(Bloomberg) - Peeling away former Soviet republics from their U.S. and European allies is getting easier for Russia after its show of force in Ukraine.
Azerbaijan is changing tack after months of steering clear of the showdown 1,500 kilometers (900 miles) away. First Deputy Premier Yaqub Eyyubov broke the silence in September, calling Russia his country’s “closest, most fraternal” ally. As a sign of the warming ties, Russian warships last month docked at in the capital, Baku, for the first time in more than a year.
The nation, which provides the only westward route for central Asian oil bypassing Russia, has grown alarmed that Ukraine was left to fend for itself as President Vladimir Putin had his way in Europe’s biggest crisis since the Iron Curtain fell 25 years ago. That was a “very bad” signal, according to Elnur Soltanov, head of the Caspian Center for Energy and Environment, a research group focused on foreign policy in Baku.
“It told everybody who is the real boss in the region, who is the real hegemon,” he said. “Ukraine is the biggest jewel among the post-Soviet states and if Russia comes in broad daylight and occupies Ukraine and the Western world shows this limited reaction -- it tells us that if something goes wrong with Russia, we shouldn’t trust anybody to come and save us.”
Oil Effect
As Azerbaijan redraws its foreign policy, its $74 billion economy is being buffeted by falling crude output and an oil-market selloff. Gross domestic product expanded 2.8 percent in the January-October period, slowing from 5.7 percent a year earlier. Hydrocarbons, which account for 45 percent of GDP, make up more than 90 percent of total Azeri exports, up from 60 percent in the late 1990s, according to the International Monetary Fund.
The Caspian Sea country is backtracking on its two-decade drive to forge closer ties with the U.S. and Europe as tensions escalate with Russian ally Armenia over the breakaway region of Nagorno-Karabakh. The government has also come under greater scrutiny for its commitment to media freedoms and human rights.
Azerbaijan last week shot down what it said was an Armenian helicopter that violated its airspace, an attack that threatens to escalate the conflict. More than 20 troops were killed in August as the skirmishes turned the deadliest in 20 years.
With Russian troops already stationed in neighboring Georgia and Armenia, leaders in the nation of 9.6 million people are concerned about leaving the country’s other flanks exposed after seeing the failed efforts to counter Putin’s actions in Ukraine.
‘Closer Relationship’
President Ilham Aliyev has visited Putin twice in the past three months and has recently hosted a range of senior officials from Moscow.
“We definitely see a closer relationship between Baku and Moscow in the past year,” said Thomas de Waal, senior associate at the Russia and Eurasia program of Carnegie Endowment for International Peace. “The Azerbaijani elite is seeking an equal relationship with both Russia and the West, while retaining its own economic and political independence.”
Azerbaijan’s shift toward Russia is also straining relations with the U.S. and Europe.
U.S. President Barack Obama in September singled out Azerbaijan as a country where “laws make it incredibly difficult for NGOs even to operate.” The Organization for Security and Cooperation in Europe this month urged the government to end its “ongoing and increasing number of repressive actions against independent media and advocates of freedom of expression,” according to a statement.
BP, Exxon
After winning independence 23 years ago, Azerbaijan has developed energy and security ties with the U.S. and the European Union. In partnership with oil companies including BP Plc (BP/), Statoil ASA (STL) and Exxon Mobil Corp. (XOM), the Caspian Sea nation built the Baku-Tbilisi-Ceyhan pipeline, which ships Asian oil to Europe bypassing Russia.
The country also sent troops to fight alongside U.S. forces in Kosovo, Iraq and Afghanistan. NATO relies on Azerbaijan for a third of non-lethal shipments to Afghanistan.
It also joined GUAM, a U.S.-backed alliance with Georgia, Ukraine and Moldova. All bar Azerbaijan tied their future to the European Union in June by signing free-trade agreements with the 28-nation bloc. Azerbaijan rejected such an offer.
Like the three other members of the group, Azerbaijan has struggled to regain control over a breakaway region. The message is that confrontation with Russia by Georgia and Moldova worsened separatist challenges, as it did in Ukraine said Rasim Musabayov, a member of the international relations committee in Azerbaijan’s parliament.
Azerbaijan is locked in a territorial dispute with Armenia over Nagorno-Karabakh, a conflict that erupted after the Soviet breakup in 1991.
Although major hostilities ended with a Russia-brokered cease-fire in 1994, no peace agreement has been signed. Armenia hosts the only Russian military base in the region and gets Russian weapons at discounted prices.
“Azerbaijan has drawn lessons from what has happened to Georgia, Moldova and Ukraine,” Musabayov said. “Azerbaijan realizes that it can’t get Nagorno-Karabakh resolved without Russia’s involvement.”
