Azerbaijan in 2020: Reviewing Recent Developments and Understanding Future Foreign Policy Challenges

At the dawn of the unipolar international system – following the collapse of the Communist system in Eastern Europe and the South Caucasus – “the end of history” was announced. It was expected that the benevolent hegemony of the United States would last for many decades to come – liberal values and democracy would be spread to each corner of the world. Nevertheless, some academics claimed intrinsic instability of the unipolar world and predicted its transformation into a multipolar one, much like what ceased to exist in 1914 when World War I began. The events of recent years and the chaos in the international order shows that the world is transforming from a unipolar world into a multipolar one. This transformation process has its reverberations in regions such as the South Caucasus.

Most current major powers are bordering or declared interest in the South Caucasus region. Russia, Turkey and Iran are geographically bordering the region. The EU is present in the region through its Eastern Partnership initiatives, while the USA holds strategic interests in the region and has invested in various economic projects since the early 1990s. China tries to enforce its ‘Belt and Road initiative’ and reach the western shores of the Caspian Sea. Thus, the geopolitical actors party to clashes around the world, such as the Syrian conflict where Russia, Turkey, Iran and the USA are major actors involved, have also declared their interest in South Caucasus affairs. The USA-Iran and USA-China rivalry, along with the Iran-Turkey-Russia triangle all have their repercussion in the South Caucasus.

Azerbaijan – the region’s biggest country for its area and the size of economy – must identify the undergoing processes and take appropriate steps in order to guarantee its sovereignty in the future of the region. Hence, it becomes important to understand the current events in the region and forecast the foreign policy challenges that Azerbaijan will face in 2020.

To that end, this paper will analyse the foreign policy challenges which Azerbaijan has been facing since 2015 and will provide a summary of recent events in the region, focusing particularly on Azerbaijan’s role in these events. In the following part, the paper will discuss possible trends of Azerbaijan’s foreign policy for 2020.

Main foreign policy challenges for Azerbaijan in 2015-2019

Azerbaijan’s recent foreign policy challenges stem from the rise of regional players. Russia and Iran feel empowered to act as regional powers who could stand against the Euro-Atlantic sphere of influence and, hence, they initiate a bolder foreign policy agenda in the region. Consequentially, we are witnessing the more intense efforts of Russia and Iran to drag Azerbaijan (and the South Caucasus) into their spheres of influence. Regarding the Armenian-Azerbaijani relationship, the recent developments in Armenia also created a new opportunity for the negotiations process in the Nagorno-Karabakh conflict, which shaped the foreign policy of Azerbaijan.

Russia-Azerbaijan relations, Azerbaijan’s CSTO membership

For many years relations between Russia and Azerbaijan have been ambiguous. On the one hand, some areas of cooperation have been stable and predictable; on the other hand, each side has had its own interests and views on regional politics. Recent high-level communications have become more frequent and have had a positive effect on relations between the two sides in various fields – trade, economy, military, science, education and culture.

Azerbaijan was among the very first former Soviet countries which forced the Soviet/Russian troops to leave its territories in early 1992. Since the mid-90s, Azerbaijan dubbed its foreign policy strategy as ‘balanced foreign policy’, meaning Azerbaijan cooperates with Russia but always leaves the door open for other foreign economic and political interest groups to come in. While cooperating in many areas, Baku has never been keen to bind itself only with Moscow; on the contrary, Azerbaijan has been willing to have closer cooperation with Washington, Ankara and European countries, along with Moscow. Azerbaijan was among the very first post-Soviet countries who welcomed Western investment (mainly to its oil sector) and, hence, created a strategic bond with the Euro-Atlantic region despite Kremlin’s efforts to keep the region solely under its own sphere of influence.

Due to its geopolitical position, Azerbaijan has greater freedom of action than other countries in the region and Western countries are also interested in getting Azerbaijan under their influence. Azerbaijan is keen to engage with the Euro-Atlantic organisations because of Turkey – a NATO member country. Azerbaijan and Turkey enjoy historical and strategic bonds.

Nevertheless, both Moscow and Baku have a clear and shared vision: solid relations between Russia and Azerbaijan are a guarantee of stability and peace in the South Caucasus. The sides take this factor into account and must accommodate each other.

Recently, the main issue discussed between Baku and Moscow is Azerbaijan’s expected observatory membership to the Collective Security Treaty Organisation (CSTO), a Russian-led military alliance. One might notice that, currently, there is no “observatory membership” at the CSTO. This status was created for countries such as Azerbaijan, which want to take a step closer to Russian-led incentives while, at the same time, keeping their independence and sovereignty.

Becoming an observatory member of the CSTO would also mean choosing Russia over its European allies. Hence, this issue will be on the watchlist in upcoming 2020.

Iran-Azerbaijani relations, Iran nuclear deal

Iran is actively involved in the South Caucasus region along with the other regional powers Russia and Turkey. Iran neighbours the South Caucasus region and borders Armenia, Nakhichevan (Azerbaijani Autonomous Republic), Azerbaijan (mainland) and the conflict-zone between Armenia and Azerbaijan – Nagorno-Karabakh. In addition, Azerbaijan and Iran share borders in the Caspian Sea. Also, Iran is the link between Azerbaijan and its enclave – Nakhichevan Autonomous Republic, raising the role of Iran for Azerbaijan.

Modern Iran presents itself as one of the leading countries in the Middle East. There are large Shiite communities in countries such as Iraq, Bahrain, Lebanon and Azerbaijan, in which Iran has some interest.

The South Caucasus countries also are interested in having close interactions with Iran – a large market for products in the neighbourhood. The South Caucasus countries also try to build railway connections with the Persian Gulf ports of Iran and, hence, gain access to other Persian Gulf countries such as India, China and others. Azerbaijan, Russia and Iran have started a railway project to link Bandar Abbas port in Southern Iran to the Baltic Sea ports of Russia.

At the same time, Iran-Azerbaijan relations have their own historical peculiarity. Since the first days of the Soviet Union’s disintegration, there has been a completely new reality along the northern borders of Iran. For the sake of economic and political cooperation, historical and religious factors had to be overcome.

Despite religious proximity, relations between Iran and Azerbaijan have been strained. The Iranian provinces inhabited by the ethnic Azerbaijanis are a source of tension.

The pro-Turkish and pro-Western stand of Azerbaijan on many issues and close military and security cooperation between Baku and Tel-Aviv are also sources of Tehran’s dissatisfaction in relations with Baku.

Both Iran and Azerbaijan are trying to pursue a balanced policy towards one other as both sides are interested in good relations. Iran is one of the most important trading partners of Azerbaijan. Despite US sanctions, Baku and Tehran tried to build sustainable economic connections benefiting both parties.

The agreement on the Iran nuclear deal by the Obama administration had created an opportunity for Azerbaijan and Iran to cooperate closely on economic issues. However, Mr Donald Trump’s decision to re-install US sanctions and discontinue the foreign policy of the previous administration has created a lot of obstacles for Azerbaijan and Iran to move onwards together in many areas, especially in economy.

Additionally, in 2018 and 2019, there were several important events which need careful consideration in order to observe the rising influence of Iran in the region. In the summer of 2018, within two weeks Azerbaijan experienced a country-wide blackout, the mayor of Ganja  (head of the second biggest city of Azerbaijan) was shot-down and two policemen were killed by a sword. There was a subtle hint to the origin of the events, which made many believe in rumors of Iran’s involvement in these cases. In recent month, Iran claimed to neutralise a terrorist group near the Azerbaijani and Turkish borders and accused Azerbaijan in allowing Israel to launch a drone-attack on the position of pro-Iranian forces in Iraq. As a result, Iranian generals started inspections at the Iranian-Azerbaijani border.

These developments indicate Iran’s ambitions and rising influence in the region.

EU-Azerbaijani relations, Azerbaijan’s integration to the Euro-Atlantic area of influence.

The relations between EU and Azerbaijan are currently being realised through the Eastern Partnership.The watershed moment for EU-Azerbaijan relations was the EaP summit in Vilnius in 2013. Azerbaijan was one of the countries which decided to freeze the signing of its Associative Agreement with the European Union. Nevertheless, for the last two years Azerbaijan and the EU re-started the negotiation process and, in a short period, have almost completed the draft version of the document, leaving several critical issues without an agreement.

Azerbaijan, not being a WTO member, would not be able to sign the FTA Agreement with the European Union. Nevertheless, Baku and Brussels found common ground in many areas which previously saw no agreement. Baku was in favour of establishing close relations with the EU, however, in the past, it was disappointed with Brussels’ approach to the Nagorno-Karabakh problem. Baku was not pleased with the EU’s inability to openly recognize the territorial integrity of Azerbaijan, as was done in relation to Ukraine, Moldova and Georgia. However, since December 2017, EU documents indicate unilateral support to all EaP countries territorial integrity, including Azerbaijan. Several high-ranking EU officials have publicly expressed their support of Azerbaijan’s territorial integrity while visiting the region.

Recently, Russia has been more aggressively pushing for Azerbaijan’s membership in the Collective Treaty Security Organization and Eurasian Union in order to counter further EU and European integration. The Kremlin sees CSTO and EAU membership of regional countries as a crucial point – by using these organisations, Moscow intends to take leading positions in the South Caucasus once again. For those reasons the dynamism in Azerbaijan-CSTO and Azerbaijan-EU relations are important points to watch in the upcoming year.

Armenia-Azerbaijani relations, Nagorno-Karabakh conflict

The conflict over Nagorno-Karabakh is a priority in the foreign policies of both Armenia and Azerbaijan. The modern phase of Azerbaijani-Armenian conflict over Nagorno-Karabakh started following the “Four Day War” in April 2016. After a long diplomatic stagnation process Azerbaijan and Armenia had restarted negotiations only to have them put on hold again due to the domestic political crisis in Armenia.

In May 2018, the crisis in Armenia ended with the election of the “people’s candidate” Nikol Pashinyan as prime minister. Hi election created a new opportunity for the negotiations process.

Even as a candidate for the highest position in Armenia, Pashinyan made several statements outlining the major points of his future policy, which also included the resolution of Nagorno-Karabakh. Pashinyan also emphasized consistently strengthening the Armenian army and increasing its combat effectiveness and fighting spirit. According to Pashinyan, only a strong Armenian army can lead Azerbaijan into a “constructive channel” of negotiations.

While calling for “less aggressive rhetoric”, Pashinyan also remembered times when he “slept in tents, dug trenches and, with a gun in his hands, defended the safety of his fatherland and the security of the Nagorno-Karabakh Republic and Armenia”.

The main aim of Pashinyan is to bring Nagorno-Karabakh Armenians to the negotiation table as full participants and start economic communication with Azerbaijan. While doing so, he also tries not to allow further armed clashes on the line of Armenian-Azerbaijani contact in Nagorno-Karabakh, thereby ensuring security in the region.

So far, Pashinyan’s activity has created more questions rather than resolving issues. While bringing Nagorno-Karabakh Armenians back to the negotiation table as a full member of the negotiation process (an argument of old Armenian establishment about the “conflict having three parties”) might seem a genuine move, many sense that Pashinyan seems to keep himself away from the Nagorno-Karabakh conflict (leave the burden of the negotiations process to them) and focus more on economic problems.

Pashinyan presents a harder rhetoric in public, unlike at the negotiation table, where he pursues a much softer approach. Earlier he expressed his willingness to consider the wishes of the Azerbaijani people in the resolution of the Nagorno-Karabakh conflict. Later, publicly, he proclaimed “Nagorno-Karabakh is Armenia. Full stop” and brought the negotiations process to a frozen state once more.

There are no clear answers for many questions, and, in their search, it is necessary to continue observing the actions of the new head of Armenia.

Expected foreign policy developments in 2020

Azerbaijan’s foreign policy was shaped by global developments. Following the recent Russia-US and Iran-US confrontation, both Moscow and Tehran feel stronger and, hence, are striving to increase their influence in the South Caucasus region. Azerbaijan, which has a grand strategy of having these powers balance each other, must adapt to the new reality.

Tehran, after the military tensions in the Persian Gulf, feels capable of great endeavours. Hence, we observe its increased attention toward the South Caucasus region in the matters of security and strategic alliance.

The Kremlin has also made obvious its plans to increase Russian strategic presence in the region. Russia tries to bring Baku closer to itself by having Azerbaijan as an ‘observatory’ member to the Collective Treaty Security Organisation.

Although in 2018, Azerbaijani CSTO membership was a hot topic for regional media, the EU-Azerbaijan negotiation process took over as the star topic for 2019. Only recently, in early September 2019, the CSTO issue resurfaced in local media. The visit of the Secretary of Russian National Security Council Nikolai Patrushev to Azerbaijan was followed by other high-ranking CSTO officials’ visits and meetings with their Azerbaijani counterparts.

One might assume a strong urge of Azerbaijan and Russia to bring the issue back to the table. The renewed discussions of Azerbaijan’s observatory membership in CSTO, Iran’s statement on the drone attacks from Azerbaijani soil and incidents at the border regions all took place at the same time in late August and early September 2019.

At the same time, Armenian officials responsible for security and CSTO issues made public statements practically welcoming Azerbaijani membership at CSTO, which they were strongly opposing in previous years. The Armenian government opposing Azerbaijan’s membership to CSTO was the last legal reason blocking Baku to join the Russian-led military alliance.

Azerbaijan is a country with a strategic orientation towards the Euro-Atlantic community and located in a troubled region, so cooperation with the EU is highly important for Baku. Especially the cooperation of Azerbaijan with the EU in the energy sector serves to mutual interests. Hence, Baku is willing to have closer cooperation with Brussels also, in order to keep the balance in foreign policy.

In sum, due to the increased influence of Russian and Iran in the South Caucasus region, following the statements from Tehran, which remarkably worried Azerbaijan, Baku had to reconsider its position on its observatory membership to the Collective Treaty Organisation. The rise of regional powers such as Russia and Iran requires Azerbaijan to have a dynamic response to the changing realities in the region. Hence, moving closer to Russia and Iran forces Azerbaijan to keep its balance in foreign policy and closely align itself the Euro-Atlantic nations. Consequently, in 2020, it is highly expected that due to its security concerns – Iran’s increasing ambitions in the region – Baku will opt for an observatory membership at the CSTO. In order to keep the balance, Baku will have to find a way to accommodate itself with the Partnership Agreement with the European Union.

Regarding the Nagorno-Karabakh conflict, up until now, Azerbaijan and Armenia have reached another deadlock in the peace process. The recent statement by the OSCE Minsk Group demonstrates the will of the co-chair countries to avoid military escalation in the region. Depending on how successful they are, both sides may be able to avoid further military actions in the region.

Russia is also completely uninterested in a war between Baku and Yerevan. In the case of war, Russia will be a losing side no matter what the outcome. It will have to choose a side and therefore, break up either with Armenia, which is an ally of the CSTO and the EAEU, or with Azerbaijan. Therefore, Moscow sets forth conditions for the pacification of the Karabakh conflict. Azerbaijan’s expected observatory membership at the CSTO is a game changing moment in this case. It is expected that Russia is going to push for the implementation of the so-called ‘Lavrov Plan’ in 2020.


The dynamic processes in the world emerge also in the South Caucasus region. Russia, Turkey and Iran – countries in transformation and with big ambitions – all border the South Caucasus. Russian-Turkish clashes in the Syrian conflict and Crimean affairs, Iran-Russia rivalry in Syria and Central Asia, USA-Iran and USA-China rivalry are all finding their way into regional affairs.

The South Caucasus suffers from the world’s transformation from unipolar to multipolar more than any other region. While global powers were stepping down, the rise of regional powers in their stead leaves scars in the public-policy affairs of the region and will seriously affect foreign policymaking in the following years.

The rise of new global powers creates a different reality on the ground. The regional countries of the South Caucasus (and Azerbaijan) faced tough pressure from outsiders in 2018 and 2019. It is expected that this trend is going to continue throughout 2020 as well.

Azerbaijan-Iran relations, Azerbaijani-Russia relations, Azerbaijan’s integration toward EU institutions and cooperation with the US on security issues are among the top issues on the to keep an eye on in 2020.