OPINION | Who is Winning & Who Is Losing in Karabakh?
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OPINION | Who is Winning & Who Is Losing in Karabakh?

By Mohsen Hadi 
Researcher of Eurasia Studies

OPINION | Who is Winning and Who Is Losing in Karabakh?

Image Attribute:  The situation in the area after the 1994 ceasefire. Armenian forces of Nagorno-Karabakh currently control almost 9% of Azerbaijan's territory outside the former Nagorno Karabakh Autonomous Oblast. Azerbaijani forces control Shahumian and the eastern parts of Martakert and Martuni. / Source: Wikipedia , CC BY-SA 3.0

When a truce deal was reached in Karabakh 22 years ago, Armenia was apparently the winner of the war. It had occupied 20 percent of Azerbaijan's soil and was proud for having taken a step forward toward the realization of the Greater Armenia. Azerbaijan, on the other hand, was both defeated and shamed. However, the other side of the story was quite different, because Armenia also cut its ties with its second neighbor in a hostile manner. Before long, Armenia came to loggerheads with Georgia as well and after severing ties with Tbilisi, out of four neighbors around, it only had cordial relations with Iran. This means a real deadlock on the ground. 

On an international level, Armenia’s moves earned it four resolutions in favor of the Republic of Azerbaijan and against Yerevan, as a result of which even Armenia could not recognize the independence of the self-proclaimed Nagorno-Karabakh Republic, let alone other countries. Add to this the diplomatic deadlock in which Armenia found itself as a result of serious dependence on Russia, which overshadowed its relations with the West. It is not hard to guess how the economy of a country with such territorial and diplomatic deadlocks would fare. Armenia lost many economic opportunities. It could have emerged as a route for the exchange of energy, that is, transfer of oil and gas from Caucasus and Iran to Europe, but this did not happen. It could have served as a transit route, which failed, and could have had trade exchanges with three countries around it, but this did not happen either, let alone that no foreign investor would trust such a country. The only way remained for Yerevan was to sell mineral resources and look to religious funds and aid from Russia, and possibly from the United States and other countries. The bottom line for Armenia was a bankrupt economic situation, which stirs unrest among its people every once in a while. 

The Forbes magazine, in a feature published in 2011, introduced Armenian economy as the world’s worst after Madagascar, which drew criticism from Armenian government. In 2014, Armenia’s Hayots Ashkharh newspaper published a report by an international rating agency about a deplorable collapse of the country’s economy, adding that along with Armenia’s economy, the country’s financial system was falling apart, rendering resolution of the country’s economic problems nearly impossible. 

As a result of this situation, Armenians have been thinking about leaving this country in search for a better life elsewhere and the population of Armenia has been, as such, on a decline. In 1991, the Armenian magazine, Hooys, which is published in Iran, carried an article on the risk of further reduction of Armenia’s population. While describing the population figure of the country as a source of concern, it added that according to a census in 2011, Armenia’s population stands at 3.2 million of which 400,000 live outside the country’s borders. These figures are worrying for Armenians that are scattered across the world because it had taken a long time for the current population of Armenia to hit three million. 

According to a census carried out under the former Soviet Union in 1979, the population of the Republic of Armenia was more than three million of which 90 percent was accounted for by ethnic Armenians. The last nationwide headcount under the Soviet Union was carried out in 1989 and in difficult circumstances, including after a quake as well as war and two-way immigration between Armenia and Azerbaijan. According to that census, the population in the Soviet Republic of Armenia stood at 3,304,776, including 93.3 percent Armenians. Now, however, in the independent state of Armenia, the registered population is falling below three million. It seemed that the independence of Armenia would provide suitable conditions for the increase in the Armenian population and would prompt hundreds of thousands and even millions of Armenians to get back to their homeland. However, the turbulent situation in which the new Armenian government has been born in addition to a total siege of the country’s railroad network, war, and energy crisis turned into major factors encouraging immigration of Armenians from the country. Even the end of the war and resolution of the energy crisis and establishment of cease-fire has not been able to improve the situation of the country’s population. At present, the population in Armenia can be only considered equal to its population in the 1970s. 

On the other hand, the Republic of Azerbaijan has been experiencing remarkable economic growth. In 2013, the country’s growth figure hit 8.3 percent, most of which was, of course, attributable to the country’s oil industry. Oil accounts for the biggest sector of Azerbaijan's economy and when the oil price was at its peak subsequent to the completion of Baku – Tbilisi – Ceyhan pipeline, the country’s gross domestic product grew by 41.7 percent in the first quarter of 2007, thus ranking the first in the world. Of course, this figure later subsided due to plummeting oil prices as a result of which inflation rate started to rose, but never reached a critical level. 

If Armenia had maintained friendly relations with the Republic of Azerbaijan, it could have taken advantage of its geographical advantages and turn into a major transit country for the export of oil to Western markets as a result of which it could have strategic relations with the West and get rid of its dependence on Russia in order to be able to create a balance in its foreign policy. Even mere trade with Turkey and Georgia would have provided it with a big market. It is due to these facts that the former president of Armenia, Levon Ter-Petrosyan, believed that the government should give in to some demands about the mountainous Karabakh region because continued tension over this issue would weaken the Armenian society and sovereignty. He told the Armenian people that they should choose between the mountainous Karabakh and development, and of course, he was sentenced to house arrest due to this remarks! 

Now, the two countries are entangled in another faceoff despite their incomparable economic capabilities. On the one side of the faceoff is Azerbaijan with extensive economic relations with various world countries, including its neighbors, while on the other side, there is Armenia, which is caught in a deadlock of relations. Azerbaijan's defense budget is very much higher than Armenia’s military spending and as evidence shows, the two countries weapons arsenals are not comparable. However, it is not clear what the final fate of the war between the two countries would be. The Armenian side may be able, like 22 years ago, to buy time and leave resolution of Karabakh problem to repetitive and futile negotiations. In this way, it would try to not only be a winner of land, but a winner of time as well. The victory, however, does not necessarily depend on these quantitative factors, since the quality of life can change conditions on the ground. If it cast a look inside its own society, the government of Armenia would see that the time is faring in favor of Azerbaijan and time can change conditions on the ground as well. Who knows, perhaps the time has already come for a change on the ground.

Source: Khabaronline News Website http://khabaronline.ir/ Translated By: Iran Review.Org

This article was originally published at IranReview.org.   
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