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Priorities of Azerbaijan's foreign policy | New realities in relationship with the EU, and prospects for cooperation

22.09.2021

Strong relations with the European Union (EU) is deemed one the main priority of Azerbaijan's foreign policy. Azerbaijan is also considered as one of the active participants in the EU's Eastern Partnership program and the EU is one of the largest trading partners of Azerbaijan. Both Azerbaijan and the EU have had an interest in developing relations at all levels in recent years.

It is notable, that the European Union's (EU) bilateral relations with Azerbaijan are principally based on the EU-Azerbaijan Partnership and Cooperation Agreement (PCA), signed on 22 April 1996 in Luxembourg and entered into force on 1 July 1999. The PCA is the legal basis for relations with the EU, defining the format of cooperation in all areas except the military. Since the implementation period of the Partnership and Cooperation Agreement signed for a period of 10 years expires in 2009, its implementation is automatically extended for 1 year each year until the signing of a new agreement.

Moreover, Azerbaijan-EU relations can be generalized as Azerbaijan's geostrategic, economic and political interests, as well as the EU's geopolitical interests in the South Caucasus. There are two aspects to the EU program, both are bilateral and multilateral. The EU is cooperating with Azerbaijan as well as other partner countries in both directions. Azerbaijan prefers bilateral relations with the European Union. The EaP plays a supportive role for Azerbaijan in developing its national interests in the context of regional policy, launching various initiatives, and thus on the bilateral cooperation agenda with the EU, by exchanging views on certain issues on a multilateral platform.

Perspectives for the development of relations: The new geopolitical situation in the region, the post-war period, the restoration and reconstruction of the liberated territories of Azerbaijan, the implementation of regional transport projects are discussed as perspectives for cooperation between Azerbaijan and the European Union. In terms of relations with the EU, the points that give a new impetus to political dialogue and mutually beneficial cooperation are emphasized.Therefore Baku has proposed a new comprehensive agreement on strategic partnership that is mutually beneficial, instead of an associative membership format with official EU. After the Riga Summit in 2015, a qualitatively and fundamentally new agenda began in EU-Azerbaijan relations. The Azerbaijani leadership has stated an open and concrete position on this issue. Azerbaijan's resolute position was accepted by official Brussels, visits of EU leaders to our country were organized and the EU gave a mandate to negotiate a new bilateral agreement to replace the PCA. 

The foundation was set for cooperation in a more equal spirit. The format of cooperation or agreement proposed by Azerbaijan in 2017 additionally determined the scope of relations and the wishes of the parties.  Negotiations on a new comprehensive agreement between the EU and Azerbaijan, political dialogue and a new impetus for mutually beneficial cooperation have begun, and in 2018 a document entitled "Partnership Priorities" was signed. With its firm position, Azerbaijan has shown its readiness to be a strategic partner with the EU, while maintaining its economic, political, geopolitical and independence. On this basis, the EU has adopted a new document reflecting the territorial integrity, sovereignty and inviolability of Azerbaijan's borders. The agreement also defined the scope of the relationship and the wishes of the parties. Along with the four priority areas of the Eastern Partnership, this also defines the EU-Azerbaijan political dialogue and cooperation. The EU also contributes to Azerbaijan's economic modernization, including in areas such as education, entrepreneurship and regional development. The EU also supports the process of further improving the investment and business environment in Azerbaijan. The goal is to prepare a document "Azerbaijan - EU Partnership Priorities for 2018-2020". This document aims to identify priorities in areas of mutual interest between the parties and implement them in the form of specific projects for 3 years (2018-2020).

Azerbaijan takes part in many EU programs and agencies. A protocol between the EU and Azerbaijan was signed in 2014. The Protocol was approved by the Decree of the President of the Republic of Azerbaijan dated September 30, 2014, ratified by the European Parliament on July 6, 2016 and entered into force. Agreements between the Republic of Azerbaijan and the EU on visa facilitation and readmission of persons residing without a permit were signed on 29 November 2013 and 28 February 2014, respectively. Both agreements entered into force on September 1, 2014. This allows Azerbaijani citizens, especially those who travel frequently, to travel to many EU countries with easier and cheaper visas. Also, according to the visa facilitation agreement, mainly pensioners, researchers, students, children under 12 years of age are completely exempted from visa fees. It should be noted that the EU Erasmus + program from 2015 to 2018 allowed about 1,300 students and teachers in Azerbaijan to study or teach in EU countries.  The Joint Declaration on Displacement Partnership signed between the Republic of Azerbaijan, the EU and its member states was signed in Brussels on 5 December 2013. The Joint Declaration was approved by the Order of the President of the Republic of Azerbaijan No. 312 dated March 6, 2014. The main purpose of the Joint Declaration is to facilitate the movement of people between the Republic of Azerbaijan and the EU, to better manage migration flows in accordance with relevant international standards and to expand cooperation in combating illegal migration.

The Protocol to the Partnership and Cooperation Agreement on the General Principles of Participation of the Republic of Azerbaijan in EU Programs was signed during the visit of former European Commission President JM Barroso to Baku on 14 June 2014. The EU has suspended Azerbaijan's use of the EU Generalized System of Preferences (GSP) since 22 February 2014, citing the country's inclusion in the group of upper middle-income countries according to the World Bank's Gross National Income Classification. At present, the standard "Most Favorited Nation" regime is applied for Azerbaijan. 

As one of Azerbaijan's main trading partners: EU countries continue to be Azerbaijan's main trading partners. According to the State Customs Committee of the Republic of Azerbaijan, the share of EU countries in the foreign trade turnover of the Republic of Azerbaijan was about 42 percent, including 20 percent in imports and 54 percent in exports. Thus, the trade turnover of the Republic of Azerbaijan with the EU countries amounted to about 12.9 billion US dollars, including imports of 2.3 billion US dollars and exports of 10.6 billion US dollars. According to these indicators, the share of EU countries in the foreign trade turnover of the Republic of Azerbaijan was about 42 percent, including 20 percent in imports and 54 percent in exports. In 2020, the trade turnover amounted to $ 9.33 billion. The total amount of EU investments in Azerbaijan over the past eight years is more than $ 20 billion. 

Year 2017 was the most intensive one for the EU Delegation to Azerbaijan, covering the most regions and involving various instruments. “Year of Public Diplomacy” / IMAGINE- European Film Festival, discussions, lectures, debates, European bus tours to the regions, “AvropadASAN” program on “ASAN Radio” and www.sizinavropa.az portal organized by the EU in Azerbaijan opening was carried out in that year. In connection with the activities of the EU mission in our country on social reforms and national priorities, the Union is working on the process of implementing the Multi-Year Indicative Programming for Azerbaijan for 2021-2027. Approved by the Decree of President Ilham Aliyev, "Azerbaijan 2030: National Priorities for Socio-Economic Development" is one of those priorities in building a dynamic, inclusive and socially just society, competitive human capital and modern innovation space, and Azerbaijan is cooperating with partner organizations and countries. Furthermore, in February 2021, the European Union launched a new website www.eu4azerbaijan.eu, which demonstrates 131 projects in Azerbaijan.

Within the framework of the program of EaP, Azerbaijan actively cooperates with the EU through twinning projects. Over the past decade, Azerbaijan has used more Twinning than other EaP countries. This unique instrument of cooperation has brought to Azerbaijan the best practices and standards of the EU. For 10 years, more than 25 ministries and NGOs in Azerbaijan have participated in 50 twinning projects covering EU technical knowledge and practical experience of civil servants. This active cooperation has contributed to the development and improvement of local legislation in line with EU standards. Of the 50 twinning projects implemented over 10 years, 34 have been completed, 11 are ongoing and 1 is under preparation. 

The European Neighborhood Instrument of the European Union has been applied in Azerbaijan since 2007. This tool is intended to assist in the implementation of the European Neighborhood Policy. The ENP includes assistance tools such as budget support, Twinning, technical assistance, TAIEX, SIGMA. The European Union and Azerbaijan have signed a National Indicative Program to identify priority areas of cooperation for 2011-2013, as well as to provide assistance in these areas. The European Neighborhood Instrument was implemented in 2007-2013. It replaces the ENP for 2014-2020, the European Neighborhood Instrument. The European Neighborhood Instrument is a key EU financial instrument designed to implement the neighborhood policy. 

Azerbaijan plays a key role in transporting the Caspian Sea's energy resources to the EU market, is an important EU energy partner. It is also Azerbaijan's largest foreign investor in the oil and non-oil sector. The EU is a major trading partner for Azerbaijan, as well as the largest export and import market. Azerbaijan currently supplies about 5 percent of the EU's natural gas needs. Azerbaijan transports Caspian natural gas resources to the EU market via the Southern Gas Corridor. By establishing a regional program called EU4Energy in 2016, the EU supports the Eastern Partnership countries, including Azerbaijan, in achieving energy policy goals and improving energy efficiency.

The EU is a major customer of Azerbaijani oil and oil transiting through the country. The Southern Gas Corridor is a strategic initiative to transport natural gas resources from the Caspian, Central Asia and the Middle East to European markets and is a key tool in expanding Europe's energy security. Shah Deniz II, a giant offshore gas field in the Azerbaijani sector of the Caspian Sea, will initially export 10 billion cubic meters of gas a year to European markets from 2020 onwards. Infrastructure to supply natural gas from the Caspian Basin, in particular Shah Deniz II, the existing South Caucasus Pipeline from Azerbaijan to Turkey via Georgia; The Trans-Anatolian gas pipeline connecting Georgia with Europe via Turkey; as well as the Trans-Adriatic Pipeline, which transports natural gas from the Turkish border to Italy via Greece and Albania.

Active dialogue and cooperation in the field of transport play an important role in Azerbaijan's economic relations with the EU. Azerbaijan's favorable geographical position and location at the junction of strategic transport routes create ample opportunities for close cooperation in this area. It is known that in recent years Azerbaijan has invested heavily in important infrastructure projects such as the Baku Port and the Baku-Tbilisi-Kars railway. Therefore, it is no coincidence that the most important roads and railways, seas and airports are included in the advanced indicative plan for the construction of the Trans-European transport network TEN-T. It should be noted that the decision to adopt the TEN-T was made by the European Parliament in 1996 and provides for the establishment of a planned network of roads and railways, airports and water infrastructure in the EU. It is also part of a wider system of Trans-European networks. In addition, the EU provides technical support to the port of Baku.

The fact that Azerbaijan is a secular state with large oil and gas resources, stability, as well as its location in a complex region is one of the factors of interest to it. In addition to being a legal and technical process, European integration includes the formation of a broad mutual understanding, as well as the acceptance and use of each other's strengths. In this regard, Azerbaijan and the European Union are in each other's interest. Strengthening the image of a reliable partner in the international arena, Azerbaijan offers economically viable projects to the European Union. The EU wants to strengthen ties with its European neighbor, Azerbaijan, which has large oil and gas resources.

According to a public opinion poll, the European Union is in the opinion of the Azerbaijani society: According to the annual public opinion poll conducted in 2017, people's positive attitude towards the EU has increased in Azerbaijan (26% in 2016, 47% in 2017). 68% of Azerbaijanis surveyed believe that relations between the EU and Azerbaijan are good. This is better than the regional average (61%). Also, 51% of Azerbaijanis trust the EU. For comparison, 35% of Azerbaijanis trust the UN, 26% trust the Eurasian Economic Union and 32% trust NATO. 33% of Azerbaijanis are aware of EU financial support. 65% of them think that this support is effective. For comparison, the regional rate of answer to this question is 53%. According to a survey conducted in 2020, 44% of Azerbaijani citizens have a positive image of the European Union (EU). This figure is 17% higher than in 2016. Only 9% of the population has a negative perception of the EU. According to the survey, 30% of Azerbaijanis are aware of the EU's financial support to the country, 76% of them think that this support is effective, and 69% of Azerbaijanis who know about the European Union think that relations with the EU are good. It should be noted that according to respondents, the EU is the most trusted foreign institution, and 41% of respondents trust it (compared to 2018, it increased by 13%).    

A new phase in relations: the EU supports Azerbaijan's territorial integrity, sovereignty and independence. Also, in the period before the 44-day war, the EU and its member states did not recognize the so-called "Nagorno-Karabakh Republic". In particular, the EU supported the efforts of its Special Representative for the South Caucasus and the crisis in Georgia, the co-chairs of the OSCE Minsk Group, to resolve the Nagorno-Karabakh conflict. The Union was interested in promoting confidence-building and peace-building activities through the implementation of the European Partnership Program for the peaceful settlement of the Nagorno-Karabakh conflict. Because the Nagorno-Karabakh conflict is ahead of the events of interest to the countries of the South Caucasus. In the second half of 2016, there was an expectation that the mediating states would take serious steps to resolve the Nagorno-Karabakh conflict in 2017 with the intensification of Russia. Although some important meetings were held in this direction in 2017, no serious steps were taken as a result. However, the importance of the principle of territorial integrity in the Nagorno-Karabakh conflict at the EaP Summit in November 2017 was highlighted as another achievement of Azerbaijan and a defeat for Armenia. The war, which began on September 27, 2020, further strengthened Azerbaijan's role as a lasting guarantor of peace and security in the region as a victory for Azerbaijan in the eyes of partner countries and international organizations. This increased the importance of continuing relations with the EU at a new stage. 

The European Union allocated 3 million euros in humanitarian aid to help people affected by large-scale military operations in and around Nagorno-Karabakh, including a large number of IDPs. Since the start of hostilities on 27 September 2020, the EU has mobilized a total of € 6.9 million in humanitarian aid.The key to the EU's success in its relations with countries that meet vital interests, such as energy security, is to play a more active role in conflict resolution. As stated in both the European Security Strategy and the European Neighborhood Policy, the prevention and resolution of conflicts in the immediate vicinity is one of the EU's main goals. However, initiatives to resolve conflicts in the region are often implemented by the Special Representative or the EU Observer Mission. In other words, the EU's ability to be effective in foreign policy depends on its ability to solve its internal problems. As a result, no matter how comprehensive the EU develops its bilateral and regional platform, its success in resolving regional conflicts depends on its ability to be a strategic player in the immediate vicinity.

None of the former Soviet republics that have signed an association agreement with the European Union has signed a document on strategic partnership with nine EU member states.   Azerbaijan is also a strategic energy partner of the EU. The British company BP plays an important role in the establishment and development of this strategic partnership. At a meeting with Wendy Morton, UK Minister for State for European Neighborhood and American Affairs, on 9 February 2021, President Ilham Aliyev stressed that BP is a strategic partner of Azerbaijan and recalled that we are delighted to complete the Southern Gas Corridor and increase gas production in Azerbaijan. The new developments and the infrastructure completed in December last year.

Despite the conflict of interests of a number of foreign forces and countries in the South Caucasus, Azerbaijan has managed to maintain an independent foreign policy. This has allowed Azerbaijan to build relations with EU countries on the basis of the country's national interests. It is an undeniable fact that Azerbaijan, with its diplomatic relations and successful foreign policy, prefers relations with different states and organizations in the international arena based on equal rights and mutual respect. At the level of these relations, factors such as the protection of Azerbaijan's sovereignty, national values and interests play a key role. In this regard, Azerbaijan has put forward its own model of cooperation in response to certain points in the cooperation proposals within the EU's Eastern Partnership program, and fruitful discussions have been held in this direction. Serious problems between the parties have been resolved by mutual understanding. The previous relations were continued within the framework of the "Association Agreement" adopted between the parties.

The Eastern Partnership considers issues of cooperation and bilateral relations, including the importance of signing a new agreement, energy partnership and new opportunities. There are detailed discussions on the EU's humanitarian assistance to those affected by the conflict and the role the Union can play in the post-conflict process. At the economic level, relations are developing steadily. As a result of the establishment of equal bilateral relations, the European Union maintained its neutrality in the Karabakh War II, which Azerbaijan waged to ensure its territorial integrity. Because there are EU resolutions on the territorial integrity of Azerbaijan.

Azerbaijan's contribution to Europe's energy security, the huge Southern Gas Corridor project, which is already fully operational, and the opportunities to expand the geography of this project in Europe, as well as Azerbaijan-EU bilateral relations will form the legal basis of these relations.

A number of issues related to the preparation of a new cooperation document between the European Union and Azerbaijan have always been among the leading directions. In some cases, different theses were voiced, different positions were expressed, but the restraint and activity of official Baku, which kept the balance of power, created favorable conditions for the removal of obstacles. This is one of the successes of Azerbaijan's balanced foreign policy.

 

Elnara Garibova

Senior Consultant, Social Research Center (SRC)

 

References:

  1. https://ec.europa.eu/commission/presscorner/detail/en/IP_17_4845
  2. https://eeas.europa.eu/sites/default/files/eap_factsheet_azerbaijan_en.pdf
  3. https://mfa.gov.az/en/content/193/european-union
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  5. https://minenergy.gov.az/az/beynelxalq-teskilatlarla-elaqeler/avropa-qonsuluq-ve-terefdasliq-aleti-aqta
  6. https://apa.az/az/senaye-ve-energetika/xeber_prezident__azerbaycan_artiq_avropa_itti_-500499
  7. https://ec.europa.eu/commission/presscorner/detail/en/IP_17_4845
  8. https://ec.europa.eu/echo/where/europe/armenia-and-azerbaijan_en
  9. https://azertag.az/xeber/Ispandilli_metbuat_Ilham_Aliyev_Avropa_Ittifaqi_ile_sazis_meselesinde_daha_boyuk_irelileyis_gozleyir-1731189
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