RUSSIA AND THE U.S. IN THE SOUTHERN CAUCASUS: FUTURE PARTNERS OR FUTURE RIVALS?

Magomedsalikh GUSAEV


Magomedsalikh Gusaev, Ph.D. (Philos.), Minister for Ethnic Policy, Information and Foreign Relations, Republic of Daghestan (Makhachkala, Russia)


Politicians, academics and the public are peering with increasing attention at the Caucasus grappling with problems created by the emergence of new independent states and its own geographical location between Europe and Asia (two largest energy markets) that has turned this large oil-extracting region into a crossroads of transit of energy fuels. It has become clear that the geopolitical and geo-economic projects devised by various blocs and countries turned the Caucasus into a region of actual policies. This is confirmed by lively discussions of the local armed conflicts (in Nagorny Karabakh, Chechnia and between Georgia and its autonomiesAbkhazia and Ossetia) and the related problems of domestic development and the statehood of the South Caucasian states.

There is another questionan important one or even the most important of allabout the prospects of political and economic integration of these republics among themselves, with their geographic neighbors, and with Russia and the United States. In fact, this destroys the Crimean system and the worlds regional arrangement that existed while the Soviet Union was alive, and brings a new balance of forces to the Caucasus.

Cooperation Strategy

Discussions of Caucasian politics that unfolded as soon as the Soviet Union had disappeared from the map of the world was closely associated with the internal institutional reforms in the former socialist South Caucasian republics and their altered foreign policy landmarks. The two attraction polesRussia and the Westformulated new questions for researchers. Will the new geopolitical interests cut the thread of cultural identity that was keeping these countries together? Will this thread strengthen the factors that tied these countries together or will it push the dividing factors to the fore? What are the world powers interests in the Caucasus?

The attempts to find answers to the above showed that the hopes that the end of the Cold War would create prerequisites of unification of the world community for the sake of dealing, in a consolidated and just way, with the problems the world was facing remained unjustified. Life proved to be much more complicated: the old challenges were replaced with new threats while unresolved problems are piling up. Those who hoped to see bi-polar confrontation replaced with partnership for the sake of international stability proved wrong.

This is true of the Caucasus as well. The events of the last ten years testify that the situation there is complex and contradictory, that old geopolitical interests and priorities have been replaced with new ones. It has become abundantly clear that new players prepared to gamble on their own appeared on the regions political map. Russia and the United States are two favorites.

The old leaders of the Russian Federation gripped with the euphoria of democratic changes and deeply concerned with the countrys social and economic problems missed the fact that the appearance of the new independent states in the Southern Caucasus would undermine Moscows influence in this key strategic area that gave it access to the Middle East. The West, the United States in the first place, grasped the meaning of the local developments. They did not allow the chance to slip between their fingers and reserved themselves a place in the Caucasus. Back in August 1997 Bill Clinton, the then president of the United States, declared the Caspian a zone of his countrys national interests. Before that, in February Senator Robert Byrd described the South Caucasian countries as Washingtons strategic partners. At the same time, the United States had to bear in mind that the Caucasus was a zone of the Kremlins special interests. This explains why American Ambassador to Azerbaijan Ross Wilson tried to correct Senator Byrd by admitting that Russia had interests in the Southern Caucasus. He said that the United States hoped that Moscow, too, borne in mind that the U.S. had its own interests in the region.1

We all see today that the foreign policy interests of the two states met in this region. An analysis has shown that both Russian and American strategy in the Caucasus is structuralized along several directions: first, the so-called aid programs; second, support for market reforms and democratization; third, promotion of political stabilization; fourth, protection of energy interests, and investments in the oil and gas industry and transportation projects, as well as military presence.

Aid Programs

It is hard to overestimate the role that the aid programs play in Americas foreign policy. Officially they are presented as purely humanitarian ones designed to support economically weak countries. In fact, they serve the task of consolidating certain states around the United States. These programs first appeared after World War II in the form of the Marshall Plan and proved an effective vehicle of the Western countries increasing integration under the U.S. leadership. They were also responsible for the German and Japanese economic miracle.

Since the early 1990s the United States has been using these programs with success in the Caucasus. According to the U.S. State Department,2 since 1992 Armenia has got about $1,336 billion within these programs and $218m from other sources. On the whole, the republic received over $1,554 billion from Washington. In the same period, Azerbaijan received $335m from the state U.S. sources and $115m from nongovernmental sources ($450m in all), while Georgia received $1.1 billion and $408m, respectively.

American money used to support humanitarian projects in various spheres. For example, Minister of Education of Azerbaijan Misir Mardanov pointed out that American colleagues extended considerable aid to restructuring the republics system of education. He described the United States as the main strategic partner in this sphere. Despite Art 907 of the 1992 Freedom Support Act that until recently did not allow the U.S. government to provide direct aid to Azerbaijan American NGOs and humanitarian organizations have been for over ten years helping the Azeri schoolchildren and students receive fundamentally new type of education.3 William Taylor, co-chairman of the Azerbaijanian-American work group for economic cooperation, said that in 2001 alone the United States had allocated $32m-worth aid to Azerbaijan. The money was used to carry out several credit projects. USAID uses part of the money to open micro-credit and credit lines for small and medium-sized enterprises. There are plans to realize programs of crediting agriculture and funding education of Azeri students and postgraduate students in the United States. According to the Trend Agency, these projects will be realized by NGOs.

Washington extends serious aid to Tbilisi: supported by the U.S. government USAID allocated about $5m for winter 2002-2003 for heating. This money will be distributed among nearly 100 thou as compensation for electric energy they used in December, January, and February. A year earlier similar aid was given to over 116 thou families, orphanages, schools, kindergartens and hospitals, and also refugees and forced migrants living in 42 settlements.4

The Armenian Aid Fund and the Armenian American University signed an agreement with USAID under which within the next 5 years a humanitarian program worth $15m would be realized in Nagorny Karabakh. The money will be spent on restoration of old and construction of new schools, clinics, and water conduits. The Fund will be engaged in construction while the University will sent medical workers to Nagorny Karabakh. To coordinate these efforts the Fund will soon open its offices in Stepanakert.5

Associated Press quoted William Taylor, the U.S. coordinator for assistance to Europe and Eurasia, as saying that his country planned to allocate $90m-worth aid to Armenia in 2002. He also said that American firms would like to buy state energy companies and were prepared to take part in the privatization tender.6 Russia is also interested in the Armenian energy sector: Premier Kassianov announced that in exchange for the $93.76m-worth Armenian debt to Russia its companies would participate in privatization of the Razdan hydropower station, joint-stock company Mars and several research institutes.7

For economic reasons Russias aid to the South Caucasian states is very limited and is mainly of a humanitarian nature. For example, in 2001 the RF government decided to extend humanitarian aid to Armenia struck by severe drought in 2000. The Russian Ministry of Agriculture received 33.2m rubles out of the state reserve fund to buy seeds of winter wheat while the Ministry for Emergency Situations received up to 3.3m rubles and up to $368,800 to deliver the humanitarian cargo to Armenia.

Military Presence

Military presence comprises an important part of American and Russian foreign policies in the Caucasus. Some experts believe that the factor of force having changed its direction lost none of its importance in the region.

U.S. Secretary of Defense Donald Rumsfeld has pointed out that Americas interest in the Caucasus was increasing and that Washington attached great importance to stabilization there and to its cooperation with the three South Caucasian states.8 The Defense Secretary was talking about direct military aid. Kenneth Spencer Yalovitz, U.S. Ambassador to Georgia, pointed out that by the end of 2002 total U.S. aid to Georgia would reach $70m. According to his information, in winter 2001 the Georgian border guards received from the United States a helicopter, radar equipment and means of communication that, the ambassador said, had made protection of the 21-km long Chechen stretch of the Georgian border with Russia more reliable.

Donald Rumsfeld also said that Washington attached much importance to the Train and Equip Program for Georgia: when realized it would help it fight terrorism, improve its military sphere and reinforce its border guards. The Defense Secretary referred to the statements of the Russian side when he added that the program had created no problems for Russia.

There is an opinion in America that the North Atlantic Alliance should be moved to the Caucasus. Strobe Talbott, Deputy Secretary of State in the Clinton Administration, never ruled out a possibility of NATO membership for the South Caucasian states. He said that none of the countries could be excluded from the NATO expansion process.9 He was convinced that Moscow was doing its best to sow distrust of Washingtons political, economic, and diplomatic involvement in the regions security sphere. He was quoted as saying to the Turan news agency (Baku) that there were people in Moscow who were convinced that the U.S. mere presence in Azerbaijan, Georgia, and Armenia and its active involvement were bad for Russia. He described this as vestiges of old thinking and Cold War mentality.

Talbott is convinced that new thinking prompts closer cooperation between the United States, Russia, and other countries for the sake of stability and prosperity in the Southern Caucasus. He added that Washington and Moscow could work together in the region if they managed to remove certain obstacles. Russia should recognize these countries sovereignty and independence and should be interested in developing their statehoods. According to the former Deputy Secretary of State the United States was convinced that its interests were not spearheaded against any other country or interfered with the interests of others. America did not intend to develop the local countries to produce negative effects for Russia. It wanted prosperity for the Southern Caucasus because it met the interests of Russia, which obviously wanted security and stability along its southern borders.

Today NATO is penetrating the Caucasus not so much through acquiring new members there (though Georgia has already announced its desire to join the bloc) as by using other means of military presence partly through its peacekeeping contingents and OSCE forces.

While saying that the West has no intention to strengthen its military presence in the Caucasus NATO experts insist that to ensure their security and independence small states do not necessarily need strong military allies. Many of the developed states hinge their security conceptions on the idea that a number of institutions cooperating with similar agencies in other countries serve as the best guarantee of their common security. This principle has been realized in the Partnership for Peace program and in the special program of cooperation between Russia and NATO; it also applies to what OSCE is doing in the Southern Caucasus.

One can agree that the state should not rely solely on military force to ensure its security: it should strengthen interstate, regional, economic, cultural, and other institutions that help develop economic, social, and political contacts. This is common international practice yet we all know that cooperation in the military sphere remains the linchpin of contemporary conception of security. I am convinced that we should not ignore this: we are confronted not so much with NATOs penetration into the Caucasus as with a large-scale recarving of the continent and with NATOs penetration into Central Asia. The Caucasus is used as a transit corridor because it makes it possible to control Russia, Iran, China, India, etc., that is, the countries that are much stronger than the South Caucasian states now in a deep economic crisis.

So far, Russia has not adequately responded to Americas lightning advance in the region and the developments around Afghanistan and Central Asia. Today Moscow has to reassess its policy in Central Asia.10 The situation in the Southern Caucasus is of special importance for Russia: the Caspian and Black sea ports give Russia access to the Middle Eastern countries regarded as promising partners in trade, economy, science, and technology.

American activity in the Caucasus does affect Russias positions there. Under the Istanbul Agreements starting with 1 July, 2001 Russia has been removing its troops from the bases in Gudauta (Abkhazia) and Vaziani (Georgia). So far, the sides have not reached an agreement on the future of two more Russian bases in Georgia (in Batumi and Akhalkalaki). Georgia will continue insisting on evacuation of these two bases. Their future will be decided during the next round of talks.

The Russian leaders are well aware of what is going on in the Southern Caucasus. This is testified by the statement President Putin made at a meeting of the presidium of the RF State Council of 12 October, 2000. He pointed out that the countrys leaders were greatly concerned with the developments along Russias southern borders. This probably explains why the 503rd Motorized Rifle Regiment of the 58th Army is being deployed in Ingushetia.11 Earlier, no federal forces were permanently deployed there despite the areas closeness to Chechnia and a stretch of troublesome state border with Georgia. By late 2003 the tents at the village of Troitskoe will be replaced with barracks; its new location is strategically advantageous.

One can surmise that it was concern with the Caucasian developments that prompted large-scale Russian exercises in the Caspian Sea and the alert regime 2 and 3 introduced in the air defense of Russia and Armenia in May 2001. Their air defenses will be functioning according to the Soviet patterns. According to the then chief commander of the air force and air defense of Russia Anatoly Kornukov, this unification of the air defenses realized the earlier agreements about unification of the CIS air defense systems. Russia strengthened its air group in Armenia with five more MiG-29 fighters stationed on the Erebuni airfield.12

It seems that Moscow attaches special importance to its military presence in the Eastern Caucasus. Recently, the relations between Azerbaijan and Russia have been moving toward strategic partnership. During the talks that took place in Moscow the sides firmly agreed on strengthening their bilateral cooperation. According to the president of Azerbaijan, Vladimir Putins visit gave an impulse to bilateral relations. An agreement On the Status of the Gabala Radar Station, the Principles and Conditions of Its Maintenance that identified the station as Azerbaijanian property was signed within the new strategy. This means that the Russian specialists employed at the station should share information with the Azeri side. So far, the renting cost has not yet been agreed upon yet the Russian military believe that it should not be too high: not more than $2m a year. (Russia paid Cuba about $200m a year for the use of a similar station.) Russia insists that part of the sum should be offset by trade operations including possible arms deliveries.

It looks as if both the U.S. and Russia are trying to strengthen their military presence in the Caucasusthe local countries will have to tread cautiously in this difficult situation. They should profit to the maximum from the American foreign policy strategy while avoiding any damages to their strategic, in particular military-defense, partnership with Russia. The local leaders are aware of this. While Erevan was greeting Stephan R. Sestanovich, ambassador-at-large and U.S. State Secretary special advisor for the new independent states, the speaker of the Armenian parliament made in Moscow several important pro-Russian statements that approved of Russias Caucasian policy. While talking to Madeleine Albright about possible military cooperation between Washington and Erevan Armenia received four more Russian fighters. This was a politically balanced decision: there are no alternatives to the local countries involvement in the Big Game of the United States and Russia.

The Oil Factor of the Russian-American Relations

Closeness to the Caspian oil reserves and the transnational transport communications and energy systems created by the West is an important factor of American and Russian policies in the Caucasus. It should be said that in the post-Cold War period the United States is regarding the right to extracting energy resources in the Caspian as an important foreign economic and foreign policy issue but also a determining factor of its relations with Russia.

According to analysts of some of the foreign oil companies, in the 21st century the Caspian region will supply the largest amount of oil and gas to the world market. In April 1998 the London International Institute of Strategic Research announced that the hydrocarbon reserves in the area proved to be much lower than earlier stated. It informed that while the U.S. State Department had estimated the Caspian reserves as being 16 percent of the world total the area held merely 3 percent.

An analytical research supplied by the James Baker Institute for Public Policy at Rice University (Texas) also said that the area had from 15 to 31 billion barrels of oil and gas (about 2.7 percent of the world total). The most optimistic forecasts of potential oil reserves do not exceed 60 to 140 billion barrels that is much lower than those of Saudi Arabia (269 billion barrels): the Caspian cannot compete with the Persian Gulf where the oil reserves are concerned. Still, it is the oil factor that determines to a great degree the relations between America and Russia in the region. Sometimes they even reached an open confrontation.

It all started with the Gulistan contract signed by Azerbaijan and the International Oil Consortium on 20 September, 1994 (known as contract of the century). Russia responded with notes to Azerbaijan and Great Britain and limited itself to oral protest to the United States. At that time Radio Liberty informed the world that the American and Russian interests had clashed in the Caspian. Washington openly supported Bakus unilateral steps in the Caspian. In the wake of the meeting of the Caspian states in Ashghabad on 11-12 November, 1996 that discussed the status of the Caspian James Collins, special advisor to the U.S. State Secretary for new independent states, came to Baku to assure President Aliev that the United States supported the principle of sectoral division of the Caspian and that it has long-term strategic interests there.

American corporations enthusiastically plunged into the development of the majority of the local oil fields on the Caspian and adjacent areas. Americans promised to invest about $10 billion in developing Azeri oil fields. The Tengiz project in Kazakhstan carried out by Chevron and Mobil is estimated at $20 billion.

Transportation of oil is another sphere where Russian and American interests clash. This became absolutely obvious at a conference in Istanbul called by Washington in May 1998 under patronage of the then Vice President Gore and Energy Secretary Federico Peña. The participants were invited to discuss 68 infrastructure projects designed to bring oil from the Caspian and Central Asia to the world markets. The participants were also informed that the United States supported three pipelines: Baku-Tbilisi-Ceyhan (total length 1,030 miles); its 150-mile long branch laid on the Caspian seabed to move oil from Kazakhstan and Turkmenistan (both will cost about $2 billion), and a gas pipeline between Turkey and Turkmenistan partly laid on the Caspian seabed and crossing the territories of Azerbaijan and Georgia.

The American side insists that the projects will attract $20 billion-worth investments. At a press conference in Istanbul Board Chairman of the Eximbank James Harmon pointed out that his bank might open credit lines to the Caucasian and Central Asian countries that would reach the level of loans to China (about $6 billion) and that they would be granted without limitations.

From this it follows that the United States, the South Caucasian states, and Turkey used the Istanbul conference to block off the route across Russia despite the fact that it was the only functioning pipeline moving Caspian oil.

Recently, Moscow had to shift its positions on the Caspian clearly stated early in the 1990s in the context of a confrontation inside the Caspian Five: Russia-Turkmenistan-Iran, on the one side, and Azerbaijan-Kazakhstan, on the other. Today, Russia is siding with Azerbaijan and Kazakhstan. The recently acquired flexibility in foreign policy issues helped Russia and its leaders to respond on time to the threat of losing control over the export of Caspian (including Kazakhstani) oil. The Kremlin continues to regard the Caspian as a zone of its strategic interests and one of its foreign policy priorities.

This is confirmed by the following facts. In January 2002 LUKoil, the largest Russian oil company, announced its intention to join, in the nearest two or three months, the consortium building the main export pipeline Baku-Tbilisi-Ceyhan with a share of 7.5 percent. One can surmise that Russias previous alienation from the West-patronized project as unprofitable was geopolitically unjustified. The United States is demonstrating its resolution to realize the projectthis alone is enough to say that the port of Ceyhan will receive oil despite the projects huge cost and its unprofitable nature that has not yet been clearly demonstrated. The LUKoils new position demonstrates that the RF government with a 35 percent share in the company wants to remain involved in the transit of energy fuels from the Caspian.

Arc of Instability

Any discussion of the rather complicated relations between Russia and the United States in the Southern Caucasus should look at one more problem. Here I have in mind the arc of instability outlined with Brzezinski and his followers that have still preserved its topicality. It stretches from the Middle East and Asia Minor to the Balkans with hot spots along nearly its entire stretch. For over ten years now the Caucasus has been remaining in its center with ethnic, religious, and territorial conflicts flaring up and subsiding on its territory. They are not easy to quench.

Some time ago the Karabakh conflict, the first and the hardest to resolve in the former Soviet Union, became 10 years old. It added new deepness to mutual mistrust born by the previous history of clashes between Armenians and Azerbaijanians. The spirit of confrontation is still lingering there. The only breakthrough, a cease-fire agreement signed on 12 May, 1994 mediated by Russia is still acting despite its certain faults.

There is no solution of the Georgian-Abkhazian conflict in sight. Russia will hardly remain outside it. Georgian President Shevardnadze believes that the Abkhazian problem will never be removed from the agenda of the Georgian-Russian relations. There are 3,000 Russian military deployed in the conflict zone as part of the collective peacekeeping forces in the region. Recently, due to the events along the Chechen stretch of the Russian-Georgian border and in the Pankisi Gorge conflict became even more complicated.

The Chechen crisis confronted Moscow with problems that are even harder to resolve. In summer 1999, Daghestan moved close to a civil war while the terrorist acts of 2001 and 2002 demonstrated that Russia is facing a complex and alarming phenomenon of international terrorism. It takes no wisdom to see that Russia and the United States are guided, very much as usual, by different standards when dealing with the conflicts. They are driven by national interests rather than by moral and ethical considerations. This is confirmed by the fact that a group of fighters destroyed in the Argun Gorge was armed with brand-new American M-16 rifles. Despite their frantic efforts the federal forces cannot seal off the border: the fighters continue buying arms abroad and bring them in to Chechnia. Federal forces spokesmen say that it was for the first time that American rifles were confiscated. Earlier, fighters were carrying small arms made in Russia and Borz submachine-guns made by the Krasniy molot plant in Grozny in 1994-1999.13

The events of 11 September in New York and the hostage taking in a Moscow theater forced the United States to revise its approaches to the problem of international terrorism. In his interview to Izvestia President Bush said: We are confronted with a common threat that we should repulse together. Al-Qaeda fighters are in Russia and they should be fought against. He also pointed out that everything is done to contribute to a dialog between Shevardnadze and Putin and to formulate a joint strategy against those of the al-Qaeda fighters who might be stationed in the Pankisi Gorge.14

There is hope that the approaches to the problem of Chechnia will be adjusted and that the United States will stop accusing Russia of human rights violations and disproportionate use of force against fighter objects in Chechnia.

Conclusions

We all witnessed serious changes in Russias foreign policy strategy that came together with a revision of its role and place in the world today. This is true, first and foremost, of its relations with the United States and a considerable decline of its influence in the Southern Caucasus. Recently Moscow has changed its priorities in this region and its policy has become more active.

The events in the region demonstrate that the South Caucasian countries share their preferences between Russia and the United States. Moscow and Washington declared political stability, uprooting international terrorism and drug trafficking, independence, territorial integrity and friendly relations with the South Caucasian countries to be the aims of their policies that meet their national interests and the interests of the local states.

The recently opened prospects of Russias involvement in the Caspian projects require its adequate political foundation. It has become obvious that despite the South Caucasian leaders superficially friendly rhetoric in their talks with Russian politicians Moscow was given a far from leading role in the region. It has to take into account Americas influence there.

Russia that will have to look for a formula of cooperation with diverse South Caucasian political forces still has a number of advantages in the sphere of history, culture, technology, economy, and human contacts earned during Soviet times. The present-day context has forced Moscow to look for new approaches to the main strategic tasks (stability and regional cooperation) meeting the local states basic interests and to realize, within this newly found policies, adequate practical measures. The social sphere is another challenge that will require considerable financial efforts and will be repaid with considerable political dividends. The United States will also have to bear this in mind.

Washington, it its turn, while keeping away from a possible rivalry with Russia and not seeking political and military domination in the region should create flexible cooperation with the local countries. In other words, it should find a niche in the complex context that would meet its own political and economic interests.

For a while Russia will retain its leading role in developing new military forces in Armenia, Azerbaijan, and Georgia. The United States has demonstrated that it, too, wanted a greater involvement yet the South Caucasian countries will find it more profitable to cooperate with Moscow and to tap on its considerable military-technical experience. The U.S. contribution can prove more efficient in building and restoring strategic communications, airfields, military bases, training centers, etc. This will require not only coordination but also close cooperation of the two powers.

The nature and scope of Russian and American involvement in the regional raw materials and transit projects will depend not only on the sides intentions and potentials but also on the requirements of the local countries themselves and on the political situation in the region.

With these circumstances in view Moscow and Washington can not only strengthen their positions in the Southern Caucasus but also make weighty contribution to the common efforts designed to bring political and economic stability to the region, to quench the smoldering conflicts, and to fight international terrorism. This will meet the interests of all sides involved: Russia, the United States, and the Caucasian peoples.


1 See: A. Gadzhizadeh, Iuzhniy Kavkazzona interesov SShA, Nezavisimaia gazeta, 26 June, 2001.
2 See: Media-Press Information Agency (Azerbaijan), 25 June, 2002.
3 See: website Gazeta SNG, 30 January, 2002.
4 RIA Oreanda, 6 November, 2001.
5 See: website ArCNews (Nagorny Karabakh), 10 October, 2002.
6 See: Kommersant, 25 January, 2002.
7 See: Izvestia, 6 November, 2002.
8 See: Donald Rumsfeld: prisutstvie SShA v Gruzii ne predstavliaet problemy dlia Rossii, 22 June, 2002 [website Strana.ru].
9 Ibidem.
10 M. Laumulin, Central Asia After 11 September, Central Asia and the Caucasus, No. 4 (16), 2002, p. 32.
11 See: Nezavisimaia gazeta, 21 August, 2002.
12 See: Nezavisimaia gazeta, 27 October, 1999.
13 Kavkazskiy uzel, Novosti, 23 November, 2001.
14 Izvestia, 20 November, 2002.

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