was led by “radical” Muslims and resulted in
property damage and injuries to 26 policemen. In late May 2011, reportedly 150 women wearing

85 CEDR, March 29, 2011, Doc. No. CEP-950156; U.S. Embassy in Baku, Azerbaijan, U.S. Embassy Statement on
April 2 Protests
.
86 APA News Agency, April 16, 2011.
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hijab held a march in Baku. In early October 2011, five men received sentences ranging from
probation to 2.5 years in prison for organizing the early May 2011 protest and using force against
government representatives. The chairman of the banned Islamic Renaissance Party of
Azerbaijan, Movsum Samadov, also denounced the ban on the hijab, and he and six other party
members subsequently were arrested and convicted in October 2011 on charges of planning a
coup.
On June 19, 2011, the Public Chamber attempted to hold an unauthorized protest, but police
quickly thwarted the attempts of protesters to gather at various locations in Baku and detained
about two dozen.
In October 2011, four more participants in the April 2, 2011, demonstration received sentences
ranging from 1.5 to 4 years for violating public order and using force against government
representatives, bringing the number of those sentenced for this protest to 14. Those sentenced
have included officials and members of the Popular Front and Musavat parties. Reportedly, the
trials and sentences have elicited protests from family members and others. In December 2012,
outgoing U.S. Ambassador Bryza stated that he did not think the “Arab Spring” would come to
Azerbaijan.
As in the attempted March 2011 protest, social media appeared to play a large role in triggering a
protest in the northern town of Guba on March 1, 2012, against a local official whose filmed
comments denigrating the populace were posted on the Internet. Reportedly, one thousand or
more citizens rallied and marched to the local government headquarters to demand the official’s
resignation, but later that day some individuals vandalized government facilities and burned the
official’s home. Local police and security forces (augmented by forces rushed from Baku) shut
down the local Internet and harshly attempted to disperse the crowds. The protesters only
completely dispersed when it was announced the next day that the official had been sacked.
Police have announced that about two dozen residents of the city have been arrested, including
several accused of posting the official’s comments on the Internet.
On March 16, 2012, Aliyev pardoned prisoners, including two regarded by activists as “political
prisoners,” including one alleged organizer of the April 2011 attempted protest, who reportedly
pledged that upon his release, he would join the ruling party. After some delay, Baku authorities
permitted the Public Chamber to hold a protest at an obscure locale in the suburbs under tight
security and alleged restrictions on access on April 8, 2012. The reported 3,000 protesters called
for the release of political prisoners, democratic reforms, and other demands. Seven
oppositionists were sentenced for up to two weeks in jail for distributing leaflets. President Aliyev
appeared to be referring to this rally on April 16 when he stated that “the Azerbaijani public have
seen that there is freedom of assembly in our country.”87 Another rally by the Public Chamber,
approved by the government, was held on April 22, 2012, also in the Baku suburbs. The
government claimed that about 1,200 attended the rally, but the opposition estimated by crowd at
between 5,000 and 10,000 individuals. There was a reportedly large police presence, and police
allegedly attempted to restrict the number of demonstrators. Musavat Party head Isa Gambar
reportedly called for President Aliyev to resign and for new elections to be held.

87 CEDR, April 17, 2012, Doc. No. CEP-950147.
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Some Iranian clerics and politicians and Iranian-linked terrorists have threatened violence against
Azerbaijani interests if Baku goes ahead and holds the Eurovision music festival planned for May
2012, claiming that the event is un-Islamic and immoral.
Georgia
In his address at the U.N. General Assembly on September 23, 2008, President Saakashvili
announced new democratization initiatives as a means to strengthen Georgia’s sovereignty and
independence and thereby prevent Russia from subverting Georgia’s statehood. After lengthy
attempts, President Saakashvili met with a few opposition leaders in April 2009 and again in May
to discuss setting up a constitutional commission to work out changes to the political system. In
June 2009, President Saakashvili formed the constitutional commission and the former president
of the Constitutional Court, Avtandil Demetrashvili, was appointed chairman. In his March 2010
state of the nation address, Saakashvili called for a new wave of democratic reforms.
In May 2010, the constitutional commission agreed on amendments to slightly reduce the power
of the president and increases the powers of the legislature and prime minister. Under the
amendments, the party that has the largest number of seats in the legislature will nominate the
candidate for prime minister. The draft also proposes that regional governors be appointed by the
prime minister rather than the president, as is currently the case. Public discussion of the draft
amendments began in July 2010. The Venice Commission, an advisory body of the Council of
Europe, raised concerns that the proposed presidential powers are still substantial relative to the
prime minister and legislature, and that clashes between the president and prime minister could
emerge. A citizen’s group likewise complained that the legislature’s powers remained weak and
criticized the retention of gubernatorial appointments. In October 2010, the Georgian legislature
approved the constitutional changes, which will take effect with the next presidential election
scheduled for October 2013.88 Saakashvili cannot run in 2013 under constitutional term limits.
According to some speculation, he may be hoping to become the prime minister.
On the night of May 25-26, 2011, Georgian security forces suppressed opposition demonstrators
at Tbilisi’s Freedom Square and Rustaveli Avenue, action that reportedly resulted in four deaths,
dozens of injuries, and scores of detentions. The security forces were intent on clearing the area
(just minutes after the expiration of the demonstration permit) in advance of an independence day
military parade, which the opposition forces aimed to disrupt. The Georgian government alleged
that the Russia-backed protesters had planned to launch an armed overthrow of the government.
The government charged Badri Bitsadze, the husband of Nino Burjanadze, leader of the
opposition Democratic Movement-United Georgia Party, with involvement in planning the
alleged putsch. U.S. Ambassador Robert Bass, the United Nations High Commissioner for
Human Rights, the EU, and various non-governmental organizations such as Amnesty
International and Human Rights Watch called on the government to launch an inquiry into
whether security forces used excessive force against the protesters. In July 2011, the Interior
Ministry announced that an internal probe had resulted in 16 police being fired or disciplined, but
the public defender called for continuing the probe and for possible prosecutions. In August 2011,
Bitsadze was sentenced in absentia to 5.5 years in prison on charges of organizing attacks on
police and disturbing the public order. His whereabouts remain unknown.

88 CEDR, September 6, 2010, Doc. No. CEP-964002; September 14, 2010, Doc. No. CEP-964028.
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The ruling National Movement Party and several opposition parties launched talks on reforming
the electoral code in November 2010. Talks reached an impasse in early March 2011 but were
resumed in June 2011. Later that month, two prominent opposition parties, the Christian
Democratic and the New Rights parties, broke with other opposition parties forming the
“Opposition Eight” alliance and agreed with the ruling party on several electoral reforms. They
formed an inter-party group to draft legislation based on the agreement. The agreement called for
increasing the number of legislators from 150 to 190, 107 of whom would be elected by party
lists and 83 by single-mandate constituencies. Since the National Movement Party in the past had
won most of the majoritarian seats, the increase in the proportion of seats to be allocated through
party list voting was viewed by some observers as somewhat increasing the chances for
opposition parties to gain seats in the legislature. The draft electoral code was publicized for
public discussion in September and then was considered by the legislature.
In December 2011, however, the UNM and some opposition parties agreed that 77 members of
the 150-seat legislature to be elected in October 2012 would be chosen through proportional
voting and the remaining 73 through majoritarian voting in single member districts (previously,
50% of the members had been elected by each method). Another provision guaranteed that a party
that gains a minimum of 5% of the vote will get at least six seats. Under a 2011 constitutional
amendment, the newly elected legislature will convene in a new building being completed in the
city of Kutaisi (in western Georgia). Some legislative business is scheduled to begin there in May
2012.
In early October 2011, reclusive Georgian oligarch Bidzina Ivanishvili declared that he would set
up a party and would participate in 2012 legislative elections in opposition to the ruling National
Movement Party of President Saakashvili. A few days later, Saakashvili signed an order revoking
Ivanishvili’s Georgian citizenship on the grounds that he also held Russian and French
citizenship, and the government reportedly began investigating and seizing assets of Ivanishvili’s
Cartu Bank. With his citizenship revoked, Ivanishvili is barred from running for office or
providing donations to political parties, and may be vulnerable to deportation. Ivanishvili has
relinquished his Russian and French citizenships, but has not regained Georgian citizenship. He
has pledged that if he is elected president, he will bolster democratization and free market reforms
and follow a pro-Western foreign policy, including seeking NATO membership, but will also
work toward better relations with Russia. Besides the revocation of citizenship, the ruling party
pushed through legislation barring corporate contributions and limiting corporate employee
contributions to political parties, which critics viewed as aimed to block Ivanishvili from
financing prospective or existing parties. Instead, state financing of campaigns by existing parties
that had won past elections was stepped up, also viewed by critics as a means to constrict any
new party created through Ivanishvili’s interests. His party, Georgia Dream-Democratic Georgia,
was launched in April 2012, headed on an interim basis by a human rights advocate.
U.S. Aid Overview
The United States is the largest bilateral aid donor by far to Armenia and Georgia, and the two
states are among the five Eurasian states that each have received more than $1 billion in U.S. aid
FY1992-FY2010 (the others are Russia, Ukraine, and Kazakhstan, which have received sizeable
Comprehensive Threat Reduction funds; see Table 1, Table 2, and Table 3). U.S. assistance to
the region FY1992-FY2010 amounts to about 16% of all aid to Eurasia and has included
FREEDOM Support Act (FSA) programs, food aid (U.S. Department of Agriculture), Peace
Corps, and security assistance. Armenia and Georgia have regularly ranked among the top world
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states in terms of per capita U.S. aid, indicating the high level of concern within the
Administration and Congress. In Foreign Operations Appropriations for FY1998 (P.L. 105-118),
Congress created a new South Caucasian funding category to emphasize regional peace and
development, and since then has upheld this funding category in yearly appropriations.
Congress also has directed that humanitarian aid be provided to displaced persons and needy
civilians in NK out of concern that otherwise the region might not get aid. Such aid expenditures
have amounted to about $36.1 million from FY1998 through FY2011. See Table 4. In the
Omnibus Appropriations Act for FY2009 (P.L. 111-8) and the Consolidated Appropriations Act
for FY2010 (P.L. 111-117) up to $8 million was made available for NK.89 Actual aid to NK has
been about $2 million per year since FY2002. Aid has been provided to NGOs to rehabilitate
homes, renovate health clinics and train personnel, repair water systems, provide micro-loans for
agriculture, and clear landmines. Besides bilateral aid, the United States contributes to
multilateral organizations such as the International Monetary Fund and the World Bank that aid
the South Caucasus region.
At a hearing on March 20, 2012, Representative Brad Sherman urged that the Administration’s
foreign assistance for Armenia for FY2013 be based on an increase from the previous year, and
also stated that the Georgian government had agreed that U.S. assistance could be targeted to the
country’s Samtskhe-Javakheti region, where ethnic Armenians are a majority of the population.
The Millennium Challenge Account
In January 2004, Congress authorized a major new global assistance program, the Millennium
Challenge Account (Section D of P.L. 108-199). A newly established Millennium Challenge
Corporation (MCC) deemed that Georgia was eligible as a democratizing country for assistance,
even though it did not meet criteria on anti-corruption efforts. In September 2005, MCC signed a
five-year, $295.3 million agreement (termed a “compact”) with Georgia to improve a road from
Javakheti to Samtskhe; repair a gas pipeline; create a small business investment fund; set up
agricultural grants; and improve municipal and rural water supply, sanitation, irrigation, roads,
and solid waste treatment. In the wake of the August 2008 Russia-Georgia conflict, the MCC
announced plans for an extra $100 million for road-building, water and sanitation facilities, and a
natural gas storage facility. The MCC reported in April 2011 that it had completed its compact
with Georgia. MCC reportedly is considering a new compact with Georgia.
In December 2005, the MCC approved plans to sign a five-year, $235.65 million compact with
Armenia—to bolster rural agriculture through road-building and irrigation and marketing
projects—but raised concerns about the November 2005 constitutional referendum. Following
assurances by then-Foreign Minister Oskanyan that Armenia would address democratization
shortfalls, the MCC and Armenia signed the compact, and it went into force in September 2006.90

89 Several Azerbaijani legislators protested the conference agreement to H.R. 3288 (P.L. 111-117) to direct up to $8
million in humanitarian aid to NK. Some legislators and the Azerbaijani presidential administration reportedly
suggested that such aid be shared with those who had fled the region. An Azerbaijani Foreign Ministry note to the State
Department said that the aid “decreases confidence and trust toward the United States in Azerbaijan.” CEDR,
December 16, 2009, Doc. No. CEP-950112; December 20, 2009, Doc. No. CEP-95002; January 4, 2010, Doc. No.
CEP-950063; OSC Report, January 12, 2010.
90 Millennium Challenge Corporation. Ambassador Danilovich’s letter to Armenian President Robert Kocharyan,
December 16, 2005; Press Release: Millennium Challenge Corporation Board Approves Armenia Compact but
Expresses Concern Regarding Irregularities in the November Referendum
, December 19, 2005; and Ambassador
(continued...)
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After the political turmoil in Armenia in March 2008, the MCC indicated that as an expression of
its “serious concern,” it would halt contracting for road-building. In December 2008, the MCC
Board reiterated its concerns about democratization progress in Armenia and decided to retain the
suspension of some road work, while moving ahead on other projects. In June 2009, the MCC
Board announced that it was cancelling $67.1 million in funding for the road building project
because of Armenia’s halting democratization, although other projects would continue (later this
canceled amount was said to be about $59 million).91 Some of the road-building projects canceled
by MCC subsequently were funded by the World Bank. The MCC reported in October 2011 that
it had completed its compact with Armenia by disbursing $177 million. Beneficiaries reportedly
included about 428,000 rural residents in hundreds of communities across Armenia. In its 2012
evaluation of Armenia, MCC raises concerns about fiscal policy, inadequate government
expenditures for health and education, problematic political rights conditions, restrictions on
freedom of information, and high levels of corruption.
U.S. Assistance After the Russia-Georgia Conflict
To address Georgia’s urgent humanitarian needs in the wake of the August 2008 Russia-Georgia
conflict, the U.S. Agency for International Development (USAID) and the Defense and State
Departments provided Georgia with urgent humanitarian assistance, with the Defense Department
quickly beginning naval and air deliveries. Reportedly, the Bush Administration had authorized
these Defense Department deliveries to demonstrate U.S. backing for Georgia’s continued
independence.
On September 3, 2008, then-Secretary of State Rice announced a multi-year $1 billion aid plan
for Georgia. The Administration envisaged that the proposed $1 billion aid package would be in
addition to existing aid and requests for Georgia, such as FREEDOM Support Act assistance. The
added aid was planned for humanitarian needs, particularly for internally displaced persons, for
the reconstruction of infrastructure and facilities that were damaged or destroyed during the
Russian invasion, and for safeguarding Georgia’s continued economic growth.92
Congress acted quickly to flesh out the Administration’s aid proposals for Georgia. The
Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009 (H.R.
2638/P.L. 110-329), signed into law on September 30, 2008, appropriated an additional $365
million in aid for Georgia and the region (beyond that provided under continuing appropriations
based on FY2008 funding) for humanitarian and economic relief, reconstruction, energy-related
programs, and democracy activities. Of that amount, $315 million was actually budgeted for
Georgia. The Supplemental Appropriations Act for FY2009 (P.L. 111-32; signed into law on June

(...continued)
Danilovich’s letter to Armenian President Robert Kocharyan, January 18, 2006, at http://www.mcc.gov. See also
Armenian Foreign Ministry. Oskanyan Thanks MCC for Millennium Compact, January 12, 2006, at
http://www.armeniaforeignministry.com.
91 U.S. Embassy in Yerevan. Background Information on the Status of the MCA-Armenia Program,” December 16,
2008; MCC. Press Release: MCC Board of Directors Meets to Address U.S. Government Global Development
Priorities
, June 10, 2009.
92 U.S. Department of State. Secretary Condoleezza Rice. Remarks On U.S. Economic Support Package for Georgia,
September 3, 2008; Briefing On U.S. Economic Support Package for Georgia, September 3, 2008.
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24, 2009) provided an additional $242 million in Freedom Support Act assistance to Georgia, “the
final portion of the $1 billion pledge.” See Table 5.93
U.S. Security Assistance
The United States has provided some security assistance to the region, and bolstered such aid
after September 11, 2001. Admiral James Stavridis, Commander of the U.S. European Command
(EUCOM) testified in February 2012 that the Caucasus countries
present important strategic issues in our theater, including logistical access to Afghanistan,
participation in coalition stability operations, hydrocarbon infrastructure security, and rising
humanitarian concerns. The region also possesses a high degree of potential instability due to
the unresolved NK conflict between Armenia and Azerbaijan, and the Russia-Georgia clash
over Abkhazia and South Ossetia. EUCOM’s engagement with these nations seeks to
promote security and stability in a sensitive region, promote maritime security cooperation in
the Caspian, and improve partner nation interoperability with U.S. forces.94
EUCOM initiatives in the region have included the Georgia Deployment Program, the South
Caucasus Clearinghouse, and the Caspian Regional Maritime Security Cooperation program. The
Georgia Deployment Program-ISAF, a two-year program that began in late 2009, is supported by
Marine Forces Europe to deploy Georgian forces alongside U.S. Marine Forces to Afghanistan.
The program encompasses four rotations of a Georgian battalion with a Marine Corps Marine
Expeditionary Brigade to Afghanistan. As capabilities improve, the Georgian forces will operate
independently, and a Georgian training group will be created that can largely take over the
Partnership Training Program by the fourth rotation.
The Clearinghouse aims to facilitate cooperation by sharing data on security assistance among
both donor and recipient countries. General Craddock testified in March 2008 that the Caspian
Regional Maritime Security Cooperation program aims to “coordinate and complement U.S.
government security cooperation activities in Azerbaijan and Kazakhstan. U.S. Naval Forces
Europe continues to promote Maritime Safety and Security and Maritime Domain Awareness in
the Caspian Sea through routine engagement with Azerbaijan. These efforts are targeted to create
an organic ability within Azerbaijan to ‘observe, evaluate, and respond’ to events in their
maritime domain.”95 (This program appears to combine elements of the former Caspian Guard
and Hydrocarbons programs.) For FY2013, the Administration has requested FMF assistance for
Azerbaijan to bolster their naval capabilities or otherwise enhance Caspian Sea maritime security.
Of the cumulative assistance from all agencies and programs provided to the South Caucasian
states from FY1992 through FY2010, the State Department reports that $223 million was
provided to Armenia, $327 million to Azerbaijan, and $896 million to Georgia for “ensuring
peace and security.” This category includes law enforcement, border security, counter-narcotics,
counter-terrorism, and conflict mitigation funds. Also included are International Military

93 U.S. Senate. Committee on Foreign Relations. Subcommittee on Europe. Hearing on Georgia: One Year After the
August War. Statement of S. Ken Yamashita, Acting Assistant Administrator for the Bureau for Europe and Eurasia,
United States Agency for International Development
, August 4, 2009.
94 U.S. House of Representatives. Committee on Armed Services. Hearing on Fiscal Year 2013 National Defense
Authorization Budget Request from U.S. European Command and U.S. Africa Command, Testimony of Admiral James
G. Stavridis, United States Navy, Commander, United States European Command
, February 29, 2012.
95 U.S. Senate. Committee on Armed Services. Statement of General Bantz J. Craddock, March 13, 2008.
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Education and Training (IMET), Foreign Military Financing (FMF), Section 1206 (to train and
equip forces for counterterrorism and operations in Afghanistan) and other Defense Department,
and agency and program funding (although some classified funding may not be reported).
Until waived, Section 907 had prohibited much U.S. security aid to Azerbaijan, including Foreign
Military Financing (FMF), and International Military Education & Training (IMET). Under U.S.
policy, similar aid had not been provided to Azerbaijan’s fellow combatant Armenia. From 1993
to 2002, both had been on the Munitions List of countries ineligible for U.S. arms transfers. Since
the waiver provision to Section 907 was enacted, some Members have maintained that the
Armenian-Azerbaijani military balance is preserved by providing equal amounts (parity) in IMET
and FMF assistance to each country. Successive Administrations have not always agreed with this
understanding of “parity,” and occasionally have requested unequal amounts of such aid, but
Congress usually has directed that equal amounts be provided. The Congressional Budget
Justification for Foreign Operations for FY2013
calls for $2.7 million in FMF and $600,000 in
IMET for each country.
Security Assistance to Georgia Since the August 2008 Conflict
In the wake of the August 2008 Russia-Georgia conflict that severely damaged Georgia’s military
capabilities, General Craddock visited Georgia on August 21 to survey the destruction of
infrastructure and military assets. According to Assistant Secretary of Defense Vershbow,
EUCOM carried out a “comprehensive multi-month assessment of Georgia’s Armed Forces.” In
October 2008, the Defense Department also held yearly bilateral defense consultations with
Georgia. Vershbow testified that as a result of these assessments, “many previously unrecognized
or neglected deficiencies in the various required capacities of the Georgian Armed Forces and
Ministry of Defense [came to light]. In practically all areas, defense institutions, strategies,
doctrine, and professional military education were found to be seriously lacking.”96
In March 2009, General James Cartwright, the Vice Chairman of the Joint Chiefs of Staff, visited
Georgia to further assess its defense needs. He stated that “the United States remains committed
to the U.S.-Georgia charter on strategic partnership and to provide training and other assistance to
the Georgian military in support of their reform efforts and continued independence.” He pledged
added training that would be “focused on the defense of Georgia, on its self and internal defense,”
and equipment transfers that would be based on “what equipment needs to be upgraded and then
what new types of equipment that are necessary for their homeland defense.”97 Assistant
Secretary Vershbow similarly testified in August 2009 that “we are focusing on building defense
institutions, assisting defense sector reform, and building the strategic and educational
foundations that will facilitate necessary training, education, and rational force structure design
and procurement. We are assisting Georgia to move along the path to having modern, western-
oriented, NATO-interoperable armed forces capable of territorial defense and coalition
contributions.”98 He stressed, however, that “the United States has not ‘rearmed’ Georgia as some

96 U.S. Senate. Committee on Foreign Relations. Subcommittee on Europe. Hearing on Georgia: One Year After the
August War. Testimony of Alexander Vershbow, Assistant Secretary of Defense for International Security Affairs,
August 4, 2009.
97 Air Force Master Sgt. Adam Stump, “U.S., Georgia to Continue Strategic Partnership,” American Forces Press
Service
, March 31, 2009; CEDR, March 30, 2009, Doc. No. CEP-950352; Giorgi Lomsadze, “Georgia: Pentagon to
Start Military Training Program,” Eurasia Insight, March 30, 2009.
98 Vershbow, August 4, 2009.
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have claimed. There has been no lethal military assistance to Georgia since the August [2008]
conflict. No part of the $1 billion U.S. assistance package went to the Ministry of Defense.”99
Some in Congress and elsewhere have criticized this dearth of lethal security assistance to bolster
Georgia’s territorial defense capabilities.100 Although President Saakashvili seemed to indicate
during Secretary Clinton’s July 2010 visit that U.S. security cooperation with Georgia was
adequate, he stated in September 2010 that “leaving Georgia defenseless doesn’t help the
situation. Georgia cannot attack Russia, while a defenseless Georgia is a big temptation for
Russia to change our government through military means…. As part of ongoing security
cooperation, we hope that the U.S. will help us with defense-weapons capabilities.”101 On
December 12, 2010, U.S. Senator John McCain called for the Obama Administration to resume
some defensive arms transfers to Georgia, including early warning radars. Three days later,
Giorgiy Baramidze, the Georgian deputy prime minister and state minister for Euro-Atlantic
integration, also called for the United States to resume the transfer of defensive weapons to
Georgia. During his March 10-17, 2011, visit to the United States, President Saakashvili
reportedly requested U.S. transfers of defensive weapons. In late March 2011, he reportedly
stated that while some U.S. small arms transfers were “in the pipeline,” Georgia needed anti-air
and anti-tank weapons from the United States.102
During a hearing of the Senate Armed Services Committee on March 29, 2011, Senator McCain
asked whether the United States was providing defensive weapons to Georgia, and EUCOM
Commander Stavridis stated that “at this moment we are not providing them [with] what I would
term high-end military defensive weapons.” Senator McCain responded that “it is hard for me to
understand, since the Russians still occupy territory that is clearly Georgian territory and continue
to threaten Georgia, and yet we're not even giving them weapons with which to defend
themselves. It is not comprehensible.”103
After a meeting between U.S. Members of Congress and Georgian legislators on the sidelines of
the annual meeting of the NATO Parliamentary Assembly in Bucharest, Romania, in mid-October
2011, the U.S. delegation head, Representative Mike Turner, released a statement of support for
Georgia. According to the statement, “the United States recently approved a commercial arms
sale to Georgia; all NATO states should look to arms sales with Georgia that can add to the
collective defense…. A stronger Georgia is clearly in the interest of all NATO members.”104

99 U.S. Senate. Committee on Foreign Relations. Subcommittee on Europe. Hearing on Georgia: One Year After the
August War. Testimony of Alexander Vershbow, Assistant Secretary of Defense for International Security Affairs,
August 4, 2009.
100 U.S. Senate. Committee on Foreign Relations. Striking The Balance: U.S. Policy And Stability In Georgia, a Report
to the Committee on Foreign Relations
, S. PRT. 111–37, December 22, 2009; Joshua Kucera, “Georgia: Senate Staff
Report Stokes Unease in the Caucasus,” Eurasia Insight, January 5, 2010.
101 Jerry Guo, “Russia’s Occupation Won’t Last,” Newsweek, September 12, 2010.
102 Josh Rogin, “Georgian President: Russia has to Compromise if it Wants into WTO,” The Cable, Foreign Policy,
March 30, 2011, at http://thecable.foreignpolicy.com/posts/2011/03/30/
georgian_president_russia_has_to_compromise_if_it_wants_into_wto.
103 U.S. Congress, Senate, Committee on Armed Services, Hearing on the U.S. European Command and U.S. Strategic
Command Budget for Fiscal Year 2012
, March 29, 2011.
104 “Meeting of US and Georgian Delegations at NATO Parliamentary Assembly,” The Messenger, October 11, 2011;
“U.S. Congresspersons Release Strong Statement of Support for Georgia in NATO,” The Messenger, October 12, 2011.
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A report issued in October 2011 by a team led by Senators Jeanne Shaheen and Lindsey Graham
urged that U.S. policy be changed to “normalize ... defense relations with Georgia, including
allowing sales of defensive military equipment [which] will encourage other allies to follow suit,
enabling Georgia to resume purchasing armaments from Central European allies.”105
On December 31, 2011, President Obama signed into law the National Defense Authorization Act
for FY2012 (P.L. 112-81). Section 1242 calls for the Defense Secretary to submit a plan to
Congress for the normalization of U.S. defense cooperation with Georgia, including the sale of
defensive weapons. In a signing statement, the President stated that if the provisions of the
section conflict with his constitutional authority to conduct foreign relations (presumably, in this
case, including his “reset” policy with Russia), they would be considered non-binding. At a press
conference after he met with President Obama in late January 2012, President Saakashvili stated
that “we are very grateful for elevating our defense cooperation further, and talking about
[developing] Georgia’s self-defense capabilities,” while President Obama appeared more reticent
in stating only that “we will continue to strengthen our defense cooperation.”106 Russian Prime
Minister (and currently President-elect) Vladimir Putin denounced the reported closer U.S.-
Georgia defense cooperation as encouraging Georgia to carry out aggressive military actions.
Deputy Assistant Secretary of Defense Celeste Wallander visited Georgia in February 2012 to
discuss enhanced defense cooperation. She stressed that U.S. efforts to professionalize the
Georgian military since 2008 “have begun to build a military that is not only more interoperable
with the United States and NATO, but also one that is beginning to meet Western and Euro-
Atlantic standards of conduct.” She emphasized that such defense institution building to
consolidate democratic civil-military relations is “more important than acquiring any weapons or
military hardware, gaining any critical combat skills, or becoming interoperable with any
coalition forces.”107 In testimony to Congress on March 1, 2012, Admiral Stavridis reported that
the U.S. military was preparing a report on normalizing U.S.-Georgia defense relations, in line
with the directive in P.L. 112-81, for delivery to Congress by the end of March 2012. An
extension of time has been requested.
At his confirmation hearing on March 21, 2012, Ambassador-designate to Georgia Richard
Norland stated that one commercial arms sale of M4 carbines had been approved by the
Administration, and he pledged that, if confirmed, he would work to enhance military-to-military
defense cooperation.108
The Regional States and NATO
All three regional states joined NATO’s Partnership for Peace (PFP) in 1994. The June 2004
NATO summit pledged enhanced attention to the South Caucasian and Central Asian PFP
members. A Special Representative of the NATO Secretary General was appointed to encourage
democratic civil-military relations, transparency in defense planning and budgeting, and enhanced

105 Georgia in the West: A Policy Road Map to Georgia’s Euro-Atlantic Future, Atlantic Council, October 13, 2011.
106 The White House, Remarks by President Obama and President Saakashvili of Georgia After Bilateral Meeting,
January 30, 2012.
107 U.S. Embassy, Tbilisi, Georgia, Deputy Assistant Secretary of Defense Wallander Presentation to the Georgian
National Defense Academy
, February 22, 2012.
108 U.S. Senate, Committee on Foreign Relations, Hearing on Nominations, March 21, 2012.
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force inter-operability with NATO. In 2004-2005, all three states agreed with NATO to participate
in Individual Partnership Action Plans (IPAPs) for military and civil-military reforms.
• Troops from all three regional states served as peacekeepers in the NATO
Kosovo Force (KFOR).
• All three regional states have deployed troops to support the International
Security Assistance Force (ISAF) in Afghanistan (see above, “Support for
Military Operations in Iraq and Afghanistan”).
NATO and Georgia
Although the United States urged that Georgia be considered for a Membership Action Plan
(MAP; preparatory to membership), NATO’s Riga Summit in November 2006 reaffirmed support
for an “intensified dialogue” to assist Georgia in implementing reforms.109 A MAP for Georgia
was a matter of contention at the April 2008 NATO Summit. Although Georgia was not offered a
MAP, the Alliance pledged that Georgia would eventually become a member of NATO, and stated
that the issue of a MAP for Georgia would be revisited later in the year.
After the August 2008 Russia-Georgia conflict, several allies raised heightened concerns that
Georgia was not ready to be granted a MAP because of the destruction of much of its military
infrastructure by Russia, the uncertain status of the breakaway regions, and the uncertain quality
of conflict decision-making by Georgia’s political and military leadership. At a NATO foreign
ministers’ meeting in early December 2008, the allies agreed to step up work within the Georgia-
NATO Council (established soon after the Russia-Georgia conflict) to facilitate Georgia’s
eventual NATO membership, and to prepare annual plans on Georgia’s progress toward eventual
membership. The first annual national plan was worked out during meetings of the Georgia-
NATO Council and started to be implemented in May 2009.
During the visit of the North Atlantic Council to Georgia in November 2011, Secretary-General
Anders Fogh Rasmussen praised Georgia for making progress in meeting conditions for NATO
membership, including by increasing freedom of expression, economic growth, and military
reforms, and by combating corruption. However, he also cautioned that the 2012-2013 legislative
and presidential elections “will be an important indicator of ... how ready Georgia is for NATO
membership.”110 The NATO-Georgia Commission also met in Tbilisi, and NATO pledged to
strengthen its NATO liaison office in Tbilisi, enhance support to the National Defense Academy
for education and training, bolster the capacity for civil democratic oversight of the defense
sector, and increase support for Georgia’s role in Afghanistan.
In the final communiqué of the NATO foreign ministerial meeting in Brussels in December 2011,
Georgia was affirmed as an “aspirant” to membership, along with Macedonia, Montenegro, and
Bosnia and Herzegovina. Russian Foreign Minister Sergey Lavrov denounced this support for
Georgia, asserting that NATO in April 2008 had “wittingly or unwittingly” encouraged Georgia to
launch warfare later in the year by pledging to give it membership, and warning that this renewed

109 NATO. North Atlantic Council. Riga Summit Declaration, November 29, 2006. Sen. Richard Lugar urged soon
granting Georgia a MAP and suggested that NATO’s energy security would be facilitated by eventually offering
NATO membership to Azerbaijan and Kazakhstan. “Senator Lugar Delivers Remarks at the Riga Summit, Latvia,”
Congressional Quarterly Transcripts, November 27, 2006.
110 Reuters, November 10, 2011.
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pledge could instigate Georgia to repeat such an “escapade.” The most recent NATO-Georgia
Commission meeting was held in Brussels on March 7, 2012. NATO agreed to strengthen support
for civil service reform and democratization efforts in Georgia.111
After meeting with President Saakashvili at the White House in late January 2012, President
Obama stated that he had “assured him that the United States will continue to support Georgia's
aspirations to ultimately become a member of NATO.”112 A NATO summit scheduled for May
2012 in Chicago may consider Georgia’s progress in its efforts to gain membership. At his
confirmation hearing in March 2012, Ambassador-designate to Georgia Richard Norland reported
that the Administration planned to “use the Chicago summit to signal acknowledgement for
Georgia’s progress ... and to work with the allies to develop a consensus on the next steps
forward.” Senator Richard Lugar deemed this “a very very important statement.”113
The U.S. Congress approved the NATO Freedom Consolidation Act of 2007, signed into law in
April 2007 (P.L. 110-17), to urge NATO to extend a MAP for Georgia and to designate Georgia as
eligible to receive security assistance under the program established by the NATO Participation
Act of 1994 (P.L. 103-447). The statement released by the U.S. delegation to the NATO
Parliamentary Assembly in October 2011 (mentioned above) called for NATO to extend a MAP
for Georgia at the upcoming NATO Summit in Chicago in May 2012. Some Administration
officials have appeared to indicate that the United States will not push for a MAP for Russia at the
Chicago NATO summit.
On March 8, 2012, Senator Lugar introduced S. 2177, The NATO Enhancement Act, which
reaffirms an “open door” policy with respect to the accession of additional countries to NATO,
including NATO aspirant Georgia. The bill expresses the sense of Congress that the President
should lead efforts at the Chicago NATO Summit to provide a clear roadmap for the granting of a
MAP (or other equivalent plan) to Georgia and other aspirants. The bill also amends the NATO
Participation Act (P.L. 103-447) by adding that the President may assist Georgia and other
aspirants to prepare for NATO membership by providing a joint assessment of their defense needs
upon their request; by supporting sales of defense articles and services necessary to maintain
sufficient territorial self-defense capabilities; by providing nonlethal excess defense articles; by
approving commercial export sales; by providing Nonproliferation, Anti-Terrorism, Demining,
and Related Programs assistance; by providing counter-narcotics aid; and by providing military
assistance under Section 1206 of the National Defense Authorization Act for FY2006 (P.L. 109-
163). The bill also requires a report from the Secretary of State 90 days after enactment that
describes U.S. efforts to uphold the sovereignty and territorial integrity of Georgia.
U.S. Trade and Investment
The former Bush Administration and others have maintained that U.S. support for privatization
and the creation of free markets directly serve U.S. national interests by opening markets for U.S.
goods and services and sources of energy and minerals. Among U.S. economic links with the
region, bilateral trade agreements providing for normal trade relations for products have been
signed and entered into force with all three states. Bilateral investment treaties providing national

111 NATO, National Security Advisor of Georgia briefs the NATO-Georgia Commission, March 7, 2012.
112 The White House, January 30, 2012.
113 U.S. Senate, Committee on Foreign Relations, Hearing on Nominations, March 21, 2012.
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treatment guarantees have entered into force. U.S. investment is highest in Azerbaijan’s energy
sector, but rampant corruption in the three regional states otherwise has discouraged investors.
With U.S. support, in June 2000 Georgia became the second Eurasian state (after Kyrgyzstan) to
be admitted to the WTO. The application of Title IV of the Trade Act of 1974, including the
Jackson-Vanik amendment, was terminated with respect to Georgia in December 2000, so its
products receive permanent nondiscriminatory (normal trade relations or NTR) treatment.
Armenia was admitted into WTO in December 2002. The application of Title IV was terminated
with respect to Armenia in January 2005. H.Res. 374 (Shuster) calls for opening negotiations on a
U.S.-Georgia free trade agreement.
Georgia and Russia’s Accession to the WTO
When Georgia became a member of the WTO in 2000, it joined an existing Working Party of
interested WTO members—established in 1993—that has been considering Russia’s WTO bid.
Georgia added its main concerns to those of the other 60-odd members of the Working Party, that
market access be upheld and that Georgia establish control over customs clearance at posts
located along its borders with Russia (including between its breakaway regions and Russia), in
accordance with its sovereign territorial rights and the provisions of a 1994 free trade agreement
signed by Georgia and Russia (never ratified by Russia). This Georgian request for customs
control did not fundamentally change after Russia recognized the independence of the breakaway
regions in late August 2008. Although Russia held bilateral talks with all members of the Working
Party and by late October 2011 had resolved most of their concerns, Russia long continued to
refuse to resolve Georgia’s concerns about customs control, arguing that the issue was political
and hence irrelevant to WTO accession. Instead, Russia demanded that the United States put
pressure on Georgia to drop its request or that the WTO use an unprecedented majority vote of
the membership to admit Russia to get around Georgia’s request. The Russia-Georgia dispute
became the last major obstacle to Russia’s WTO accession. According to some observers,
powerful interests in Russia that remained opposed to WTO membership were using the dispute
to convince others in the Russian leadership to cease efforts to join WTO.114
At talks moderated by Switzerland that began in March 2011 between Russia and Georgia,
Switzerland reportedly proposed in mid-2011 that an international monitoring group could be
established, similar to the EU Border Assistance Mission to Moldova and Ukraine (EUBAM), to
work at customs posts between Russia and the breakaway regions. The Swiss proposal also
reportedly included, as an adjunct or alternative element, the establishment of a computerized
reporting system to bolster the transparency of cross-border trade. EUBAM was set up in late
2005 between Moldova’s border with Ukraine, and works to monitor trade involving Ukraine and
Moldova, including to a substantial degree the latter’s breakaway region of Transnistria.
Corruption and crime had previously been an increasing problem along these borders. Russia has
objected to the monitoring by EUBAM, terming it as supporting Moldova’s “economic blockade”
of Transnistria. At the same time, many Transnistrian companies, including those that are
Russian-owned, have cooperated with Moldovan customs regulations in order to gain access to

114 Russian Prime Minister Vladimir Putin at times appeared lukewarm or mildly supportive of the benefits of WTO
membership to Russia’s economy, and at other times appeared to side with interests opposing WTO accession. Anders
Aslund, “Why Doesn’t Russia Join the WTO?” The Washington Quaterly, April 2010; Mamuka Tsereteli, “Russia’s
WTO Accession: Is Georgia an Obstacle?” Center for Black Sea/Caspian Studies, The American University, 2011;
Government of the Russian Federation, Prime Minister, Transcript: Interview with Prime Minister Vladimir Putin,
October 17, 2011, at http://premier.gov.ru.
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WTO and EU markets (Moldova is a member of WTO and receives trade preferences from the
EU).
Georgia and Russia signed a trade monitoring agreement in Geneva on November 9, 2011, after
lengthy negotiations mediated by Switzerland, clearing one of the last major obstacles to Russia
being invited to join the WTO at its Ministerial Conference in mid-December 2011 (full accession
will occur 30 days after the Russian legislature ratifies membership). The agreement calls for
customs monitoring along three “trade corridors” on the Georgia-Russia border, two running
through the breakaway regions and the third running through the uncontested Zemo Larsi-
Kazbegi border crossing. In regard to the breakaway regions, a terminal will be located at
Russia’s border with the region, and another at Georgia’s border with the region. A private firm
will be hired and managed by Switzerland to monitor the terminals. Georgia and Russia will
provide trade data to the firm, which will forward the data to the WTO. On December 26, 2011,
Russian Ministry of Foreign Affairs spokesman Aleksandr Lukashevich appeared to boast that
Georgia had been bested during the negotiations, asserting that since Georgia will provide
customs clearance information for goods entering Abkhazia and South Ossetia, it effectively will
be recognizing their independence, a claim Georgia disagrees with. In early April 2012, the
Russian Foreign Ministry stated that the customs agreement would enter into force upon Russia’s
accession to the WTO.115
Energy Resources and U.S. Policy
The U.S. Energy Department reports estimates of 7 billion barrels of proven oil reserves, and 30
trillion cubic feet of proven natural gas reserves in Azerbaijan.116 In addition, added gas has been
discovered in 2011 at the Umid and Apsheron offshore fields. Critics argue that oil and gas from
Azerbaijan will amount to a tiny percent of world exports of oil and gas, but successive U.S.
Administrations have argued that these exports could nonetheless boost energy security somewhat
for European customers currently relying more on Russia.
In testimony in June 2011, Richard Morningstar, the U.S. Special Envoy for Eurasian Energy,
stated that U.S. policy encourages the development of new Eurasian oil and gas resources to
increase the diversity of world energy supplies. In the case of oil, increased supplies may directly
benefit the United States, he stated. A second U.S. goal is to increase European energy security, so
that some countries in Europe that largely rely on a single supplier (presumably Russia) may in
the future have diverse suppliers. A third goal is assisting Caspian regional states to develop new
routes to market, so that they can obtain more competitive prices and become more prosperous. In
order to achieve these goals, the Administration supports the development of the Southern
Corridor of Caspian (and perhaps Iraq) gas export routes transiting Turkey to Europe. Of the
vying pipeline proposals, the Administration will support the project “that brings the most gas,
soonest and most reliably, to those parts of Europe that need it most.” At the same time,
Morningstar rejected views that Russia and the United States are competing for influence over
Caspian energy supplies, stating that the Administration has formed a Working Group on Energy

115 For concerns about whether Russia will comply with the customs agreement, see Andras Racz, Russian WTO
Accession and the Geneva Agreements: Implications for Russia and Georgia
, Transatlantic Academy, December 2011.
116 U.S. Energy Department. Energy Information Administration. Azerbaijan: Country Analysis Brief, January 9, 2012.
The BP Statistical Review of World Energy, June 2011, reports proven gas reserves of 44.9 trillion cubic feet in
Azerbaijan at the end of 2010.
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under the U.S.-Russia Bilateral Presidential Commission.117 According to some observers, the
construction of such pipelines will bolster the strategic importance to the West of stability and
security in the Caspian region.118
U.S. officials have argued that Azerbaijani gas is critical to the development of the Southern
Corridor.119 In March 2007, Azerbaijan and the United States signed a memorandum of
understanding on energy cooperation that called for discussions on the proposed ITGI and
Nabucco gas pipelines. In August 2007, the U.S. Trade Development Administration granted
Azerbaijan $1.7 million to fund feasibility studies on building both an oil and a gas pipeline
across the Caspian Sea to link Central Asia to the BTC pipeline and the SCP.
Building the Baku-Tbilisi-Ceyhan and South Caucasus Pipelines
During the Clinton Administration, the United States in 1995 encouraged the building of one
small oil pipeline (with a capacity of about 155,000 barrels per day) from Azerbaijan to the
Georgian Black Sea port of Supsa as part of a strategy of ensuring that Russia did not monopolize
east-west export pipelines. As part of this strategy, the United States also stressed building the
Baku-Tbilisi-Ceyhan (BTC) pipeline (with a capacity of about 1 million barrels per day) as part
of a “Eurasian Transport Corridor.” In November 1999, Azerbaijan, Georgia, Turkey, and
Kazakhstan signed the “Istanbul Protocol” on construction of the 1,040-mile long BTC oil
pipeline. In August 2002, the BTC Company (which includes U.S. firms Conoco-Phillips,
Amerada Hess, and Chevron) was formed to construct, own, and operate the oil pipeline. The first
tanker on-loaded Azeri oil at Ceyhan at the end of May 2006. Azerbaijan’s state oil firm SOCAR
reported in April 2012 that the BTC pipeline had transported 1.33 billion barrels of oil to the
Ceyhan terminal since 2006. Reportedly, some Azerbaijani oil reaches U.S. markets.
A gas pipeline from Azerbaijan to Turkey (termed the South Caucasus Pipeline or SCP) was
completed in March 2007. Exports to Georgia, Turkey, and Greece were 53 billion cubic feet of
gas in 2007, more than 160 billion cubic feet in 2008, 184 billion cubic feet in 2009, and 162
billion cubic feet in January through November 2010. The ultimate capacity of the SCP is about
706 billion cubic feet per year, according to British Petroleum. The joint venture for the SCP
includes Norway’s Statoil (20.4%); British Petroleum (20.4%); Azerbaijan’s Ministry of Industry
and Energy (20%); and companies from Russia, Iran, France, and Turkey. Some in Armenia
object to lack of access to the BTC and SCP pipelines.
The August 2008 Russia-Georgia conflict did not result in physical harm to the BTC pipeline or
the SCP. The BTC pipeline was closed due to other causes. The SCP and the small Baku-Supsa
oil pipeline were closed temporarily as a safety precaution. Russian gas shipments via Georgia to
Armenia decreased in volume for a few days at the height of the conflict. Rail shipments of oil by

117 U.S. House of Representatives, Committee on Foreign Affairs, Subcommittee on Europe and Eurasia, Hearing on
European and Eurasian Energy: Developing Capabilities for Security and Prosperity, Testimony of Ambassador
Richard L. Morningstar, Special Envoy for Eurasian Energy
, June 2, 2011. See also U.S. Embassy, Baku, Azerbaijan,
Speech to Plenary Session of Caspian Oil and Gas Conference, Ambassador Richard L. Morningstar, Special Envoy
for Eurasian Energy,
June 8, 2011.
118 Sedat Laciner, “Turkey’s Pipeline Politics,” The Journal of Turkish Weekly Online, International Strategic Research
Organization, September 16, 2009.
119 Speech to Plenary Session of Caspian Oil and Gas Conference, Ambassador Richard L. Morningstar, June 8, 2011;
“Former U.S. Envoy [Matthew Bryza] Says Gas Project ‘Impossible’ without Azerbaijan,” APA News Agency, March
28, 2012.
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Azerbaijan to the Kulevi oil terminal (owned by Azerbaijan) on Georgia’s Black Sea coast were
disrupted temporarily.
At the end of October 2008, the first oil from Kazakhstan started to be pumped through the BTC
pipeline. Reportedly, about 70,000 barrels per day of Kazakh oil are being barged across the
Caspian Sea to the BTC pipeline. In addition, some Kazakh oil is barged to Azerbaijan to be
shipped by rail to Georgia’s Black Sea port of Batumi. Kazakhstan plans to increase its shipments
to Azerbaijan to 500,000 barrels per day by 2012. Some Turkmen oil began to be transported
through the BTC pipeline in June 2010. Some observers argue that the completion of the BTC
and SCP boosted awareness in the European Union and the United States of the strategic
importance of the South Caucasus.120
Other Export Pipeline Proposals
In mid-November 2007, Greek Prime Minister Kostas Karamanlis and Turkish Prime Minister
Recep Tayyip Erdogan inaugurated a gas pipeline connecting the two countries. Since some
Azerbaijani gas reaches Greece, the pipeline represents the first gas supplies from the Caspian
region to the EU. If a pipeline extension is completed to Italy, this Interconnector Turkey-Greece-
Italy (ITGI) gas pipeline could permit Azerbaijan to supply gas to two and perhaps more EU
members, providing a source of supply besides Russia.
The Nabucco pipeline has faced numerous delays, some of them attributable to Russia’s counter-
proposals to build pipelines that it asserts would reduce the efficacy of the Nabucco pipeline and
to questions about supplies for the pipeline. In early September 2010, the European Investment
Bank, the European Bank for Reconstruction and Development, and the World Bank announced a
commitment—pending environmental and social feasibility studies—to provide $5.2 billion to
build the Nabucco pipeline. Latest EU planning calls for construction of the 1.1 tcf-capacity
Nabucco pipeline to begin in 2012 and for shipments to begin in 2017. In 2011, new higher cost
estimates for building the pipeline appeared to place these plans at risk.
At a meeting in early May 2009 in Prague, the EU, Azerbaijan, Georgia, Turkey, and Egypt
signed a declaration on a “Southern [energy] Corridor” to bolster east-west energy transport. The
declaration called for cooperation among supplier, transit, and consumer countries in building the
Nabucco gas pipeline, finishing the Italian section of the ITGI gas pipeline, and other projects.
Ambassador Morningstar stated that the Obama Administration supported the “Southern
Corridor” program and endorsed an EU proposal to consider forming a private “Caspian
Development Corporation” to assist Turkmenistan in developing gas fields and pipelines to
transport Turkmen gas across the Caspian.121
In 2009, Azerbaijan stepped up its efforts to diversify the routes and customers for its gas exports
beyond the SCP and the planned Nabucco route. President Aliyev attributed some of this
increased interest in added gas export routes—including to Russia and Iran—to the country’s
difficult negotiations with Turkey over gas transit fees and prices (excluding the agreed-upon

120 Jaba Devdariani and Blanka Hancilova, “EU Broaches Peacekeeping Possibility in Georgia,” Central Asia-
Caucasus Analyst
, March 7, 2007; Rovshan Ismayilov, “Azerbaijan, Georgia and Turkey: Building a Transportation
Triumvirate?” Eurasia Insight, February 7, 2007.
121 U.S. Department of State. Press Release: Remarks at the EU Summit “Southern Corridor-New Silk Road,” May 8,
2009.
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arrangements for Nabucco). In October 2009, Azerbaijan’s State Oil Company (SOCAR) and
Russia’s Gazprom gas firm signed agreements that SOCAR would supply 17.7 billion cubic feet
of gas per year to Russia beginning in 2010. The gas would be transported by a 140-mile gas
pipeline from Baku to Russia’s Dagestan Republic that was used until 2007 to supply Azerbaijan
with up to 283 billion cubic feet of gas per year. During a visit by President Medvedev to
Azerbaijan in September 2010, the two countries agreed that Azerbaijan would provide up to 35.4
billion cubic feet of gas per year beginning in 2011 (this increase had been under consideration
since the signing of the 2009 accord). President Aliyev stressed that this small supply agreement
would not jeopardize plans to supply gas for Nabucco, since Azerbaijan possessed huge gas
reserves.122
As another alternative to gas shipments through Turkey, Azerbaijan, Romania, and Georgia
signed a memorandum of understanding in April 2010 to transport liquefied natural gas (LNG)
from Azerbaijan to the EU through Georgia and Romania. This Azerbaijan-Georgia-Romania-
Interconnection (AGRI) project envisions the construction of a gas pipeline from Azerbaijan to
the Georgian port of Kalevi, where the gas would be liquefied, shipped across the Black Sea, and
regasified at the Romanian port of Constanta. The output is expected to be 247 billion cubic feet
per year, with 71 billion cubic feet of the gas used by Romania and the rest by other EU countries.
The presidents of the three countries (and the prime minister of Hungary, which joined the
project) met in Baku on September 15, 2010, to sign the Baku Declaration of political support for
the project. President Aliyev argued that the AGRI project would not make Nabucco less feasible.
Some of the tensions between Turkey and Azerbaijan involving energy issues appeared resolved
in June 2010, during President Aliyev’s visit to Turkey, when the two countries signed accords on
the sale and transportation of Azerbaijani natural gas to Turkey and to other countries via Turkey.
A memorandum of understanding permitting Azerbaijan to conclude direct sales with Greece,
Bulgaria, and Syria involving gas transiting Turkey was signed. Many observers viewed the
MOU as increasing the feasibility of the TGI and Nabucco pipelines.123
In January 2011, President Aliyev and the President of the European Commission, Jose Manuel
Barroso, signed a joint declaration committing Azerbaijan to supplying substantial volumes of gas
over the long term to the European Union. Nonetheless, some analysts raised concerns that there
would not be enough Azerbaijani gas to fill the ITGI and Nabucco pipelines (deliveries will be
406 billion cubic feet per year for ITGI and 158 billion to 459 billon cubic feet per year for
Nabucco) and to provide for the proposed AGRI project without a trans-Caspian gas pipeline or
participation by Iran or Iraq. Others suggested that Azerbaijan would be able to supply at least
most of the needed gas for both the ITGI and Nabucco pipelines and the AGRI project, including
because of recent results from exploratory drilling off the Caspian seacoast.124
In September 2011, the Council of the European Union approved opening talks with Azerbaijan
and Turkmenistan to facilitate an accord on building a trans-Caspian gas pipeline. Such a link
would provide added gas to ensure adequate supplies for the planned Nabucco and other
pipelines. Hailing the decision, EU Energy Commissioner Günther Oettinger stated that “Europe
is now speaking with one voice. The trans-Caspian pipeline is a major project in the Southern
Corridor to bring new sources of gas to Europe. We have the intention of achieving this as soon as

122 CEDR, September 6, 2010, Doc. No CEP-950267.
123 “Azerbaijan to Move Quickly to Negotiate Sales of Gas to Europe,” Oil Daily, June 14, 2010.
124 Eric Watkins, “New USGS Report Confirms Big Caspian Stakes,” Oil & Gas Journal, January 3, 2011.
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possible.”125 The Russian Foreign Ministry denounced the plans for the talks, and claimed that the
Caspian Sea littoral states had agreed in a declaration issued in October 2007 that decisions
regarding the Sea would be adopted by consensus among all the littoral states (Russia itself has
violated this provision by agreeing with Kazakhstan and with Azerbaijan on oil and gas field
development). It also claimed that the proposed pipeline was different from existing sub-sea
pipelines in posing an environmental threat. In Baku in early April 2012, Lavrov stated that the
EU should show “respect” to the Caspian littoral states, and that it was “unacceptable” for the EU
to advocate for a trans-Caspian pipeline before the littoral states have concluded a convention on
the legal status of the sea.126 An Azerbaijani official two days later claimed that the issue of a
trans-Caspian pipeline was strictly between the EU and Turkmenistan, perhaps indicating some
hesitancy in encouraging the development of an alternative source of gas.
Meeting an October 1, 2011, deadline, the State Oil Company of Azerbaijan (SOCAR) received
final proposals for pipelines to export gas from the second phase development of the Shah Deniz
offshore oil and gas fields. Proposals were received from consortia backing the ITGI, Nabucco,
and Trans Adriatic Pipeline (TAP; from Turkey through Greece, Albania, and the Adriatic Sea to
Italy) projects, as well as from BP, which reportedly proposed building an 808-mile “South East
Europe Pipeline” (SEEP) from western Turkey through Bulgaria, Romania, and Hungary to
Austria. A proposal for AGRI was not reported. A decision on a pipeline may not be made until
2013, but reportedly SOCAR has discounted the ITGI proposal.
On October 25, 2011, Azerbaijan and Turkey announced that they had signed accords on the final
terms for the transit of Shah Deniz phase 2 gas through Turkey. The agreements—signed during
President Aliyev’s visit to Turkey—specified that 565-706 bcf of gas would transit Turkey, of
which 212 bcf would be available for Turkey’s domestic use. Another significant accord provided
for the possible construction of a new Trans-Anatolian Pipeline (TANAP), so that the gas from
Shah Deniz Phase 2 would not have to go through the Turkish pipeline system. This pipeline
could link to BP’s proposed SEEP or to a new version of the Nabucco pipeline termed “Nabucco
West” (stretching from the Turkish border to Austria).
In late December 2011, the Azerbaijani and Turkish governments signed a memorandum of
understanding on setting up a consortium involving SOCAR, the Turkish state-owned TPAO
energy firm, and TPAO’s pipeline subsidiary, BOTAS, to construct TANAP. SOCAR is
designated initially to hold an 80% share in the consortium, although other members may be
invited to join the consortium. Contract negotiations on setting up the consortium reportedly have
been contentious, however.
Regional Energy Cooperation with Iran
On March 19, 2007, Armenia’s then-President Robert Kocharyan and Iranian President Mahmoud
Ahmadinejad inaugurated an 88-mile gas pipeline from Tabriz in Iran to Kadjaran in Armenia.
Work was completed on the second section of the pipeline, a 123-mile section from Kadjaran to
Ararat, in December 2008. The Russian-controlled ArmRosGazprom joint venture built this
second section and operates the pipeline. Initial deliveries reportedly are 10.6-14.1 billion cubic

125 European Commission, Press Release: EU Starts Negotiations on Caspian Pipeline to Bring Gas to Europe,
September 12, 2011.
126 CEDR, April 4, 2012, Doc. No. CEP-950050.
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feet of gas per year, with plans for more gas deliveries in future years. Some of this gas will be
used to generate electricity for Iran and Georgia, but the remainder eventually may satisfy all
Armenia’s consumption needs, alleviating its dependence on Russian gas transported via
Georgia.127
At the end of 2005, Azerbaijan began sending about 7 billion cubic feet of gas per year through a
section of Soviet-era pipeline to the Iranian border at Astara, partly in exchange for Iranian gas
shipments to Azerbaijan’s Nakhichevan exclave. On November 11, 2009, Azerbaijan signed an
accord with Iran to supply 17.7 billion cubic feet of gas annually through the pipeline. These gas
supplies could increase in coming years.
Legislation
S.Res. 175 (Shaheen)
Introduced on May 10, 2011, and approved by the Senate on July 29, 2011. Calls upon the
Russian government to fulfill the terms of the ceasefire agreements, including by reducing
military forces to pre-war levels, ensuring full access for humanitarian aid, and allowing the
return of internally displaced persons. The resolution also supports confidence-building efforts
between the Georgian government and authorities in the breakaway regions.
H.Res. 374 (Shuster)
Introduced on July 26, 2011. Calls for the United States to initiate talks to enter into a free trade
agreement with Georgia.

Table 1. U.S. Foreign Aid to the South Caucasus States,
FY1992 to FY2011, and the FY2012 Request
(millions of dollars)
South Caucasus
FY1992-FY2010
FY2011
FY2012
FY2013
Country
Budgeted Aida
Actualb
Estimateb
Requestb
Armenia 1,951.83
44.42
44.25
36.61
Azerbaijan 975.75
26.4
20.87
16.33
Georgia 3,369.33
87.1
85.1
68.7
Total 6.365.73c 157.92 150.22 121.64
Percent 16
27
29
27
Sources: State Department, Congressional Budget Justification for Foreign Operations for FY2013, March 2012.
a. Assistance to Europe, Eurasia, and Central Asia (AEECA) and Agency budgets.

127 Platt’s Commodity News, May 31, 2007.
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b. Economic Support Funds (incorporates AEECA) and other “Function 150” funds. Does not include Defense
or Energy Department funding, funding for exchanges, or Peace Corps programs. Percentage of funding
excludes some Eurasian regional programs involving the South Caucasus.
c. Total includes $68.82 million in South Caucasus regional funding.

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Table 2. U.S. Assistance to the South Caucasus, FY1992-FY2001
(millions of current dollars)
Country FY1992 FY1993 FY1994 FY1995 FY1996 FY1997 FY1998 FY1999 FY2000 FY2001
Armenia
74.97 172.39 159.1 114.38 135.23 98.72 116.14 91.86 117.19 102.47
Azerbaijan
1.8 8.42 34.52 26.01 29.96 16.77 41.2 47.22 37.96 48.26
Georgia
29.16 169.01 93.34 105.26 94.41 28.29 123.33 119.51 124.5 151.23
Regional
0.0 0.0 0.0 0.0 0.0 0.0 8.3 0.0 2.0 4.4
Total
105.93 349.82 286.96 245.65 259.6 143.78 288.97 258.59 281.65 306.36
Source: Derived from U.S. Department of State, Office of the Coordinator for Europe and Eurasia.
Notes: Includes all agencies and accounts.
Table 3. U.S. Assistance to the South Caucasus, FY2002-FY2010 (and Totals, FY1992-FY2010)
(millions of current dollars)
Total
(FY1992-
Country FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2010)
Armenia
112.74 105.08 93.19 91.01 88.17 71.91 78.92 69.2 59.16
1,951.83
Azerbaijan 68.89 68.63 79.48 80.11 84.24 79.38 80.05 76.21 66.65
975.75
Georgia
150.44 150.64 148.29 129.1 147.35 131.58 895.67 423.87 154.36
3,369.33
Regional
2.3 1.99
17.71 2.03
11.1 3.0 1.03
12.94 2.03
68.82
Total
334.37 326.34 338.67 302.25 330.86 285.87
1,055.67 582.22 282.2 6,365.73
Source: Derived from U.S. Department of State, Office of the Coordinator for Europe and Eurasia.
Notes: Includes all agencies and accounts.

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Table 4. U.S. Humanitarian Assistance to Nagorno Karabakh Provided by the U.S.
Agency for International Development and Other Agencies, and Totals for Budgeted,
Obligated, and Expended Funding, FY1998-FY2011
(millions of dollars)
Year Budgeted
1998
8.6
1999
3.5
2000
2.0
2001
4.4
2002
2.3
2003
1.987
2004
2.0
2005
2.43
2006
1.98
2007
2.509
2008
2.0
2009
1.996
2010
2.0
2011
2.0
Prior-Year De-obligated
-0.708
Total Budgeted
38.994
Of which, Total Obligations
38.002
Of which, Total Expenditures
36.103
Source: Source: State Department. Office of the Coordinator of U.S. Assistance to Europe and Eurasia.
Note: Does not include $480,000 in FY2009 AEECA funding provided for a Track II diplomacy project to
increase cross-border communication and understanding among Armenians, Azeris and Karabakhis, with the goal
of fostering reconciliation in the NK conflict. Does not include $223,000 in FY2010 AEECA Performance Funds
provided for de-mining activities in NK.
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Table 5. The $1 Billion in Added Aid to Georgia by Priority Area
(millions of dollars)
Area Level
Restoring Peace and Security
47.577
Strengthening Democracy, Governance, and
48.1
the Rule of Law
Economic Recovery and Growth
466.64
Aid to Internally Displaced Persons and Social
185.683
Recovery
Management Support
5.5
Direct Budget Support
250.0
Total Committed or Expended
1003.5
Source: U.S. Senate. Committee on Foreign Relations. Subcommittee on Europe. Hearing on Georgia: One
Year After the August War. Statement of S. Ken Yamashita, Acting Assistant Administrator for the Bureau for Europe
and Eurasia, United States Agency for International Development, August 4, 2009; USAID. Completion of the $1 Billion
Pledge
, February 5, 2010.
Figure 1. Map of Caucasus Region

Source: CRS.
Notes: Administrative borders of the former Nagorno Karabakh Autonomous Region.

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Author Contact Information

Jim Nichol

Specialist in Russian and Eurasian Affairs
jnichol@crs.loc.gov, 7-2289

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