Nagorno-Karabakh: no war, no peace

By bne IntelliNews February 13, 2015

Monica Ellena in Tbilisi -


Since the 1994 ceasefire the Armenian-Azerbaijani conflict over Nagorno-Karabakh has languished in a state of “no war, no peace”. A landlocked mountainous region, Nagorno-Karabakh is an enclave in Azerbaijan’s territory, a de facto independent statelet in the hands of its ethnic Armenians, backed by Yerevan.

But after two decades, the last 12 months of the frozen conflict – one of three in the South Caucasus alongside Georgia’s Abkhazia and South Ossetia – have been more about fire than ice.  

Skirmishes have been common since the ceasefire, but last year tension started brewing and violence has become a daily routine, peaking in early November when Azerbaijani forces downed what Baku said was an Armenian military helicopter east of Nagorno-Karabakh, killing three crew members. It was the first time an aircraft had been shot down in the conflict zone in the past 20 years. The fighting hasn’t cooled down in the New Year.

“We were very used to measuring ceasefire violations by the number of shots fired,” says Richard Giragosian, director of the Yerevan-based independent think-tank Regional Studies Centre. “Unfortunately, now the escalation is so serious [that] we measure ceasefire violations by the number of casualties.”

The clashes have thwarted international efforts – led by the Organisation for Security and Cooperation in Europe’s Minsk Group – to cut through the Gordian knot. On January 27, the Minsk Group released an unusually strongly-worded statement “deploring the upsurge in acts of violence resulting in loss of lives, and [calling] on the sides to demonstrate responsibility and avoid steps that would lead to further escalation”.

In 2014 the two presidents, Azerbaijan’s Ilham Aliyev and Armenia’s Serzh Sarkisyan, resumed face-to-face talks and they have met three times between August and November, but have been unable to narrow their differences. As diplomacy fails, soldiers wait on opposing sides a few hundred metres away from each other in WWI-like trenches along the 100km ceasefire line. Only six international monitors are left to oversee the line.

According to Thomas De Waal, senior associate at the Carnegie Endowment for International Peace and author of “The Black Garden: Armenia and Azerbaijan Through Peace and War”, Azerbaijan, the losing side in the conflict, has more of a reason to keep the ceasefire unstable so as to remind the world that the line cuts across the internationally recognised territory of Azerbaijan and that territories behind it lie under Armenian military control. “However, although the Azerbaijani side is probably responsible for a greater quantity of ceasefire violations, the Armenians also like to demonstrate their power,” he wrote recently.

The immediate trigger for the escalating violence is in the growing regional tensions in the relationship between Russia and the West which have also begun to disturb the South Caucasus, according to Neil Melvin, director of the programme on armed conflict and conflict management at Stockholm International Peace Institute Research Centre.

“When Armenia rejected the EU’s Association Agreement and opted for the [Russia-led] Customs Union, this immediately raised the question of whether [Nagorno-] Karabakh would be integrated into the Union through Armenia which a number of countries have opposed,” he says.  The political uncertainty initiated by these events was the catalyst for violence but longer term trends prepared the ground, notably the transformation of the Karabakh conflict into an interstate conflict between Armenia and Azerbaijan.”

A contested cradle

In the dying days of the Soviet Union, Nagorno-Karabakh was one of the first clashes between the principles of peoples’ self-determination and the republics’ territorial integrity in the USSR and its successor states.

In 1988 the majority Armenian population asked the central Soviet authorities in Moscow for the region to join the then-Soviet republic of Armenia. Events unravelled and by the time the USSR started melting from Riga to Bishkek, Armenia and Azerbaijan were engaged in a fully-fledged war.

A Russian-brokered ceasefire in 1994 left Armenian-backed forces in charge of the region and seven surrounding Azeri districts, with more than 30,000 dead and half a million Azerbaijani displaced. The ethnic Azerbaijanis, about 25% of the pre-war population, left their homes, while ethnic Armenians fled the rest of Azerbaijan. Neither group has returned home since the end of the conflict.

Armenia, an ally of Russia, and Azerbaijan, oil-and-gas rich, got very close to solving the stalemate, notably in 2001 in Key West, Florida, but neither of the then-presidents, especially ageing Heydar Aliyev, pushed the deal home. After two decades of reciprocal isolation, harsh rhetoric and propaganda - pleasing to public opinion at home-  trying to make peace is a daunting task. A peace deal remains on the table, but as De Waal puts it in his book, “it asks to do something that runs against the grain of their national narrative for two decades”.

“Domestic politics has been a key factor in preventing both sides reaching a peace agreement on Karabakh,” agrees Melvin. Leaders [in both countries] have used the threat of conflict around Karabakh to justify their rule and crack-down on opposition forces.”

Arm race

Last year Azerbaijan looked past falling crude prices and increased military spending by more than a quarter to AZN5bn ($4.8bn). So did Armenia, whose defence outlays reached AMD200bn ($446mn), from AMD64.4bn in 2005. Azerbaijan’s oil-rich economy dwarfs Armenia’s limping economy as the defence allocation of the former exceeds the latter’s total budget spending by $3.2bn.

“The Armenian forces, however, are very well dug in and have significant defensive capabilities,” explains Melvin. “In the mountain areas, the Armenians enjoy advantages.  In this context, an Azeri attack would likely endure high causalities and there is still no guarantee of military victory.  Given this, the primary aim of Baku’s weapons purchases has been seen to break Armenia’s economy through an arms race rather than provide the capacity to launch a military attack.”

Whatever the reason, Azerbaijan is flexing its muscles. On February 2 the Defence Ministry announced it had started military exercises involving all units of military forces - including 20,000 soldiers, 300 armored vehicles, 200 missile launchers and artillery units, and up to 20 military jets. 

Related Articles

COMMMENT: Great challenges for Eurasia call for decisive solutions

Juha Kähkönen of the IMF - The Caucasus and Central Asia (CCA) region continues to navigate a wave of external shocks – the slump in global prices of oil and other key commodities, the slowdown ... more

IMF calls for Central Asia to tighten monetary policy

Naubet Bisenov in Almaty -   Caucasus and Central Asian (CCA) countries need to tighten their monetary policy to anchor inflation expectations, but excess tightening may weaken financial ... more

COMMENT: Once I lived the life of a millionaire…

Peter Szopo of Erste Asset Management -   No, the title of this column is not the first line of the autobiography of an erstwhile emerging markets investor – although it could be. Somebody who ... more