Blue Black Sea : New Dimensions of History, Security, Strategy, Energy and Economy [1 ed.] 9781443864756, 9781443842440

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Blue Black Sea

Blue Black Sea: New Dimensions of History, Security, Politics Strategy, Energy and Economy

Edited by

Giray Saynur Bozkurt

Blue Black Sea: New Dimensions of History, Security, Politics, Strategy, Energy and Economy, Edited by Giray Saynur Bozkurt This book first published 2013 Cambridge Scholars Publishing 12 Back Chapman Street, Newcastle upon Tyne, NE6 2XX, UK British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Copyright © 2013 by Giray Saynur Bozkurt and contributors All rights for this book reserved. No part of this book may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the copyright owner. ISBN (10): 1-4438-4244-3, ISBN (13): 978-1-4438-4244-0

TABLE OF CONTENTS

List of Tables............................................................................................... x List of Figures............................................................................................. xi Preface ....................................................................................................... xii Introduction ................................................................................................. 1 Part I: History Chapter One............................................................................................... 10 A Glance at the History of the Black Sea Region Mehmet Bilgin Chapter Two .............................................................................................. 21 The Black Sea and the Balkans under Ottoman Rule Nihat Celik Chapter Three ............................................................................................ 45 The Preconditions of Ethnic-Political Conflicts in Georgia (A Georgian Perspective) Zurab Davitashvili Part II: Security Chapter Four.............................................................................................. 56 The Security Policy of the Caucasus Nations in the New Security Environment Elhan Mehtiyev Chapter Five .............................................................................................. 70 The Georgia-Russia Conflict as an Example of Interdependence in World Politics Natalija Nechayeva Yuriychuk

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Chapter Six ................................................................................................ 78 The Roles of the Ukraine and the EU in Settling the Russian-Georgian Conflict in the Caucasus Grigoriy Perepelytsia Chapter Seven............................................................................................ 97 The Security Policies of Turkey and Russia towards Abkhazia and the Internal Georgian Conflict Giray Saynur Bozkurt Chapter Eight........................................................................................... 107 Background to the Hostilities between Armenia and Azerbaijan: From the Prague Process to the Madrid Principles Elhan Mehtiyev Chapter Nine............................................................................................ 120 Black Sea Regional Security after 9/11 Yevgeniya Gaber Chapter Ten ............................................................................................. 130 Turkey’s Security Strategies in the Extended Black Sea Region after September 11, 2001 Mujib Alam Chapter Eleven ........................................................................................ 143 The US Military Bases in Romania and Bulgaria and their Possible Implications for Regional Security Saffet Akkaya Chapter Twelve ....................................................................................... 153 Security in the Black Sea Region from a Neorealist Perspective Aslihan Anlar Part III: International Relations and Strategy Chapter Thirteen...................................................................................... 170 The Black Sea Region: Challenges and Opportunities Mohammad Hassan Khani

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Chapter Fourteen ..................................................................................... 180 Regional Cooperation Efforts in the Black Sea Region: Black Sea Synergy Cigdem Ustun Chapter Fifteen ........................................................................................ 197 US Interests in the Wider Black Sea Region Sergei Konoplyov Chapter Sixteen ....................................................................................... 207 US Policies towards the Black Sea Region Idris Bal Chapter Seventeen ................................................................................... 219 The EU’s Black Sea Policy Ertan Efegil and Neziha Musaoglu Chapter Eighteen ..................................................................................... 234 Relations between Russia and Turkey under the New Conditions in the Black Sea and Caucasus Region Alexander Sotnichenko Chapter Nineteen ..................................................................................... 241 Black Sea Regional Policies of Russia and the United States after September 11 Giray Saynur Bozkurt Chapter Twenty ....................................................................................... 266 International Organizational Initiatives in the Black Sea Region Alaeddin Yalcinkaya Chapter Twenty-One ............................................................................... 285 The Role of Mediators in Settling Conflicts in the Black Sea Region Hannah Shelest Part IV: Energy Chapter Twenty-Two............................................................................... 300 The Geopolitics of Energy in the Black Sea Context Nicolae Iordan-Constantinescu

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Chapter Twenty-Three............................................................................. 311 Energy Politics in the Black Sea Region: The Superpowers’ Race for Fuel Jatinder Khanna Chapter Twenty-Four .............................................................................. 320 Energy as a Foreign Policy Tool in the Wider Black Sea Region Sercan Salgin Chapter Twenty-Five............................................................................... 372 The Role of Azerbaijan in EU Energy Security Agshin Umudov Chapter Twenty-Six................................................................................. 401 The Nexus between the Energy Pipeline Contest and Security in the Black Sea Region: Russia Versus the Rest Guner Ozkan Chapter Twenty-Seven ............................................................................ 427 Policies around the BTC Pipeline Halil Erdemir Chapter Twenty-Eight ............................................................................. 450 Gazprom: A Leading Actor in the Post-Soviet Gas Policy-Making Process in the Black Sea Region Evrim Eken Chapter Twenty-Nine .............................................................................. 484 Domestic Supply of Natural Gas and Oil in Relation to Total Energy Demand in Turkey: How Can its Energy Needs be Secured? Idris Demir Part IV: Economy Chapter Thirty ......................................................................................... 496 Enhancing Security and Stability in the Black Sea Region through Economic Cooperation Aliosha Nedelchev

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Chapter Thirty-One ................................................................................. 503 Analyses of the Banking Sector in Black Sea Region Countries and Turkey Birgul Sakar Chapter Thirty-Two................................................................................. 519 A Handicap to Regional Economic Cooperation: Poverty (The Example of Turkey) O÷uz KaymakçÕ, Ömer Canbeyo÷lu and Deniz Emre Türkgenç Contributors............................................................................................. 526

LIST OF TABLES

Table 12-1 Comparison between domestic political structure and international political structure Table 12-2 Situation of Ukraine and Georgia Table 12-3 Georgia’s trade with main partners (2008) Table 12-4 Ukraine’s trade with main partners (2009) Table 12-5 Turkey’s trade with main partners (2009) Table 12-6 Russia’s trade with main partners (2009) Table 22-1 EU-30 Energy dependency by 2030 Table 22-2 Global oil import dependency (as % of global demand) Table 22-3 Proven reserves of oil at end 2007 (thousand million barrels) Table 22-4 Proven reserves of gas at the end of 2007 (trillion cubic meters) Table 22-5 Current participants of the ITER project Table 25-1 EU energy suppliers Table 25-1a EU imports of crude oil, by country of origin (megatonnes) Table 25-1b EU imports of natural gas, by country of origin (Petajoule = 1015 Joule) Table 25-2 Azerbaijan: Energy and the economy Table 25-3 Projected petroleum supply growth 2008–2009 Table 25-4 BTC/AIOC Project Shareholders Table 28-1 Gazprom’s major joint ventures and overseas subsidiaries (selected) Table 28-2 Amounts of proved reserves, current production and consumption of gas in Central Asia: Table 31-1 Growth in Turkey, Development of Unemployment, and Labour Efficiency Table 31-2 Total Assets in Turkey and Black Sea Countries (billion EUR) Table 31-3 Growth of Total Assets in Turkey and Black Sea Countries by Percentage (%) Table 31-4 Number of Banks in Turkey and Black Sea Countries Table 31-5 Growth in the Number of Banks in Turkey and the Black Sea Countries by Percentage (%) Table 31-6 Loans in Turkey and Black Sea Countries (billion EUR) Table 31-7 Loan Growth of Turkey and Black Sea Countries by Percentage (%) Table 31-8 Total Deposits in Turkey and Black Sea Countries (billion EUR) Table 31-9 Growth of Total Deposits in Turkey and Black Sea Countries by Percentage (%) Table 31-10 Total Loans/Total Assets in Turkey and Black Sea Countries Table 31-11 Total Loans/Total Deposits in Turkey and the Black Sea Countries Table 31-12 Total Deposits/Total Assets in Turkey and Black Sea Countries

LIST OF FIGURES

Fig. 7-1 Map of Georgia Fig. 22-1 Supremacy of fossil fuels Fig. 22-2 Gross inland consumption of the EU-29 (2005) Fig. 23-1 The Black Sea Region Fig. 23-2 BTC Pipeline Fig. 25-1 Central Asia natural gas balances, in billion cubic feet (2006) Fig. 25-2 Map of the South Stream and Nabucco natural gas transportation pipelines Fig. 27-1 Bosporus Bypass Options

PREFACE

This volume is a collection of papers that were originally presented during international congresses entitled “Blue Black Sea: New Dimensions of Security, Politics, Strategy, Energy, History and Economy” held at the International Relations Department of Sakarya University on 14–17 October 2008 and 10–13 October 2010. The papers were later revised and updated by the authors in 2012 to be included here. The book presents the opinions of experts and researchers from the Black Sea states with respect to the political, economic, social, and cultural relations in the region, and explains various dimensions of the present relations and problem areas from both theoretical and conceptual perspectives. While some articles in the book study existing and newly emerging institutions, others examine areas of disagreement and suggest peaceful resolutions for conflicts. Offering the reader a comprehensive approach that covers a wide range of affairs, we hope that this book will fill an important gap in international relations studies. While the added word “Blue” in the title indicates our shared aspirations for a clean and peaceful future, overall this book is intended to provide valuable academic assessments and share them with the wider world community, thus disseminating findings about the regional and global policies being pursued in the Black Sea region today. Given that all regional issues impact globally, it is surely true that any steps towards peace achieved at the regional level are also highly significant for the world overall. To be able to attain a peaceful world order, we need to address each other’s requirements and dissatisfactions with an attitude of understanding. To pursue further research projects that examine related problems in an unbiased way, and to find sound and acceptable solutions for ongoing issues, is absolutely necessary. In this sense, I hope that this book will also serve the cause of world peace. —Associate Professor Dr. Giray Saynur BOZKURT

INTRODUCTION

We are living through an extraordinary period and the Black Sea region has not been exempted from this. Since the collapse of the Soviet Union and the dissolution of the Warsaw Pact, two decades ago, the Black Sea region has gradually passed out of the sphere of influence of the Russian state. With the end of the Cold War, the USSR collapsed and left the United States as the only superpower. Though the Russian Federation, successor to the USSR, is still a great regional power that is trying to regain its former global status, it so far has insufficient weight to counterbalance US power. Meanwhile, this geopolitical power gap creates new opportunities for other regional and global actors. The fifteen former Soviet republics have been faced with radical movements linked to ethnic and religious fanaticism. While the whole world has been affected by these events, they have struck most firmly at Central Asia, the Caucasus, and the Black Sea regions. Today we can observe that further changes are brewing, and that important developments are taking place in the Black Sea region. The coastal states of Bulgaria, Romania, Ukraine, and Georgia, and the wider Black Sea regional states of Moldavia, Macedonia, Albania, BosniaHerzegovina, Croatia, Azerbaijan, and Armenia, are increasingly siding with the Western world and turning away from the Russian Federation. The importance of this development becomes more obvious when we remember that until recently these states were either members of the former Warsaw Pact or acting under the influence of the Soviet Union. The term “Greater Black Sea Region” encompasses the countries situated in the corridor that links Asia to Europe as well as those situated in the transportation zone of the Caspian energy sources to the west (Albania, Serbia, Armenia, and Azerbaijan), in addition to the standard coastal countries of the Black Sea. Both the energy resources in the region and the energy transport lines used for these energy resources to the West have increased the importance of the Black Sea. In addition, the so-called Colour Revolutions have started a new power struggle around the Baltic, Black, and Caspian Seas. The United States and Russia, as well as other global and regional powers and coastal states and institutions, are competing for influence over the strategically prominent Black Sea region.

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Introduction

The strategic rapprochement with the Western world is likely to produce a new Black Sea, one which will be part of the Euro–Atlantic zone, the European Union, and NATO. Such a geopolitical shift in search of identity will have significant repercussions for the future of the states involved, and also means that the Black Sea region will come into closer contact with two major powers in world politics in addition to Russia— namely the United States and the European Union. The full implications of this rapprochement are not yet in sight. On the other hand, the security of the Black Sea is not just a matter for the region; it has global impacts, and directly affects the political and economic security of the global powers—particularly the United States, which encourages and supports new democracies in the region. Their success, stability, and prosperity are all essential to the security and peace of the whole region, and thus also of the world. The papers in this book are organized under five sections: History, Security, International Relations, Strategy, Energy, and Economy. The History section comprises three papers, “A Glance at the History of the Black Sea Region” by Mehmet Bilgin, “The Black Sea and the Balkans under Ottoman Rule” by Nihat Çelik, and “The Preconditions of Ethnic–Political Conflicts in Georgia” by Zurab Davitashvili. Bilgin summarizes the history of the Black Sea region from 8 BC up to the present, while Çelik focuses on the Ottoman period, from the fourteenth to the twentieth centuries, and examines the importance of the Balkans and the Black Sea for the Ottoman Empire. Çelik then probes the Ottoman– Russian rivalry in the region, and comments on the formation of national states (Romania and Bulgaria) on the western coast of the Black Sea. Meanwhile, Zurab Davitashvili reflects on the Georgian perspective, evaluating the deep historical backgrounds of the Abkhazian and South Ossetian problems. The Security section comprises nine papers. Elhan Mehtiyev makes two valuable contributions: “The Security Policy of the Caucasus Nations in the New Security Environment” and “Background to the Hostilities between Armenia and Azerbaijan: From the Prague Process to the Madrid Principles.” In his first contribution it is emphasized that the Black Sea area is becoming an indispensable part of the newly emerged European security architecture and has to face the global changes connected to the process of integration into Euro–Atlantic security and economic structures. As part of the wider Black Sea region, the Caucasus has direct access to Central Asia and Middle East. Now bordering NATO and the European Union, it has attracted attention to fact that the security policy of the Caucasus nations has now to be established. In his second contribution,

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concerning the Azerbaijani–Armenian conflict, he addresses one of the major security issues in the Caucasus and concludes that military action has not offered any solution. In “The Georgia–Russia Conflict as an Example of Interdependence in World Politics,” Natalija Nechayeva Yuriychuk examines the evolution of Georgian–Russian relations based on the ever-changing interests of both sides. In “The Roles of the Ukraine and the EU in settling the Russian– Georgian Conflict in the Caucasus,” Grigoriy Perepelytsia gives details of the initial events in that conflict and describes the valuable contributions provided by Ukraine and EU in pursuit of resolution. Giray Saynur Bozkurt’s article “The Security Policies of Turkey and Russia towards Abkhazia and the Internal Georgian Conflict” points out that the unresolved conflicts of the South Caucasus form a serious obstacle in the establishment of a regional security system. In her work, the development of the problems of Abkhazia and South Ossetia are analyzed in light of their historical background, stressing the lack of progress towards the resolution of the conflicts. In this context, the relations of the two regional powers (Turkey and Russia) with Georgia and their policies towards ethnic conflicts in the region are evaluated. Black Sea regional security after 9/11 is addressed by Yevgeniya Gaber, who stresses the increasing importance of the Black Sea region after the notorious events of 9/11 and analyzes the regional security strategies of the United States, the main “outside actor,” and Turkey, which has recently positioned itself as a regional power. She tries to show how cooperation between these two forces can contribute to the creation of a more stable and secure Black Sea. In his paper entitled “Turkey’s Security Strategies in the Extended Black Sea Region after September 11, 2001,” Mujib Alam examines the challenges which Turkey faces, such as terrorism, human and narcotrafficking, and illegal trade, most of which emanate from the Middle East. He also explores the nature of these security threats and their effects on Turkey’s Black Sea security policy. The article “The US Military Bases in Romania and Bulgaria and their Possible Implications for Regional Security” has been composed by Saffet Akkaya for this volume. Focusing on the US military bases in Romania and Bulgaria, he adumbrates the US approach to the Black Sea region from a broader security perspective and in consideration of a possible vital role for the United States and accordingly NATO in the region. “Security in the Black Sea Region from a Neorealist Perspective,” by AslÕhan Anlar, uses neorealist theory to examine how the state of security

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Introduction

has changed in the Black Sea region, attempting to explore changes in the characteristics of the structure of the Black Sea region and focusing mainly on the ordering principle, which is one of the three defining principles of neorealist theory. The paper attempts to define an ordering principle for the region and to assess its effect on security. In the International Relations & Strategy section, nine articles are presented. In his “The Black Sea Region: Challenges and Opportunities,” Mohammad Hassan Khani indicates the value of regional cooperation in the international system, regarding this as a good way to achieve peace, security, and economic prosperity across the globe, and attempting to see if this approach is also working for the Black Sea region. In the article “Regional Cooperation Efforts in the Black Sea Region: Black Sea Synergy,” written by Çi÷dem Üstün, it is explained that conditions in this long-neglected region have dramatically changed since the end of the Cold War. The increasing energy demands of Europe have amplified the importance of the region, and the EU, United States, and the regional actors have developed several new policies towards the area. The Black Sea Economic Cooperation (BSEC), which can be seen as the most successful regional cooperation initiative, and the perspectives of the BSEC member states, form the centre of attention of this work. The paper also attempts to answer the question “What kind of a process is needed for better regional cooperation in this specific area?” In his “U.S. Interests in Wider Black Sea Region,” Sergei Konopylov asserts that the Black Sea Region has begun to play an important part in world politics in the last two decades. He also analyzes US interests and foreign policy in this part of the world during the last three US presidential terms. The survey “US Policies towards the Black Sea Region,” which was undertaken by ødris Bal, assesses the importance of the Black Sea region, the position of United States in the post–Cold War era, and the potential benefits that can be gained from this region. He also analyzes the US goals and new policies towards this region. “The EU’s Black Sea Policy” is examined in the article contributed by Ertan Efegil and Neziha Musao÷lu. Here it is indicated that, primarily for security reasons, the EU has developed new policies in order to create a more peaceful international environment based on mutual cooperation, sympathy, peace, and stability. In this respect, the EU could not fail to deal with the Black Sea region, with its oil and gas, frozen conflicts, and economic and commercial potentials. Thus the EU has adopted a new approach called Black Sea Synergy, which frames the EU’s approach to the Black Sea region.

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In an interesting article entitled “Relations between Russia and Turkey under the New Conditions in the Black Sea and Caucasus Region,” Alexander Sotnichenko draws attention to the years of hostility and mutual distrust between Russia and Turkey. He then emphasizes their growing common interests in a multi-polar world, alongside Eurasian co-operation and international problems like international terrorism. By means of cooperation and political partnership, good opportunities may emerge for both Turkey and Russia, and an analysis is given of the possible ways this might unfold in several different regions of Eurasia, with particular attention to the Black Sea regional partnership. In “Black Sea Regional Policies of Russia and USA after September 11,” written by Giray Saynur Bozkurt, the growing significance of the Black Sea region is underlined, alongside an understanding of the altered aspects of security. She also evaluates the threat perceptions and new dimensions in the Black Sea policies of the United States and Russia following the attacks of September 11. In “International Organizational InÕtiatives in the Black Sea Region,” Alaeddin YalçÕnkaya claims that some international organizations which are supposed to function to create peaceful and steady international conditions, are actually manipulating the international system according to the interests of “Great Powers.” The discrepancy between the intended and declared goals of the organizations creates mistrust amongst their members, and their continuity and legitimacy becomes debatable. On the other hand, if developed cautiously, manipulation according to self-interest could be reduced and these kind of organizations could really be put to good use. From these perspectives, the Black Sea regional international organizations—especially Black Sea Economic Cooperation (BSEC) and the sub-organization Black Sea–Caspian Energy Community (BSCEC)— are evaluated. Meanwhile, studying “The Role of the Mediators in Settling Conflicts in the Black Sea Region,” Hanna Shelest shows the potential of the Black Sea region to become an area of prosperity and stability. The lack of implementation of many economic, transport, political, and energy projects, however, mostly due to existing conflicts and security problems, poses great challenges. Although this potential draws the attention of many international actors, the policies of these mediators are very diverse, being shaped by their self-interest. Eight articles comprise the Energy subdivision of this book. In the first, “The Geopolitics of Energy in the Black Sea Context,” Nicolae Iordan-Constantinescu explains how energy, politics, and power are linked to each other as a force in international security. This is because there is a

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Introduction

constant increase in the energy demand of the world and neither science, technology, nor industry are able to generate enough alternatives—as a result of which the limited fossil fuels still remain the major resource. In this sense, despite the fact that the oil and gas reserves of the Caucasus and Caspian region are much smaller than the resources in the Middle East, they hold geopolitical importance. Thus the energy policies developed by the consumer states in the West envision a diversification of the import of resources so that their energy dependence on Russia and Middle East can be controlled. In the article “Energy Politics in the Black Sea Region: The Superpowers’ Race for Fuel,” Jatinder Khanna describes the geopolitical significance of the Black Sea region and then examines the interests of the United States, Russia, and China, this region having become a playground for these major powers. Sercan Sal÷Õn, in his study “Energy as a Foreign Policy in the Wider Black Sea Region,” seeks to identify to what extent the Caspian and Black Sea states have effectively used energy as a foreign policy tool to promote their interests in regional and global affairs. The author examines three important actors in the region, Azerbaijan, Kazakhstan, and Turkmenistan, for which energy policies form part of their foreign policy agenda. The constraints faced by these states while playing their energy cards are also mentioned. The article “The Role of Azerbaijan in EU Energy Security,” prepared by Agshin Umudov, presents information on the energy policy of the European Union and sets out the importance of Caspian basin energy resources within this policy. The utmost importance of Azerbaijan is stressed, both as a supplier of its own energy resources and as a crucial energy transmission corridor between Central Asia and Europe. As well as this, the prospects for further cooperation between EU and regional states is discussed. The essay by Güner Özkan entitled “The Nexus between the Energy Pipeline Contest and Security in the Black Sea Region: Russia versus the Rest” illustrates that if the regional states of the wider Black Sea region can exercise strong control over energy resources and pipelines, they will reap economic, strategic, geopolitical, and security benefits and become much more powerful. In this respect an examination is provided of the fierce competition between Russia, one of the major energy exporters, on one side, and the rest of the energy-dependent states in Europe and the transporting countries in the Black Sea region, on the other. “Policies around the BTC Pipeline” written by Halil Erdemir, delves into how the growing significance of energy security has contributed to the

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formation of strategic alliances and policies of states involved, in and around the Baku–Tbilisi–Ceyhan pipeline. In this work, in order to reflect adequately the complexity of the BTC policies in the post–Cold War environment, the concept of security is assessed beyond the understanding of military security alone. In her essay entitled “Gazprom: A Leading Actor in the Post-Soviet Gas Policy-Making Process in the Black Sea Region,” Evrim Eken exposes the factors and forces that drive Gazprom, currently the biggest natural gas company in the world, to be an influential actor in the region and globally. She then analyzes Gazprom’s influence over the natural gas policy pursued by Russia in the Black Sea region. The final article in this section, prepared by ødris Demir, is “Domestic Supply of Natural Gas and Oil in Relation to Total Energy Demand in Turkey: How Can Its Energy Needs be Secured?” Here it is demonstrated that Turkey as a growing country is in need of more energy as there is a gap between its insufficient domestic energy resources and its energy consumption. Being in need of external energy resources, Turkey has to adopt wise energy policies so that sustainable economic growth can be maintained. The constraints of Turkey and the steps to be taken in this respect are discussed in the article. The Economy subdivision of the book consists of three articles. “Enhancing Security and Stability in the Black Sea Region through Economic Cooperation,” by Aliosha Nedelchev, talks about the bridges that facilitate trade and cooperation, signifying the consequence of BSEC, founded primarily as a regional economic organization, which now also serves to strengthen security and stability in the region by its unique method of “security through economic cooperation.” In “Analyses of the Banking Sector in Black Sea Region Countries and Turkey,” Birgül ùakar examines the economic situation and financial system in Turkey in the last decade. She compares the Turkish banking sector with those of Bulgaria, Rumania, Russia, and the EU, in terms of efficiency and financial effectiveness. “A Handicap to Regional Economic Cooperation: Poverty (The Example of Turkey)” is a co-production by O÷uz KaymakçÕ, Ömer Canbeyo÷lu, and Deniz Emre Türkgenç. Here it is alleged that Turkey, despite being an advanced country in terms of corporate identity and economy, still suffers from low income levels and absolute poverty. Thus, the example of Turkey is studied in order to show how poverty prevents the development of the country and leads to social problems by engendering a vicious circle which negatively affects regional collaborations. Finally, it is suggested

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Introduction

that most of the Black Sea countries are faced with similar economic problems.

PART I: HISTORY

CHAPTER ONE A GLANCE AT THE HISTORY OF THE BLACK SEA REGION MEHMET BILGIN

Introduction The Black Sea region is the heartland of Eurasia, not only in terms of contemporary politics,1 but also in terms of historical phenomena. Geographically, the northern coasts of the Black Sea are lined by vast steppes and plains, while its southern coasts are carved out of the Anatolian plateau; to the east, it is enveloped by the mountains of Caucasia and, to the west, it is enclosed by the mountainous Balkan Peninsula. The Bosporus and Dardanelles straits, which connect the Black Sea to the oceans via the Mediterranean Sea, are the most important crossing points. Although many river and canal transport systems have been operative in the region for the last two centuries, the Bosporus is still the most important passage for people who want to enter or leave the Black Sea. The Black Sea has been a very significant linkage point between the East and the West since ancient times.2 Ancient Greeks3 from the Aegean Sea first reached Propontis (Marmara Sea), and then travelled on to the Black Sea. They established commercial colonies along the Black Sea coast. In the centuries that followed, these commercial colonies were considered gateways to Asia.4 The Greeks were neither the first nor the last colonists in the region.5 The Black Sea’s gateways to Asia had been used by many other powers in history, including the Argonauts, the Roman Empire, states established in Anatolia, the Byzantine Empire, the Seljukids, and the Ottoman Empire, as well as some states that did not have any port on the Black Sea, such as Genoa and Venice.

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Historical Background In ancient times, when Greek colonists attempted to penetrate the Black Sea coasts, the north of this region was occupied by the Scythians,6 who were related to the Germanic tribes that had migrated westwards from Middle Asia. From the eighth century BC, the Scythians lived on the steppes of the northern Black Sea region, where the Cimmerians also resided. The relationship of the Greek colonists with the Scythians was friendlier than their relationship with the Cimmerians.7 The Scythians banished the Cimmerians from the region and chased them relentlessly as far as the hinterland of Anatolia and the Middle East.8 With its culture and art, Scythia was a positive influence both on the colonies and on neighboring communities in the region.9 In the ancient era, the rise of the Persian Empire in the east was a challenge to Greek power. While the southern coast of the Black Sea was controlled by the Persian Empire, its northern and western coasts were dominated by the Scythians. It would seem that from this time, the Balkans and the Caucasus became the stage for power struggles between Persia, expanding in the east, and Greece, the rising power to the west. Later in history, the Scythians descended from the hills of the Caucasus, across the plateaux of north-east Anatolia in two branches: one steered towards the hinterland of Anatolia; the other headed towards the Middle East. Later, Scythians came to Anatolia from the Balkans through Thrace, and then turned towards the western cities of Anatolia. When Darius, the legendary emperor of Persia, decided to attack the Scythians in 514 BC, his army advanced towards the north of the Balkans by crossing a bridge they built over the Bosporus straits.10 Rather than face the gigantic army of Persia, however, mounted troops of Scythians withdrew to the interior of the northern steppes. Darius lost track of the Scythians and had to withdraw. It is evident that events in the history of this part of the world are a repetitive (and cruel) power game played by western and eastern powers. There were also successive power struggles between the peoples that settled along the northern coasts of the Black Sea from Central Asia,11 including Sarmatians,12 Huns,13 Avars, Bulgarians,14 Caspians,15 Pecheneks,16 Kumanos,17 and other tribes.18 Tribes that spread to the southern coasts came mainly through the Caucasus in the east or the Balkans in the west.19 The powers that rose up on the northern and southern coasts of the Black Sea influenced one other, either through invasion or through commercial relations during peaceful periods. These reciprocal relations had multiple dimensions, including culture and trade, and this interaction

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Chapter One

has left a legacy in the region. Arrows, bows, clothes, and so forth were objects of trade. Mutual influence was also evident in the arts, governmental activities, and religious beliefs.20 Descendants of these tribes can be found today in the Balkans, Caucasus, and on the southern coasts of the Black Sea.21 The last power to come from Central Asia and play an active role on the northern Black Sea coast were the Mongols.22 It would be remiss, however, not to mention the tribes in this area that came from the northwest and the north, such as the Gots and their descendants, the Russians.23 As the last rising power on the steppes of northern Asia, Russians settled on the northern coasts of the Black Sea and later descended towards the Caucasus and spread to Georgia, Azerbaijan, northern Iran, and northeast regions of Turkey to the south. In the same period, they reached the Bosporus area from the Balkans.24 Instead of expanding towards the northern Black Sea coasts, the imperial powers that were dominant over the southern parts of the Black Sea—such as the Persians, Byzantines, and Ottomans—preferred to extend their sovereignty to the already existing cities of the Black Sea, which at the time were considered gateways between this region and Central Asia. Transportation of goods such as slaves, fur, and wheat from the North, and textile products and gemstones from Central Asia, was maintained through these trading centres in the coastal areas. Historically, northern parts of the Black Sea had been a route of migration for local tribes. Tribal societies that had previously been dominant powers in this region either had to abandon their territory or mingled into the new tribal society. In either case, power-holders who had settled on the migratory route along the northern Black Sea coasts had to leave the scene to the newcomers. The situation in the south, however, was different. In this region, while tribes moving westwards from Asia were hindered by the rising power of Iran on one hand, and Byzantium on the other, they were securely positioned in Anatolia alongside the population it gained through tribes that migrated from the Balkans. Meanwhile, southern and northern parts of the Black Sea were zones of diffusion and collision of major faiths. For example, religious organizations, rituals, and symbols of the Tengri Han belief system—a monotheistic religion, rooted in Central Asia—influenced the entire northern, central, and eastern areas of Europe.25 Religions such as Judaism, Islam, and Christianity reached Anatolia from the Middle East. From there, they influenced the northern Black Sea region and Central Asia, as well as the whole of Europe. With the help of the Caspian Empire,26 Judaism27 spread through all of eastern and central Europe.28

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13

Later, Orthodox Christianity spread within Slavic and Russian regions through the Byzantine Empire, while the Caspian Empire caused the Sassanid dynasty to lose much of its power, limiting the spread of Islam in Iran and Central Asia. Moreover, Byzantium fought against Muslim Arabs for centuries and delayed them from reaching the Anatolian hinterland. Muslim Arabs later tried to enter Anatolia from the north of the Black Sea, where they had to fight against Caucasians29 and were eventually forced to retreat. Throughout history, the Black Sea region has witnessed many significant political, cultural, and religious clashes and transformations. Driven by religious motivations, Byzantium attacked not only Muslims but also peoples of other beliefs, including local creeds of Christianity. While Byzantium was engaged in extinguishing all beliefs other than Orthodox Christianity in Anatolia, a minority of Armenians were able to save their own beliefs with the support they received from their neighbors. Thanks to the Muslim Seljukids who moved into Anatolia, the biggest regional threat against the Armenians was removed. What is more, the Seljukids took the Armenians under their protection. Even the Gregorian Armenians were able to return to Istanbul once Fatih Sultan Mehmet had conquered the city. After the collapse of the Seljukids with the invasion of Mongols, the Ottoman Empire emerged as a new power in Anatolia and the Balkans. Once Fatih Sultan Mehmet captured Istanbul, he abolished the kingdom of Commenian Byzantium in Trebizond. After this, Fatih came to Kefe, removed the Genoese and Venetians from the region, and turned the Black Sea into a “Turkish lake.” In the following century, the Black Sea area became a land of peace for the people who lived in it. This peaceful situation in the Black Sea region lasted until the 1550s, when Don Kazakhs descended on the region and attacked the coastal cities.30 The Kazakhs were merely the vanguards of the Russian Tsar. After only a few attacks, the Russians settled permanently on the northern coasts of the Black Sea, under the Treaty of Kuchuk-Kainarji, signed in 1774. Having summarized the history and background of the Black Sea area, we can now shed light upon more recent developments. In this respect, it is interesting to note both the Russian Tsardom ruling in the north and the weakening Ottoman Empire in the south. After settling on the northern coast of the Black Sea, taking the place of the Crimean Khanate, the Russian Tsardom started to make incursions into the Balkans on one hand, and the Caucasus region on the other, with the intention of spreading southwards through these paths. In this mission, the Russian Tsardom used

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not only its army and fleet, but also other driving forces such as religion and race (Orthodox Christianity and Slavism).31 In addition to its military power, the Russian Tsardom exploited ethnic elements of the region to bring down the Islamic resistance.32 The Ottomans, who were left alone in the Balkans, were not powerful enough to stop Russia. Meanwhile, Western interference, which peaked with the 1854–1855 Crimean War,33 had no other purpose than to slow down or control the expansion of Russia. After the Russian Tsardom collapsed, Bolshevik Russia rose as a new regional power. Once it gained control of the whole government, Bolshevik Russia reoccupied, one by one, all the territories that had been severed from Tsarist Russia. At the end of World War I, during the Crimean War, the western powers (England, France, and Greece) sent their troops to Odessa to interfere with the intention of stopping the Bolshevik Russian expansion; however, their efforts were to no avail. Upon defeat, they shipped their troops and Russian supporters to Istanbul. Bolshevik Russia then established its sovereignty in the Balkan and Caucasus regions, which were once under the rule of the Tsardom. It was as though history was repeating itself when Bolshevik Russia collapsed at the end of the 1980s. This time, Bolshevik Russia retreated from Central Asia, the Balkans, northern parts of the Black Sea region, and some regions in the Caucasus. However, there was no indication that it had completely abandoned all these areas. Aware that the emerging balance of power would be crucial, Russia made good use of the time and opportunities created by subsequent events. When the Russian Tsardom tried to attack towards the south, it was held back by the Ottomans. In those days, in order to keep control of the situation, the West acted in alliance either with the Ottomans or with Russia.34 At the beginning of World War I, Britain signed an agreement with the Russian Tsar to destroy the Ottomans. The nationalist movement that had risen against the invasion of Anatolia, under the leadership of Mustafa Kemal, stood against the imperialist Western powers, which were led by England and Bolshevik Russia. After World War II, Turkey allied with the United States and joined NATO, a move which made Turkey a key country in the West’s defence against the Soviet Union. The Cold War period was characterized by several treaties. The United States, which had attained the leadership of the West after World War II, expanded its influence in the region after the collapse of Bolshevik Russia.35 This time, the United States emerged as the new global power in a unipolar world order and forced an economically ruined Soviet Union out of some of the former Soviet republics. Moscow had to accept this

A Glance at the History of the Black Sea Region

15

withdrawal due to its poor economic condition. Nevertheless, Russia insisted as far as it could that it retain its military presence in some of the republics; in particular, the Caucasus was the foremost region that Russia resisted leaving. The Russian army did not regard retreating from areas that were mostly flat as a defeat, but knew that it would take decades to readvance in the mountainous regions, such as the Caucasus, and fought fiercely in these regions, as is evident in the cases of the Caucasian Sheikh Shamil and the Chechens. Russia was also aware that by losing control of this region, it would also lose the floor in international circles to speak about the Caucasian and Middle Eastern energy sources and transfer routes. The Balkans and Caucasus have been regions of refugees for more than a century as a result of either mass conversion or forced migration. The Caucasian Mountains provided shelter for many groups until the nineteenth century. The mountains’ natural protection also enabled tribes to live without interfering with one other. If it were not for the protective isolation of the mountains, these small communities would not survive to present day, and would have been assimilated by larger communities or powers in the past: the Caucasian Mountains have been dubbed Diller Da÷Õ, meaning “Mountains of Refuge.” There is a similar situation in the Balkans. Present and future events and developments in the region may be best understood by considering the fact that the western and eastern mountainous regions in the Black Sea area have been a shelter for many communities,36 and by taking the historical background of these communities into account. Today, certain global powers have defined the Balkans and Caucasus as districts of dispute and are exploiting clashes and conflicts between ethnic groups in the region, treating these groups as pawns in a power game against each other. Meanwhile, in the regions where ethnic differentiation is not distinct, micro-nationalist movements have arisen and instead of being regarded as cultural richness, differences are being constructed negatively, exaggerated, and presented as reasons for conflict. In pursuit of their own interests, foreign powers, especially from the West, have used their funds to cement these ethnic differences. Foreign funds have been used to make ethnic divergence—from music to skin tone—more distinct, and to solidify these differences by provoking racist perceptions. These acts by powerful states gave rise to dramatic events in the region. The fact that they continue to finance similar policies in areas of potential conflict shows the great powers to be culpable for their part in inducing the terrible massacres committed by the fighting ethnic groups.

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The United States and the Russian President, Vladimir Putin—who was appointed to elevate Russia’s situation against the United States— have so far acted in accordance with the notion that the Black Sea is a strategic area for all regional economies.37 While the United States, having assured control over Iraq, was expected to press on to the Caucasus and continue taking further steps towards the control of energy sources and transfer routes in the region, it was indubitable that Russia was going to develop new policies against the potential US siege. By granting NATO membership to the Eastern European countries that had joined the EU, the United States became the biggest power on the Black Sea coasts. It is evident that the United States desires to make its presence in the region permanent. In light of this, it is certain that Putin was aware that Russians would not be able to prevent the United States from moving its powerful fleets (e.g., the Sixth Fleet) into the Black Sea merely by upholding the treaties regulating passage from the Turkish straits. Despite the fact that the situation and the future of the Russian fleet in the Black Sea is uncertain, Russia still has the advantage because of Washington’s foreign policy mistakes, which are rooted in its fixation with being the sole global power. One of these mistakes made by the United States was not foreseeing that Russia would recover so quickly; in particular, the abnormal increase in oil prices worked in favour of Russia while it weakened the EU economy. In order to test Putin’s possible reactions, the United States provoked Georgia to attack South Ossetia. Russia did not merely throw this advance back, but also threatened Europe with cutting off their natural gas supply and sent its warships to the ocean as a strong message. By sending its own warship into the Black Sea, the US response was more a check regarding Turkey’s attitude to the Montreux Treaty, which regulates passage across the Turkish straits. As a result of these events, the two parties have determined their positions ahead of any repetition of these events. Those who paid the price for all the painful consequences have been, and will be, the people who live in the area. Washington’s ostentatious support of Saakashvili, but not of Georgia itself, is a good clue to what may happen in the future. Meanwhile, Turkey, being the next-door neighbour, considered Georgia’s position as a convenient buffer between itself and Russia, and has always been supportive of the pursuit and maintenance of political stability in Georgia. Ankara also aided Tbilisi to restructure its military. Turkey continued this support to Saakashvili, even though some provocative Georgian nationalist policies also emerged, including Christianization campaigns against Muslims in the Adjarian region, and Georgianization

A Glance at the History of the Black Sea Region

17

campaigns in Turkish regions of Georgia (the homeland of the Tarakamas). However, recent events showed, yet again, that without being underpinned by the development of a good relationship with Russia, policies intended to stabilize the region would not give healthy results.

Conclusion Having its own ambitions for the region, the United States does not want an overly powerful Turkey in the region, thinking it unnecessary since the end of the Cold War. Claiming itself to be the only global power, the United States desires a Turkey that is a part of the Great Middle East Initiative; is attached to the European Union; is economically dependent upon imports and integrated into international capitalism as a good market; has an economy that runs solely with hot money flows and has an increasing current account deficit; is suffering under heavy debts; is cornered by the threat of claims of the so-called Armenian genocide; and has its influence weakened by being forced out of Cyprus and threatened by being divided. Ultimately, the United States desires a Turkey that is forced to carry out any duty given to it by the West. Even though there are claims that the Turkish government does not object to the US Great Middle East Initiative and Turkey is currently one of the actors in this initiative, opponents of the initiative, notably the army, are still influential. The United States and European powers still pursue their goals to shift Turkey into the position desired by them, trying every possible means including intimidation and the use of force. Foreign policy experts are watching policies applied in this direction with great interest. But we are still not in a position to answer the question, “Is Russia’s attitude to recent events adequate to show that the desire for a weak Turkey in the region is a wrong policy for the West?”

Notes 1

Osman Metin Öztürk and YalçÕn SarÕkaya, UluslararasÕ Mücadelenin Yeni Oda÷Õ Karadeniz (Ankara: Platin YayÕnlarÕ, 2005). 2 Ekrem Memiú, Eskiça÷ Tarihinde Do÷u-BatÕ Mücadelesi (Konya: Selçuk Üniversitesi YayÕnÕ, 1993). In the ancient world, the East was represented by the Persian Empire and the West by Greek civilization. This situation eventually evolved into the form of the liberal West and the Socialist Republics and the USSR. 3 Greeks claim cultural possession of Black Sea on the basis of myths, which can be summarized as involving the conversion of Pont Axenos (Inhospitable Sea) into Pont Euxinus (Hospitable Sea). The reality of the influence of Greek culture

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over the people of the Black Sea region is open to question, and every new finding can cause a re-evaluation of the known facts about this issue. It is certain that by the beginning of the Age of Enlightenment, Greek culture was seen as a primary influence on Western culture; it seems to be the case, unfortunately, that this longstanding influence has led Western authors to overly privilege the Greek account. 4 For the northern arm of Silk Road, the earliest mercantile connection between Asia and Europe, see Boris Stavisky, “øpek Yolu ve ønsanlÕk Tarihindeki Önemi,” trans. Mehmet Tezcan, in Türkler Vol. 3, ed. Hasan Celal Güzel, Kemal Çiçek, and Salim Koca (Ankara: Yeni Türkiye YayÕnlarÕ, 2002), 222–242. See also Anna A. Ierusalimskaya, “øpek Yolunda Kafkaslar,” in Türkler Vol. 3, 243–250. 5 Marianna Koromila, The Greeks and The Black Sea From The Bronze Age to the Early 20th Century, new ed. (Athens: The Panorama Cultural Society, 2002). 6 For the Scythians, see B. N. Grakov, øskitler, trans. D. Ahsen Batur (Istanbul: Selenge YayÕnlarÕ, 2006); ølhami Durmuú, øskitler (Sakalar) (Ankara, Türk Kültürü AraútÕrma Enstitüsü YayÕnlarÕ, 1993); Ekrem Memiú, øskitlilerin Tarihi (Konya, Çizgi Kitabevi, 2005). 7 The Ancient Greeks developed relations with the Scythians in every area. As a result, a new hybrid population arose whose spoken language was a mixture of Greek and Scythian. Hippocrates, the famous physician, lived with the Scythians for a long time and his records contain interesting information about them, while the well-known Greek doctor Demosthenes’ grandmother was a Scythian. These facts illustrate that the relationship between the two nations was extremely close. 8 M. Taner Tarhan, “Eski Anadolu Tarihinde Kimmerler,” I. AraútÕrma SonuçlarÕ ToplantÕsÕ, Istanbul 23–26 May 1983 (Istanbul: Eski Eserler ve Müzeler Müdürlü÷ü), 109–120; Kadriye Tansu÷, “Kimmerlerin Anadoluya Giriúleri ve M.Ö. 7. YüzyÕlda Asur Devletinin Anadolu ile Münasebetleri,” AÜDTCF Dergisi, 5/7, no. 4: 535–550. 9 AnÕl YÕlmaz, “øskit SanatÕ,” in Türkler Vol. 3, 26–32. 10 Grakov, øskitler, 61–63; Durmuú, øskitler, 71; Memiú, øskitlilerin Tarihi, 40–53. 11 Karoly Czegledy, BozkÕr Kavimlerinin Do÷u’dan BatÕ’ya Göçleri, trans. Ahsen Batur (Istanbul: Özne YayÕnlarÕ,1998). 12 ølhami Durmuú, Sarmatlar (Istanbul: Kaynak YayÕnlarÕ, 2007). 13 L.N. Gumilev, Hunlar, 3rd ed., trans. D. Ahsen Batur (Istanbul: Selenge YayÕnlarÕ, 2003). 14 Geza Feher, Bulgar Türkleri Tarihi, 2nd ed. (Ankara, Türk Tarih Kurumu,1985). 15 M. I. Artamonov, Hazar Tarihi Türkler, Yahudiler, Ruslar, trans. Ahsen Batur (Istanbul: Selenge YayÕnlarÕ 2004). 16 Akdes Nimet Kurat, Peçenek Tarihi (Istanbul: Devlet BasÕmevi, 1937). 17 Istvan Vasary, Kumanlar ve Tatarlar OsmanlÕ Öncesi Balkanlar’da Do÷ulu Askerler (1185–1365), trans. Ali Cevat Akkoyunlu (Istanbul: YapÕ Kredi YayÕnlarÕ, 2008). 18 Akdes Nimet Kurat, IV–XVIII. YüzyÕllarda Karadenizin Kuzeyindeki Türk Kavimleri ve Devletleri (Ankara: Türk Tarih Kurumu,1972). 19 One of the sources concerning the movement of Turkish tribes from the Balkans to the northern Black Sea is “De Administrando Imperio,” written by Byzantian

A Glance at the History of the Black Sea Region

19

emperor Constantine Porphyrogenitus. Gy. Moravcsik, Constantine Porphyrogenitus De Administrando Imperio, 4th ed., trans. (to English) R. J. H. Jenkins (Washington, DC: Dumbarton Oaks Texts One, 2002). 20 Murad Adji, Kaybolan Millet (Deút-i KÕpçak Medeniyeti), trans. Zeynep Ba÷lan Özer (Ankara: Atatürk Kültür Merkezi BaúkanlÕ÷Õ YayÕnlarÕ, 2001). 21 We can say similar things for the Cimmerians and Scythians. Sources from Antiquity show that the Amazons and Halybes are fragments of Scythian groups on the southern coasts of the Black Sea. Today, groups on the southern coasts of the Black Sea are the ancestors of peoples living in this region in the Middle Ages. Mehmet Bilgin, Do÷u Karadeniz Tarih Kültür ønsan, 3rd ed. (Istanbul: Ötüken YayÕnlarÕ, 2007). 22 George Vernadsky, Mo÷ollar ve Ruslar, trans. Eúref Bengi Özbilen (Istanbul: Selenge YayÕnlarÕ, 2007); L. N. Gumilev, Eski Ruslar ve Büyük BozkÕr HalklarÕ 2nd ed., trans. Ahsen Batur (Istanbul: Selenge YayÕnlar, 2003), 191–348; Kurat, Karadenizin Kuzeyindeki Türk Kavimleri, 119–290; ølyas Kamalov, Mo÷ollarÕn Kafkasya PolitikasÕ (Istanbul: Kaknüs YayÕnlarÕ, 2003). 23 Akdes Nimet Kurat, Rusya Tarihi BaúlangÕcÕndan 1917’e kadar (Ankara: Türk Tarih Kurumu,1948). 24 Akdes Nimet Kurat, Türkiye ve Rusya XVIII. YüzyÕl Sonundan Kurtuluú SavaúÕ’na Kadar Türk-Rus øliúkileri (1798–1917) (Ankara: Ankara Üniversitesi Dil ve Tarih-Co÷rafya Fakültesi YayÕnlarÕ,1970). 25 Adji, Kaybolan Millet, 169–242; Turhan Kaçar, “Avrupa HunlarÕ ve HÕristiyanlÕk,” Türkler Vol. 3, 385–391. 26 Jacques Piatigorsky and Jacques Sapir, Hazar ømparatorlu÷u VII.–XI. YüzyÕllar AtlÕ Bir Kavimin Gizemi, trans Hande Güreli (Istanbul: Bilge Kültür Sanat YayÕnevi, 2008). 27 P. B. Golden, C. Zukerman, and A. Zajaczkowski, Hazarlar ve Musevilik, ed. Osman Karatay (Çorum: Karam YayÕnlarÕ, 2005). 28 Arthur Koestler, Onüçüncü Kabile (Hazar ømparatorlu÷u ve MirasÕ), 5th ed., trans. BelkÕs ÇorakçÕ (Istanbul: SayÕ YayÕnlarÕ, 1993); ùaban Kuzgun, Türklerde Yahûdilik ve Do÷u Avrupa Yahûdilerinin Menúei Meselesi Hazar ve Karay Türkleri (Ankara: Se-Da YayÕnlarÕ,1985). 29 D. M. Dunlop, Hazar Yahudi Tarihi, trans. Zahide Ay (Istanbul: Selenge YayÕnlarÕ, 2008), 53–100. 30 Charles King, Karadeniz, trans. Zülal KÕlÕç (Istanbul: Kitap YayÕnevi, 2008), 161. 31 Mehmet Bilgin, Post Modern Pontosçuluk, 3rd ed. (Istanbul: Do÷u Kütüphanesi YayÕnlarÕ, 2008), 70. 32 John F. Baddeley, RuslarÕn Kafkasya’yÕ østilasÕ ve ùeyh ùamil, 2nd ed., trans. Sedat Özden (Istanbul: KayÕhan YayÕnlarÕ). 33 The Paris Treaty which ended the Crimean War also marked the end of an era for the Black Sea. It had two results: first, the gates of the Black Sea were effectively opened to the Europeans; second, it emphasized the fact that no lone power, especially Russia, could take advantage of the Ottoman’s weakness. 34 Mustafa AydÕn, Üç Büyük Gücün ÇatÕúma AlanÕ Kafkaslar (Istanbul: Gökkubbe YayÕnlarÕ, 2005).

20 35

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Eyyub Kandemir, UluslararasÕ Sistemin Yeni Düzen ArayÕúÕnda Karadeniz’in De÷iúen Jeopoliti÷i (Istanbul: IQ Kültür ve Sanat YayÕnevi, 2008). 36 Ufuk Tavkul, Etnik ÇatÕúmalarÕn Gölgesinde Kafkasya (Istanbul: Ötüken YayÕnevi, 2002). 37 Alâeddin YalçÕnkaya, Kafkasya’da Siyasi Geliúmeler Etnik Dü÷ümden Küresel Kördü÷üme (Ankara: Lalezar Kitabevi, 2006).

CHAPTER TWO THE BLACK SEA AND THE BALKANS UNDER OTTOMAN RULE NIHAT ÇELIK*

Introduction The Ottoman Empire, which first came into being as one of the emirates in western Asia Minor (Bithynia) in the fourteenth century, succeeded in becoming the dominant power of all of Asia Minor and Europe in the following centuries. Other emirates declared their independence during the turmoil after the disintegration of the Seljuk Empire in Anatolia. Historical data show that some of these emirates were stronger than the Ottomans, both politically and militarily. As a consequence of this, the Ottomans targeted the Byzantine lands. Their victories against the Byzantine Empire strengthened the Ottoman position vis-à-vis other emirates. Internal conflicts and the decay of the Byzantine central administration, together with external threats posed by Serbia and Bulgaria in the Balkans, created a fertile ground for the Ottoman advance. Ottoman raids against the Byzantine Empire increased the prestige of the Ottomans amongst other Anatolian emirates, encouraging an influx of warriors (sing. Ghazi) into the Ottoman territory. Paul Wittek emphasizes the role of the Ottomans as a “warrior state” which fought with religious zeal, conducting an endless war against the “infidel,” with the purpose of widening the dar’al-Islam (abode of Islam). However, Wittek exaggerates the concept of religious warfare. In Ottoman history there are many instances demonstrating Ottoman pragmatism and flexibility in foreign affairs. The Ottoman example was not unique; contrary to generally accepted assumptions, religious differences were not the main determinants of medieval foreign policies. The maritime states of Italy such as Venice *

Research Assistant, International Relations Department, Kadir Has University, Turkey.

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Chapter Two

and Genoa did not hesitate to develop peaceful relations with the Ottomans, acting against all the prohibitions declared by the pope, especially those concerning trade with Muslim states. So it is very clear that despite the Byzantines and maritime states of Italy referring to Ottomans as “infidels,” and vice versa, for their political and economic interests they were prepared to end the “Holy War” and develop close relations with each other. Religious differences were mostly remembered at times of conflict, and used to legitimize war. From this point of view, it is not surprising to see that Venice, one of the main supporters of the Crusaders against Muslims, was the first Christian state to obtain commercial privileges from a Muslim state, the Ayyubids, at the end of the twelfth century.1 It seems that religion was not the only determinant in the foreign policy outlook of powers at that time, especially Venice. They preferred a flexible foreign policy in order to protect their interests. It is evident that even before the Ottomans, a culture of peaceful coexistence started to develop in Anatolia. Cities and towns with mixed populations were inevitably places of contact and interaction. However, the role of religious warfare cannot be ignored completely. It was one of the dominant factors, especially in the border areas of the Seljuk and Byzantine empires. According to Paul Wittek, the conditions in such border areas (Turkish: uch) were very different from cities and towns, and both sides were very similar to each other in many aspects. However, they were populated with people who were always ready to fight (Byzantine warriors were known as akritai, which is derived from the Greek word for “border”), whose main economic wealth came from booty and plunder.2 Thus, the first part of this paper will deal with the issues of the status of non-Muslims in territories ruled by Muslims in Anatolia, the relations between each group, and the contact they had with each other. In addition, the decline of the Byzantine and Seljuk empires, and the resultant power vacuum, will be examined in order to fully show the conditions which paved the way for the rise of other power centres in Anatolia and the Balkans, including that of the Ottomans. The term “Balkan” is a Turkish word which means “thickly wooded mountain range,”3 and it is also the name of the mountain range which passes modern Bulgaria in an east–west direction. The Ottoman name for the Balkan peninsula is Rumeli, “the land of the Romans.” The Ottoman Empire was a Balkan–Anatolian empire, particularly before the conquests of Selim I (including those of Syria and Egypt) in the 1520s. The second part of this paper will give a brief survey of the Ottoman imperial mind, while touching upon the nature of Ottoman conquests. It will try to find answers for the frequently asked question of how the Ottomans managed

The Black Sea and the Balkans under Ottoman Rule

23

to expand their territories in a relatively short period, and to rule a very mixed population for many centuries. It will also show the importance of the Balkans to the Ottomans in relation to the core region of the empire, Anatolia. The Balkan Peninsula is surrounded in the east by the Black Sea, a fact which makes their histories inseparable: this interwoven history forces us to use a broader perspective. Fernand Braudel refers to the Black Sea as a part of the “Mediterranean world.” This view is strengthened with the foundation of Greek colonies in antiquity, which in the following centuries were to become Latin colonies on the coasts of the Black Sea, with their vivid commercial life. The third section of the paper will examine Ottoman policies regarding the Black Sea, especially during the rule of Mehmed the Conqueror. Also included in our analysis will be the decline and destruction of the Golden Horn, together with the emergence of the Crimean Khanate and its status within the empire. Istanbul, with its huge population, was the biggest consumer of food in the empire. The Ottoman sultans were forced to provide sufficient amounts of grain and meat for their subjects at reasonable prices. Any rise in the food prices could trigger uprisings which would end up dethroning the sultan. Thus food provisioning for the imperial capital was one of the main concerns of every sultan. In the third section, we will also point to the importance of the Black Sea Basin as the “granary” of the empire.

The Decline of the Byzantine and Seljuk Empires: The Eve of the Ottoman Conquests From 293 to 305, the Roman Empire was ruled according to the new administrative structure introduced by the Emperor Diocletian. Known as a “Tetrarchy” (the rule of four), the empire was ruled by two emperors bearing the title of Augustus, each of whom was served by a deputy named Caesar, who was to succeed the Augustus. The senior Augustus was to rule the eastern portion of the empire.4 Emperor Constantine, son of Constantinus, who succeeded his father as the Augustus of the Western Empire from 312 onwards, publicly supported Christianity, and after a long struggle to control the empire against his rivals, was successful in restoring his rule. In 324, Constantine the Great chose Byzantion, an old colony at the mouth of the Bosporus, as his imperial seat, and renamed it “Constantinopolis nova Roma.”5 The term “Byzantine” is itself the product of later centuries. The subjects of the empire called themselves “Romans” or “Christians,” and

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the emperors always claimed to be the successors of Roman emperors.6 As Donald M. Nicol has proposed: Byzantine is a convenient term to describe the culture of the medieval world that centered on Constantinople. It was not a word that the inhabitants of that world were in the habit of employing. They saw themselves as Romans or Romaioi, and their empire as that eastern portion of the Greco–Roman world of antiquity which had, by God’s grace, survived all the catastrophes and changes that had afflicted the western part of the old Roman Empire.7

In a palace coup in 476, the last of the Roman Emperors of the West, Romulus, was deposed by his barbarian general Odoacer, who set himself up as king in Italy.8 In the following centuries the Byzantine Empire faced new threats from almost every direction: Persia and Muslim Arabs in the east, and the Huns, Avars, Slavs, Bulgars, and Pechenegs in the west. The possessions of the empire faced fragmentation; however, it was still a glorious empire, ruling a vast area in the Near East. In Byzantine ideology, all groups outside the orbit of the Byzantine Empire were regarded as “barbarians.” The empire dealt with them in different ways. Settling them in border provinces and benefitting from their military power was a common method. At the diplomatic level, sending crowns to their leaders as an act of claiming suzerainty, playing off one group against the other and triggering internal strife by supporting rival chieftains (a divide and rule policy supported by the famous “Byzantine intrigues”) was another method that served the survival of the empire. However, the most important Byzantine solution was converting those “pagans” to Christianity. This policy shaped both the religious and cultural map of Eastern Europe. Byzantine missions spread over the Black Sea Basin. Under Khan Boris, the Bulgars, a Turkic tribe with a strong Slavic element, accepted Christianity in the 860s, and in the following centuries Christianity was to become the dominant religion in the Balkans. Circa 988, Princess Olga’s grandson Vladimir was baptized, and a religious mission was sent to Kiev. In an effort to convert the Hungarians, a monk named Hierotheos was appointed as the bishop of Tourkia (Hungary).9 However, baptizing as an instrument of foreign policy did not work all the time. The Orthodox Bulgars and Serbs, together with the Russians, were to cause trouble for the empire in the following centuries. The population of Eastern Anatolia consisted mainly of Armenians and monophysite Jacobites, who had only weak ties with the empire.10 Disputes over religious matters and Byzantine policy aimed at subjugating the Armenian Church and persecuting Armenians made things even worse. Constantine X, in search of new sources of revenue, disbanded the

The Black Sea and the Balkans under Ottoman Rule

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Armenian militia forces (50,000 men), whose members had certain privileges such as tax exemptions. Then he re-imposed the taxes. In John J. Norwich’s words: Thus it was that Byzantium lost an invaluable buffer state and gained instead, not an Armenian bulwark as it had hoped, but what might a century ago have been called an Armenian Question—a disaffected and discordant minority within the Empire which created more problems than it solved. The Armenian princes, left to themselves, would have put up as stiff a resistance to the Muslim invaders as they always had; now, demoralized and resentful, they found themselves wondering whether even conquest by the Turks would prove appreciably worse than their present subjection to the Greeks.11

The tension between Greek and Armenian elements of the Byzantine society ran high. When Romanus visited Sebastia during his campaign in 1069, the Greek inhabitants complained to him that when Sebastia had been sacked by the Turks (1059), the Armenians had been more violent and unpitying toward the Greeks than had the Turks themselves! So it was that Romanus ordered his troops to attack Sebasteia, a Byzantine city, and then he swore that he would destroy the Armenian faith.12

The victory of Seljuk armies under the command of Sultan Alp Arslan at the Battle of Manzikert (Malazgirt) in 1071 was a turning point in the history of Anatolia. The Turkic mercenaries serving in the Byzantine army deserted the Emperor and joined the Seljuk army.13 The Seljuk sultan released the captured Emperor Romanos, and his release caused a civil war which left the Byzantine territory unprotected in the east. The arrival of Oghuz Turks began not with raids for booty, but with the purpose of settling in the newly conquered territories. Turkification was a long process that was to last for centuries, and was fed by the massive influx of new settlers. Regarding this subject, Paul Magdalino states: Thus, twenty years after the battle of Manzikert, the Turks were established on the west coast of Asia Minor, and their occupation was progressing beyond the nomadic stage: a branch of the Seljukid family was creating the nucleus of an independent sultanate behind the walls of Nicea, in the Asiatic hinterland of Constantinople, while in Smyrna an emir called Tzachas, who had spent some time in Byzantine service, had built himself a fleet with which he was attempting to capture the Aegean islands.14

The Seljuks invaded most parts of Anatolia and moved their capital to Nicea (øznik), a city positioned just a few hundred kilometres south of

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Constantinople. This was regarded as a real threat by the Emperor, so he asked Pope Urban II for help against the Seljuks in 1095, and that provided the perfect justification for the Crusaders to enter Byzantine lands.15 Their arrival, however, created trouble not only for the Seljukids, but also for the Byzantine Empire. The undisciplined army of Crusaders passed through the Balkan Peninsula in search of booty, and finally reached Constantinople, pillaging whatever they could find on the way. The Byzantine emperor hastily transported these Crusaders to Anatolia to save the capital.16 The emperor now had to deal with the Latins, too. Nicea was conquered in 1097, and handed over to the Byzantines. The imperial seat of the Seljukids was moved to Iconium (Konya). The Crusaders finally reached Jerusalem in 1099. But problems quickly arose; the Crusaders began establishing small kingdoms in places they conquered, and this paved the way for the sack of Constantinople during the Fourth Crusade in 1204.17 The influence of Latins was also increasing in the empire, especially in the areas of commerce and shipping. City-states like Venice, Genoa, and Pisa were able to get concessions and privileges from the emperors, and form colonies in the imperial territory. There were perhaps sixty thousand Latins living in Constantinople, in their quarters on the coast of the Golden Horn.18 According to Magdalino, shipping and maritime communications do not seem to have rated very highly in Byzantine politics, society, and culture, so Italian city-republics filled the gap in the empire’s naval capability.19 W. Heyd criticizes Byzantine merchants for their inertia in leaving the commerce to the Latins.20 However, it should be kept in mind that it was not easy for the Byzantine merchants to compete with the Latins, because of the privileges obtained by the latter. That was another factor fuelling anti-Latin sentiments in Constantinople, especially after the Great Schism in 1054. So it is not surprising that Byzantine crowds began attacking Latin colonies in Constantinople.21 However, the Black Sea remained closed to all foreigners and the empire had a near-monopoly over it. In Georges Bratianu’s words, it was a “Byzantine Lake.”22 The Fourth Crusade (1204), followed by the sack of Constantinople and the fragmentation of Byzantine territory by the Crusader kings, was a serious blow for the Empire. Once they had gained control of Constantinople and the Straits, the city-republics of Italy had the ability to enter and form colonies on the Black Sea coast. The imperial seat had been moved to Nicea, where it would stay until 1261. However, the Byzantines were experienced enough in diplomacy to benefit from the deadly competition between Venice and Genoa. Genoa sought revenge against Venice because the Venetians had sacked the Genoese colony in Akka;

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and as W. Heyd underlines, even the fear of excommunication by the pope was not sufficient to force them to refrain from an alliance with the Byzantine emperor in Nicea, Michael Palaiologos (Michael VIII). Thus, the Treaty of Nymphoeum was signed between the parties on 13 March 1261. The Genoese promised to help the emperor in his attempts to reconquer Constantinople by sending an armed fleet, and in return, the emperor granted them many privileges, including the formation of new colonies throughout the empire. Genoa was allowed to form colonies on the Black Sea coast, and their goods were exempted from customs taxes. According to the treaty, only Genoese merchants were to benefit from the Black Sea trade. However, the Byzantines preferred a balanced foreign policy, and in the following years almost the same privileges were granted to the Venetians, too.23 After the Fourth Crusade, the relations between the Byzantine and the Seljuk Empires seemed to be stable and peaceful. The Nicean Empire at that time was busy making plans to re-conquer Constantinople.24 On the other hand, the Seljuks were conquering cities in other parts of Anatolia, such as Sinop, Antalya, and Alaiye. Trade relations, which had almost ceased, revived again in this period. In obtaining the above-mentioned port cities, the Seljukids gained important outlets to the sea. The land routes crossed Anatolia in north–south and east–west directions. The trade route starting from Antalya or Alaiye (Alanya) passed through Sivas and Tokat to the Black Sea ports of Sinop and Samsun. The trade with the Crimean port of Sudak/Soldia (Su÷dak) mainly included furs and slaves. Slaves of both genders were in high demand, especially in Egypt, whose army consisted of mamluks (slaves). At that time, the slave trade was in the hands of Latins. Seljuk policy attempted to support trade by every possible means. Many caravanserais were built on these roads, providing security, food, and bed, all free of charge. Merchants whose goods were stolen or damaged in sea accidents received compensation. They introduced a mechanism similar to modern insurance.25 In March 1220, the Venetians and the Seljuks concluded a treaty whose text mentioned that it was the renewal of the two earlier treaties.26 Thus in the thirteenth century, trade in Anatolia flourished. There were even Russian and Kipchak (Cuman) merchants from Deút-i KÕpçak (Dasht-i Kipchak, Kipchak Steppe) in Sivas and Syria, and Seljuk subjects were present in the Crimean port of Sudak, and built a mosque there.27 The rise of the Mongol Empire caused the mass immigration of Turcomans into Anatolia, and the Seljuk sultans didn’t have tight control over them. There were certain religious differences between the sedentary population of Anatolia and the newly arrived Turcomans: they were

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Muslims, but they preserved their old faith of shamanism under a veneer of Islam.28 The difference between them and the sedentary population can be easily observed by the religious orders they supported. The sedentary population supported the order of Mevlana Jalaluddin Rumi, later known as Mevlevilik, a religious order supporting the Seljuk authority, with middle and upper class members, including also people of Christian faith under the heavy influence of Persian culture.29 This order had negative views on the Turcoman heterodox religious leaders (known as “baba” or “dervish”), and attacked their beliefs. The devastating revolt of Baba øshak (known also as Babai KÕyamÕ), fed by heterodox preaching, was only suppressed with an army that included many Christian mercenaries.30 With the battle of Köseda÷ in 1243, the Seljukids were crushed and became a vassal state of the Mongol Empire. In the following years, internal strife in the Seljuk Empire weakened its control over the various Turcoman tribes scattered around Anatolia. After the re-conquest of Constantinople in 1261, Byzantine control over Asia Minor was neglected and grew weaker, to the advantage of those Turcoman tribes. It was this environment which paved the way for the emergence in Anatolia of many independent emirates at the beginning of the fourteenth century. The presence in Anatolia of many non-Muslims living for a long time under the rule of Muslim states led inevitably to contact, and significant interaction occurred between the two groups. The employment of Christians in the army as mercenaries and in the bureaucracy as state officials strengthened the ties between the groups.31 Particularly well integrated into Muslim society were the Armenians, who were suppressed by the Byzantine authorities due to disputes over their faith. The Seljuk sultans had close contact with their religious leaders. This explains the letter sent by II. KÕlÕçarslan to the Armenian patriarch Mihael in Malatya, after his victory against the Byzantine army, in which he stated that the victory was won with the help of the patriarch’s prayers.32 It may be surprising to see that Christians adopted Turkish names (such as Kaya, Arslan, Ya÷mur, Çiçek, etc.) and Islamic personal names (like Hamza, Allahverdi, etc.), a tendency which also continued during the Ottoman period.33 This emerges as an important problem for historians working on Ottoman documents, especially related with Bursa and the surrounding region, former Bthynia, because it is not possible to be sure about people’s religion if it is not mentioned in the document. According to Irène Beldiceanu-Steinherr, some of them were probably Turkic groups settled in the region by the Byzantine imperial authorities.34 Another tendency was to visit each other’s sanctuaries. Many Christians visited Muslim sanctuaries and many Muslims visited the Christian ones. That was a

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tradition in both Anatolia and later in the Balkans during the Ottoman period. F.W. Hasluck gives a detailed list of these sanctuaries.35 In Islamic law, non-Muslims—especially Christians and Jews, who were known as ahl-i kitab (people of the book)—had to be protected by the state. If they came to Muslim territory and stayed there for a short time (the generally accepted duration was one year), as merchants, for example, they gained the status of mustamin (those who are under protection). During their stay, they were under the state’s protection and they didn’t pay jizya, the poll tax.36 If they lived permanently in Muslim domains, they gained a different status, zhimmi, whereby in addition to the taxes paid by the Muslims, they also had to pay the jizya, while they were exempted from the military service. The old, the clergy, and the poor were exempted from the jizya. They had the right to take cases regarding such issues as inheritance and marriage to their special courts, while maintaining their religious institutions and schools. They were able to take up bureaucratic positions. However, they could not be elected as president of a state, and could not be appointed to critical posts such as high ranks of military command.37 In return, the state had to protect them against any threat, and even declare war on other states if they were attacked, while providing them with freedom of faith. Regarding the regulation of clothing, there were different views. Some Muslim scholars (ulema) found it important to distinguish subjects by their clothing.38 When the Mongol armies invaded Anatolia, the Mongol governor Timurtash, “found the clothing and hats of the Jews and Christians to be indistinguishable from those of the Muslims. He announced that the non-Muslims should wear conical hats with yellow turbans so that they could be distinguished from the faithful … .”39 Conversion to Islam, followed by Turkification, was a long process and the result of many factors. In Vryonis’s words: The historical events indubitably exercised a profound influence on the psychology of the Christians. They had experienced and witnessed the defeat of Byzantium and they were now subjects of military conquerors who professed an alien faith. Undoubtedly some saw in this fact a proof of Islam’s validity. Others were prepared for assimilation by the preaching of dervishes and ulemas, and by the religious syncretism that tended to equate Islamic practices and saints with those of the Christians. In any case strong economic and social motivations were ever present. Converts would escape the onerous tax of the djizye, and their agricultural tax would be lightened. Others might hope for administrative positions and lands.40

Forced conversion is strictly prohibited by Islamic law; however both political and economic incentives were used to encourage people to

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convert. Osman Çetin’s study, based on the Ottoman judicial registers, shows us that the conversion movement was limited. For the years between 1472 and 1909, in Bursa, a very cosmopolitan city, he was able to detect only 835 conversions.41

The Nature of the Ottoman Conquests The aim of this section is not to give a full political history of Ottoman conquests. Instead, here I will mostly focus on the nature of these conquests, and relations between the conquerors and the conquered. The main idea of this section is that the Ottomans were not only trying to conquer countries, but also trying to conquer people’s hearts with the ideal of a just rule. The emirates of Anatolia filled the power vacuum that was left following the decline of the two empires. Former members of the Byzantine–Seljuk civil and military bureaucracy were now working under their service. Due to the fiscal crises that the Byzantine Empire had been going through, the emperor had to decrease the number of military personnel in the Byzantine navy. “With no hope of alternative employment in the Empire, many of them took service with the Italians or even with the Turks rather than die of hunger.”42 The Ottomans benefitted from the declining Byzantine rule and the resentment of the population, fed by corruption and malpractice. The contemporary Greek observer Pahimeres reports that, before the Battle of Bapheus (Bafeus SavaúÕ, 1301) between the Ottoman and Byzantine armies, the inhabitants of Nicea hated the governor because of his wrongful conduct, and he adds that after the abolition of privileges granted to the soldiers serving in the fortress, many of them chose to serve on the Ottoman side.43 Due to all of the reasons listed above, the Ottomans were able to enlarge their territory very rapidly: in 1326, Bursa, an important commercial centre of that time, was conquered. Later, in 1331, Nicea, a city famous for its strong walls, was also conquered. The Ottoman emirate attracted Turcomans throughout Anatolia. After witnessing Ottoman victories against the Byzantines, they became more eager to join the Ottomans. Internal strife within the Byzantine Empire forced the emperors to ally with the Ottomans in order to get military support from them. The Ottomans granted support for Emperor Cantacuzenos in his wars against the Serbs and Bulgarians. Meanwhile, by participating in the emperor’s Balkan campaigns, the Ottoman military command gained experience and information about the situation there.44 A milestone in Ottoman history

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came in 1354, when they gained a foothold in the Balkans by taking Tzympe on the Gallipoli isthmus, which served as a bridgehead for the following Ottoman conquests. At the same time, the Ottomans extended their rule over the Emirate of Karesi (which controlled almost all southern parts of Gallipoli), whose navy provided them with a useful tool. It was an Ottoman policy to form relations of vassalage before the final conquest, though this was naturally a slow process. After eliminating the native dynasty, the Ottomans applied the timar system and started to rule the country directly.45 The same policy was implemented both in Anatolia and the Balkans. In 1369, Adrionople (Edirne) was conquered, and Ottoman military commanders on the borders started to carry out raids as far as Serbia. In 1387, Thessaloniki was conquered and John V Palaiologos agreed to become a vassal of Sultan Murad.46 Like in Anatolia, in the Balkans the Ottomans also benefitted from internal conflicts and the power vacuum. Peter F. Sugar summarizes the situation in the Balkans before the Ottoman conquests as follows: In the middle of the fourteenth century the Balkan Peninsula was in turmoil. The second Serbian empire was disintegrating, and the Byzantine Empire, which in previous centuries had always been able to fill the vacuum left by similar collapses in the area, was too weak to play this role. Political chaos was paralleled by social and religious controversy. The lower classes were trying to shake off the rule of the traditional noble ruling element, and heresies, which often represented social class differences, flourished. Members of the Slav ruling families were fighting each other, and a similar struggle for the throne was in progress in the Byzantine Empire. It was the latter struggle that brought a new force, the Ottomans, into the Balkans.47

Heterodox dervishes played an important role in the Ottoman conquests. In many cases they participated in the conquests with their followers and later the sultans granted privileges and distributed fiefs48 to them.49 Writing in the 1940s, Ömer Lütfi Barkan described them as “colonizer Turkish dervishes.” They founded new villages, especially in insecure territory, near mountain passes or bridges, and opened new agricultural lands. Their first step was to build a zaviye or imaret (public kitchen). These institutions provided security in their neighbourhood, and served travellers. They were propaganda centres; they also organized the settlement of the newly arrived Turkish population, so in a short time new villages with Turkish populations were founded which controlled the countryside.50 Waqfs (pious foundations) and imarets played an important role in Ottoman conquests. Even in the formation years of the empire, Sultan

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Orhan founded a waqf in Mekece in 1324 with the purpose of serving the travellers and poor (written in Persian, his order is also one of the oldest surviving Ottoman documents). Heath W. Lowry offers a valuable insight into these institutions, using the narrative of the fifteenth century Ottoman chronicler AúÕkpaúazade (whose book is known as Tevarih-i Al-i Osman). AúÕkpaúazade describes the activities of Sultan Orhan after he conquered Nicea (Lowry’s translation):51 He [Orhan Gazi] established an imaret at the edge of the Yeniúehir Gate … when the doors of the imaret were first opened and its first food prepared, it was distributed by the blessed hands of Orhan Gazi himself. He served as the imaret’s apprentice on the opening evening.52

Lowry then states the importance of that act, and summarizes the Ottoman policy: AúÕkpaúazade likewise highlights the causal linkage between accommodation and conversion, i.e. the fact that good treatment of the conquered led many Bithynian (and later Balkan) Christians to accept not only the political reality of the new order but also the religion of its dynasty, Islam. A Muslim conqueror feeding his newly acquired Christian subjects with his own hands is a striking image.53

The Ottomans followed a policy of deportation (iskan siyaseti). Many families were sent to the Balkan peninsula from Anatolia following the Ottoman conquests. In some cases, as an act of punishment, families who violated the laws were selected for deportation. On the other hand, there were also those who voluntarily relocated. Peasant families looking for land or pastures for animal breeding were sent to the Balkans.54 It is possible for historians to track these deportations in the Ottoman tahrir defterlar (official records). In the tahrir defter of Arvanid (an Ottoman province in modern Albania), dated 1432, many examples of deportees can be found. Their origins are indicated with placenames like SaruhanlÕ (modern Manisa in Turkey) or Engürülü (modern Ankara).55 In Ottoman society there was a privileged group known as askerî (military), a social class under the government’s service which included both Muslims and non-Muslims. This class included both the highest-level officials and the lowest ranks of timarlÕ sipahis (fief holders) and other auxiliary forces. They were exempted from many taxes for the services they provided. The main aim of the Ottomans was to provide security and stability in the areas they ruled, as these were the preconditions for welfare and commerce. Thus, in rural areas the Ottomans formed auxiliary forces from the villagers, who acquired tax exemptions for such services as

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guarding and repairing bridges, roads, mountain passes, and water canals. This organization, named derbend teúkilatÕ, can be seen in the Ottoman administrative structure from the reign of Murad II (1421–1451), and was very effective, especially in the mountainous Balkan areas. Its Christian members were known as martolos, klepht, and armatol in the Balkans.56 The willingness of the Ottomans to employ its Christian subjects at various levels of bureaucracy served the integration process. They were the members of the military class (askerî), like the grand vizier (sadrazam), who was the head of civil and military bureaucracy. The rest of society, who paid taxes, was named the reaya (subjects). Another important Ottoman policy was accepting former land holders into the askerî class. In this way, many of the local elites in the Balkans were transformed into Ottoman sipahis: they were granted fiefs and exempted from taxes, and in return they served as local security forces who collected the taxes and joined the Ottoman army with their men during campaigns.57 While cooperating with the former elite class, the Ottomans could not have neglected the rest of the society, the reaya. The Ottoman peasantry, in contrast to the serfs in Europe, had certain rights which were overseen by the strong state bureaucracy. Before the decay of the Ottoman land administration (timar sistemi) in the seventeenth century, the main agricultural production unit was the small family farm known as çift (an area that can be ploughed by two oxen). After the conquest of a town, the first action of the Ottomans was to appoint a subaúÕ (a local military commander responsible for security as well as administrative tasks, and head of the timarlÕ sipahis), and a qadÕ (a judge with many other municipal responsibilities, such as inspecting markets and craftsmen). After that, a group of trusted men were assigned to prepare the cadastral survey, a document which showed all the revenue-creating assets of an area (tahrir is the name of the process, and the records are tahrir defterleri). The amount of revenue derived from customs, markets, and agricultural lands (even the number of fruit trees were included), as well as the number of buildings, houses, bakeries, public baths, and the population structure (including the religious affiliation of households and the population in general) were all recorded. Following the sultan’s approval of the tax estimations, a kanunnâme, a legal text detailing the amount of taxation and fines for crimes, was promulgated. Apart from this, a cadastral survey was also prepared which included the rights and responsibilities of both the timarlÕ sipahi and reaya in a province, along with the duties of the reaya regarding corvée (the word angarya is used by the Ottomans for corvée or forced labour, a word borrowed from Latin, which is also used in English as “angary”). After the completion of the cadastral survey and the

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proclamation of the kanunnâme, the administration and taxation of the province were regularized accordingly. The surveys were renewed if conditions changed in the province due to natural disasters or wars that destroyed buildings and crops and reduced the population; otherwise the next survey took place at the beginning of a new sultan’s rule, or generally after a period of fifteen to thirty years. By the method of tahrir, everyone knew their responsibilities and rights; if their rights had been attacked, they had the right to appeal to the court, and even to send a úikayetnâme (petition for complaints) to the imperial capital, which could end with the abolishment of the timarlÕ sipahis’ privileges for abuses against the reaya. ønalcÕk underlines the difference between the code of the Serbian monarch Stephen Dusan and Ottoman law: Dusan’s code required the peasant to work for his lord two days a week, while the Ottoman kanunnâmes envisaged only three days a year.58 Peter F. Sugar lists the advantages to the peasantry in the Ottoman period: The arrival of the Ottomans prevented the full enserfment of the Balkan peasants. In the Ottoman Empire, the cultivator belonged to the “reaya” class, but so did about 90 percent of all inhabitants of the state. He retained certain legal, personal and property rights and could take his grievances to a court in which a trained jurist, not his lord, acted as a judge. For these reasons the gulf separating landlords and peasants never became as deep as it did in those states in which feudalism reached full maturity.59

Especially after the conquest of Constantinople, Ottoman policy during the reign of Mahmud II was conducted in cooperation with the Orthodox Church. Gennadios, who heavily opposed unification with Rome, was appointed as the patriarch. The Ottomans regarded the Catholic Church in Rome and the pope as enemies of the empire because of their role in the Crusades in the past, and their ties with Catholic Hungary, and later Austria, which were the main rivals to the Ottomans in the Balkans. For their part, the Orthodox population living in the former Byzantine lands were generally hostile to the pope: the motto “Islam is better than the pope” reflects general public opinion at the time. It was this feeling which helped the Ottomans to establish good relations with the former Byzantine subjects.60 The Orthodox Church became an Ottoman institution, and the patriarch was made a high-level Ottoman official, holding a rank equal to that of vizier. ønalcÕk states the importance of Muslim–Orthodox cooperation as follows: The Ottomans established their empire by uniting the Muslim Anatolia and Christian Balkans under their rule and, although the fundamental principle of the state was to convey the Holy Message to every corner of the world,

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the empire emerged, at the same time, as a protector of the Orthodox Church and millions of Orthodox Christians.61

During the Ottoman period, not all the Balkan lands were directly ruled by the sultans. Principalities such as Wallachia (Eflak), Moldavia (Bo÷dan), a city-republic like Dubrovnik (Italian: Ragusa), and Transylvania (Erdel) were tribute-paying Ottoman vassals. They held a special status, being neither a part of dar’al-harb nor dar’al-Islam: they were considered as part of dar’al-ahd. Non-Muslim countries that developed friendly relations with Muslims sometimes became vassals, a status which was documented in an ahdnâme (treaty). Suraiya Faroqhi lists their functions as follows: At least at certain times, such dependencies served as venues of diplomatic and/or commercial exchanges that the authorities in Istanbul certainly had approved of, but did not wish to carry out in full view of everyone. One manner of dealing with such sites was to keep them outside the regular Ottoman administrative system altogether, or to at least have the central power represented only by low-level dignitaries. Dubrovnik (in Italian: Ragusa) constitutes the best documented instance of this type; when the military threat was limited, apparently there was little motivation to dignify relations with “the infidel” by managing them under the auspices of a highranking provincial governor.62

The Ottomans appointed their rulers, who were elected from the local people according to the local procedures, and protected them from attacks by other states. Dubrovnik, a city republic positioned on the coast of the Adriatic Sea, became an Ottoman vassal with the ahdnâme of 1442, and was obliged to pay a yearly tribute of 1,000 ducats (in the following centuries the tribute reached 12,500 ducats). Dubrovnik paid the lowest customs duties in the Ottoman Empire, so it became an important trade centre.63 People sometimes took refuge and invested their money in this vassal, and for this reason Stevan K. Pavlowitch described it as the “Switzerland of the fifteenth century.”64 Its merchants could be found anywhere in the Balkans. Wallachia and Moldavia too were tribute-paying states whose princes (voyvoda or bey) were elected by the local elites (boyar) and then appointed by the sultan. They had several obligations regarding foreign policy and international trade, but were otherwise autonomous in their internal matters. In their treaties, the most important obligation regarding foreign policy was the general Ottoman principle dosta dost ve düúmana düúman ol (be a friend to [my] friends and be an enemy to [my] enemies).65 However, after Prince Dimitrie Cantemir sided with the Russians in 1711, local nobles were no longer preferred by the Ottomans. Instead, Greeks from the Phanar (Fener) district of Istanbul,

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who were known as Phanariots, started to be appointed as princes. The presence of these vassal states provided the Ottomans with buffer zones against their enemies, and helped them to save money which would have had to be spent if they had ruled the principalities directly. In ending this section, I must add that the Balkans provided the Ottomans with an important base of power. During the Battle of Ankara (1402), while most of the soldiers from Anatolian provinces deserted the Ottomans and sided with Emir Timur, there were Serbian cavalries who bravely defended Sultan Bayezid, whose wife was a Serbian princess, alongside the remaining loyal soldiers. In 1492, the famous Ottoman historian Mehmed Neúri completed his book, which includes Turkish history from the prehistoric period to the reign of Bayezid II, and presented it to the sultan. In this book, Neúri accuses the Serbian princess of making Bayezid I drink wine: “Sultan Bayezid learnt drinking wine and chatting from the daughter of Laz.”66 This reflects the reaction to the centralization policies of Bayezid I, which included employing converts and slaves (kul) as governors in Muslim provinces of Anatolia after conquests instead of the Muslim aristocracy, the destruction of other independent emirates, and the introduction of timar, the new land and taxation system, to the Ottomans. In Islamic law, private property (mülk) is heavily protected against any abuse by the state. By destroying local dynasties in Anatolia and introducing Ottoman methods of taxation and administration, huge tracts of land were confiscated by the state, and many local elites lost their former privileges. After the war, during the interregnum period (Fetret Devri) which lasted from 1402 to 1413, private possessions in Anatolia were in anarchy, emirates that had been previously destroyed by Bayezid I were re-established with the military help of Tamerlane, and there was a struggle for the throne between the sons of Bayezid I; all these factors weakened the state. In the Balkans, however, except for some small territorial concessions, Ottoman rule was still powerful enough to provide the sultans with the necessary force to reunite the empire. The Balkan Peninsula was also out of reach of Tamerlane’s forces, which was a vital factor for survival. Later, during the reign of Mehmed the Conqueror, the land reform which involved confiscating the property of Muslim pious foundations—which thereby lost their function—created another wave of reaction and resentment among the Muslim circles of Anatolia. Pious foundations were untouchable, and their property was regarded as the property of God, thus its confiscation was strictly forbidden. On the other hand, with this protected status, establishing pious foundations was a safe way of transferring and securing revenue to subsequent generations. By adding an article in the

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establishment deed of a pious foundation, stating that the administrators of the foundation had to be the founder’s sons and grandsons, these people were assured of receiving a fixed amount of money for their administrative services. As a result of the increase in the amount of lands, houses, and shops owned by pious foundations—keeping in mind that their revenue was exempted from many taxes—the state was losing an important source of revenue. Trying to strengthen the central administration and increase state revenues, Mehmed the Conqueror confiscated the possessions of some of the pious foundations. This policy was reversed only when his son Bayezid II ascended to the throne. The Anatolian and Balkan Peninsulas together comprised the heart of the empire. Coping with local forces in the Balkans, however, was easier than dealing with forces in Anatolia. After the destruction of local dynasties in the Balkans, the only major threat emanated from external forces like Hungary, and later the Habsburg dynasty, as well as Venice; there was no serious revolt in the Balkans until the eighteenth century.

The Black Sea (Kara Deniz): An Ottoman Lake After Mehmed the Conqueror conquered Constantinople, the Ottomans attained control of the Straits; however, they still did not have full control of the Black Sea Basin. The Genoese colonies were well established, especially in the Crimean Peninsula. They had a near-monopoly during the Byzantine rule over the Mare Maggiore. The Genoese colonies included Caffa/Feodosia (Kefe), Cembalo (Balaklava), and Soldaia (Su÷dak), while the Venetians, due to their agreement with the Golden Horde, controlled Tana (Azak).67 The Genoese were in an advantageous position compared to the Venetians. In addition, one of the most important port cities of Anatolia, Trebizond (Trabzon), was under the rule of the Trebizond Empire. Constantinople, as the Queen of Cities, with its huge population during Byzantine and later Ottoman rule, depended mostly on the resources of Black Sea region. According to Fernand Braudel “the Black Sea was the supplying region without which the mighty capital couldn’t survive … .”68 It was a centre of international trade. Charles King draws a picture of the trade relations of the Black Sea with its neighbouring areas: the Black Sea was already at the center of an economic network that extended from the mulberry groves of China to the silk houses of Marseilles, from the fairs of Novgorod and Kiev to the bazaars of Tabriz. It lay at the crossroads of major international highways. “Silk routes” wound

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Chapter Two from China through Central Asia, across the Caspian to the Volga, then overland to the Don river and from there into the Sea of Azov and the ports of Crimea; or along a southern road, across central Asia and Persia, then through Armenia to the port of Trebizond. The rivers of the north carried traffic through Poland and Russia to the Baltic Sea, an ancient route that had once brought amber to the Mediterranean but now bore silk, fur and animal hides to the growing cities of northern Europe. Manufactured goods, especially textiles, arrived from central Europe and then spread out across the Eurasian steppe. Cereals and spices flowed in the opposite direction, into Central Europe or out through the Bosphorus to the Aegean.69

In the Byzantine period, maritime trade in the Black Sea was almost a monopoly of the Latins. Mehmed II did not follow the same policy. He wanted to secure his capital, to control the flow of goods and receive customs duties for his imperial treasury. As early as 1454, after an agreement with the Crimean Khan, an Ottoman fleet was sent to help the Khan to conquer Kefe. However, the town was able to withstand the attack. After that, parties made an agreement according to which the Genoese were to pay 1,200 gold pieces every year.70 It was that strategic thinking which led to the conquests of Amasra, Sinop, and Trabzon in 1461, and campaigns in Kefe (1475) and Moldavia (1476). His ultimate aim was to transform the Black Sea into an Ottoman lake.71 The struggle for the throne was always the Achilles heel of the Crimean Khanate. Megli Giray, after gaining control of the Khanate, tended to ally with Muscovy against Poland and the Golden Horde. Ottoman relations with the Genoese, on the other hand, were getting worse. When, in 1475, an internal struggle triggered by the Genoese ended with an uprising of the Tatar aristocracy against Mengli Geray, he sought refuge with the Genoese. Ottomans were then invited by the Tatar aristocracy to intervene in Crimean affairs and, first of all, to drive the Genoese out of the Crimean Peninsula.72 For this purpose, an Ottoman fleet of 300 ships under the command of Gedik Ahmed Paúa was sent to Crimea. Ultimately all the Genoese possessions were conquered, and the Ottomans became the suzerain of the Crimean Khanate.73 In a letter sent to Mehmed II by Mengli Giray in 1475, the khan mentions one of the articles of a treaty which obliged him to be the friend of the sultan’s friend and the enemy of the sultan’s enemy, a formula common—as we have noted—in Ottoman ahdnâmes.74 However, it is clear that the Crimean Khans were not willing to be fully dependent on the Ottomans, sometimes following policies against them.75 After the conquest, the Ottomans formed a new province (eyalet) named Kefe, which included Kefe, Kerç, Taman, Mankub, ønkirman, Su÷dak, Taman, and BalÕkla÷o, and appointed a

The Black Sea and the Balkans under Ottoman Rule

39

governor. At that time, most of the coastal areas had come under the direct rule of the Ottomans. Kefe was an important centre of the Black Sea trade, and also the centre of Ottoman diplomatic relations with Muscovy.76 In the sixteenth and seventeenth centuries, it served as the main supply centre for the Ottoman troops campaigning in Iran, and most of the Ottoman forces from the Balkans were transported there via Kefe.77 Istanbul, the imperial city, with its huge population of half a million, was the main consumer of food and goods produced throughout the empire. Its population’s welfare was one of the main concerns of the sultans. Travellers from Europe were surprised by the low prices of food in Istanbul. The imperial city consumed 500,000 kilograms of wheat every day, and four million sheep, three million lambs, and 200,000 cattle every year.78 The Ottomans used mostly private capital to deal with the problem of providing sufficient grain for the city. Merchants had to obtain an official license from the authorities in order to invest in grain trading and transportation. Government capital was used to reserve the necessary grain for the use of the palace and army.79 The grain produced in Mediterranean areas of the Empire (including Asia Minor and Egypt) was reserved for imperial purposes and stored in granaries, because it was more durable than the grain of the Black Sea area. Grain from the Black Sea Basin could be stored in the granaries for a maximum of one year. Thus, this supply was only enough to meet the daily needs of Istanbul, and was distributed to the bakeries.80 The amount of grain (wheat and barley) brought to Istanbul in 1758 by private capital was 6,510,000 kiles, which is equal to 166,656 tons (one Istanbul kile is 256 kilograms).81 UnkapanÕ, a district of Istanbul on the coast of the Golden Horn, was the place where the ships carrying grain from Black Sea areas such as modern Romania, Bulgaria, Thrace, and Crimea arrived.82 There the grain was recorded by the state officials. The Crimean Khanate, as a vassal of the Ottomans, was able to provide the Ottomans with auxiliary forces of light Tatar cavalry, a force comprising between 40,000 and 100,000 men.83 Also, the Crimean Khanate formed a buffer zone, preventing powers of other centres such as Poland and Muscovy from reaching the Black Sea. “It is no accident that the Russian appearance on the shores of the Black Sea (which brought about a sudden and serious deterioration of Ottoman power) could take place only after the Crimean Khanate had been tamed in the late eighteenth century.”84 Thus, until the Treaty of Küçük Kaynarca (1774), the Black Sea was closed to all foreign ships, and an Ottoman lake was formed around which the empire held strong positions, especially in the Crimea.

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In the fourteenth century, the famous Arab traveller øbn-i Batuta (d. 1369) visited and described Kefe, with its big markets and a great port which could shelter approximately 200 ships. He states: “I later found out that it was one of the most famous and busiest ports of the world.”85 Ottoman customs registries show that it was still a busy port during the Ottoman rule, and was visited by many ships every year. It also weakens the general assumption that Muslims did not take part in trading activities in the empire, as it lists many Muslims as merchants and ship-owners.86

Conclusion As shown throughout this paper, the Ottoman Empire was an Anatolian–Balkan empire with a predominantly Muslim and Orthodox population. The Balkans played an important role as a power base and a source of natural resources. By controlling Anatolia and the Balkans, and later the Crimean Peninsula, the Ottomans were able to control the Black Sea and turn it into an Ottoman lake for some time. Ottoman sultans were from the very beginning willing to cooperate with the Orthodox Christian population of Anatolia. Especially when Mehmed II conquered Constantinople, he saw himself as the successor of Roman emperors. Thus, he used the title of Kayzer-i Rum (Caesar of Rome) and tried to integrate the Orthodox population into the imperial structure by giving privileges to the Church. The Ottomans, at the height of their power, were able to fulfil their promise to the subjects of the state of a just rule for everybody. There was no serious uprising in the Balkans even three centuries after the Ottoman conquest. By appointing converts to high posts and incorporating the Christian elite, the Ottomans ruled a cosmopolitan society, while at the same time protecting the rights and freedoms of the peasantry. To sum up, it is fair to say that, during the first centuries of the Ottoman rule in the Balkans, the Ottomans succeeded in conquering the hearts and minds of the Balkan people.

Notes 1

Hans Theunissen, Ottoman–Venetian Diplomatics: The Ahd-names (Rotterdam, 1960), 4. 2 Paul Wittek, OsmanlÕ ømparatorlu÷u’nun Do÷uúu, trans. Fatmagül Berktay (Istanbul: Pencere YayÕnlarÕ, 2000), 29. 3 Sir James Redhouse, Redhouse Sözlü÷ü (Türkçe/OsmanlÕca–øngilizce) (Istanbul: Sev YayÕncÕlÕk, 1998), 129.

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Peter Sarris, “The Eastern Roman Empire from Constantine to Heraclius (306– 641),” in The Oxford History of Byzantium, ed. Cyril Mango (Oxford: Oxford University Press, 2002), 19. 5 Cyril Mango, “Introduction,” in The Oxford History of Byzantium, 2. 6 Averil Cameron, The Byzantines (Oxford: Blackwell, 2007), 1. 7 Donald M. Nicol, The Last Centuries of Byzantium 1261–1453, 2nd ed. (Cambridge: Cambridge University Press, 1996), 1. 8 Sarris, “The Eastern Roman Empire,” 40. 9 Jonathan Shepard, “Spreading the Word: Byzantine Missions,” in The Oxford History of Byzantium, 231. 10 Claude Cahen, OsmanlÕlardan Önce Anadolu, trans. Erol ÜyepazarcÕ (Tarih VakfÕ Yurt YayÕnlarÕ, 2008), 7 (originally published in French as La Turquie préOttomane). 11 John Julius Norwich, Byzantium (The Apogee) (London: Penguin Books, 1993), 341. 12 As reported by Matthew of Odessa. Speros Vryonis, Jr., The Decline of Medieval Hellenism in Asia Minor and the Process of Islamization from the Eleventh through the Fifteenth Century (Los Angeles: University of California Press, 1971), 93. 13 Laszlo RasonyÕ, Tarihte Türklük, trans. H. Z. Koúay (Istanbul: Örgün YayÕnevi, 2007), 243. 14 Paul Magdalino, “The Medieval Empire (780–1204),” in The Oxford History of Byzantium, 185. 15 Cameron, The Byzantines, 45. 16 Georg Ostrogorsky, Bizans Devleti Tarihi, trans. Fikret IúÕltan (Ankara: Türk Tarih Kurumu YayÕnlarÕ, 2006), 335 (originally published in German as Geschichte des Byzantinisches Staates). 17 See especially Steven RuncÕman, HaçlÕ Seferleri Tarihi, 3 vols., trans. Fikret IúÕltan (Ankara: Türk Tarih Kurumu YayÕnlarÕ, 1998) (originally published in English as A History of the Crusades). 18 Cameron, The Byzantines, 46. 19 Magdalino, “The Medieval Empire,” 197. 20 W. Heyd, YakÕndo÷u Ticaret Tarihi, trans. Enver Ziya Karal, 2nd ed. (Ankara: Türk Tarih Kurumu, 2000), 63 (originally published in French as Histoire du Commerce du Levant au Moyen-Age). 21 For Byzantine–Venetian relations, see Donald M. Nicol, Byzantium and Venice, A Study in Diplomatic and Cultural Relations (Cambridge: Cambridge University Press, 1999). 22 Georges Bratianu, La Mer Noire: Des Origines a la Conquete Ottomane (Münich: Societatea Academica Romana, 1969), 173. 23 Heyd, YakÕndo÷u Ticaret Tarihi, 480–487. 24 Vryonis, The Decline of Medieval Hellenism, 132. 25 Osman Turan, “Selçuklu KervansaraylarÕ,” Belleten (Ankara: Türk Tarih Kurumu BasÕmevi)10, no. 39 (July 1946): 473. 26 Theunissen, Ottoman–Venetian Diplomatics, 55. 27 Cahen, OsmanlÕlardan Önce Anadolu, 121–123.

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28 Fuat Köprülü, OsmanlÕ ømparatorlu÷u’nun Kuruluúu, 4th ed. (Ankara: Akça÷ YayÕnlarÕ, 2006), 77. 29 Fuat Köprülü, Anadolu’da øslamiyet (Ankara: Akça÷ YayÕnlarÕ, 2005), 50. 30 Vryonis, The Decline of Medieval Hellenism, 134. 31 Cahen, OsmanlÕlardan Önce Anadolu, 160. 32 Osman Turan, Selçuklular ve øslamiyet (Istanbul, 1971), 12. 33 Osman Çetin, Sicillere Göre Bursa’da øhtida Hareketleri ve Sosyal SonuçlarÕ (1472–1909) (Ankara: Türk Tarih Kurumu YayÕnlarÕ, 1999), 37. 34 Irène Beldiceanu-Steinherr, “La Population non-Musulmane de Bithynie (Deuxième Moitié du XIVe s.–Première Moitié du XVe s.),” in The Ottoman Emirate (1300–1389): Halycon Days in Crete I, A Symposium Held in Rethymnon, 11–13 January 1991, ed. Elizabeth Zachariadou (Rethymnon: Crete University Press, 1993), 18. “On sait également que les Byzantians ont christianisés des communautés turques venues soit par le nord de la mer Noire soit des parties de l’Asie Mineure dependant de l’État seldjouqide. Il ne faut cependant jamais perdre de vue que le passage au christianisme était à Byzance soumis des règles très strictes et exigeait, entre autres, l’abandon du nom ‘barbare.’ A cette categories appartiennent probablement les habitants du village de Tchepni dont les noms sont tirés du calendrier grec. Quant aux autres, il ne peut s’agir ni de populations autochtones grecques, ni de musulmans convertis. A en juger d’apres les anthroponymes, nous avons affaire à une population turco-tatare (meme si d’autres elements ne sont pas à exclure), chrétienne de père en fils, mais dont le christianisme, voire parfois le religion, reste à definir.” 35 F. W. Hasluck, Christianity and Islam under the Sultans (Istanbul: The ISIS Press, 2000), vol. 1, 96–117. 36 Ahmet Yaman, øslam Hukukunda UluslararasÕ øliúkiler (Ankara: Fecr YayÕnevi, 1998), 235. 37 Bilal EryÕlmaz, OsmanlÕ Devleti’nde Gayrimüslim TebaanÕn Yönetimi (Istanbul: Risale YayÕnlarÕ, 1996), 21. 38 For the regulations regarding non-Muslims in the Ottoman Empire, see Ruth Lamdan, “Communal Regulations as a Source for Jewish Women’s Lives in the Ottoman Empire,” The Muslim World 95 (April 2005): 249–263, and Betül øpúirli ArgÕt, “Clothing Habits, Regulations and non-Muslims in the Ottoman Empire,” Akademik AraútÕrmalar Dergisi, no. 24 (2005): 79–96. 39 Vryonis, The Decline of Medieval Hellenism, 224. 40 Vryonis, The Decline of Medieval Hellenism, 359. 41 Çetin, Sicillere, 34. 42 Nicol, The Last Centuries, 108. 43 For a comparison of Ottoman and Byzantine sources regarding early Ottoman military activities, see Halil ønalcÕk, “Osman Ghazi’s Siege of Nicea and the Battle of Bapheus,” in Zachariadou, The Ottoman Emirate (1300–1389), 77–99. 44 ùerif Baútav, “OsmanlÕ ømparatorlu÷u’nun Kuruluúu EsnasÕnda Bizans ve Avrupa,” Belleten 68 (April 2004): 3. 45 Halil ønalcÕk, “Ottoman Methods of Conquest,” Studia Islamica, no. 2 (1954): 103–129. 46 Cameron, The Byzantines, 59.

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47 Peter F. Sugar, Southeastern Europe Under Ottoman Rule 1354–1804 (Seattle: University of Washington Press, 1996), 3. 48 Here I use the term “fief,” but it must be kept in mind that the Ottoman timar was very different, especially from the Western European fief. 49 Irene Melikoff, Uyur ødik UyardÕlar, Alevilik-Bektaúilik AraútÕrmalarÕ, trans. Turan Alptekin (Istanbul: Demos YayÕnlarÕ, 2006), 197–209. 50 Ömer Lütfi Barkan, “OsmanlÕ ømparatorlu÷u’nda Bir øskân ve Kolonizasyon Metodu Olarak VakÕflar ve Temlikler,” VakÕflar Dergisi (Ankara: VakÕflar Umum Müdürlü÷ü NeúriyatÕ, 1942), 279–386. 51 The text in Turkish is “Yiniúehir kapusÕnÕ çÕkdugÕ yirde bir imaret yapdÕ … ømaretün kim kapusÕ açÕldÕ, ta’am kim biúdi Orhan Gazi ol ta’amÕ kendü mübarek eliylen üleúdürdi ve çÕra÷Õn dahÕ evvel gice kendü yakdÕ … ”; AúÕk Paúazade, Tevarih-i Al-i Osman, ed. K. Yavuz and M. A. Yekta Saraç (Istanbul: Gökkubbe YayÕnlarÕ, 2007), 314. 52 Heath W. Lowry, “Random Musings on the Origins of Ottoman Charity: From Mekece to Bursa, øznik and Beyond,” in Feeding People, Feeding Power: Imarets in the Ottoman Empire, ed. Nina Ergin, Christoph K. Neuman, and Amy Singer (Istanbul: Eren Press, 2007), 71. 53 Lowry, “Random Musings,” 7. 54 Hüseyin Arslan, 16. yy. OsmanlÕ Toplumunda Yönetim, Nüfus, øskan, Göç ve Sürgün (Istanbul: Kaknüs YayÕnlarÕ, 2001), 181. 55 Halil ønalcÕk, ed., Hicri 835 Tarihli Suret-i Defter-i Sancak-i Arvanid (Ankara: Türk Tarih Kurumu BasÕmevi, 1987), passim. 56 Cengiz Orhonlu, OsmanlÕ ømparatorlu÷u’nda Derbend TeúkilatÕ (Istanbul: Eren YayÕncÕlÕk, 1990), 17. 57 For Christian sipahis in the Balkans, see esp. Halil ønalcÕk, Fatih Devri Üzerine Tetkik ve Vesikalar, 4th ed. (Ankara: Türk Tarih Kurumu YayÕnevi, 2007), 137– 184. 58 Halil ønalcÕk, The Ottoman Empire: The Classical Age 1300–1600 (London: Phoenix, 2000), 7. 59 Peter F. Sugar, “Major Changes in the Life of the Slav Peasantry under Ottoman Rule,” International Journal of Middle East Studies 9, no. 3 (October 1978): 297– 305. 60 L. S. Stavrianos, The Balkans Since 1453 (New York: Rinehart, 1961), 61. 61 ønalcÕk, The Ottoman Empire, 7. 62 Suraiya Faroqhi, The Ottoman Empire and the World Around It (London: I. B. Tauris & Co. Ltd, 2004), 80. 63 Nicholas H. Biegman, The Turco–Ragusan Relationship (The Hague: Mouton, 1967), 26–27. 64 Stevan K. Pavlowitch, A History of the Balkans 1804–1945 (London: Addison Wesley Longman, 1999), 4. 65 Mihai Maxim, Romano-Ottomanica, Essays and Documents from the Turkish Archives (Istanbul: The ISIS Press, 2001), 12. 66 Mehmed Neúri, KitabÕ-Õ Cihan-Numa (Neúri Tarihi), 2 vols., reprinted in Türk Tarih Kurumu, 3rd ed., ed. Faik Reúit Unat and Mehmed A. Köymen (Ankara: 1995), 1:333. The Turkish text is: “Ve Sultan Bayezid úarab içüb sohbet itme÷i Laz

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kÕzÕndan ö÷rendi. Yoksa ol vakte de÷in nesl-i Osman her giz úarab içmiú de÷üldi.” Here the term “Laz” refers to the name of the Serbian despot Lazarevic; the Ottomans called his territory “Lazeli” and his dynasty and successors “Laz o÷lu.” 67 ùerafettin Turan, Türkiye-øtalya øliúkileri (Metis YayÕnlarÕ, 1990), 53. 68 Fernand Braudel, The Mediterranean and the Mediterranean World in the Age of Philip II, vol. 1, trans. Silan Reynolds (Berkeley: University of California Press, 1995), 110. 69 Charles King, The Black Sea, A History (Oxford: Oxford University Press, 2004), 82. 70 Alan Fisher, The Crimean Tatars (Stanford: Hoover Institution Press, 1978), 5. 71 Halil ønalcÕk, “Yeni Vesikalara Göre KÕrÕm HanlÕ÷Õ’nÕn OsmanlÕ Tabili÷ine Girmesi ve Ahidname Meselesi,” Belleten 8, no. 30 (April 1944): 195. 72 ønalcÕk, “Yeni Vesikalara Göre,” 205. 73 Muzaffer Ürekli, KÕrÕm HanlÕ÷Õ’nÕn Kuruluúu ve OsmanlÕ Himayesinde Yükseliúi (1441–1569) (Ankara: Türk Kültürünü AraútÕrma Enstitüsü YayÕnlarÕ, 1989), 16– 17. 74 InalcÕk, “Yeni Vesikalara Göre,” 227. 75 Ürekli, KÕrÕm HanlÕ÷Õ’nÕn Kuruluúu, 47. 76 Regarding Kefe, see especially Yücel Öztürk’s study, based on Ottoman documents, which provides insight into the trade and commerce history of the province: Yücel Öztürk, OsmanlÕ Hakimiyetinde Kefe 1475–1600 (Ankara: T. C. Kültür BakanlÕ÷Õ YayÕnlarÕ, 2000). 77 Öztürk, OsmanlÕ Hakimiyetinde Kefe, 93–99. 78 Salih Aynural, østanbul De÷irmenleri ve FÕrÕnlarÕ, Zahire Ticareti (1740–1840) (Istanbul:Tarih VakfÕ Yurt YayÕnlarÕ, 2001), 13. 79 Lütfi Güçer, “Grain Supply of Istanbul in the Eighteenth Century,” in The Economic History of Turkey, 1800–1914, ed. Charles Isaawi (Chicago: The University of Chicago Press, 1980), 29. 80 Robert Mantran, XVI ve XVII. YüzyÕlda østanbul’da Gündelik Hayat, trans. Mehmet Ali KÕlÕçbay (Istanbul: Eren YayÕncÕlÕk, 1991), 42 (originally published in French as La Vie Quotidienne a Constantinople au Temps de Soliman le Magnifique et de se Successeurs [XVIe et XVIIe Siecles]). 81 Rhoads Murphey, Ottoman Warfare 1500–1700 (Padstow: UCL Press, 1999), 1. 82 Fisher, The Crimean Tatars, 38. 83 øbn-i Batuta, Büyük Dünya Seyahatnamesi [Tuhfetu’n-Nüzzar fi Garaibi’l-Emsar ve’l-Acaibi’l-Esfar] (Istanbul: Yeniúafak YayÕnlarÕ). 84 Halil ønalcÕk, ed., The Customs Register of Caffa, 1487–1490 (Cambridge: Harvard University Press, 1995). 85 Mantran, XVI ve XVII. YüzyÕlda, 143. 86 Güçer, “Grain Supply,” 27.

CHAPTER THREE THE PRECONDITIONS OF ETHNIC–POLITICAL CONFLICTS IN GEORGIA (A GEORGIAN PERSPECTIVE) ZURAB DAVITASHVILI1

Introduction Keeping and protecting territorial integrity is one of the most essential questions for any country. This is an especially burning matter for Georgia, where restoring and preserving its territorial integrity and extending its jurisdiction everywhere within its borders, as recognized by the international community, are its main current political issues. Due to its hard historical fate, the united state of Georgia disintegrated into separate kingdoms and principalities in the second half of the fifteenth century. In this period, the Kartli, Kakheti, and Imeret kingdoms and the Samctskhe–Saatabago (Meskheti) principality were formed. In the sixteenth century, Guria, Samegrelo, Abkhazia, and Svaneti detached from Imereti and were established as separate principalities. In this way, eight political units emerged as independent from each other, instead of a united Georgia. In the first half of the seventeenth century, Persia and Turkey divided Georgia’s territory between them: Kartli and Kakheti became Persian domains, and Imereti and five Georgian principalities became Ottoman cities. In the second half of the eighteenth century, Kartli and Kakheti united under one kingdom, but the other Georgian principalities and Imereti kingdom failed to join. In 1783, the Kartli–Kakheti kingdom entered the protectorate of Russia, and in 1801, the Russian Empire completely abolished this kingdom and annexed its territory. This was followed by attaching the Imereti kingdom and the Guria, Samegrelo, Svaneti, and Abkhazia 1

Tbilisi State University; Member of the Board of Governors, Georgia.

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principalities to the Russian Empire. As a result of the Russian–Turkish war (1828–1829), Russia also annexed a part of Meskheti—Samtskhe and Javakheti—followed by Adjaria in 1878. Therefore, Georgian kingdoms and principalities entered the Russian Empire separately, at different times. This fact is misrepresented by Russian ideologists, and has been used against the interests of the Georgian nation and state. The point is that in Russia, Georgia (known there as Ƚɪɭɡɢɹ, Gruzia) is understood to comprise the former Kartli–Kakheti kingdom, and only residents of these two provinces are considered Georgians. They did not regard Georgia’s other kingdoms and principalities and their populations as separate nations (Imeretians, Gurians, Megrelians, Svans, etc.). This manipulation has frequently been applied to Abkhazia. Russian academics and media often emphasize that Georgia and Abkhazia are two different countries, as Georgia (meaning Kartli–Kakheti) entered Russia’s protectorate in 1783, while Abkhazia entered in 1810. Using similar logic, it might be successfully alleged that West Georgia is not Georgia at all, and Kutaisi and Batumi are not Georgian towns, as they did not enter Russia in 1783. Russia set itself the goal of breaking Georgia into smaller parts. In order to realise its goal, it first separated Abkhazia and South Ossetia, but after it became clear that Georgia was firmly determined to integrate itself into European–Atlantic structures, Russia realized that it was impossible to keep the whole of Georgia under its influence. This is why Russia decided to play its last trump cards in Abkhazia and Ossetia.

The Problem of Abkhazia With a language that belongs to the North Caucasian language family, Abkhazians are related to Adygeans, Kabardinians, and Circassians. With their daily lifestyle and spiritual culture, however, Abkhazians partly represent the Georgian culture, and there is little difference between them and Megrelians and Svans, the neighbouring Georgian sub-ethnic groups. There is disagreement among academics about the geographical origins of Abkhazians. Some researchers suppose that they are the autochthonic aboriginal population of Abkhazia, while others think that they migrated to this territory in the Middle Ages from the North Caucasus. However, there is one question that is indisputable for impartial commentators: despite differences with respect to the language, in political, economic, and cultural terms, Abkhazians have been considered an integral part of Georgia. Moreover, when the unification of Georgia began in the ninth century, it started in the principality of Abkhazia itself (covering

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approximately the territory of the present Gudauta region). The kingdom of Abkhazia was formed, which included all of West Georgia, with the capital city being Kutaisi; “Abkhazian” meant a resident of West Georgia, or a West Georgian. (Supposedly, in that period ninety percent of West Georgia’s residents were ethnic Georgians, proving that Abkhazians themselves were even then ethnically not Georgians of North Caucasian origin). At the end of the tenth century, West and East Georgia joined to form a united kingdom which was known at first as “the kingdom of Abkhazians and Georgians,” and when Kakheti–Hereti joined at the beginning of the twelfth century, the name “Georgia” was introduced.1 Abkhazia’s estrangement from Georgia began at the beginning of the seventeenth century, when the kingdom was broken up and Abkhazia was formed as a separate principality. This situation was exacerbated by the weakening of Christianity, the establishment of the Ottoman protectorate, the introduction of Islam, the immigration of North Caucasians, and separation from the Georgian linguistic-cultural environment. (However, amongst Abkhazian principality officials, Georgian remained the language of business, and the Abkhazian aristocracy made up a significant part of Georgian noble society). After entering under Russia’s protectorate, the Principality of Abkhazia existed for over half a century and was officially abolished in 1864. In the Caucasian war which the North Caucasian peoples led against Russia for half a century, Abkhazians fought for the North Caucasians, since they had been considered unreliable by the Russian Empire. Abkhazians were deported three times (in 1864, 1866, and 1877–1878) to Turkey, which reduced the number of Abkhazians in Abkhazia and left some regions entirely uninhabited.2 The Russian Empire’s attitude toward Abkhazia changed from the beginning of the twentieth century. Since the Georgian national movement for liberty, whose goal was to restore the Georgian state, was now much stronger, Russia had to take measures to prevent its independence and create internal problems in Georgia. The policy of predisposing Abkhazians against Georgians served exactly this purpose. Russian propaganda made every effort to convince Abkhazians that they had no relation whatsoever with Georgians; Abkhazia and Georgia were two quite different countries, and Abkhazian historical milestones were in no way Georgian. Moreover, the young people of Abkhazia were educated through the Russian language, and actually did not speak Georgian at all (apart from some aristocrats). Consequently, the newly formed Abkhazian intelligentsia was positively predisposed towards Russia, and against Georgia.

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Despite the above-mentioned facts, the majority of the Abkhazian people supported union with the Georgians. In 1918, when Georgia reinstated its independence, Abkhazia entered Georgia with the status of autonomy, guaranteed by the 1921 constitution of the Georgian Democratic Republic. After Georgia’s occupation, forced sovietization, and annexation by Russia in 1921, Russia formed the “independent” Soviet Socialistic Republic of Abkhazia; however, this decision turned out to be so illogical and absurd that after eight months, Russia had to give Abkhazia back to Georgia, but with the status of a “republic under agreement.” This strange attitude (which was only one of many types in the Soviet Union) lasted for ten years, and changed in 1931 when Abkhazia became part of Georgia’s autonomous republic. Abkhazian separatists use these facts as “evidence” against Georgia, which twice “demoted” Abkhazia’s status (first from “independent” republic to union republic, and then to autonomous republic).3 Among the events which took place during the reign of Soviet power, Abkhazians especially condemn the so-called “demographic expansion,” according to which the Georgian population increased sixfold, while that of the Abkhazians only increased threefold. Actually, a migration of the Georgian population from other regions of Georgia occurred at the time, due to the need for a work force to develop subtropical production. Because of the policies of the USSR central government, about 50,000 people (not 150,000, as Abkhazians claim) moved to Abkhazia from the neighbouring Georgian provinces. It is noteworthy that according to the census, the proportion of ethnic Georgians in the population of Abkhazia was less in 1989 than in 1886 (45.5 percent compared to 51.3 percent). The decrease in the number of Abkhazians during the same period (from 41 percent to 17.5 percent) is explained mainly by the movement of other ethnic groups to the region. Suffice it to say that the number of Russians in this period increased by seventy-two times, and that of Armenians by seventy-five times.4 The second serious claim against Georgia is the replacement of Abkhazian schools with Georgian ones. This actually never happened. The schools in question were named Abkhazian because the education in the elementary grades was given in these schools in the Abkhazian language, and after the fourth grade Abkhazian was taught only as a second language, but all other subjects were taught through the Russian language. After 1938, Russian, the teaching language in the upper grades, was replaced by Georgian, and in the lower grades it remained Abkhazian. Consequently, no changes were actually made to Abkhazian schools and

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language education. From 1953 onwards, the teaching language for the upper grades became Russian again, and teaching of the Georgian language in Abkhazian schools ceased completely. Hence, young Abkhazians were exempt from studying Georgian, which gave rise to an estrangement of newer generations from the Georgian language and culture. Abkhazians who were brought up in the Russian language and culture became antagonistic to the Georgians and Georgia. All of this prepared the ground for turmoil and ethnic conflict.5 Despite the fact that Abkhazians were one of the most privileged ethnic groups in the Soviet Union, actually enjoying an ethnocracy (it was the only autonomous republic where the local language had official status, and seventeen percent of the Abkhazian population occupied almost all major official positions), Russian propaganda and the Abkhazian press represented them as an oppressed ethnic group who were threatened by the Georgians; that was why when Georgia’s national movement for liberty became stronger, and the disintegration of the Soviet Union became real, Abkhazians took an extremely hostile position against Georgia’s formation as an independent country, and supported the maintenance of the Soviet Union. If Georgia had been unable to become an independent country, Abkhazia would have joined Russia. In 1992, when Georgia became an independent country, Abkhazians exploited the tense situation in the country, performing a whole range of provocative actions such as stopping and robbing trains and illegally displacing Georgians from their positions to employ Abhkazians in their place. Moreover, the Abkhazian parliament terminated the enforcement of the Georgian constitution within the Abkhazian territory. Under such circumstances, the Georgian government deployed its military units on Abkhazian territory, with the purpose of re-establishing order there. Russia, meanwhile, was waiting for exactly that action. The military conflict started, with the inexperienced, weak, greenhorn Georgian army and volunteers fighting on one side, and on the other, professional Russian soldiers (most of them veterans of the Afghan war), Kazakh and North Caucasian warriors (amongst whom were Chechen fighter groups under the command of Shamil Basaev, who turned their weapons against Russia two years later). Almost eighty percent of the so-called Abkhazian army was composed of these forces. In September 1993, breaching the ceasefire agreement which had been drawn up in July, Russians, North Caucasians, and Abkhazians started mass attacks on Sukhumi. After ten days of heavy fighting, Sukhumi fell. A massive extermination of the Georgian population began. Almost all of the Georgian population had to leave Abkhazia. An unprecedented ethnic combing-out took place. Georgia

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managed only to keep the upper part of Kodori gorge, with several thousand residents. In 2008, however, this territory was also occupied by Russia after the Russian–Georgian war. By asserting Abkhazia’s independence (which actually meant accepting the Russian occupation of this region), Russia created one more explosive flashpoint, and made the restoration of Georgia’s territorial integrity into an international problem.

The South Ossetia (Tskhinvali Region) Problem Unlike that of Abkhazians, the question of the historical homeland of the Ossetians is less controversial. That the Ossetian people belong ethnically to the North Caucasus, and the first Ossetian settlements appeared on the southern side of the Caucasian range, on Georgia’s territory, only from the beginning of the seventeenth century, is not a matter for debate even for Ossetian academics. The first Ossetian settlement took place in the highland regions of Georgia (the upper reaches of the Liakhvi and Ksani rivers), where they occupied the former settlements of the Georgians who had moved to the plains. In the nineteenth century, the Ossetian migration to Georgia became more intensive and the area of their settlement expanded. Ossetian villages appeared in the plains of Kartli and Kakheti. The number of Ossetians in Georgia increased to 150,000 in half a century. The term “South Ossetia,” which indicates the northern mountainous region of Shida Kartli, was first used at the end of the nineteenth century, and the area (presently the Java district and the highland part of the Akhalgori district) was densely inhabited by the Ossetians.6 The Ossetians who migrated to Georgia had the status of “tenants” and were subject to certain restrictions. However, this status was removed from the beginning of the twentieth century, when they became the usual migrant peasants and were even given some privileges. It was a deliberate step on the part of the Russian Empire to use Ossetians, whom they considered loyal to their Empire, against Georgia’s national movement, as this would be rather effective. When Georgia actually restored its independence in 1918, Ossetians turned out to be the most active opponents of the Georgian independent state. Encouraged by Russian Bolsheviks, they arranged two riots, but in both cases they were cruelly defeated, and over 20,000 Ossetians escaped and took shelter in the North Caucasus. In 1921, as a result of Georgia’s occupation, sovietization, and de facto annexation by Russia, the policy of punishing Georgia and encouraging Ossetians began. In 1922, the South Ossetia autonomous region was

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established. Through this step, not only was this new political unit formed on Georgia’s territory, but also the term “South Ossetia” started to be legally used, emphasizing the existence of the two would-be Ossetias. Only two years later, an autonomous region in Ossetia’s actual territory was created within the Russian Federation. South Ossetia was such an artificial entity that the definition of its borders was almost impossible. Districts that were densely inhabited by the Ossetians (Java, Znauri, and part of Akhalgori) were few, and mostly covered extremely hard-to-access highland territory. Hence it was necessary to include in the autonomous region the neighbouring plain regions, where Ossetian villages were scattered among Georgian ones. In this way, over a hundred Georgian villages were incorporated into South Ossetia. Moreover, there was not a single town in the territory that was inhabited mostly by Ossetians, but still the province needed a capital. The nearest town to this territory was the town Tskhinvali, where, according to the census of 1886, there was not a single Ossetian resident, and the whole population of the town was made up of Georgians, Armenians, and Jews.7 The border of the autonomous province was established in such a way that Tskhinvali was included inside the territory. To the south, Tskhinvali directly adjoined Georgian villages which administratively belonged to Geori district and not to the autonomous region; to the north, Tskhinvali was also surrounded by nine Georgian villages which formed a continuous twenty kilometre settlement zone beside the Liakhvi river. Hence, the town was located entirely within the Georgian environment. In the years of Soviet power, the situation changed radically. Tskhinvali became an Ossetian town. According to the population census in 1989, ethnic Ossetians composed seventy percent of the town, which held 41,000 residents. Tskhinvali became the centre of Ossetian culture, home to a pedagogical institute and an Ossetian theatre, and where Ossetian newspapers and magazines were issued. Ninety-eight Ossetian schools in total operated in the province, while in actual, historical Ossetia (North Ossetia), there was not a single Ossetian school. All research on the Ossetian language, literature, and history was conducted only in Tskhinvali. Along with all the aforementioned issues, policies were conducted with the intention of distancing Ossetians from the Georgian culture. From 1953, education in the Georgian language ceased in Ossetian schools. As a result, unlike older generations who spoke the Georgian language well, the younger generations who grew up learning Russian were estranged from the Georgian language and culture.

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Conclusion All the conditions mentioned above fertilized the soil for Ossetian separatism, with the goal of separating South Ossetia from Georgia and uniting it with North Ossetia in the Russian Federation. When Georgia’s national movement for liberty strengthened and its independence became a real fact at the end of the 1980s, Ossetian separatism gained huge power. The first step was to change its status of autonomous province and to declare an autonomous republic. The Georgian government (which was still ruled by a communist regime) annulled the decision of South Ossetia, causing ever-increasing conflict in the area. In October 1990, South Ossetia declared its separation from Georgia. In October, after parliamentary elections, the communist regime ended in Georgia, and the radical nationalists came to power under the leadership of Zviad Gamsakhurdia. The new government took a radical step against Ossetian separatism, which turned into a military conflict. After Zviad Gamsakhurdia was replaced by Eduard Shevardnadze, a ceasefire agreement was signed. The region was occupied by Russian peace-keeping forces which were entirely focused on observing the interests of the Ossetian separatists. Although the situation turned into a frozen conflict, close everyday relations between Ossetian and Georgian populations did not stop. (Besides, there was a large proportion of combined Georgian–Ossetian families in the region.)8 Since 2004, following the so-called Rose Revolution, Mikheil Saakashvili’s government started to take serious steps to settle the conflict and to reintegrate South Ossetia into Georgia. These steps disturbed the separatist leaders of the Russian government, and Putin’s government set the goal of preventing the establishment of Georgian jurisdiction in South Ossetia, and finally severing this region from Georgia, as a target that must be achieved by all means. In order to reach this goal it was necessary to stir up a major conflict in the area. For this purpose, Russia tried Georgia’s patience, starting armed provocations against Georgian villages by aggravating the Ossetian separatists, and tempting Georgia to reply in the same manner. And finally they attained what they wanted: in August 2008, Georgia responded to the bombing of Georgian villages by opening fire on Tskhinvali. Thus Russia reached its goal, drawing Ossetia into a war against Georgia. As a result of the war, Russia occupied all of South Ossetia and ethnically combed out and razed the Georgian villages of Liakhvi gorge. Soon after this incident, Russia “recognized” the “independence” of South Ossetia and set up a military base on its territory. In this way, an area in the middle of Georgia, surrounded on three sides by Georgian provinces and on the other side separated from Russia by the

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Caucasian mountains, has been occupied and severed from the rest of Georgia. The Russian army is positioned at a distance of forty kilometres from Tbilisi. Obviously, this situation is extremely dangerous and it is a real potential source for an international conflict.

Notes 1

Studies in the History of Georgia, Vol. 2 (Tbilisi: Sabchota Sakartvelo, 1973), 416–445. 2 Studies in the History of Georgia, Vol. 5 (Tbilisi: Sabchota Sakartvelo, 1970), 216–226. 3 G. Zhorzholiani, Historical and Political Roots of Conflict in Abkhazia (Tbilisi Metsniereba, 2000), 76. 4 A. Totadze, The Demographic Picture of Georgia (Tbilisi: Samshoblo, 1993), 57–75. 5 Z. Davitashvili, Nationalism and Globalization (Tbilisi: Metsniereba, 2003), 413– 414. 6 Studies in the History of Georgia, Vol. 4. (Tbilisi: Sabchota Sakartvelo, 1973), 429–433. 7 Totadze, The Demographic Picture, 82. 8 Davitashvili, Nationalism, 415–418.

PART II: SECURITY

CHAPTER FOUR THE SECURITY POLICY OF THE CAUCASUS NATIONS IN THE NEW SECURITY ENVIRONMENT ELHAN MEHTIYEV1

Introduction The Black Sea security dimension is becoming an indispensable issue in the new European security agenda. The Black Sea is linked with SouthEast Europe and the South Caucasus, and has various cooperative and partnership programmes with Central Asian countries. NATO’s Istanbul summit communiqué confirmed the importance of the Black Sea region for Euro-Atlantic security and expressed its readiness to explore the means of enhancing security and stability in the area.1 The enlargement of NATO, including the admission of two Black Sea countries, Bulgaria and Romania, and the possible later admission of Georgia, gives strong backing to the argument that the entire wider Black Sea area is about to face significant global changes during the process of integration into the Euro-Atlantic security and economic structures. The growing importance of the Caucasus is due to its geographical location, lying between the Black and Caspian Seas, and sharing borders with NATO and European Union countries, as well as having direct access to the Central Asian and Middle Eastern countries. For Turkey and Western Europe, it is a doorway to Central Asia and Afghanistan; and for Russia, it has always been a gateway to the Middle East. But the overall environment in the Caucasus is still deprived of proper peace and stability, since the disturbance caused by territorial and separatist conflicts, and the ensuing mistrust, still continues in the region. 1

Director, Peace and Conflict Resolution Centre, Baku, Azerbaijan; email: [email protected].

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Fifteen years have passed since the break-up of the Soviet Union, but the landscape of the region has not changed much, and it is still struggling for sovereignty, security, and to remove the remnants of the Soviet legacy. Major impediments to the attempts to bring about change in the region so far have been the Armenian military occupation of Azerbaijani territories, the rebel territories of Georgia and Georgia’s uneasy relations with Russia, and the opposition of local authoritarian regimes to democratic transformation. Foreign and security policies of these nations are mainly based on these mutual confrontations, rather than on a vision for establishing common security and development in the region.

A Security Policy for South Caucasus The foreign and security policies of the states situated in the Southern Caucasus are shaped by the influence of the Euro-Atlantic institutions, and their political structures are set out on the ruins of the Soviet Union. When examined more closely, however, this scene shows particular differences in every nation. Being a CIS member, Azerbaijan has a representative in the security structures of the CIS Defence, the Council of Interior Ministries and the CIS Anti-Terrorist Centre; it can join in discussions about military security cooperation within the CIS, but it is not a member of the Collective Security Treaty. Azerbaijan and Georgia are also founding members of the GUAM Organization for Democracy and Economic Development, an organization which aims to help its member states in issues of security cooperation and transnational projects. Nevertheless, all three countries have enhanced their cooperation with NATO, although at different levels, signing IPAPs (Individual Partnership Action Plans) and developing bilateral military–technical cooperation with the NATO countries individually. It must be noted that Russia is still a dominant player in the Caucasus, since the problems inherited from the Soviet Union are not yet settled and Russia has a significant influence over these problems—and sometimes is itself part of the problem. It is becoming obvious that Russia considers any departure from its orbit very painful, and tries to oppose or prevent it, sometimes harshly.2 In the region, general relations with Russia differ greatly from state to state. The Russian invasion of Georgia indicates how infuriated Russia is about the aspirations of these nations to establish their own independent foreign policies and follow their free choice of future. In the case of Azerbaijan, there are two main issues that define its foreign and security policy towards Russia: its intention of obtaining

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Russia’s support in eliminating the results of the Armenian occupation and, in return, addressing Russia’s dominating military–security concerns in Azerbaijan and the Caspian basin. Russia still has significant leverage in Azerbaijan, which is characterized by numerous factors, including the close ties of the Azerbaijani ruling elite with Moscow, intense trade and economic relations, and the presence of millions of Azerbaijani migrants who earn their living in Russia. Relations with Russia are maintained by bilateral and the above-mentioned multilateral structures. At different levels, Russia has expressed its opposition to any US military installation or NATO-led operations in Azerbaijan or in the Caspian Basin.3 Hence, what Russia wants from Azerbaijan is for it not to go too far with NATO and the United States, since it is concerned about the arrival of a foreign military force in the area. On this matter, Iran and the Russian Federation are equally reluctant to maintain Azerbaijani military cooperation with Turkey and the United States, as they both oppose the presence of any foreign military components in the region. Russia has so far managed to maintain the principal strategically important military object in Azerbaijan—the Gabala Radar Station—which it rents long term, and it is still the major weapon supplier for the Azerbaijani army. The major problem in Azerbaijani–Russian relations is over the continued Russian military support of Armenia; Azerbaijan believes that the fourteen-year Armenian occupation is maintained only due to Russia’s support for and arming of Armenia.4 Russia does not deny arming Armenia, while acting as a mediator at Armenian–Azerbaijani negotiations, on the grounds that it has a security treaty with Armenia. The events of September 11 dramatically changed the stance of the United States in the region, creating an environment for closer security relationships with virtually all Caspian basin countries. Azerbaijani– United States cooperation has focused on borders and maritime security, upgrading the air defence system, and intelligence cooperation.5 The United States helped to build two radar stations with modern equipment in areas close to the Russian and Iranian borders, with the purpose of improving Azerbaijan’s control of its airspace.6 The US Department of Defense donated patrol boats designed to improve the Azerbaijani ability to secure its territorial waters in the Caspian.7 The idea is “to build surveillance capabilities for both air and sea in the Caspian Sea.” This initiative is called the Caspian Guard, and forms part of the security cooperation in the Caspian Sea aimed at coordinating activities to assure long-term stability of mineral resources and, presumably, to provide surveillance of the trafficking of illegal products in the international waters

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of the Caspian Sea.8 In addition, the US Department of Defense provided some equipment for preventing and detecting weapons of mass destruction at border checkpoints.9 Azerbaijan cooperated with the United States in the war on terror by sending troops to Afghanistan and Iraq, by opening its air space to US planes heading to Afghanistan, and allowing US airplanes to land in Azerbaijani aerodromes as a stopover en route to their final destinations. Azerbaijan–United States security cooperation also includes intelligence and border control activities. The proposal made by President Putin in early 2008 for cooperation in the Gabala Radiolocation Station (RLS) was an encouraging indication of a change in the Russian attitude towards US involvement in security cooperation with regional states, which it had sharply opposed before. The proposal might have served as a joint security cooperation in Azerbaijan between Russia and the United States, but in the current situation it was finally killed off by confrontation over Georgia. Meanwhile, Turkish access to and presence in the Caspian basin and Central Asia has traditionally been viewed by Russia as undesirable, and represents a major concern for its foreign policy. Turkey’s involvement in the region also faces resistance from Iran and Armenia. Azerbaijan, however, views the Turkish presence in the region as a significant factor for maintaining security and peace, as proved by Turkish cooperation with Georgia and Azerbaijan for the last fifteen years. “Strategic cooperation of Ankara with Azerbaijan and Georgia, and Ankara’s efforts to strengthen independence and sovereignty, as well as preserving territorial integrity of Azerbaijan and Georgia” are the cornerstones of Turkish foreign policy regarding Azerbaijan.10 Because of the transportation of energy resources via Turkey and issues related to security and infrastructure, the Turkish presence in the region is getting stronger, and is likely to continue to do so. The bilateral Azerbaijani–Turkish security cooperation to secure the transportation of energy sources and other goods from Azerbaijan to Turkey also included Georgia, and has expanded more since the BTC pipeline came into operation.11 Azerbaijan does not have a security treaty with Turkey similar to that of Armenia with the Russian Federation. This issue has always been a matter of debate in Azerbaijani society, because there is support for Turkish military involvement in the Azerbaijani army: the Turkish military schools in Baku and Turkey are the major educational basis of the Azerbaijani military.12 Azerbaijan has problems with both Iran and Turkmenistan over the Caspian Sea energy resources, which have led to occasional tension

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between Azerbaijan and the two countries. The Iranian side has long disputed the status of the Caspian Sea, demanding its division into five equal parts, a position which conflicts with Azerbaijani sovereignty in the Caspian and has led to small incidents, causing public outrage in the country. Iran still opposes the Azerbaijani–Russian and Russian–Kazakh agreements on the division of the Caspian Sea, and this is still one of the biggest reasons for discord between the two countries. Relations with NATO are dictated by Russia’s sensitivity, and the Azerbaijani leadership has repeatedly stated that NATO membership is not on the agenda of Azerbaijani politics, and they are not willing to host any foreign troops in Azerbaijan.13 NATO itself has no expressed position over Azerbaijan security concerns; has not, so far, made use of its significant potential to address the key security issues of the region; and is trying to be neutral towards the Armenian occupation, which is in fact inconsistent with its own principles. NATO is trying to conduct equal relations with both Azerbaijan and Armenia, but this is viewed by Azerbaijan as indifference to Armenian military aggression. Meanwhile the Azerbaijani public does not expect much from NATO. Anticipating a reaction to the Armenian invasion similar to its response in the Balkans, Azerbaijanis were frustrated when NATO failed to live up to their expectations. While Azerbaijanis appreciate NATO’s stance in Georgia, they rightly wished a similar reaction to be displayed against the fifteen years of Armenian aggression. From the security standpoint, Azerbaijan has certain disadvantages compared to the other nations of the Caucasus. Azerbaijan shares 120 kilometres of its border with Iran, and has an even longer common border with Armenia, which is under Armenian control. The total amount of Armenian military hardware stationed inside the territories occupied by Armenia exceeds the arsenal owned by the Azerbaijani military, and the rebel weapons are beyond the control of the CFE (the Treaty of Conventional Armed Forces in Europe), but are part of the military command in Yerevan. Furthermore, Azerbaijan is not a member of the CSTO (Collective Security Treaty Organisation, led by Russia), and neither does it have a mutual security treaty with Turkey. From this perspective, proceeding from the classical notion of security, Azerbaijan may be considered to be in a security vacuum. Generalizing Azerbaijani foreign and security policy, we should note two prevailing dominant views. One official view is that Azerbaijan is trying to pursue a balancing policy between Iran, Russia, the United States and Europe, in an effort to turn the country into an area of cooperation rather than confrontation. Another view is that the ruling regime’s policy

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actually serves its own survival, aiming to balance neighbouring powers in order only to accommodate the regime’s short-term interests, and it lacks any determination and political will to pursue national interests. Armenia considers Russia a guarantor for its security, and the military relationship with Russia constitutes the core of its security policy.14 Armenia hosts the Russian military base N102, which is equipped with modern S-300 anti-aircraft systems and MiG-29 fighter jets. Russian plans to deploy new S-400 air defence systems in this base have increased the security concerns of Azerbaijan.15 In 2006, Armenian Defence minister Serge Sarkisyan commented that relations between Armenia and Russia have strategic importance and help guarantee the country’s national security: “Military and military–technical cooperation [are] a priority in the strategic partnership between the two countries.”16 As Armenia also claims, the Russian base in Armenia serves to provide security for both Armenia and the southern borders of Russia.17 While Armenia has the advantage of being in alliance with Russia, Georgia, and Azerbaijan, it also faces problems with Russia due to their changing relations with the CIS. The militarization of Armenia is increasing and, under the pretext of modernization, new weapons and arms continue to be deployed in Armenia in addition to the military hardware recently withdrawn from Georgian bases. According to the Armenian defence minister, “In 2005, we obtained so much ammunition that their numbers can only be compared with the number of ammunitions we obtained for the past ten years.”18 Armenia purchases Russian arms at cheaper Russian internal prices, while Azerbaijan purchases them at the much more expensive world prices.19 Azerbaijan believes that the Russian base 102 provides an additional source of weapons for Armenia, and some of the weapons that had been transferred from Russia’s bases in Akalkalaki and Batumi, Georgia, to the Russian base in Gumri, Armenia, were delivered to the territories occupied by the Armenian army.20 Meanwhile, Russia insisted that it was just transferring its weapons from one base to another, and it caused no threat to anyone by transferring its weapons from Georgia to Armenia.21 Since April 2004, Armenia has also launched initiatives to establish closer cooperation with NATO22 and the United States, and as the Armenian leadership stated repeatedly, they consider these relations an integral part of strengthening the Armenian army. Pursuing the same goal, Armenia also joined the IPAP and started to cooperate with NATO on issues concerning mutual interests. Periodic training sessions and war games are becoming essential parts of the cooperation between Armenia

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and NATO. As far as NATO is concerned, relations with Armenia should be developed up to the point where they start to contradict Russia. The top Armenian leadership believes that “Armenia has no intention to join NATO. The membership of the Collective Security Treaty Organization and the high level of military–technical cooperation with Russia settle its security task to a considerable extent.”23 NATO’s stance is also loyal to such a relationship, and it tries to build its relationship on a bilateral basis.24 Military–technological relations with both Russia25 and CSTO members, together with the developing bilateral NATO and US relations, make this a four-stage security policy. Armenia’s hostile claims against Turkey have made it impossible for Turkey to have relaxed relations with Armenia, where former provincial warlords have ruled the country with no vision for the future. Armenia has been isolated from the regional energy and transportation projects because of its hostile behaviour, which poses an impediment to positive change in the region. Hatred, militarization, and animosity are the dominant inclinations in Armenian society. From the perspective of Azerbaijan, Armenia’s cautious approach towards NATO is due to its total dependence on Russian military support for pursuing Armenian policy in the Caucasus. The claim they use in the international arena, asserting that they need Russian troops to oppose the Turkish threat, is not justified. It has become clear that it purely serves the acquisition of Azerbaijani lands, since Armenians believe that having Russian troops in Armenian lands would give them the Russian political support that they desperately need for their military activities. Georgia, on the other hand, is determined to join NATO, and at the 2002 Prague Summit, the Georgian leadership officially stated that NATO membership would be a guarantee of Georgia’s eternal security. This policy on NATO, which also gained the overwhelming support of the whole of Georgian society,26 has been a cornerstone for the current democratic leadership of Georgia, who unambiguously stated Georgia’s will to become a NATO member.27 Georgia was the first to agree an IPAP (Individual Partnership Action Plan) in the Caucasus, in 2004, and has performed best in implementing its IPAP by carrying out radical military reforms and establishing very strong military relationships with both NATO and the United States.28 In 2002–2004, the United States initiated the Georgia Train-and-Equip Program (GTEP), which involved training about 2,400 troops, and in 2005 it started a second military assistance program—the Sustainment and Stability Operations Program (SSOP)— which focused on the training of infantry, logistics battalions, and the general staff of the Georgian army.29

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Georgia’s adamant stance on the withdrawal of Russian troops from Georgia, and its goal of becoming a member of NATO, have triggered tense relations with Russia. Russia was unhappy about the presence of US military instructors in Georgia, and uneasy about the deployment of a third country’s army in Georgian territory after Russia’s departure.30 In March 2006, Russia and Georgia finally signed an agreement to complete the withdrawal of Russian troops by 2008.31 This was a welcome development. The transfer of the withdrawn arms and soldiers to Armenia, however, has raised questions about future developments in the region.32 Georgia’s aspiration towards NATO membership received strong support from the United States, and the then president George Bush promised to help to facilitate the process. During his meeting with Saakashvili in July 2006, Mr. Bush said, “I believe that NATO would benefit with Georgia being a member of NATO and I think Georgia would benefit. And we will work with our partners in NATO to see if we can’t make the path a little smoother for Georgia.”33 However, Russia’s support of separatist regimes reached a confrontational and dangerous stage in bilateral relations, questioning Georgia’s integrity.34 Georgia considered Russian military forces and its peacekeeping troops as a potential threat to its national security, which was directly expressed in the National Security Concept of Georgia adopted in July 2005.35 Russia has been disturbed by regional infrastructure projects like the Baku–Ceyhan, Baku–Erzurum, and Baku–Kars railways. The main causes of the deterioration in Russian–Georgian relations, however, are Georgia’s plans to become a member of NATO, and its establishment of military relations with the United States. Since there are no independent TV channels or private media in Russia, Russian public opinion has dramatically changed against Georgia and also Ukraine, and people on the street have overwhelmingly remained under the influence of the unilateral government propaganda, which labels the leaderships of Georgia and Ukraine as enemies of Russia. Georgia’s military operation against Osettian rebels thus provided Russia with a good pretext to change the ongoing development in the region, punishing Georgia’s move towards NATO and demonstrating Russian willpower both to the western countries and to the former Soviet countries that aspire to integrate with Euro-Atlantic structures. This has been the final stage in the latest covert war of interest between Russia and NATO in the region that stretches from the Balkans to the Caucasus. NATO’s eastward expansion, the construction of new anti-missile shields in Poland and the Czech Republic, and the battle over Kosovo have raised

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enormous strains between Russia and the West, reviving the spirit of the Cold War. Hence, Russia used Georgia’s military operations in South Ossetia (which were long-awaited by Russia) as an opportunity to settle scores with Georgia and her western allies, employing excessive force to destroy Georgia’s military infrastructure. Again, in early 2008, the Russian foreign minister Sergey Lavrov described a possible Georgian NATO membership as “a colossal geopolitical shift,” with possible consequences for Russian security36 to which Russia would react, as President Putin threatened.37 Such measures, if taken by Russia, would most likely include deploying sophisticated weapons in Armenia and in the Caucasus region. In any case, Russia keeps powerful army units in the northern Caucasus, making up the biggest military group in Europe. Consequently, the war has dramatically changed the overall conditions in the Caucasus. Georgia’s security has become an issue that relates to Europe’s own security, and Georgia’s determination to become a member of NATO has become irreversible. In August 2008, the foreign ministers of NATO member countries decided to form an inaugural session to establish a NATO–Georgia Commission, which was later held on 15 September in Tbilisi. As the NATO secretary-general underlined, it was “a milestone in the history of the NATO–Georgia relationship,” moving NATO–Georgia relations to a new stage on the way to full integration into the Alliance.38 The purpose of the commission is to promote the decisions of NATO at its Bucharest summit, which called for further integration. The visit of all the NATO member countries’ ambassadors, and holding a Council meeting in Tbilisi, was a clear indication that NATO stands by Georgia, and Georgia’s security entered the agenda as one of NATO’s responsibilities. The new situation requires the process of Georgia’s admission into NATO to be speeded up, since abandonment of Georgia would only result in losing the independence, freedom, and democracy that have been gained so far in the entire region. The US Secretary of Defense again confirmed the US stance towards Georgia, and called on the NATO partners to support Georgia’s accession to the MAP (Membership Action Plan) in December, 2008.39 Meanwhile, having cautious relations with NATO and the United States due to the overly sensitive attitude of Russia, Azerbaijan faced some uncertainty in its security policy even before the war between Georgia and Russia. However, a more confusing environment awaits Azerbaijan in the post-confrontation era.

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Recent events regarding the NK conflict have shown how vulnerable Azerbaijan is before Russia, and how the Azerbaijani leadership has been supportive of Russia’s aggression in Georgia. In contrast to the ordinary Azerbaijani public, the absence of strong solidarity in the leadership with their close neighbour and strategic ally has demonstrated the existence of a strong Russian influence over the Azerbaijani Government. The confused and troubled Azerbaijani leaders remained silent in the face of the invasion and violence of Russia, which caused them to suppress and change their tone to a more cautious one. As a result of Russia’s negative influence, from now on Azerbaijan is expected to be more cautious in its relations with NATO and its inter-military relations with other countries. During the peacetime before the war, Azerbaijan was more courageous about opposing Russia’s position in Georgia than in the current circumstances. Azerbaijan did not side with Russia in imposing sanctions against Georgia, and tried to help Georgia to overcome its energy crisis. Later, in the Abkhazia matter handled in the UN, Azerbaijan took a position that was not in line with Russia. But these contradictions have never been publicly expressed by either Russian or Azerbaijani officials, and obviously served for understanding more of each other’s positions. Azerbaijan also occasionally tried to oppose Russia’s position on issues like the NK settlement process. For example, Azerbaijani border officials detained Russian cargo to Iran, probably in response to the Russian vote in the General Assembly meeting held in New York. In the case of Armenia, however, Azerbaijan’s reaction was not surprising. Armenian officials have always expressed their disapproval for the cooperation and alliance between Georgia and Azerbaijan, and always opposed Georgia’s aspiration to become a member of NATO. Armenia felt more confident in supporting Russian actions, thinking that it would affect Azerbaijan’s behaviour.

The Caucasus Stability and Cooperation Platform Turkey proposed the Caucasus Stability and Cooperation Platform (CSCP) in order to provide a forum for dialogue, to bring the countries of the region together in the interest of building confidence and cooperation, developing stability and security, promoting economic development for the benefit of all people in the region.40 Turkey made the proposal in good faith, trying to help the people of the South Caucasus and change the animosities into friendship and mutually beneficial cooperation. But first of all the platform requires the hostility that exists between Armenia–

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Russia and Azerbaijan–Georgia to be settled, and also requires Armenia to cease its hostile claims against Turkey and others. As is evident from Russian statements, Russia is apparently very supportive of this initiative, since it will otherwise remain isolated in the international arena; in the long term, it is also to Russia’s benefit to support and join such regional structures. Moreover, the resolution of all issues in our region by the regional states themselves is in line with the general Russian policy. Russia rejected a similar proposal which was initiated eight years ago by the Turkish president Demirel, “trying not to share the region with any other third countries.” Considering recent changes, with Georgia disengaging from the Russian influence which has its roots in Russia’s continued dominance in the region over hundreds of years, it is obviously in the interests of Russia to agree to the Turkish initiative, to save its situation and continue to have some influence over Georgia and the whole Caucasus, in the hope that it might dominate the proposed structure in the long term. Paradoxically, considering their confrontation with Armenia and Russia, Azerbaijan and Georgia are reluctant to participate in the CSCP. Georgia is not going to join in a structure where Russia will dominate again: it wants to be completely free from Russian influence and become a NATO member, since it sees NATO membership as the only guarantee for its own security. Azerbaijan, on the other hand, will not come to terms with the project as structured, because of the Armenian occupation, and as long as Azerbaijani lands remain under Armenian rule, Azerbaijan will not agree to any regional umbrella requiring obligations, in which Armenia participates. Armenia is very supportive of the proposal, since this pact would afford it direct access to Turkey, Azerbaijan, and, via Georgia, to Russia. But Armenia would like to join the pact while preserving the status quo, which will surely be rejected by Azerbaijan. Hence, there are quite complex issues which should be resolved, and the proposed pact might still stimulate and encourage the sides to contribute to the resolution of the outstanding issues.

Conclusion The key prerequisites of a lasting and durable Caucasian security environment are to resolve the existing Caucasian conflicts within the sovereignty and territorial integrity of the regional states, to put those

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responsible for ethnic cleansings and massacres on trial, and to encourage and advance the regional countries towards democracy and transparency. Potential internal confrontation caused by the nature of the existing authoritarian systems in Azerbaijan and Armenia, corruption and monopoly over resources, the emigration of young and skilled people to developed countries, the policy of hatred towards neighbours which is still wellgrounded in Armenia, the unjust distribution of oil revenues and huge disparity in living standards in Azerbaijan, and internal tension and foreign pressure exerted upon Georgia, can all be identified as potential causes of conflicts and insecurity in the Caucasus that also have significant negative consequences for the entire region

Notes 1

See NATO website at http:/www.nato.int/docu/rdr-gde-ist (link now broken). “Analysis: Putin Seeks To Draw Azerbaijan Back Into Russian Orbit,” Radio Free Europe, 21 February 2006. 3 “US ‘Buildup’ in Caspian Alarms Russia,” DAWN International, 15 March 2006, dawn.com. 4 “Analysis: Putin Seeks To Draw Azerbaijan Back Into Russian Orbit,” Radio Free Europe, 21 February 2006. 5 “Azerbaijan, USA discuss Military Cooperation,” Itar-Tass (Baku), 19 May 2006. 6 “United States is Going to Modernize Two Radar Stations in Azerbaijan,” Day.az, 9 January 2006. 7 “United States is Going to Deliver Two New Radar Stations and Three Boats to Azerbaijan,” Day.az, 17 January 2006. 8 Rino Harnish, “V Baku sozdana radiolokacionnaya stansiya,” Day.az, 12 October 2005, http://www.day.az/news/politics/33045.html. 9 “Security forces of United States Are Training Azerbaijani Partners to Fight Against the Spread of Weapons of Mass Destruction,” Day.az, 7 June 7 2006, http://www.day.az/news/politics/50404.html. 10 Abdulla Gül, “Security and Stability in South Caucasus Turkish Foreign Policy Priority,” PanArmenian.net, 7 March 2006. 11 “Uceniya dnya,” Realniy Azerbaijan (Baku), 21 May 2006. 12 “Turkey May Provide Military Aid to Azerbaijan,” PanArmenian.net, 7 March 2006. 13 Ilham Aliyev, “Vopros voennogo prisutstviya inostrannix gosudarstv na Azerbaidzanskoy territorii v povestke dnya ne stoit,” Day.az /ɂɧɬɟɪɮɚɤɫ/, 4 June 2006, http://www.day.az/news/politics/50223.html. 14 “Armenia sees Russia as Strategic Partner—Defense Minister,” RIA Novosti (Yerevan), 6 March 2006. 15 “Control dnya,” Realniy Azerbaijan (Baku), 20 June 2006. 2

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16 “Armenia sees Russia as Strategic Partner—Defense Minister,” RIA Novosti (Yerevan), 6 March 2006. 17 “Rent for Military Base in Response to Double Price for Russian Gas?” PanArmenian.net, 26 December 2005. 18 “RA Defense Minister: Mechanical Increase of Military Budget Doesn’t Decide Anything,” PanArmenian.net, 24 January 2006. 19 “Armenian Army Chief Untroubled By Russian-Azeri Military Ties,” www.armenialiberty.org, 23 February 2006. 20 “NATO Intends to Cooperate with Armenia for the Long Term,” PanArmenian.net (Yerevan), 1 June 2006. 21 Sergey Ivanov, “Govorit o tom cto Rossiya vooruzaet Armeniyu, po mensey mere ne korrektno,” Day.az, 24 January 2006, http://www.day.az/news/armenia. 22 Oksana Musaelyan, “The Secretary General’s Special Representative for the Caucasus and Central Asia, Robert F. Simmons, JR., Answered the Armenian Arminfo News Agency’s Questions,” ARMøNFO, 27 September 2005. 23 Robert Kocaryan, “Armeniya ne namerena vstupat v NATO,” Day.az, 22 April 2006, http://www.day.az/news/armenia/47126.html. 24 R. Simmons, “NATO Doesn’t Object to Russian Base in Armenia,” Itar-Tass (Yerevan), 23 May 2006. 25 “Yerevan and Moscow to Sign Agreement on Military-Technical Cooperation,” PanArmenian.net, 3 August 2006. 26 “Parlament Gruzii prinyal postanovlenie ‘Ob integrasii Gruzii v NATO,’” 12 May 2006, http://www.day.az/news/georgia/48548.html. 27 “Georgia Looks Forward to Membership in NATO and EU, Saakashvili Says,” Associated Press (New York), 15 September 2005. 28 Mission Reports, 12–16 June 2006, “Joint Visit to Armenia and Georgia by the Sub-committee of NATO Parliamentary Assembly on Future Security and Defense Capabilities and the Sub-committee on Democratic Governance.” 29 Jonathan Moor, “U.S. Marine-Led Task Force Trains Republic of Georgia Soldiers,” U.S. Department of Defence Website, 27 March 2006, http://www.defense.gov/news/newsarticle.aspx?id=15044. 30 “Georgia: Saakashvili Ready to Extend ‘Friendly Hand’ to Putin,” Radio Free Europe, 10 February 2005. 31 “Agreements Signed on Russian Military Withdrawal from Georgia,” Eurasia Daily Monitor 3, no. 65 (4 April 2006), available from website of the Jamestown Foundation. 32 “First Convoy Leaves Russia’s Akhalkalaki base, Goes to Armenia,” InterfaxAVN (Moscow), May 18 2006. 33 “Bush backs Georgia’s push to join NATO,” Reuters (Washington), 5 July 2006. 34 “Russian MFA Notes Importance of South Ossetia’s Right of SelfDetermination,” Civil.ge (Tbilisi), 1 June 2006. 35 “Parlament Gruzii prinyal postanovlenie o vivode rossiyskix mirotvorceskix sil,” Tekst postanovleniya, 18 July 2006, www.day.az/news/georgia/54260.html. 36 “Lavrov Comments on Ukraine, Georgia’s NATO Accession,” Civil.ge (Tbilisi), 7 June 2006. 37 “Russia Concerned over NATO Expansion,” Civil.ge (Tbilisi), 3 June 2006.

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38 “NATO Backs Georgia but No Firm ønvitation to Join,” Reuters, 15 September 2008. 39 “Soedinyonnie Stati prizivayut strani NATO podderzat vstuplenie Gruzii v Alyans,” PanArmenian.net, 9 September 2008. 40 Ali Babacan, “Calming the Caucasus,” International Herald Tribune, 23 September 2008.

CHAPTER FIVE THE GEORGIA–RUSSIA CONFLICT AS AN EXAMPLE OF INTERDEPENDENCE IN WORLD POLITICS NATALIJA NECHAYEVA YURIYCHUK1

Introduction All contemporary ethnic and national conflicts have their roots in the past, and historical background can be considered one of the most important reasons for such conflicts. Early in the twentieth century, following World War I, the principle of national self-determination was proclaimed. This changed the political map of the 1920s, and for the entire twentieth century this principle was one of the most contestatory matters in world politics. It was exploited by the world superpowers (the United States and USSR) in pursuit of their own political interests, but not in the interests of the “small nations.” Following the collapse of the USSR and its socialist system, the situation seemed to have changed. Since that time, world politics has been multi-directional. The countries that had comprised the Union of Soviet Socialist Republics gained their independence and almost all established their own states. In the 1990s it was clear that the United States was going to be the major player in world politics, since it no longer had a serious rival—neither the European Union nor Russia had the potential to compete with it. Many reasons lie behind the situation dominating the Caucasus today. We will analyze these reasons in more depth later, but an initial examination of recent history shows that the main factor in the area was Russian–American rivalry in the former socialist bloc.

1

PhD, Bukovyna State Finance Academy, Chernivtsi, Ukraine.

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Meanwhile, Russia’s growing role in the world economy (especially in the energy sector) has brought about new tendencies in world politics and strengthened Russia’s position. Since the start of the third millennium, Russia has been trying to regain its influence over the former socialist bloc countries.

The Conflict between Georgia and Russia For many centuries Russia played a major role in all spheres of Georgian life. In the first part of the twentieth century, Georgians were a very Russophile nation. There are many reasons for this. The short-lived Georgian Democratic Republic of 1918 to 1921 had a deep impact, mainly upon Georgian intellectuals. The fact that Joseph Stalin, who was himself a Georgian, became the leader of the Soviets drove the general population of Georgia closer to Russia.1 Throughout the twentieth century, however, relations between Georgia and Russia have been bitter. The first significant crisis took place in the late 1980s and early 1990s. By then the future collapse of the USSR was clearly visible. Separatist movements had spread throughout the Soviet states, and Georgia was no exception. On 9 April 1991 Georgia became the second Soviet republic to declare its independence. Meanwhile, the central Georgian powers had to contend both with Moscow and with separatists inside the country. In September 1990, South Ossetia’s leaders declared the creation of the South Ossetian Soviet Democratic Republic. In December 1990, however, the Georgian Parliament annulled the autonomy of South Ossetia, and so ignited a military conflict. When a similar situation arose in Abkhazia, Georgian president Zviad Gamsakhurdia tried to follow a more cautious policy; however, his statement that “there is no nation called Abkhazia” proved extremely provocative.2 These events escalated the regional conflict between the central government of Georgia and its autonomous regions. Thanks to the support they received from Moscow, both South Ossetia and Abkhazia gained a considerable degree of strength. The next step in the aggravation of the conflict came in 2003 with the “Rose Revolution,” which led to political regime change in Georgia. Consequently, Georgia started to shift its foreign and internal policy toward the West. Upon coming to power, President Mikheil Saakashvili proclaimed that the new course of the state would be toward integration with the Euro–Atlantic system.

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The idea that Georgia should join NATO found widespread support among the Georgian population. In the words of Levan Berdzenishvili, the representative of the Republican Party of Georgia, “about 80% of population is in favor of NATO.”3 In Bucharest, the heads of NATO member states confirmed Georgia’s NATO prospects, but they did not offer it membership of the Airlift Management Programme (AMP). Instead, during the December 2008 meeting of foreign ministers of NATO member countries, Georgia and Ukraine were promised NATO membership. This decision engendered a great deal of comment and debate in Georgia. The main reservation regarding the decision had come from Germany, and consequently there were speculations that Russia may have influenced the summit’s outcomes. As emphasized by James Sherr, an analyst at the British Defence Academy, Germany became inclined towards the Russian position because of the growing influence of the Russian state. This was why, with respect to two main foreign policy vectors, Germany had to change its accent in favour of Russia. Germany’s stance on this issue can be summarized as seeing the entrance of Georgia and Ukraine into NATO as legitimate and inevitable, albeit with doubts as to the timescale over which this process should take place.4 However, Georgia’s hopes of taking steps toward joining NATO have faded since the Bucharest summit, where Russia convinced the alliance of the possibility of establishing tighter control over Georgia. As mentioned earlier, the separatist movements in Georgia have deep historical roots and Moscow has played a major role in both inciting and developing these movements. The issuing of Russian passports to South Ossetian residents has become routine practice in Russia over the last few years. According to data provided by Professor Tamaz Zubiashvili from Tbilisi University, over 30,000 Ossetians—out of a total of 70,000— obtained Russian citizenship in this way, while at the same time retaining their South Ossetian citizenship. Such policies can be considered evidence that Russia is trying to strengthen its role in the region and that both South Ossetia and Abkhazia are still under Russian control. Moreover, the growing number of “Russian citizens”—not just Russian-speaking people, as in Ukraine—provides Russia with a convenient opportunity to declare its right to protect its citizens abroad. Few people remember the statement of the Russian Duma regarding “the Russian Federation Policy toward Abkhazia, South Ossetia and Transnistria,” which was adopted on 21 March 2008, just before the Bucharest summit.5 This policy came to resemble a declaration to Georgia, Europe, and the rest of the world, that Russia claimed an exclusive right to solve its “frozen conflicts” in the post-Soviet environment.

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In its statement, the Russian Duma called on the Russian government to make “efforts to ensure safety of Russian Federation citizens, who are living in Abkhazia and South Ossetia territory, to consider the possibility of ensuring peace and security in that region.” Moreover, deputies of the Russian Duma stated that the president and the government of the Russian Federation should consider “the possibility of recognizing the independence of Abkhazia and South Ossetia.” These statements turned out to be an attempt to assess how Georgia, as well as the world’s leading countries, and the international and European organizations, would react in such case. Washington clearly expressed that it would support the territorial integrity and sovereignty of Georgia. However, the reaction of the rest of the world was not unanimous. Moreover, many politicians—including Georgian ones—believed that Russia would not pursue such a scenario, because of its possible negative consequences. But the Bucharest summit resolution that postponed the AMP offer to Georgia gave Russia the confidence to continue its political manoeuvring in these regions of conflict. Russia has supported the separatist mood in South Ossetia and Abkhazia in every possible way. The next step toward the escalation of conflict was taken on 8 July 2008 when two Russian aircraft entered Georgia’s airspace from Roki tunnel district. Nine minutes later, two more Russian aircraft joined them, and they flew over Tskhinvali region for about forty minutes. The Russian Minister of Foreign Affairs accepted that this was a border violation and described it as “a short flight for closer definition of the situation,” which “dampened the hotheads in Tbilisi and prevented the situation from developing into a power scenario.” When we consider the current situation in the region, we can see that those flights were actually another gambit to assess world reaction to Moscow’s aggression toward Georgia. Again, however, the world’s reaction was not unanimous. Javier Solana, then representative for foreign and defence policy of the European Union, condemned the event. US Secretary of State Condoleezza Rice blamed Russia for becoming “the side, which engages not in problem solving, but in its escalation.”6 Though Russia was obviously violating international agreements, its stance regarding South Ossetia and Abkhazia became even more stubborn. The West, on the other hand, did not send peacemakers to the conflict zone; to date, Russian forces are the only peacekeeping presence in the region. The rationale behind the events of August 2008 is indisputable evidence of Russia’s persistent role in escalating the conflict between Georgia and South Ossetia. Several motives leading Russia to act in this way are given below.

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The foremost reason is the real possibility of Georgia becoming a member of NATO. On many occasions Russian politicians and state representatives, most notably Vladimir Putin, have expressed their discontent with this possibility. Putin has boldly declared that “Georgia’s aspiration to join NATO … is driven by its attempt to drag other nations and peoples into its bloody adventures.”7 Good relations with neighbours and an absence of territorial conflicts and border disputes are required for a country to be admitted into NATO. From the Russian point of view, military conflict in Georgian territory will inevitably hinder Georgia’s prospects for receiving AMP and, consequently, of joining NATO. Another reason is the open conflict between the Russian and Georgian administrations and the Kremlin’s aspiration to retain control of Georgia. This trend has been clearly recognizable for several years. The permanent representative of the Russian Federation in the United Nations, Vitaly Churkin, accepted this situation at the meeting of the UN Security Council held on 10 August 2008. He admitted that Russia wanted to change the existing political regime in Georgia. The third reason is less obvious, though no less important. One of the major problems for all European states is energy supply, and Russia is the main exporter of oil and gas to the European Union. The Baku–Tbilisi– Jeihan oil pipeline was built with Western sponsorship, without Russian participation, and began operation in 2006. The pipeline has been used to deliver Caspian oil from Azerbaijan through Turkey to the West. Recently, Kazakhstan’s oil was also included, much to Russia’s displeasure. As we can see, the war in Georgia suits Russia’s aspiration to take control of this pipeline and to establish its monopoly over Azerbaijan’s oil traffic. The fact that on 16 August 2008 part of this pipeline was damaged by the Russians (as Tbilisi officially announced) can be considered as evidence in favour of this suspicion. A further reason is Russia’s desire to intimidate Ukraine and other post-Soviet republics by demonstrating what will happen to them if they continue their course toward integration with the Euro–Atlantic Union. The warning is especially threatening to Ukraine, as it encompasses the problematic Crimea, where many Russian-speaking (and Russianoriented) people live. The fifth reason is the attempt to show the rest of the world that Russia is no less powerful a state than the United States. Moreover, Russia’s desire to regain its superpower status and to show the entire world how bold and strong it is has played an important role in recent events. So the

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Georgian–Russian conflict can also be considered as Russia’s revenge for Kosovo in Serbia. And last, but by no means least, it should be noted that the Russian government has a hidden agenda of distracting the Russian public’s attention from social and economic problems. It is no secret that today’s Russia faces many difficulties in the social and economic sphere that can only be solved through serious structural reforms. A small war, especially a successful one, is notoriously a measure to which governments throughout history have resorted in order to divert public attention from internal policy failures. On the other hand, the Georgian side has also taken some steps which have escalated the conflict, and the reasons for and benefits it has derived from these are very difficult to define. In our opinion, one reason was simply to reveal Russian aggression to the world and, pursuant to resolving the conflict, to obtain support from the United States and the West. However, the main reason behind Georgia’s actions was the fear of losing its autonomous regions. Abkhazia and South Ossetia have already been recognized by Russia. The question of AMP and NATO membership is still problematic for Georgia. The events of August–September 2008 demonstrated that Moscow is unlikely to concede this issue. To achieve its political and economic goals, Russia is ready to continue its military conflict with Georgia while waging a diplomatic war with the rest of the world. Even after they began peace negotiations, it was obvious that Russian–Georgian relations had broken down completely as a result of this war. The conflict resolution programme proposed by the French has been put into effect, but its implementation is progressing very slowly. On 15 August 2008 a conference was held between Russian President Dmitry Medvedev and German Chancellor Angela Merkel. The Russian president declared that Russia would make all decisions regarding the status of South Ossetia and Abkhazia and guarantee their position not only in the Caucasus region, but also in the world. The German reply was rather vague. In her speech regarding her position on Georgia, Merkel had to maintain a balance between the United States and leading European countries on one hand, and Russia, one of Germany’s largest energy and trade partners on the other. In her words: “I said that Russia’s answer on that situation—I partly believe—or believed—is disproportionate.”8 As far as we can see, during her press conference with Medvedev, she was not sure about the adequacy of the Russian response to the question of the Georgian action. She was, however, trying to be objective and called on

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Russia to withdraw its troops from central Georgia, where they remain in control of large areas of the country. The United States and Russia had completely different attitudes towards the Georgian problem. US president George W. Bush claimed that the United States “stands with the people of Georgia and their democratically elected government.”9 President Dimitry Medvedev, however, supported, and still supports, separatist movements in South Ossetia and Abhazia and is doing absolutely nothing about removing Russian troops: “Peace needs to be re-established in the region and guaranteed and underpinned so that no one again will get idiotic ideas and this I see as the main task of the Russian Federation.”10 Due to the scale of Russian propaganda in South Ossetia and Abkhazia, the involvement of an independent third party with an objective and impartial perspective is necessary. With its growing position in world politics and economics, the European Union could play this role. However, the EU does not have a common position regarding this question. This is quite understandable, since many of the EU member countries have similar problems with their own autonomous regions, and it has proved difficult for them to come to a satisfactory solution to the Kosovo situation. Even today, some European countries do not recognize the independence of Kosovo. And after Russia recognized the independence of Abkhazia and South Ossetia, it was notable that the mood in favour of independence was also growing in some European countries, such as Spain. Furthermore, if the situation develops in favour of Russia, the political map and the system of international relations may bring about changes enabling Russia to rebuild its empire. This could trigger a new Cold War, with Europe again falling between American and Russian spheres of influence. A major issue highlighted by this conflict is the need to find new ways to address old territorial and ethnic problems. It will be necessary either to approve the right of self-determination for every nation, or to develop a new strategy for world security. Meanwhile, initiating a negotiation process with representatives of the European Union, insisting on the presence of European peacekeepers, and supporting NGO activities in the region and examining the situation with their help, are surely the main ways of maintaining peace in the area.

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Conclusion The European Union must reconsider its own position regarding the hostility between Georgia and Russia and make every effort to prevent future conflicts, not only in the Caucasus region, but also in Europe. The next conflict, which may be “unfrozen” by Russia or any other world player, may occur in Transnistria or indeed in any other part of the world. The Georgian–Russian conflict demonstrates once again how contemporary world politics is characterized by interdependency, since the reasons for the dispute were both regional and international. The local war between the two neighbours provoked debate between many world policy players and also highlighted the necessity of reviewing contemporary systems of international relations and global security. This conflict affected Georgian–Russian relations, and relations between Russia and the European Union, Russia and the United States, and the relations between the United States and the European Union. All parties within the system of world politics have felt the influence of this conflict, and in many ways.

Notes 1

ɋɋɋɊ ɩɨɫɥɟ ɪɚɫɩɚɞɚ / Ɉɛɳɚɹ ɪɟɞɚɤɰɢɹ Ɉ.Ɇɚɪɝɚɧɢɹ (SSSR posle raspada/ Obshchaya redaktsiya O. Marganiya). – ɋɉɛ: ɗɤɨɧɨɦɢɤɭɫ (SPb: Ekonomikus), 2007. ɋ.234–235. 2 Ibid., 248. 3 ɐɢɬ ɡɚ: ɋɿɪɭɤ Ɇ., ɉɨɩɤɨɜɚ Ⱥ. Ȼɭɯɚɪɟɫɬɫɶɤɚ „ɬɟɪɚɩɿɹ”(Tsit za:Siruk M. Popkova A. Buharestska, terapiya) // Ⱦɟɧɶ. - ʋ63. – 5 ɤɜɿɬɧɹ 2008. 4 ȿɤɫɩɟɪɬ ɭɩɟɜɧɟɧɢɣ, ɳɨ ɜ Ȼɭɯɚɪɟɫɬɿ ɍɤɪɚʀɧɚ ɨɬɪɢɦɚɥɚ ɨɩɬɢɦɚɥɶɧɢɣ ɜɚɪɿɚɧɬ ɫɩɿɜɩɪɚɰɿ (Ekspert upevneniy, scho v Buharesti Ukraina otrimala optimalniy variant spivpratsi) //www. NEWSru.ua. – ɫɭɛɨɬɚ, 12 ɤɜɿɬɧɹ 2008. 5 Ƚɨɫɞɭɦɚ ɪɟɤɨɦɟɧɞɨɜɚɥɚ ɩɪɟɡɢɞɟɧɬɭ ɢ ɩɪɚɜɢɬɟɥɶɫɬɜɭ ɨɛɫɭɞɢɬɶ ɩɪɢɡɧɚɧɢɟ Ⱥɛɯɚɡɢɢ ɢ ɘɠɧɨɣ Ɉɫɟɬɢɢ (Gosduma rekomendovala prezidentu i pravitelstvu obsudit priznanie Abhazii i Yujnoy Osetii) // http://www.newsru.com/arch/russia/21mar2008/ priznat.html. 6 Ɋɨɫɫɢɢ ɝɪɨɡɢɬ ɦɟɠɞɭɧɚɪɨɞɧɚɹ ɢɡɨɥɹɰɢɹ (Rossii grozit mejdunarodnaya izolyatsiya( // http://www.utro.ru/articles/2008/ 08/13/759280.html. 7 “Georgia ‘Pulls Out of Ossetia,’” BBC News Online, 10 August 2008, http://news.bbc.co.uk/1/hi/7552012.stm. 8 Ʉɚɧɰɥɟɪ ɎɊȽ ɩɪɢɡɵɜɚɟɬ ɜɵɜɟɫɬɢ ɪɨɫɫɢɣɫɤɢɟ ɜɨɣɫɤɚ ɫ ɬɟɪɪɢɬɨɪɢɢ Ƚɪɭɡɢɢ (Kantsler frg prizÕvaet vÕvesti rossiyskie voyska s territorii Gruzii) //http://www.news.ng.ru/2008/08/15/1218810141.html 9 “Georgia Signs Cease-Fire with Russia,” CNN.com, 15 August 2008, http://edition.cnn.com/2008/POLITICS/08/15/us.russia. 10 “Georgia Signs Cease-Fire with Russia,” CNN.com.

CHAPTER SIX THE ROLES OF THE UKRAINE AND THE EU IN SETTLING THE RUSSIAN–GEORGIAN CONFLICT IN THE CAUCASUS GRIGORIY PEREPELYTSIA*

Introduction The Russian–Georgian war, which broke out in the Caucasus in August and September 2008, was the most resonant event of the second half of 2008, and undoubtedly changed the geopolitical landscape of Europe. The military escalation of the conflict in South Ossetia shocked the public worldwide. The conflict appears to be seen as a local Georgian– Ossetian clash, with the Georgians appearing as aggressors and the Russians as defenders of the Ossetian people. However, analysis of the conflict’s latent stage reveals that long before the events of August, there had been resentment stemming from much deeper causes than the socalled Georgian–Ossetian ethnic conflict. The source of this resentment lay primarily in the geopolitical dimension. The transformation of the unipolar world into a multipolar one opened new opportunities for Russia, including changes to the existing world order resulting from the Cold War and the challenges to the sovereignty of the new independent states in the aftermath of the collapse of the Soviet Union. These changes led to Russia attempting to restore itself as a global power. In Vladimir Putin’s view, a multipolar world is more righteous and just than a unipolar one. He made this clear at the Munich conference on *

Kyiv Taras Shevchenko National University, Director of the Foreign Policy Research Institute, Diplomatic Academy at the Ministry of Foreign Affairs, Ukraine.

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security issues in February 2007, noting that a unipolar world is one of “one master, of one sovereign.” He argued that, ultimately, this was disastrous both for those within the system and for the sovereign because it destroys from the inside. It was even more disastrous, he said, because certain norms had been breached: We are seeing a greater and greater disdain for the basic principles of international law. And independent legal norms are, as a matter of fact, coming increasingly closer to one state’s legal system. One state and, of course, first and foremost the United States, has overstepped its national borders in every way. This is visible in the economic, political, cultural and educational policies it imposes on other nations … . I think it is obvious that NATO expansion does not have any relation to the modernisation of the Alliance itself or with ensuring security in Europe. On the contrary, it represents a serious provocation that reduces the level of mutual trust.1

Putin’s New Foreign Policy The essence of Putin’s new foreign policy is revealed in the following postulates. First, that the unipolar world has exhausted itself. Its actions are destructive and it must therefore be replaced by a multipolar system of international relations. Second: that the United States is no longer fit for global leadership. Third: that the United States and NATO are no longer capable of ensuring security in Europe and are further acting as provocative (destabilizing) agents in Europe. These ideological postulates cannot, however, conceal the explicit intent of Russia: x To challenge the global leadership of the United States and spearhead the fight against America’s global dominance x To establish a multipolar world where Russia can play the role of a superpower x To belittle and discredit the roles of the United States and NATO in ensuring international security x To win back lost spheres of influence from the West. Realization of these intentions would enable Russia to establish itself as a leading architect of a new global order, to restrict the geopolitical influence of the West, to scale back expansion of European civilization and to instil Russia’s own civilizational project in its place. Eventually, all these would result in Russia exerting a much broader and stronger influence on international processes. This would enable Russia to become

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one of the most powerful economies and a leading geopolitical force in the world. The strategy for the realization of this new model of Russia’s foreign policy is founded on the following principles: x Take advantage of the disagreements observed in relations between the United States and the EU, in order to weaken both parties and reinforce Russia’s own position in the world x Use the energy factor as a way to expand its influence and dominance in Europe x Increase its own geopolitical weight through reintegration of the post-Soviet space around its own civilizational foundation. Clearly, all of these principles have been put to the test by Russia in the war against Georgia. It is very logical that this conflict would have escalated into war: the transition to a multipolar world implies that each geopolitical pole fight ruthlessly for influence over a particular region. The takeover of these spheres of influence would entail the clashing of interests of various geopolitical poles in the region, hence leading to the outbreak of regional and local conflicts. The international global order of a multipolar world would feature even greater instability and uncertainty than that of a unipolar world. This instability would pass from global to regional levels and thus would pose a great challenge to regional security. Russia regards the post-Soviet space as a ground in which to reinstate itself as a geopolitical force. It is within this space that Russia intends to re-emerge as a superpower. Obviously the Caucasus is pivotal to this space. Control over the Caucasus would enable Russia to access the Middle and Near East via Iran and Turkey, to cut the EU’s and the United States’s access to Central Asian energy resources and to deprive the NATO mission in Afghanistan of rear support. Once in control of the Caucasus, Russia would deny the United States access to Central Asia, a region extremely important to the United States for its energy resources as well as in geopolitical terms. This would bring both existing oil pipelines such as Baku–Ceyhan and future ones such as Nabucco under Russia’s control. In effect, Russia would control Eurasian energy resources and related access routes. Georgia lies right in the centre of the Caucasus, allowing Russia to run transport corridors and North– South and West–East vectors of influence though it. Russia’s ambitious geopolitical plans have been inhibited by democratic regimes and by Mikheil Saakashvili’s pro-Western and pro-American

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orientation. The restoration of Russia’s former greatness necessitated a war in the Caucasus, and specifically the subjugation of Georgia. Russia had already begun preparation for the war in late 2007 by destroying Georgian radar stations. Then, after the 2008 Bucharest summit, when NATO countries turned Ukraine and Georgia down for the Membership Action Plan (MAP), Russia sent additional ground troops to Abkhazia. It appears that the Russian government perceived the refusal of Georgia’s and Ukraine’s bids for the NATO MAP as carte blanche for more resolute actions. Clearly Georgia is not the type of country over which Western countries like Germany are willing to fall out with Russia. Military action as a means of conquering Georgia became more plausible after the Georgian opposition, on which the Kremlin heavily relied, lost the presidential election to Mikheil Saakashvili. It is likely that the initial plans for military occupation of Georgia also included overthrowing the state’s sovereignty, pulling Saakashvili down, and establishing a pro-Kremlin regime in the country, all of which would be achieved by the presence of Russian troops. Obviously, Russia should have commenced its attack on Georgia through Abkhazia and South Ossetia, the two separatist regions. In that event, the joint operations of Russian troops and Abkhaz and/or Ossetian paramilitary groups would not have appeared as explicit aggression. According to the definition of the twenty-ninth UN General Assembly Session, “aggression” is understood as the use of the military forces of one state against the political independence and territorial integrity of another state. Indeed, the global community did not dare to properly assess Russia’s military intervention into Georgia, having politely defined it as a “disproportionate use of force.” On the other hand, such a military plan might have been regarded as the enforcement of peace and the final resolution of either the Georgian–Abkhaz or Georgian–Ossetian conflict, depending on the particular circumstances. Moreover, Russia had a history of difficulties in managing conflict between Georgia and Ossetia. For example, in 1921 when the Democratic Republic of Georgia was occupied by Bolshevik Russia, South Ossetia was reintegrated into Georgia as an autonomous region. Dmitry Medvedev could have conquered Georgia fully, thereby restoring its territorial integrity and gaining the goodwill of the Georgian people. To realize its ambitious military plans, Russia needed to find a good pretext for military action to give it a valid reason in the eyes of the international community. It did not take Mikheil Saakashvili long to generate an excuse for Russian intervention. It is rather difficult to

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comprehend the rationale for Georgia’s behaviour in this conflict: surely this behaviour was the result of irrational thinking. What forced Georgia to trigger military action against South Ossetia? Firstly, the Georgians have a tendency to apply force in handling all ethnic conflicts. Examples of such a disposition abound in the nation’s history. When the Georgian Democratic Republic was formed as a result of the breakup of the Russian Empire in 1918, South Ossetians responded by forming a Soviet republic on the territory of South Ossetia, as part of Russia. Georgia’s reaction to South Ossetia’s breakaway was instant. In June 1920, Georgian military troops entered the province to enforce the sovereignty of Georgia over the territory. As a result of the intervention, 5,000 Ossetians were killed and 50,000 fled to North Ossetia, while a further 15,000 died from cold and starvation. On 9 December 1990, South Ossetia ran elections for the newly created Parliament of the self-declared autonomous republic. However, on the same day, the Georgian parliament declared these elections unlawful and withdrew South Ossetian autonomy. In January 1991 the Georgian government began implementing its plan to withdraw South Ossetia’s autonomy, sending 3,000 internal security troops, detachments of the National Guard, and the paramilitary group Mkhedrioni. Intensive military operations between these Georgian units and Ossetian partisans began on 22 January 1991 for the city of Tskhinvali. The president of the USSR issued an ultimatum to Georgia, ordering it to withdraw all Georgian troops from the territory of South Ossetia within three days. However, the ultimatum was ignored. 12,000 Georgian troops surrounded Tskhinvali and began intensive attacks on the city. However, the Tskhinvali assault was unsuccessful. At the decision of the Council of Ministers of the USSR, internal security troops and militia units of the Ministry of the Interior, deployed on the territory of South of Ossetia, took the city under protection and resisted the attacks of the Georgian armed units. Later, Russia’s Ministry of the Interior lifted the siege of Tskhinvali and delivered humanitarian aid in the forms of medication and food supplies. Obviously Saakashvili was following this unhappy “tradition” in using a similar method of force in handling the conflict with Ossetians. Secondly, no territory has ever broken away from the state by way of open armed opposition and returned to its former state by any means other than by force. Russia recaptured Chechnya through the use of force as a result of two bloody wars, and Croatia took Srbska Krajina in a similar way. Thirdly, Saakashvili’s decision to use force was completely impulsive, ill-considered, and unprepared. He was aware that Russia was preparing

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for a war with his country. However, Georgian armed forces were neither mobilized nor placed on full operational readiness. The Georgian defence minister was on vacation and 2,000 professional Georgian military were on a mission in Iraq. The Georgians had no plan in place to conduct a military defence operation to repel the attack. What made Saakashvili take such risks? We can identify two motives: the failure of the peace plan offered by Tbilisi to the Ossetians, and the escalation of the conflict by Ossetian paramilitary groups. As the sequence of events demonstrates, the situation in the buffer zone deteriorated drastically on 1 August 2008. In response, Georgia began shelling the headquarters of the Russian peacekeepers in Tskhinvali from the valley known as Grad. On 8 August, subdivisions of the Georgian internal security troops began an offensive on Tskhinvali with the purpose of seizing the city and restoring Georgia’s rule over South Ossetia. All of these were sufficient grounds for Russia to intervene under the guise of a “peace enforcement operation.” Although the brigade of Georgian internal security troops could have been forced out of Tskhinvali by a single unit of paratroopers, Russian generals involved the entire fifty-eighth army, the seventy-sixth Pskov airborne division, and a whole range of special task forces from the armed forces and the Ministry of the Interior, as well as up to fifty combat aircraft of the fourth air army of the Military Air Force. This amount of armed forces suggests that Russia was planning to use armed forces on an operational and strategic scale to attain political goals such as capturing state territories and liquidating their sovereignty. The use of force by Russia was disproportionate to the declared goal; it was, however, proportional to its actual goal. Judging from the actions of the Russian troops and the Black Sea fleet, the realization of military and political goals were to be achieved through fulfilment of the following strategic objectives: x Defeat of the Georgian armed forces x Disorganization of the military and public administration of the country x Establishment of the military blockade of Georgia x Assault of Tbilisi and overthrow of central bodies of public administration in Georgia x Military occupation of Georgia and establishment of control over its transport, communications, and strategically important operations. The operation required an advance from two directions: from South Ossetia and from Abkhazia, possibly with additional positioning around the port of Potito to cover the south, with a simultaneous blockade of

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Georgia’s land and maritime boundaries. In fact, naval forces from the RF’s Black Sea fleet were sent to cover Poti. On 9 August, Russian jets began bombing Georgian cities. Russian land forces of around 15,000 servicemen forced out Georgian troops from Tskhinvali on 10 August. The following day, they started an offensive on the town of Gori, which they occupied on 12 August. Then Russian military columns proceeded in the direction of Tbilisi2 and a further tank column departed in the direction of Poti. On 11 August, Russian jets began air strikes on Tbilisi, posing the imminent threat of assault on Tbilisi by Russian troops. On 12 August, Russian troops, together with Abkhaz military units and with the support of Russian air forces from the Abkhaz territory, forced their way into the upper Kodori gorge, captured it fully and took hold of all of Upper Abkhazia, forcing the local population to leave the region. A few days later, Georgia faced the real threat of losing its sovereignty. Like the rest of the international community, Ukraine realized that the only possible way out of this situation would be the immediate end of hostilities and the earliest possible settlement of the Russian–Georgian conflict. To achieve these goals, the following key objectives had to be fulfilled: x Stopping the Russian military from carrying out an assault on Tbilisi x Immediate ceasefire between the Russian and Georgian sides and the signing of a truce x Persuading Russia to pull back its troops from the territory of Georgia and terminating its military occupation x Lifting of the blockade of Georgia x Reintegration of the Georgian territory. It is important to note that Ukraine and the EU made the largest contributions to the settlement of the conflict. How effective were their actions during the armed escalation, and what roles did they play in its settlement?

The Roles of Ukraine and the EU in the Settlement of the Russian–Georgian Conflict Comparative analysis of the roles taken on by Ukraine and the EU in the settlement of the Russian–Georgian conflict reveals similarities and differences. The efforts of Ukraine, unlike those of the European Union,

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were directed primarily at preserving the sovereignty and territorial integrity of Georgia, and also at restoring peace in the region. To this end, Ukraine undertook a number of military, political, and diplomatic steps. At a military and technical level, it provided armoured machinery and weapons to Georgia. These systems were mainly designed for defence purposes. Specifically, these included Buk, the ground troop air-raid defence system. They were designed to defend important targets from enemy air attacks, since in the war against Georgia, whose territory consists largely of mountainous landscapes, the aggressor might want to focus mainly on the use of aviation. Ukraine also took the important step of reminding Russia of its right to close its territorial waters to the Black Sea fleet, which was based in Ukrainian territory and engaged in the anti-Georgian war. By using these ships against Georgia, Russia actually brought Ukraine into the conflict, since these ships attacked Georgia and its armed forces from Ukrainian territory. This was made even more intolerable because of Georgia’s membership of GUAM: under a number of bilateral agreements, Ukraine is responsible for its safety. Unlike the EU and other countries, Ukraine provided real military, political, and diplomatic support to the preserving of the sovereignty and independence of Georgia. Ukraine also recognized the importance of two other principles of an immediate ceasefire: the peaceable settlement of the conflict by political and diplomatic means, and the unacceptability of violence by opposing sides. This position was officially laid out in a statement by the Ukrainian Ministry of the Exterior on 8 August 2008. In the statement, Ukraine called upon the Russian Federation to withdraw its troops from the territory of Georgia, to show restraint in its actions and exert necessary influence on the separatist regime in Tskhinvali to bring its representatives back to the negotiation table. According to the statement, the mark of success of such negotiations would be the immediate ending of military operations, and the unconditional confirmation of Georgia’s sovereignty and territorial integrity on the part of Russia. This expression exhibited Ukraine’s readiness to make its contribution to the peacekeeping efforts of the international community to achieve a comprehensive settlement of the situation in Georgia. However, the Russian and South Ossetian governments accused Ukraine of intervening in the conflict in support of Georgia, alluding to the deployment by Georgia of weapons of Ukrainian origin and the alleged participation in hostilities against South Ossetia of Ukrainian servicemen. The latter, however, never appeared to be true. Meanwhile, Russia started

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a media war against Ukraine, affecting the latter’s brokerage and peacekeeping capabilities in the settlement of the conflict. Another important Ukrainian contribution to the ceasefire and the prevention of an assault on Tbilisi by Russian troops was the arrival of the President of Ukraine, Victor Yushchenko, together with the presidents of Poland, Estonia, Latvia, and Lithuania, in the Georgian capital on 12 August. This show of solidarity dissuaded the Russian armed forces and politicians from realizing their plans. The main efforts of the Ministry of Exterior and the president of Ukraine were focused on the cessation of hostilities in the Georgian– Russian conflict zone and the preservation of the sovereignty and territorial integrity of Georgia, as well as the termination of the sea blockade in its territorial waters. In agreement with the international community, Ukraine condemned Russian’s invasion of Georgia. The Ukrainian president, Viktor Yushchenko, held a number of consultations with top EU officials, and he visited Georgia alongside the presidents of Poland, the Baltic countries, and Romania. In this way Ukraine was able to establish a close coordination of positions and actions with EU countries of the Baltic and Black Sea regions. The actions of the Ukrainian government, led by Prime Minister Yulia Tymoshenko, during the Russian–Georgian war were aimed at the evacuation of Ukrainian citizens from the conflict zone and provision to Georgia of 155 tons of humanitarian aid worth 8 million USD. This aid was quite commensurate with the 5 million euros of humanitarian aid provided to Georgia by the EU, and the 10.7 million USD of humanitarian cargo sent by the United States. Moreover, at the instruction of President Yushchenko, the government provided medical care in Ukraine to nearly 200 Georgian children who found themselves in the conflict zone.3 However, Tymoshenko was doing her best to avoid political assessments of the Russian–Georgian war and explained her silence by arguing that her attitude to the issue was fully in accordance with the official position of the European Union. Tymoshenko’s opponents in Ukraine took advantage of her silence. Specifically, the secretariat of the president of Ukraine suspected that Tymoshenko had her sights on the Kremlin. In the view of Andriy Honcharuk, the deputy head of the secretariat, Tymoshenko took a wait-and-see position to avoid upsetting her relationship with Russia so that she could rely on Russia’s support in handling certain issues in the future.4 It is obvious that Tymoshenko did not want to upset Russia, given that good relations would facilitate the fulfilment of the agreements regarding the gas supply to Ukraine that she had reached with Prime Minister Putin

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during her official visit to Moscow on the eve of the Russian–Georgian war. This was also the reason why the Ukrainian cabinet was stalling publication of the draft resolution “On the Procedure for Movement of Russia’s Black Sea Fleet in Ukrainian Waters and Rules for Movement of Russia’s Black Sea Fleet Troops in the Territory of Ukraine.” Russia took advantage of this delay and sent its Black Sea fleet to take part in military operations against Georgia. As a result, the president of Ukraine was forced to engage the Council for National Security and Defence (CNSD) and by presidential decree enacted a CNSD resolution on the procedure for movement of Russia’s Black Sea fleet in Ukrainian territory. Prime Minister Tymoshenko declared that she was totally against such decrees. She claimed that they ran contrary to the agreement on the status and conditions of movement of the Russian Federation’s Black Sea fleet in Ukrainian territory. However, in reality the presidential decree was based on Article 15 of the above-mentioned agreement, as well as on the Convention on International Maritime Law dated 1958 and 1982 regarding domestic and territorial waters. Instead of fulfilling the decree, representatives of the Ukrainian prime minister tried to explain their position in terms of the need to coordinate this procedure with Russia. This incompetent and preposterous objection on the part of the government served as a pretext for the deputy chief of general staff of Russia’s armed forces, Anatoly Nohovitsyn, to state that Russia’s Black Sea fleet would not comply with the orders of the president of Ukraine and would only execute the orders of its own Commander-in-Chief.5 Such motives for the actions of Tymoshenko’s government demonstrated the lack of a consolidated position among Ukrainian leaders with regard to the Russian–Georgian conflict, and did not contribute towards strengthening Ukraine’s position in the settlement of this complex regional military and political crisis. In its turn, the lack of a consolidated position underscored the ongoing conflict between the president and the prime minister of Ukraine concerning their respective constitutional powers. The actions of Ukraine’s opposition parties, represented by the Party of the Regions and the Communists, proved even more odious. They were completely supportive of Russia’s attack on Georgia, and the leader of the Party of the Regions, Viktor Yanukovych, appealed to the Ukrainian Parliament from the floor of Verkhovna Rada to recognize the independence of Abkhazia and South Ossetia. In addition, oppositional factions in the Ukrainian Parliament initiated the creation of an investigation commission aimed at revealing the illegitimacy of arms supplies from Ukraine to Georgia. This was designed to discredit the

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position of President Yushchenko with regard to Georgia, and to lay the foundation for initiating impeachment procedures against him. The Ukrainian people also failed to demonstrate a unanimous and consolidated attitude towards the Russian–Georgian war. According to a sociological survey conducted by LLC FOM–Ukraine, most Ukrainians (72%) believed that the president of Ukraine’s support for Georgia would provoke conflict with the Russian Federation. 42.6% of respondents supported neutrality; 28% supported Russia’s actions; and only 16.8% of respondents wanted to support Georgia.6 73% of the residents of Western Ukraine, 62.5% of the population of the Kyiv region, and 58.5% respondents from Central Ukraine considered Russia to be the aggressor. Georgia was perceived as the aggressor by 74.6% of Crimean residents and 27% of the respondents from Western Ukraine. Overall, 52.2% of the population of Eastern Ukraine considered Russia’s actions to be peacemaking in nature.7 The divergent attitudes of Ukrainian society towards the Russian– Georgian conflict showed once again the break-up of its national identity and its differing geopolitical orientations. The differences of public opinion in Ukraine were greatly influenced by Russian domination of Ukraine’s information media. During the Russian–Georgian conflict, Ukraine became a stage for Russia’s informational war. Ukrainian internet sites derived 76% of information about the situation in Caucasus from Russian sources.8 Another source of information influence is the so-called “Informational Fifth Column” in Ukraine. This refers firstly to Ukrainian media and TV channels, whose editorial policy is determined by representatives of Russia’s business and political elite. It also refers to Ukrainian politicians and political technologists, who were broadcast live on Russian and Ukrainian TV channels and humiliated both Ukraine as a state, and its president. They discredited Ukraine not only in the eyes of Ukrainian society but also in the eyes of the entire international community. Thus, along with Ukraine’s significant contribution to the termination of the Russian–Georgian war, the preservation of Georgia’s sovereignty and peaceful settlement of this conflict, the Caucasus events revealed the lack of a consolidated position among the Ukrainian powers and political forces, as well as a lack of national unity in the face of such a grave challenge to Ukraine’s national and regional security. Another important factor in Ukraine’s position regarding the Russian– Georgian conflict was its cooperation with the EU, since Ukraine’s leaders believed it was crucial to join follow EU statements. To that end, the president of Ukraine conducted consultations with Javier Solana, the EU

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high representative for the common foreign and security policy, Nicolas Sarkozy, president of France, which held the EU presidency, and the leaders of some other EU member states. What interests was the EU trying to accommodate in forming and implementing its position with regard to the Russian–Georgian conflict? First of all, the EU, as an economic union, pursues economic goals with regard to Russia and Georgia. There is competition for both Russia and Georgia in the context of these interests. In the first place, Russia is important to the EU as a world reservoir of energy resources: the EU is ever more dependent on Russia’s energy supply. It is also a major sales and capital investment market. However, faced with the increasingly growing geopolitical ambitions of Russia, the EU looks to new alternative sources of energy. In this respect, Georgia, located as it is in the centre of the Caucasus corridor, can secure for EU member states access to Central Asian energy resources. Thus, while developing its relations with Russia, the EU must in parallel lay the path to Central Asia, that is, through the Caucasus and bypassing Russian territory. While taking care not to undermine relations with Russia, it is also in the EU’s interests that Georgia retains its sovereignty. Therefore, the reaction of the EU was unanimous: it criticized Russia’s attack on Georgia and promised the latter political and economic support. On the other hand, certain EU states (such as Germany, France, and Italy) are not against using the growing geopolitical ambitions of Russia as a counterbalance to US ambitions. For this purpose, these countries are inclined to use Russia as an additional resource to lean upon in their efforts to weaken US influence on Europe and to strengthen their own position and influence. The old European states have an interest in Russia being stable rather than weak. Nicholas Sarkozy stated: “Europe, more than anybody else, is interested that Russia should prosper, be stable and engaged in global business. This is in our interests. Europe would like to see Russia strong.”9 Moreover, some of the leading older European states, especially France and Germany, and a few new EU member states, would not mind pursuing a separate political line in their relations with Russia, which (disregarding the general interests of the EU) can secure certain financial and economic preferences from the Kremlin. In this respect, Russia’s efforts to split the EU by building separate political axes (such as Paris–Berlin–Moscow and Moscow–Rome) and special relations with certain EU states have a chance of success. In circumstances of growing competition among EU member states, Russia can show preference to a specific country, in this way

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strengthening its competitiveness provided the country proves its loyalty to the Kremlin. Thus, confrontation with Russia runs contrary to the interests of leading European states, primarily Germany, France, and Italy. Any military confrontation between Russia and the United States (which would threaten the safety of the entire European landscape) was therefore undesirable. For this reason the EU fears the return to the Cold War even more than Russia itself does. To avoid such an outcome, and feeling that Russia was preparing for military intervention in Georgia, the minister of foreign affairs and vicechancellor of Germany, Frank-Walter Steinmeier, proposed a trilateral settlement plan for the conflict in Abkhazia and South Ossetia. The plan involved EU assistance in the restoration of separatist regions and the return of refugees. Under this plan, the economic development of these regions and improvements in the lives of their populations were expected to serve as foundations for reconciliation.10 However, Russia was not interested in this plan, and it failed. After the military conflict had begun, France (which at that time presided in the EU and acted on behalf of the entire European Union) took over the peacemaking initiative from Germany. This initiative was spelled out by Nicolas Sarkozy, was later agreed by the president of Russia, Dmitry Medvedev, and came to be known as the Sarkozy–Medvedev agreement. This plan envisaged reaching the same objectives that Ukraine pursued in its actions with regard to the Russian–Georgian war. It was specifically focused on prevention of an attack on Tbilisi by Russian troops, an immediate ceasefire, withdrawal of Russian troops from Georgian territory and the restoration of Georgia’s sovereignty and territorial integrity. Thus the tasks and goals of both the EU and Ukraine in the Russian–Georgian conflict fully coincided. The primary objective of both the EU and Ukraine was related to preventing the assault on Tbilisi by Russian troops. This was why the Presidents of Ukraine, Poland, and the Baltic states arrived there. The objective was also on Sarkozy’s agenda during his visits to Moscow and Tbilisi, which he confirmed during the award ceremony for his prize for political courage from Politique Internationale magazine.11 On 12 August 2008, during his visit to Moscow, Sarkozy tried to persuade Putin and Medvedev to stop the assault by Russian troops. The president of France was aware that Moscow was preparing a puppet government to replace the overthrown Saakashvili government.12

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Sarkozy’s plan took these circumstances into account and envisaged the following: x x x x x x

Unconditional ceasefire Creation of a humanitarian corridor for the evacuation of civilians and the wounded, and exchange of prisoners of war The return of Georgian troops to the place of their permanent disposition Withdrawal of Russian troops to the positions occupied prior to the conflict Initiation of international peacemaking operations in the region (timeframe to be determined separately) International guarantees of the stability and security of Abkhazia and South Ossetia.

This plan resolved most of the issues. However, it did not include a principle for the restoration of the territorial integrity of Georgia, which was directly related to determining the status of Abkhazia and South Ossetia. Moreover, the peacemaking operation involved bringing military observers rather than peacemaking forces into the security zone. The third stumbling block related to differing interpretations of clause 6 of the document in the French and English translations. In the French language version, security was to be maintained by international forces “in” South Ossetia and Abkhazia; the English version read “for” maintaining the security of South Ossetia and Abkhazia. In the Russian version it was interpreted as securing the safety of South Ossetia and Abkhazia. Such different interpretations would result in different placements of security zones and different deployment of military observers. According to the EU’s and Georgia’s interpretations, international observers were to act in the territory of South Ossetia and Abkhazia, and Russian troops were to be pulled out from this territory accordingly. In Russia’s understanding, its troops were to be withdrawn only to the borders of these territories with Georgia. A “buffer zone” was to be established around these borders and Russian troops were to remain there until the arrival of the international observers. After the agreement had been signed, Russia started implementing the plan according to its own vision. The Russian military command, at its own discretion, determined an expanded security zone around South Ossetia and Georgia, and carved out Kodori Gorge for Abkhazia. It is worth noting that Russia did not bother to agree this with Georgia or France. Moreover, Russia included in the security zone the most important

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strategic positions, such as an air base in the town of Senaki (40km from Abkhazia) located among rail and road links to the city of Poti, to Armenia, and to Azerbaijan. In these zones Russian troops began the establishment of checkpoints and regulated access to international observers. The implementation of Russia’s vision of the Sarkozy–Medvedev plan caused serious concern within the EU. Sarkozy’s attempts to return to the original plan resulted in Russia recognizing the independence of Abkhazia and South Ossetia and signing agreements with them on allied relations, under which Russian troops were to stay in their territory. In this way Russia took the issue of withdrawal of its troops and establishment of security zones in Abkhazia and South Ossetia out of the context of the settlement plan. Russia argued that from then on this issue would be regulated by its bilateral relations with these republics. The EU had no choice but to agree to these new conditions imposed by Russia. In turn, Russia agreed to allow 200 EU and OSCE observers access to the security zone. What will be the consequences of the implementation of Russia’s version of conflict settlement: for the EU, for Georgia, and for the international community? The EU, having initiated settlement of the Russian–Georgian conflict, has to some extent become a hostage of that conflict. Of course, having intervened in the situation in the Caucasus, the EU has achieved significant success. First, the EU initiative made it possible to stop the war in such strategically important regions as the Caucasus. Second, the EU has strengthened its position in the post-Soviet territory by breaking Russia’s monopoly on peacemaking activity and positioning itself as an influential security organization capable of resolving complex crisis issues. Third, it is obvious that the EU currently has a very good chance of strengthening its economic and political impact on the Black Sea region and post-Soviet European states and of challenging US leadership in this region. Fourth, the strengthening of such influence will indisputably result in enhanced security around the EU external borders in Eastern Europe. Fifth, in pursuing its expansionist policy in the postSoviet territory, Russia will take into account the position of the EU and sometimes agree to trade-offs. This is evidenced by the fact that after stark warnings of the French and British Ministers of foreign affairs with regard to Crimea, Russian officials and pro-Russian forces changed their strategies and tactics with regard to Crimea and Putin was forced to declare that Russia has no territorial claims to Ukraine.

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However, the EU will face serious challenges in the future, stemming from the new alignment of forces in Europe that resulted from the Russian–Georgian war. The first challenge is related to the EU’s lack of adequate resources to consolidate its position in the Caucasus and in the European part of the post-Soviet territory. The second challenge is that the “mild force” strategy used by the EU is becoming ineffective and will fail against Russia’s “rough force.” Only NATO is strong enough to oppose Russia’s rough force. The EU peacemaking strategy in the Balkans was successful only because NATO secured the conditions for its actual implementation. NATO neutralized any use of rough force against the peacemaking efforts of the West. In the Caucasus the EU is attempting to act independently of NATO and thus runs the risk of failure. The third challenge results from the EU’s double standards over international law. The EU’s recognition of Kosovan independence deprives it of the moral right to demand Russia’s compliance with standards of international law. In the case of Georgia, Russia merely repeated the precedent created by the EU when it recognized the independence of Kosovo. This is why the EU timidly called Russia’s aggression against Georgia a “disproportional use of force.” The fourth challenge is the most dangerous. The danger lies in the old EU members’ readiness to compromise with Russia and allow it to reign over the post-Soviet territory. In this way, they create a real threat to the security of the EU’s eastern members. It is no wonder that these EU members demand a harsher reaction from the EU and the imposition of stricter sanctions against Russia. Countries such as Poland, Lithuania, Estonia, Latvia, and Romania, demand that the EU draw closer to Ukraine and Georgia and bring international peacemaking forces into the security zone. The fifth challenge is related to the mismatch between the EU’s threats and its real intentions and ability to carry out those threats. Although the EU did threaten to apply sanctions against Russia, such as expelling it from the Group of Eight and refusing to sign a new agreement among others, none of its threats has been fulfilled. These were exactly the sanctions that Russia feared most. Such inconsistencies leave Russia confident that its aggressive actions towards neighbour states will remain unpunished. Thus Russia receives significant advantages in expanding its geopolitical interests in Europe. It will use the EU’s weakness as its own geopolitical resource.

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Having failed to achieve its major goals, Russia still managed to meet its minor objectives. Georgia’s territorial integrity has been broken both de facto and de jure. As a matter of fact, Russia succeeded in annexing Abkhazia and South Ossetia and unconditionally consolidated its position and military presence in these republics. The EU will act as “the guarantor of the principle for non-use of force” against these republics by Georgia and the United States. At the same time, the EU mission will be unable to resolve the problem of the return of refugees to these republics. Hence the EU will assist in creating conditions for the further strengthening of Abkhazia’s and South Ossetia’s independence from Georgia and their integration into Russia. In this way, the EU could gradually become an accomplice in the implementation of Russia’s more ambitious geopolitical plans. Specifically, these plans include: x having gained EU cooperation in peace-making efforts in the Caucasus, to persuade the EU of the inexpediency of its further expansion in the east x to neutralize eastern EU member states in their efforts to support Ukraine and Georgia x to exclude Ukraine and Georgia from the process of European and Euro-Atlantic integration x to establish dominium over these states, which would require compliance with “the rules of the game” imposed jointly by Moscow and the old EU member states. Therefore, following the Russian–Georgian war, Russia’s further strategy will be aimed at making advances to the old EU members (such as Germany, France, Italy, and Greece, all of which are involved in one way or another in Russia’s energy supply or pipeline projects), deepening the discord between EU’s old and new members, and playing on disagreements between the EU and the United States in order to sever transatlantic links and force the United States out of Europe. This strategy creates the likelihood not only of stopping NATO’s further expansion, but of totally destroying this alliance. The absence of NATO and discord within the EU will weaken the EU’s position and enable Russia to significantly expand its sphere of influence in Europe, gaining the position previously held by the United States on the European continent. Is Russia’s strategy in accordance with Ukraine’s genuine interests? The answer is obvious – NO.

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Conclusion The comparative analysis of the positions of Ukraine and the EU concerning the Russian–Georgian war yields the conclusion that, alongside common values shared by both parties, there are significant differences in their standpoints. Firstly, these differences lie in the area of security. In the context of EU relations with Russia, the security of Ukraine does not rank as a high priority. Unlike Russia, neither Ukraine nor the EU has consolidated standpoints regarding Russia’s expansionist policy in general and in the Caucasus in particular. The issues which emerged during the Russian–Georgian war have disastrous outcomes for Ukraine today. It is not by mere chance that most experts regard Viktor Yanukovych’s victory in the second Ukrainian presidential election after the Russian–Georgian war as a significant geopolitical victory for Russia over the West. This assessment is quite objective: in six months Yanukovych fulfilled all of the geopolitical demands for which Russia had been striving over the nearly twenty years of Ukrainian independence. Above all, these were: the return to nonaligned status and repudiation of the prospect of NATO membership; the extension of Russia’s Black Sea fleet presence to beyond 2017; repudiation of regional leadership; and development of GUAM and Baltic–Black Sea cooperation. Apart from these political concessions, Yanukovych’s position as opposition leader made it necessary for Ukraine to recognize the independence of Abkhazia and South Ossetia. For Yanukovych, declaring Ukraine’s non-aligned status and fixing its legislation were necessary, on the one hand, to make it impossible for Ukraine to join NATO, and on the other hand, to retain a Russian military presence within the territory of Ukraine. The Kharkiv Agreement provided an important politico-military background for Ukraine’s withdrawal from the “buffer zone” and its return to Russian control. Europe’s sharing on two zones of influence will end eventually at that. Yanukovych enthusiastically supported the initiatives of President Medvedev of the Russian Federation on the building of new security systems both in Europe and in the Black Sea region. However, Ukraine’s non-aligned status will not stop Russia interfering in its internal affairs and attempting to reformat Ukraine’s political system in alignment with its own. Consequently, beyond the borders of NATO, Ukraine has little chance of preserving its independence and state sovereignty. To ensure its security Ukraine should lean towards Euro–Atlantic structures and rely on the strengthening of regional security in cooperation

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with EU members from the Baltic and Black Sea regions; and above all, it should rely on itself.

Notes 1

Speech by Vladimir Putin at the Munich Conference on Security Issues, http://www.polit.ru/dossie/2007/02/12/putinmunich.html. 2 “ȺFɊ: Russian Tanks Go Forward to Tbilisi,” Korrespondent Online, 13 August 2008, http//www.korrespondent.net/world/552882. 3 V. Telman, “Ukraine Provided 8 Million USD Worth of Assistance to Georgia,” Utro.ua, 23 August 2008. 4 “Georgian Accent of Ukrainian politics,” For-ua.com, 15 August 2008, http://ua.for-ua.com/analytics/2008/08/15/105613. 5 “Russia Will Not Inform Ukraine on Movement of its Black Sea Fleet,” Newsru.ua, 14 August 2008, www.newsru.ua/Ukraine/14aug.2008. 6 “Survey: The Attitude of Ukrainians towards Russia has Worsened,” Ukrainians, 30 September 2008, http//www.ukrainci.com. 7 “Ukrainians are Equally Split in Their Opinion Regarding the Conflict in South Ossetia,” UNIAN, 23 August 2008. 8 “Ukraine Lost Information War to Russia,” UNIAN, 14 August 2008. 9 Economy, Newsru.com, 8 October 2008. 10 “Russia can Collapse Faster than USSR,” Novaya Gazeta, 25 August 2008. 11 Rusiko Mechaidze, “Sarkozy Criticizes Bush on Georgia,” Rezonansy (Tbilisi), 14 November 2008. 12 “Sarkozy–Putin–Medvedev—Sex in a Big Game,” Version, 20 November 2008.

CHAPTER SEVEN THE SECURITY POLICIES OF TURKEY AND RUSSIA TOWARDS ABKHAZIA AND THE INTERNAL GEORGIAN CONFLICT GIRAY SAYNUR BOZKURT*

Fig. 7-1 Map of Georgia1

*

Sakarya University, Faculty of Economics and Administrative Sciences, Department of International Relations, Turkey.

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Introduction The simmering conflict between Russia and its small neighbour Georgia erupted late on 7 August 2008, when Georgia sent forces into South Ossetia, a small pro-Russian province which threw off Georgian rule in the 1990s. Russia, which had provided support to the separatists and acted as a peacekeeper in the province, responded to Georgia’s invasion by pouring troops and tanks through the Caucasus mountains into South Ossetia to drive back the Georgians. Georgian forces pulled out of the region after three days of fighting, and Russian troops captured the capital. Meanwhile, Georgia’s separatist province of Abkhazia sent 1,000 troops to a disputed gorge, effectively opening a “second front” in Tbilisi’s battle to regain control over its breakaway regions of South Ossetia and Abkhazia. The conflict in Georgia is rooted both in the legacy of the Soviet nationalities policy and in the rise of ethnic nationalism during the demise of the USSR. The Soviet administrative arrangements were a source of grievance for both sides. The Soviet policy granted political status to major nationalities within the Soviet state and ranked them in a hierarchical federal system. In the former Soviet ethno-federal construction, union republics had the highest status, followed by autonomous republics in the second rank. Abkhazia was created as a separate union republic in 1921, but was joined with Georgia in a confederate union treaty later the same year. Abkhazia’s status was downgraded in 1931 as a result of its incorporation into the Georgian union republic as an autonomous republic. The Soviet legacy continues to dominate mind-sets. Abkhazians had witnessed Stalin’s Georgian nationality reflected in the period after World War II, in the form of the migration of large numbers of Georgians into Abkhazia. Meanwhile, despite the small Abkhazian population, Georgians were wary of preferential treatment accorded to the Abkhazians.2 The political culture of the region is characterized by an exclusive ethnic nationalism and profound scepticism of autonomy structures. Since the late 1980s, actors on both sides have exploited their political advantage, opportunities presented by perestroika, greater freedom, and unprecedented geopolitical change. While Georgians were concerned about Russian domination and sought to break away from Russia’s rule, the Abkhazians were driven by the fear of assimilation by the Georgian nation and the future viability of their community. Both sides attempted to elevate their political status: the Georgians by seeking outright independence from the Soviet Union, and the Abkhazians by demanding union republic status and a status within the USSR equal to that of the Georgians.3 Cultural claims and interpretations of history brought intellectuals to the forefront of political

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battles, including the Abkhazian leader Vladislav Ardzinba, a historian, and the Georgian ex-president Gamsakhurdia, a Soviet dissident. The proliferation of Georgian militias led to a collapse of political authority over coercive forces. The Abkhazians retaliated by forming their own militias and forging links with the Confederation of Caucasian Peoples, which mobilized volunteers for the Abkhazian cause. Russia played a controversial role in the conflict, with various parts of the Russian establishment supporting diverse sides. Parts of the Russian military and security structures and parliamentarians rendered assistance to the Abkhazians, but the Russian military also helped Shevardnadze to defeat his opponents in Georgia, evacuating him from the battlefield in Abkhazia. During the conflict, the Russian foreign ministry and the military high command acted as mediators between the parties, while individual military regiments pursued their own political and business agendas on the ground.

Russia and Georgia The borders of the Caucasian republics, which gained their independence from the Union of Soviet Socialist Republics in 1991, were first drawn arbitrarily in the 1920s and then modified in the wake of the Second World War. These borders, devoid of historical background, have become problem issues due to the independence movements that emerged in the atmosphere of self-dependence after the dismemberment of the USSR, and have become the crux of many ethnicity-based conflicts within Caucasian populations. In other words, one of the major causes of the ethnic conflicts in Caucasia is the continuation of the “divide and rule” tactics of the Russian Empire by the Soviets. Today, the area of the conflicts is in a situation of “neither war, nor peace.” These unresolved conflicts of the South Caucasus can be considered as one of the most serious obstacles to establishing a regional security system.4 In the first years following the disintegration of the USSR, failures of pro-Western policies of the “Atlanticists” adopted by President Boris Yeltsin and Foreign Secretary Andrey Kozirev, as well as the failure of democratization and the passage to a free-market economy, led to the rise of the “Eurasianists.” With this latter group’s implementation of the “Near Abroad” doctrine from 1993 onwards, Russian influence began to be reestablished in strategically and economically important Caucasia, in addition to other ex-Soviet territories.5 According to the “Near Abroad” doctrine, the Russian Federation described Central Asia and Caucasia as its “backyard,” and aimed at stopping other powers from gaining influence

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in that territory. The Caucasian region, which for centuries served as a shield for Russia, has been accepted as a cordon sanitaire against threats from the south.6 Caucasia became indispensable for Russia because it forms a junction with its historic opponent Turkey, it is a gateway to Central Asia, and it is on the road to Middle East. One of the main factors shaping Russian policy towards the Abkhaz–Georgian and Ossetian– Georgian conflicts is Georgia’s strategic location on routes of vital military and economic importance. According to the Russian military strategists, Georgia is the key country for Russia’s security policy towards Caucasia.7 Furthermore, Georgia is important for Russia, because it is indispensable in Russian attempts to place pressure on Azerbaijan, which follows pro-Western and pro-Turkish policies, and holds a land route to Russia’s ally Armenia. The roads and railways passing through this area to the South Caucasus, like a neck to a head, are another strategic reason why the geographic location of Georgia and Abkhazia is crucial for Russia. Furthermore, being the sole country in the South Caucasus with an opening onto the Black Sea, Georgia also carries strategic importance for Russian access to warm waters, a condition which is another reason for Russian military’s presence in Georgia. A withdrawal of the Russian military from Georgia would mean loss of control in the Black Sea for Russia. Moreover, the oil pipelines passing through Georgia to the west make this country even more important for Russia.8 Due to this importance, Russia wants Georgia to remain in its sphere of influence and has used the ethnic conflicts to this end. In the beginning of the twenty-first century, the Tblisi administration began approaching the United States to counterbalance its weakening ties with Russia. In June, 2002, Georgia applied for NATO membership. But its desire to join NATO was regarded by Russia’s military and political elite as a threat to their national security.9 Georgia claimed that the ethnic conflicts that it perceives as a threat to its territorial integrity were initiated by Russia, which wanted to keep Georgia in its sphere of influence. Russian policies towards the region so far appear to support this claim. Clearly, the Russian involvement in these conflicts does not aim to settle the conflicts and establish peace in the region but rather to continue the status quo and realise its own interests by deepening the crisis. Perceiving Russia as the source of the conflict has instigated two approaches to a solution: the first is to return to Russia to satisfy needs, as Shevardnadze was forced to do from 1994 onwards, and the second is to seek alternative power sources to outbalance Russia, an approach that has especially been used after 1997. Until now, Russian policies have led to further strengthening of American influence over

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Georgia. If this tendency continues, Moscow’s support of the secessionists—which is both ineffective over Georgia, indirectly causing anti-Russian feelings to emerge, and is unable to stop the increase of American influence over Georgia—will become meaningless. This consequence is forcing Russia to change its traditional policies. As was the case in the past and will continue to be so in the future, third parties are needed as mediators to solve the ethnic conflicts in Georgia. The attempts of Western states and international organizations such as the UN to foster peace in the region are continuing.10 The US military presence in Georgia after September 11 added a new momentum to the triangular relationship between Abkhazia, Georgia, and Russia. In the wake of 9/11, Russia not only had to overlook regional countries’ establishing of closer ties with the United States, but in its policies also had to accept the US presence in the region. Although the overthrow of Shevardnadze in 2003 and the annexation of Ajaria to Georgia may point to a weakening of Russian power in the region, and even though there is a view that Russian activity in the region lessened after US intervention in the region following 9/11,11 Russia is still undeniably a very strong actor and has trump cards to play. Through the August 2008 war, Russia showed that it will not remain silent in the face of the involvement of NATO or other Western institutions in the region. The August 2008 war strongly demonstrated that Moscow still enjoys significant means of influence in the post-Soviet space. While Russia may be deterred in a number of geographic regions, Moscow can easily materialize its power and deter rivals in the Caucasus and other neighbouring areas.12 As the war illustrated, Russia was not daunted by the prospect of directly invading a neighbouring state, and the United States had no ability either to deter Russia or to offer an effective military response to its close ally, Georgia.13 While globally Russia’s relative power might have waned since the Soviet period, it still possesses a significant control over its bordering regions. When one thinks of Russian influence in the Abkhazian elections and of the dependence of South Ossetia on Russia, it is clear that Russia is a sine qua non in the Abkhazian and South Ossetian problems.14 For this reason, any policy excluding Russia will not be able to solve the conflicts. All confrontations between the Russian and Georgian political elites foster the illusion that Georgia must join NATO to ensure its territorial integrity, just as they foster the illusion that Russia must exert military pressure on Georgia to guarantee its own national security.15 If Georgia ultimately does lose the territories over which its central authority has no control, the Russian political elite will feel compelled to deal with increased activities among Islamist extremists and the formation of a North Caucasus

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confederation to control the region’s oil resources. If, however, the confrontation turns into a military conflict, Russia will face the threat of an international blockade and the danger that other states and commonwealths would take advantage of the situation to force a Russian geopolitical retreat in Eastern Europe and Central Asia. In the long term, such a state of affairs would promote national movements for independence in several regions of the Russian Federation. If, in contrast, good neighbourly relations are resumed, Russian–Georgian cooperation is normalized, and Russia contributes to the rapid restoration of Georgia’s territorial sovereignty, we should expect Georgian policy to change its priorities: from a military and political confrontation with Russia to economic rationality, cooperation, and strengthening of cultural ties. All this will create conditions that will strengthen the region’s security and integrate Russia and Georgia into the European economic system. All factors, including the tendency to strengthen Russia’s stance in the international arena, the common goal of guaranteeing regional security in the region, ancient cultural and economic ties, the friendship between the peoples of the two countries, the joint contribution of the political elites to the development of Russian and Georgian statehood, and promoting democratic development, are significant enough to outbalance the prospect of a lengthy confrontation between their political elites. The current relationship between the governments of Russia and Georgia will inevitably evolve from a state of regional competition and confrontation between elites to a new state of mutual advantage based on partnership.16 Russia’s ability to use power in its bordering regions is still immensely effective and should be taken into consideration.

Turkey and Georgia Since 1991, Georgia has been considered a valuable “strategic partner” by Turkey for several reasons. The first reason is actually a strategic one: having a weaker, friendly country between gigantic Russia and Turkey as a “buffer zone” makes good tactical sense. It is assumed that to be a neighbour of a superpower, old, new, or reborn, is risky. Second, especially after the invasion of Azerbaijani territories by Armenia, and in the wake of the Nagorno-Karabakh problem, Georgia was valued again as the only direct corridor by which Turkey could reach Azerbaijan, the Caspian Sea, and the rest of the Turkic republics. Thirdly, Georgia provides the best option for the transportation of Caspian energy riches to international markets via Turkey, bypassing both Russia and Iran.17

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There were no noteworthy developments in Georgian–Turkish relations until 1994, because while Georgia was occupied with the Abkhazian and South Ossetian conflicts, Turkey was focused on implementing its Caucasian policy on Azerbaijan and Karabakh and dealing with Russia’s “Near Abroad” doctrine. Failed relations with Armenia after the Karabakh conflict led Turkey to see Georgia as the only possible gateway to Azerbaijan and Central Asia.18 Other additional factors, such as Georgia being the key country in the transfer of Caspian petroleum to the West, also advanced relations.19 Turkey trained Georgian military officials, and some basic, nonsophisticated equipment was transferred by Turkey to Georgia. The Baku– Tbilisi–Ceyhan crude oil pipeline, the Baku–Tbilisi–Erzurum natural gas pipeline, and the Kars–Tbilisi–Baku railway projects were all aimed at strengthening Turkey’s ties with the Caucasus and the Caspian Basin. Turkey has lived for centuries with the reality of Russian power. For late Ottoman Turkey, competition with Russia was a strategic challenge. For Republican Turkey after 1945, the containment of Soviet power played an equally central role in defining foreign policy priorities. However, the rapid expansion of Turkish–Russian economic and political relations over the last decade (2000–2010) seems strikingly different than the previous historic patterns. After years of rapid economic growth and weak security challenges from across the Black Sea, many Turks have been inclined to think along these post-modern lines. As relations with Washington and Brussels have cooled, some Turkish strategists have even begun to consider the possibility of alternative strategic alignments in Eurasia, and above all with Russia. Russia’s place in Turkish foreign policy gains more and more importance as time goes by.20 In terms of trade volume, Russia is a key partner for Turkey. Turkey generates half of its electricity from natural gas turbines, and buys over two thirds of its natural gas from Russia. The anti-American atmosphere in Turkey also makes Russia appealing in the eyes of sections of the Turkish leadership. Because of the indispensable geopolitical position of Georgia and the increasing importance of relations with Russia, Turkey was faced with a dilemma in making choices in its foreign policy. As a consequence of this, Ankara initially hesitated to agree to the passage of American naval vessels through the Turkish Straits, despite the fact that it was only for humanitarian purposes. 21 Issues in the Caucasus affect Turkey through diaspora populations as well. While the region was ruled from Istanbul for only relatively short periods of time and that was a long time ago, diaspora members representing virtually all the Caucasian nations are still present in Turkey.

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The solidarity groups of Muslim Georgians and their activities in the Turkish political arena are a known phenomenon. But the Abkhazian presence is also a known factor: the Abkhazian diaspora in Turkey numbers many more souls than the present-day Abkhazian population. The same can also be said for Ossetians. As a natural consequence of this characteristic, even putting aside the security and Russian factors, it is almost impossible for Turkish governments to have a clear stance supporting either Georgia, Abkhazia, or South Ossetia. Thus interviews with the foundations and pressure groups established by these diasporas display a clear picture: nobody is content with Turkey’s policies in Caucasia. The current Turkish government has been much more interested in the Middle East than in Caucasia. Yet the crisis prompted the Turkish prime minister Recep Tayyip Erdo÷an to launch an initiative for a Caucasus alliance, later renamed as the “stability and cooperation platform.” At this stage, this idea is a good opportunity for Turkey to create an inclusive (Russia, Turkey, Georgia, Armenia, and Azerbaijan) new foreign policy approach.22 This approach should be merged with the representation of all the frozen or unfrozen conflict areas, peoples, ethnic groups and regions included under the roof of such an alliance. Erdo÷an’s approach could be productively supported by economic and energy initiatives and, perhaps more importantly, with more humanitarian and inter-ethnic dialogue patterns. If Turkey could develop such an inclusive approach, not only establishing relations with the “centres” of the nation states, but also with the “problematic regions,” by capitalizing on its historical and ethnic heritage, it would succeed in establishing secure links between its allies in the West and those regions without alienating any regional power. Like most other states, Turkey pressed hard against the war in Georgia. Turkey was well aware that the war threatened both regional security and its own position in the Caucasus, as well as its long-term objective of becoming a hub of European energy distribution. Erdo÷an chose a suitable moment to promote a form of Caucasian alliance—a well-intentioned but somewhat surreal proposal in the middle of a raging war.

Conclusion While the Georgian–Ossetian war in August 2008 implied how fragile the security is in Caucasia, it also depicted how important it is to ensure a stable atmosphere for the future of the countries in the region. With the August 2008 war it is well understood that each of the issues which persisted since the USSR era, but were kept frozen in the past, now pose a threat to regional security. Affected by this conflict within its near

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neighbour’s borders, Turkey at that time was caught in a dilemma between Russia and Georgia. In this sensitive period, by following a multi-sided security and stability policy, the Turkish Government tried its hardest to preserve equilibrium. Maintaining security in the region is crucial for Turkey, which continues its strong commercial and diplomatic relations both with Russia and Georgia, and aims to be an energy distribution hub in the region. The Caucasian stability and cooperation platform is a result of Turkey’s equilibrium-conscious foreign policy. One of the most serious impacts of the August war is that of the dangerously impaired status quo in the region. The declaration of independence by Abkhazia and South Ossetia is not recognized by Georgia, and Russia is identified as the main threat in the region in point of security and stability. Through this war, Russia showed that it will not remain silent in the face of the involvement of NATO or other Western institutions in the region. From the Russian viewpoint, every activity carried out in the region for the sake of controlling the energy transport lines and preserving their domination of the region is considered as natural and legitimate. The policies that will be followed by the West will determine the security of the region. Meanwhile, because of its indispensable geopolitical position in energy transport, the interest of the West for Georgia will not decrease. Russia has to be aware of this fact while determining and implementing its policies related to the region.

Notes 1

Note that South Ossetia is inside Georgia, while North Ossetia is inside Russia. Anna Matveeva, “Georgia: Peace Remains Elusive in Ethnic Patchwork,” Searching for Peace in Europe and Eurasia—2002, http://www.conflictprevention.net/page.php?id=40&formid. 3 Oktay TanrÕsever, “Rusya—Gürcistan iliúkilerindeki artan gerilim: Bir sa÷Õrlar diyalo÷u mu?” Stradigma 7 (August 2003): 1–8. 4 Jyotsna Bakshi, “Russia’s National Security Concepts and Doctrines: Continuity and Change,” Strategic Analysis 26 (October 2000), http://www.ciaonet.org/olj/sa/ sa_oct00baj01.html. 5 Alexander Pikayev, “The Russian Domestic Debate on Policy Toward the Near Abroad,” in Peacekeeping and the Role of Russia in Eurasia, ed. Lena Johnson and Clive Archer (Boulder, CO: Westview Press, 1996). 6 Duygu Sezer Bazo÷lu, “Russia and the South: Central Asia and the South Caucasus,” European Security 5, no. 2 (1996): 47. 7 Vitaly Naumkin, “Russia and Transcaucasia,” Caucasian Regional Studies 3, no. 1 (1998), http://www.ciaonet.org/olj/crs/crs-1998/crs98-nav01.html. 8 See, for example, S. Blank, Energy and Security in Transcaucasia (Washington, DC: Strategic Studies Institute, 1994); M. Mozaffari, Security Politics in the Commonwealth of Independent States:The Southern Belt (London: Macmillan, 2

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1997); R. Ebel and R. Menon, eds., Energy and Conflict in Central Asia and the Caucasus (Lanham, MD: Rowman & Littlefield, 2001); S. E. Cornell, Small Nations and Great Powers: A Study of Ethnopolitical Conflict in the Caucasus (London: Curzon Press, 2001). 9 Mikheil Saakashvili, “The Way Forward: Georgia’s Democratic Vision for the Future,” Harvard International Review (Spring 2006): 68. 10 Susan Stewart, “The Role of the United Nations in the Georgian-Abkhazian Conflict,” Journal of Ethnopolitics and Minority Issues in Europe 2 (2003): 11. 11 Jim Nichol, “Armenia, Azerbaijan, and Georgia: Political Developments and Implications for U.S. Interests,” CRS Issue Brief for Congress, 9 May 2006 (Library of Congress: Foreign Affairs, Defense, and Trade Division, Congressional Research Service), 5. 12 Svante E. Cornell, Johanna Popjanevski, and Niklas Nilsson, “Russia’s War in Georgia: Causes and Implications for Georgia and the World,” Central Asia– Caucasus Institute and Silk Road Studies Program (Washington, DC: Johns Hopkins University–SAIS). 13 Vicken Cheterian, “The August 2008 War in Georgia: From Ethnic Conflict to Border Wars,” Central Asian Survey 28, no. 2 (June 2009): 155–170. 14 ȼɨɣɧɚ ɜ ɘɠɧɨɣ Ɉɫɟɬɢɢ: ɜɨɨɪɭɠɟɧɧɵɟ ɫɢɥɵ ɤɨɧɮɥɢɤɬɭɸɳɢɯ ɫɬɨɪɨɧ, http://top.rbc.ru/society/09/08/2008/217974.shtml. 15 Petrushka Sustrova, “The Thorn in Russia’s Side, New Presence,” The Prague Journal of Central European Affairs (Summer 2007): 51. 16 For more on Russian–Georgian relations, see J. Devdariani, “Georgia and Russia: The Troubled Road to Accommodation,” in Statehood and Security: Georgia after the Rose Revolution, ed. B. Coppieters and R. Legvold (Cambridge, MA: MIT Press, 2005), 153–203. 17 Emmanuel Karagiannis, “The Turkish–Georgian Partnership and the Pipeline Factor,” Journal of Southern Europe and the Balkans 6, no. 1 (April 2004): 13. 18 Olesya Vartanian, “Georgia: Armenians Bargain with Government,” War and Peace in the Caucasus: 100 Selected Articles from IWPR’s Caucasus Reporting Service (IWRP 2005), 19 [orig. pub. in CRS, no. 282 (April 14)]. 19 Svante E. Cornell, “Geopolitics and Strategic Alignments in the Caucasus and Central Asia,” Perceptions: Journal of International Affairs 4, no. 2 (July–August 1999). 20 Mihail Zigar and Sergey RÕjkin, “Rossiya OtÕgrala Nazad,” Kommersant (19 January 2007). 21 Ian Lesser, “After Georgia: Turkey’s Looming Foreign Policy Dilemmas,” Analyses on Turkey: The German Marshall Fund of The United States, http://www.gmfus.org/archives/after-georgia-turkeys-looming-foreign-policydilemmas. 22 Hasan Kanbolat, “What is Caucasian Stability and Cooperation? What can Turkey Do in the Caucasus?” Experts Analyze Caucasus Platform, Today’s Zaman (Istanbul), 13 December 2009, http://www.todayszaman.com/newsDetail_get NewsById.action?load=detay&link=150578.

CHAPTER EIGHT BACKGROUND TO THE HOSTILITIES BETWEEN ARMENIA AND AZERBAIJAN: FROM THE PRAGUE PROCESS TO THE MADRID PRINCIPLES ELHAN MEHTIYEV*

Introduction The conflict between Armenia and Azerbaijan dates back to February 1988 when both republics were part of the Soviet Union. Armenians in Armenia and in the Nagorno-Karabakh (NK) Autonomous Region launched mass rallies supporting incorporation of this part of Azerbaijan into Armenia,1 while at the same time they appealed to central authorities in Moscow to meet their demands. Since changing the borders was the prerogative of the union republics, both Azerbaijani and Soviet Central authorities rejected their claim, citing that it was unconstitutional. They stated that “perestroika does not mean the change of borders.” Since the rebellious party had no solid economic or political arguments for its claims, it had only violence to attract attention. Demands for separation were accompanied by sustained violence in the region. Different political and non-political organizations in Armenia formed their own armed groups. Their major aim at the first stage was to train young people and send them to Karabakh to try to intimidate, expel, or kill2 Azerbaijanis from the mixed Armenian–Azerbaijani and Azerbaijani villages adjacent to Armenian populated areas. Armenian groups from the Middle East and the United States who were experienced in training were both instructors and fighters3 in terrorist camps.

*

Peace and Conflict Resolution Centre, Baku, Azerbaijan.

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Local Soviet forces in Armenia and later in NK were covertly involved in the illegal arming4 of the local paramilitary forces, an activity which was a source of income for them. The “attack and capture” policy was promoted by the local Armenian government itself as a way to obtain weapons.5 By the time the Soviet Union collapsed in late August 1991, Armenia was the only country in the former Soviet Union to have its own armed forces.6 Azerbaijan was under a state of emergency imposed by Moscow and was left unarmed7 against the armed Armenian groups. The latter played a crucial role in further military developments in the region. An ethnic cleansing campaign against the Azerbaijani population of NK was launched in late September 1991. By early May 1992, Shusa and Lachin had been captured. Entire areas populated by Azerbaijanis in NK had been burned and looted, and the people were expelled from their native lands. Russian tanks, armoured vehicles, and military officers stationed in the regional capital of Stepanakert were active in this process.8 Brutal atrocities were inflicted on Azerbaijani villages. In the town of Khojali,9 763 people were massacred by local Armenian militants supported by the 366th Motor Rifle Regiment of the Russian Federation.10 The core of the Armenian armed forces comprised career Soviet officers and weapons “captured” from the Soviet bases in NK.11 The Khojali massacre remains the main psychologically traumatic event for Azerbaijanis, and it is central to all efforts focused on conflict resolution. The expulsion of Azerbaijanis was a planned policy of Armenian radical groups in an effort to secure a non-Azerbaijani NK as a first step in further extraction of this land from Azerbaijani control.12 In March 1993, Armenian forces advanced into areas beyond NK and captured the Kelbejer district, which led to the greater involvement of the United Nations. In June 1993, Armenian forces took advantage of the political turmoil in Azerbaijan and launched a wide-ranging military offensive. They captured six other regions of Azerbaijan, creating hundreds of thousands of refugees as they burned and looted the occupied lands. The occupied areas beyond NK were more than twice the size of NK, and were equal to half of the territory of Armenia. All residents of the occupied areas (approximately 700,000) were driven out of their homes, and the occupied areas became heavily militarized. One hundred and twenty kilometres of Azerbaijan’s international borders with Iran and more than that with Armenia still remains out of Azerbaijan’s sovereignty. Subsequently, the UN Security Council adopted four resolutions demanding the immediate and unconditional withdrawal of occupying forces, but it did not take decisive steps for implementing them.

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Overview of OSCE Activities The Organization for Security and Co-operation in Europe (OSCE) was involved in Armenian–Azerbaijani conflict resolution in early 1992. Following the Khojali massacre on 24 March 1992, the OSCE decided to convene a conference in Minsk,13 in an effort to settle the problems facing the conflicting parties. OSCE involvement was welcomed by Azerbaijan, since its principles and mediation guaranteed Azerbaijan its sovereign rights and excluded the possibility of any unpopular, unilateral mediation. Armenia considered the intervention of the OSCE undesirable due to the principle of inviolability of borders, which excluded Armenia’s territorial claims in any form. Initially, the chairmanship of the OSCE Minsk Group was rotated among countries including Italy, Finland, and Sweden. Later, in December 1994, Russia assumed the permanent chairmanship at the OSCE Budapest summit, where the decision was made to send multilateral peacekeeping forces to the area.14 At the OSCE Lisbon summit, held in December 1996, principles for NK conflict resolution stipulating a high degree of autonomy within the Azerbaijan republic were put forward.15 In 1997, the OSCE Minsk Group cochairmanship was created, which comprised the United States, France, and Russia. Co-chairmen of the Minsk Group proposed two peace plans in 1997. They were known as the “package” and “staged” plans, which envisaged greater autonomy for NK and diminishing Azerbaijani sovereignty over the region. Both were accepted by Azerbaijan. The then Armenian President Levon Ter-Petrosyan accepted the second plan in 1997 in an attempt to foster peace and cooperation with both Azerbaijan and Turkey. He was subsequently forced to resign by the influential Armenian ministries, and Prime Minister Robert Kocharyan disrupted the peace efforts. A third plan called “common state” was proposed in late 1998, which was fundamentally different from the common state plan of Bosnia. It was rejected by Azerbaijan since it aimed to divide Azerbaijan into two independent states. The stalemate continued until 1999 when Heydar Aliyev, Azerbaijan’s president at the time, initiated the Geneva meeting with Armenian president Kocharyan, in an attempt to make a deal without distancing the OSCE from the process. These one-to-one meetings yielded some hope domestically and internationally by the autumn of 1999. However, terror in the Armenian parliament later produced a power vacuum in Armenia and the peace process stalled again until Russian president Vladimir Putin’s visit to Baku in January 2001. President Putin’s efforts in

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coordination with French President, Jacques Chirac, stimulated the Paris meetings in February and March 2001. Although the specific points of discussion in the negotiations were confidential, they allegedly focused on the territorial exchanges between Azerbaijan and Armenia and on deep decentralization. In an effort to advance the Paris talks, the US government initiated the Key West meeting in the United States in early April 2001, involving conflict resolution experts skilled in presenting ideas for possible resolution options. Unfortunately, this gathering failed to produce an agreement. The widely speculated Key West “agreement” or “principles” mentioned by the Armenian side have been confirmed neither by mediators nor by the Azerbaijani side. The situation stalled until 2004 with episodic symbolic meetings.

From the Prague Process to the Madrid Principles The meetings of foreign ministers within the Prague process, which started in April 2004, seemed to have a distinct character compared to previous negotiations. Foreign Ministers of the two countries formulated a framework, which was not disclosed to the public but was supported by the OSCE Minsk Group. Although the essence of negotiations has remained secret, a few details were disclosed by both sides. Azerbaijan agreed that the conflict should be settled stage-by-stage, reflecting a positive decision both in terms of the conflict resolution approach and in terms of diffusing the deep hostility between the sides. Armenia, on the other hand, insisted on accepting a package solution in which the status of NK would be determined first, within a comprehensive peace settlement. The course of negotiations has shown repeatedly that the delegates have been trying to combine both arguments and elements of settlement into a wider phased agreement. In the first stage, Azerbaijan negotiated the withdrawal of Armenian troops from the areas beyond NK itself. This would allow the return of refugees to their homes in exchange for opening communications, establishing bilateral relations with Armenia, and engaging in economic development in NK. If goodwill prevails, the final status of the region could be decided within the context of trust and cooperation without any hostility. Azerbaijan’s general view was that as long as the territorial integrity and state security of Azerbaijan were assured, a high degree of self-rule could be granted for the entire population of NK. The local entity could enjoy the full right of administrative independence, with the exception of the major functions of central government and the state, like military

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security and foreign policy. Accordingly, demilitarization of the area, freedom of movement, and economic development should be basic elements of a comprehensive peace agreement. In seeking to legalize its military gains, Armenia tried to exclude any possibility that the final status of NK might be part of Azerbaijan. Instead, the representatives referred to horizontal relations with Azerbaijan’s central government. This approach has been unacceptable to Azerbaijan, since this type of agreement of exclusion would lead to the division of Azerbaijan into two states. In addition to NK, the Armenian side claims that the Lachin region (which is beyond the administrative borders of NK) should have the same status as NK would have. Azerbaijan does not accept this, either. Azerbaijan believes that horizontal relations cannot be ruled out, so long as the powers for preserving the unity of the state are kept intact. After the failure of the negotiations between Azerbaijani and Armenian leaders at the end of the Prague process—at Rambouillet, near Paris, in early 2006, and at the Bucharest meetings in early June 200616—the cochairs disclosed to the public details of the principles discussed during the Vienna meeting of the OSCE Permanent Council on 22 June 2006. The representatives stated that they had reached the limits of their creativity in the identification, formulation, and finalization of these principles: “We do not believe additional alternatives advanced by the mediators through additional meetings with the sides will produce a different result.”17 This was the first time that the Minsk Group of mediators publicly disclosed their peace plan. Previously, it had been held in close confidentiality during the entire period of negotiations. In their statement, the co-chairs urged both leaders to accept the proposal, which they believed was “fair, balanced and workable,” and could serve as the basis for a settlement agreement. Unfortunately, as well as being phrased in vague terms, the proposed plan leaves many key elements unnegotiated. The language of the document was based on military realities on the ground and was intended to exert pressure on the warring parties to accept the results of the military aggression. Adhering to the rules of a military solution would certainly serve to legalize Armenian military advances. The proposed plan had a key element for the Armenian side in that it would give them jurisdiction over a large section of the population in NK, which would work to their advantage in votes or referendums. Although the contours of the proposed vote on the status of NK should have been negotiated by the conflicting sides, this aspect of the proposed peace plan was interpreted as an attempt to secure permanent separation of NK from Azerbaijan.

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The plan envisioned the withdrawal of Armenian troops from the five occupied regions beyond NK. The two regions of Lachin and Kelbejar would be left under Armenian control until the final status of NK could be determined. Before this referendum, the sides would assume responsibility “to renounce the use or threat of use of force, and international and bilateral security guarantees and assurances would be put in place.” The latter stipulation included demilitarizing formerly occupied areas and allowing deployment of peacekeeping forces.18 In addition to the referendum, the plan contained some challenging uncertainties, including the interim status of NK and other occupied areas before the referendum, and the fate of substantially large numbers of armed forces deployed in those areas. Mutual agreement on these issues is the key to the final solution. The parameters of the interim status are a subject of dispute, since Armenia has attempted to remove Azerbaijan from the status, which would force it into further negotiations to accept a permanent separation. The proposed peace plan is similar to the Kosovo case, with one difference. Whereas Kosovo’s independence was accepted following its unilateral declaration, the NK case is surrounded by intense suspicions that the peace process seems to be aimed at pressuring Azerbaijan to accept separation through negotiations. The plan states that a referendum or population vote would be agreed upon at an unspecified future date to determine the final legal status of Nagorno-Karabakh. Yet the failure of negotiations indicates that the Armenian side stipulates that the referendum agenda be negotiated in advance so that they would be aware of the final status of NK. Such a position challenges the entire negotiation process, derailing it from the track pursued during the Prague process and, again, promoting a determination of the status of NK that is favourable to Armenia. In such circumstances, the occupied areas are being used as a trump card for legalizing Armenia’s military acquisition. Azerbaijan’s leadership expressed its readiness for a referendum of the whole population in NK. At the same time, both Armenia and Azerbaijan rejected any form of referendum which might lead to the secession of NK from Azerbaijan. At different levels, Azerbaijan expressed its willingness to grant a high degree of self-rule to the NK region within Azerbaijani statehood: “The Azerbaijani side reaffirms its readiness to grant the highest level of autonomy to Nagorno-Karabakh within the framework of the Azerbaijani constitution and Azerbaijan’s internationally recognized territorial integrity. Such a constitutional approach is the only way possible to achieve a lasting settlement.”19

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The principles of the formulated draft peace plan that were presented to foreign ministers of both countries in Madrid in November 2007 are referred to as the Madrid principles. As the co-chairs stated, these basic principles are based on the Helsinki Final Act, comprising selfdetermination of people, non-use of military force, and territorial integrity. However, these principles are still a matter of debate among the parties under the mediation of co-chairs. The principles can be put into force whenever the parties agree with all provisions of the proposed plan.20 Here we must note that the principles contain many unresolved questions and, due to its vague provisions, the language of the document is open to different interpretations by each side. Within this context, representatives from the top levels of both sides (including foreign ministers) have met numerous times in the past two years to close the negotiations based on the Madrid Principles. They made their recommendations to the co-chairs and the revised document is now known as the updated Madrid Principles. The Azerbaijani government accepted the updated Madrid Principles early in March 2010 as a basis for a comprehensive peace agreement. In an on-going attempt to sabotage the peace plan, Armenia continues to make vague statements, rather than presenting its specific position.

Impact of Turkey–Armenia Protocols The Turkey–Armenia initiative has not been able to clear up the continued suspicions regarding the real aims of the Armenian side. After the Turkish–Armenian protocols were signed in October 2009, the Armenian negotiating strategy with Azerbaijan changed, in the hope of a rapid opening of the border with Turkey. Armenia hopes that this step will isolate Azerbaijan and separate Turkey from the NK issue. This has been the top foreign policy goal of Armenia for the past eighteen years. By isolating Turkey from the NK issue, the Armenian side hoped that it would be much easier to prolong the status quo until the legalization of the military gains. Thus, the Armenian side had a perception that by having normal relations with Turkey, on one hand, and being in military and political alliance with Russia, on the other, it would be able to survive economically and strengthen its position, while at the same time being able to hold the occupied Azerbaijani territories until the desired outcome of the NK negotiations. Meanwhile, Azerbaijan accepted the protocols signed in October 2009 with calmness and hoped that the process would lead to a positive change in the entire region. It expected signals of peace and reconciliation would

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also come from Armenia in return. But instead of harmonizing peace efforts from all sides surrounding the country, Armenian officials have launched a domestic and international campaign, spending their energy trying to persuade the international community that the Turkish–Armenian protocols had nothing to do with Azerbaijan’s occupied lands. Watching these moves unfold, the Azerbaijani side concluded that the Armenians thus disclosed their genuine intentions and, as such, were both preventing and provoking the Azerbaijani and Turkish societies to move forward together. The Azerbaijani side asked: If there were a genuine desire for peace in the entire region, then what would be the reason for this surprisingly hysterical campaign to “prove” that these two naturally interconnected inseparable issues are in fact separate? What was the real purpose behind this campaign by Armenia? For the Azerbaijani public, one thing is clear: that through this behaviour, the Armenian side has been trying to convey their message to the international community that they have no desire to leave these territories by peaceful means. This is what the Azerbaijani side strongly believes, based on the nature of the Armenian policy. Turkey warned Armenia, however, that it will not open its borders unless the occupied lands of Azerbaijan are freed. In the meantime, Armenia pretends that the overall issues of Turkey–Armenia and Azerbaijan–Armenia are independent of each other. Turkey continues to warn Armenia that the borders were closed as a response to the occupation and they will be opened only if the occupation ends.

Changing Dynamics of OSCE Mediation: OSCE and Other International Organizations Regarding the mediation efforts of the OSCE Minsk Group, it should be noted that co-chair countries have monopolized the entire settlement issues, isolating the other thirteen Minsk Group countries. Intervention by the Council of Europe, the European Union, and the United Nations General Assembly have faced similar opposition from both the Minsk Group co-chairmen and Armenia. Armenia accepts the OSCE Minsk Group as the best format for negotiations. The past eighteen-year history of mediation has shown that the NK issue has become isolated from the international community, restricting and preventing any international involvement, while indirectly supporting the continuation of the occupation and hiding the consequences of Armenian military aggression. Throughout this period, Azerbaijan

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remained desperate for various international organizations to become involved in an effort to free her from the burden of occupation. Early in 2004, Per Gahrton, the EU Rapporteur on the South Caucasus, prepared a report in which he advocated an increase in EU aid to the South Caucasus. Additionally, the report called on the EU to solicit the cooperation of Russia and Turkey in resolving regional conflicts.21 In terms of the NK settlement, Rapporteur Gahrton was specific in stating that “the Armenian party must be ready to withdraw its armed forces from the occupied territories” and must “abstain from Armenization (settlement) of the occupied territories”; “International law bans this and it is unfavourable for the future,” Gahrton said.22 Armenia rejected the EU report23 and although the EU recognized the role of the Minsk Group in finding a solution, the OSCE remained silent. In October 2004, Azerbaijan introduced a draft resolution to the 59th session of the UN General Assembly under the title, “The Situation in the Occupied Territories of Azerbaijan,” with the purpose of debating Armenian settlement activities in the occupied territories.24 Although the Minsk Group co-chairmen were not happy about the resolution, their respective UN Security Council member countries reached a compromise agreement with Azerbaijan on forming an OSCE fact-finding mission to monitor settlement activities in the occupied areas. This was an important step, which offered another means of pursuing the issue instead of debating it at the UN. Subsequently, the OSCE fact-finding mission was sent to the occupied areas with the Minsk Group co-chairmen. The final report was written and delivered under the strict control of the Minsk Group co-chairs. Unfortunately, its language was far from accurate, in a clear attempt not to harm Armenian interests. The Armenian representatives made tremendous efforts to block the report. They believed that the debate could provoke international condemnation and weaken Armenian arguments. Armenia threatened to withdraw from negotiations with Azerbaijan.25 The biased approach of the OSCE was evident in its report of fires in the occupied areas of Azerbaijan adjacent to the contact line. From June to September 2006, the Armenian armed forces began to destroy the remnants of Azerbaijani refugee houses directly in their line of contact. They also torched the high grass and wild crops along the contact line, calling these acts a military necessity. After Azerbaijan protested at the UN, the General Assembly adopted Resolution 60/285 on 25 September 2006, and agreed to send the OSCE fact-finding mission to the region. The mission was deployed after the end of the fires and reported back to the UN in March 2007. Their consensus

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alleged that “the fires occurred due to the abundant precipitation in winter season, which has created an ideal condition for fire—a threat in an environment of dry and hot weather. Due to the absence of modern firefighting technology and trained techniques, the local residents were not able to localize the fires.” 26 In reality, however, the Armenian military forces destroyed all the buildings and burned the overgrown fields across the contact line for better visibility of enemy positions. Thus, the report from the OSCE mission manifested absolutely no logic. Instead, it appeared to be an absurd attempt to rationalize the actions of the Armenian military as they cleared solid obstacles and overgrown fields which obscured their line of vision of Azerbaijani positions. During the debate about “The Situation in the Occupied Territories of Azerbaijan” at the UN General Assembly in March 2008, the mediators took the unprecedented step—which was inappropriate to their status and mandate—of taking sides in the conflict, and voted against the resolution.27 This act of the OSCE mediators provoked a sharp outcry from both the government and society of Azerbaijan. The OSCE Minsk Group’s description of the resolution as discriminatory, unsatisfactory, and unbalanced triggered an enormous negative reaction and substantially diminished trust, as was expressed by numerous public and political organizations and the central government in Azerbaijan.28 Azerbaijan has absolutely no trust in the Minsk Group co-chairmen, yet has no political will or power to change them. “The co-chairmen feel very pleased as they have monopolized the settlement process within the Minsk Group, but the relationship with them should be principally changed. They should understand that they are not monopolists there and should not be,” said the Azerbaijani Deputy Foreign Minister immediately after the adoption of the resolution.29 In Azerbaijani society, there is a deep distrust of the mediating team due to the favour shown by the co-chairs’ countries, directly and indirectly, towards Armenia. Azerbaijan believed that Russia played a pivotal military and diplomatic role in supporting the Armenian occupation. Russia has an active military base in Armenia and continues to demonstrate its continued alliance by providing modern arms and equipment to the Armenian military. There is a consensus in Azerbaijani society that Russia’s support encourages Armenian aggression towards Azerbaijan. Providing continued supplies of arms to one side is not at all compatible with mediation efforts. For many years, another of the co-chairs, the United States, has also been perceived by the Azerbaijani public as biased due to US Government Restriction 907, which was imposed by the US Congress on Azerbaijan.

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This restriction was in force until 2002. The US Congress support for Armenia had a negative impact on the peace process by encouraging Armenia to continue its policy of occupation. Armenia is also the second largest recipient of US aid in the world. US Congress discussions of Armenian “genocide” resolutions are perceived by Azerbaijan as an attempt to divert attention from the atrocities committed by Armenia against Azerbaijan. The United States is the only country in the world to render aid direct to the rebel territory of Nagorno-Karabakh, which reflects an additional diminishment of trust. Azerbaijanis could not trust French mediation, either, as they watched the president of France embracing Armenian president R. Kocharyan as he awarded him a Medal of Honour. Citizens of Azerbaijan very well recall that it was Kocharyan who led the occupation and destruction of part of their home country, and headed the NK separatist forces as they committed war crimes similar to those committed by Serbia’s Karadzic and Mladic in the early 1990s. The Azerbaijani public is much more supportive of having Turkey, Germany, or Great Britain as co-chairs, at least to create some balance. The Minsk Group co-chairs believe that any involvement of other international institutions could lead to their isolation from the process or limit their entire monopoly. Yet they have always tried to reduce their own role in the settlement process, reiterating that their only mandate is to act as a mediator. Despite the aforementioned interests of the great world powers involved in the settlement process, the co-chairs have always emphasized their unity and common interests for settlement, regardless of their disagreement. They have repeatedly stated that the plans ultimately put forward were produced by their joint agreement.

Conclusion For the past sixteen years, the Azerbaijani policy of a ceasefire regime has sought to attain international recognition of Armenia as the aggressor state. The main purpose has been to pressure Armenia to leave the occupied areas. Azerbaijan hoped international actions similar to those taken in the former Yugoslavia could be taken towards Armenia, but the geographical remoteness of the Caucasus and international ignorance of Armenian atrocities have always raised doubts for similar involvement. Azerbaijan managed to isolate Armenia from regional transport and energy projects, but failed to make visible economic progress, resulting in

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unemployment and the emigration of millions of Azerbaijanis to Russia and Western Europe. During the past sixteen years of the ceasefire regime, Armenia’s whole approach has been based on the results of military gains. By maintaining the status quo for many years, they hoped to achieve a desirable outcome in a changed environment. Out-of-date thinking, authoritarianism, propaganda to incite hatred, lack of vision for the future of the region, lack of pluralistic debate on peace with Azerbaijan, and the rule of former warlords are the major elements of a continued stalemate by the Armenians. Verbally both countries expressed their commitment to a peaceful resolution, but neither side has embraced the rules of peaceful settlement in terms of changing the atmosphere of hatred and enmity towards each other, characterized by mistrust and the absence of a clear vision for future relations between the two nations. Azerbaijan believed that cooperation and ending the enmity would strengthen the Armenian side and toughen their position, while Armenia believed that the end of enmity and propaganda of hatred would slow the nationalist agenda and weaken their arguments to keep the occupied territories. So far, with the support of its lobbying groups in the United States and France, and its military alliance with Russia, Armenia has managed to oppose the creation of any international coalition which might work against its interests. The monopoly of the OSCE Minsk Group has also played an essential role in localizing the situation and prevented the international community from being able to construe and interpret the ethnic cleansing and military occupation. In the current circumstances, the peace process should include the establishment of an International War Crimes Tribunal for the Caucasus, which would try to bring to justice the leaders responsible for ethnic cleansing and war crimes perpetrated in occupied areas. This combined goal, of peace and justice, could be a driving force for a swift settlement and for the reconciliation of the people in the region. The Yugoslavian option clearly showed the effectiveness of such tribunals for reconciliation and justice.

Notes 1

Sovetskiy Karabakh (Stepanakert, Azerbaijan), 21 February 1988. Krasnaya zvezda, 31 July 1990. 3 Literaturnaya gazeta, 7 August 1991. 4 Den (military newspaper), 3–9 May 1992. 2

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TASS information agency, 12 October 1991; Azerinform, 21 August 1991. Interview with the President of Azerbaijan, Nezavisimaya gazeta, no. 132 (1991). 7 Nezavisimaya gazeta, no. 132. 8 Komsomolskaya Pravda (Moscow), 22 December 1991. 9 “Karabag,” 28 February 1992. 10 “Report of the Commission on Khojali,” Heyat (Baku), 24 February 1993. 11 Krasnaya Zvezda (Moscow), 22 December 1991. 12 Washington Post, 5 April 1993. 13 “Finland as a Mediator in the Karabakh Conflict,” Report by the Minister for Foreign Affairs Ms. Tarja Halonen to the Foreign Affairs Committee of Parliament on the Activities of Finland as Co-chairman of the OSCE Minsk Conference (Helsinki, 1997). 14 Materials of the OSCE Budapest Summit, Office of Archives of Azerbaijani President. 15 Statement of the OSCE Chairman in Office, 3 December 1996, Lisbon. 16 Associated Press (Yerevan, Armenia), 6 June 2006. 17 ArmInfo News Agency (Yerevan, Armenia), 28 June 2006. 18 ArmInfo News Agency, 28 June 2006. 19 Azeri-Press Agency (in Azerbaijani), Baku, Azerbaijan, 27 June 2006. 20 Panarmenian.net, 18 March 2008. 21 Radio Free Europe/Radio Liberty Newsline, 30 January 2004. 22 “Armenia Must be Ready to Withdraw its Armed Forces from Occupied Territories in Return for Some Compromises: Rapporteur of European parliament on South Caucasus,” Arminfo (Yerevan), 12 May 2004, see Noyan Tapan News Agency (Yerevan), in Russian. 23 Ekspress (Baku), 31 January 2004. 24 Reports of the Press Service of the Ministry of Foreign Affairs of Azerbaijan Republic, 30 October 2004. 25 Radio Free Europe/Radio Liberty, Armenian Service, 9 November 2004. 26 “Missiya OSCE prisla k mneniyu cto pricinami pozarov na linii soprikosnoveniya Azerbaydzano armyanskixvoysk stalasuxaya i zarkaya pogoda,” Day.az, 28 March 2007. 27 “UN GA prinyala resolyusii podderzivayusie territorialnuyu celostnot Azerbaydzana,” Day.az, 14 March 2008. 28 Araz Azimov, “Prinyatie rezolyusii UN GA dolzno stat seryeznim poslaniem dlya Armenii i seryeznim preduprezdeniem dlya sopredsedateley,” Day.az, 15 March 2008. 29 Azimov “Prinyatie rezolyusii,” Day.az, 15 March 2008. 6

CHAPTER NINE BLACK SEA REGIONAL SECURITY AFTER 9/11 YEVGENIYA GABER*

Introduction The Black Sea region has traditionally been regarded as one of the principal elements in European and Eurasian security structures, and a crucial zone for maintaining stability on the continent. Rich in natural resources and diverse cultures, with its strategically important energy corridors and transport routes for international trade, this area has always been a patchwork of overlapping civilizations and a stage for centres of influence. Yet it has gained its most extreme significance since the notorious events of 9/11 and the geopolitical shifts that took place in the region afterwards. It is only since these events that the littoral states have begun to construct their own regional identity and to propound various initiatives for regional security cooperation, claiming their desire is to stop being referred to merely as “a soft underbelly of Russia.” The region has begun to take shape through the activities of Bulgaria, Romania, and Turkey (all NATO members), which dominate the western and southern shores, and those of Russia and the new democracies of Ukraine and Georgia, whose territories stretch along the northern and eastern shores.1 At the same time, the Western powers have been searching for ways to fill the security vacuum on the southeastern borders of the Euro–Atlantic community and to ensure their footholds in the Black Sea basin in order to realise their own national interests. It is, therefore, necessary to analyse the Black Sea regional security environment in the context of the conflicting and convergent interests of the concerned powers. The aim of this chapter is to provide a comparative analysis of the regional strategies of the United States, which is the main outside actor *

PhD candidate at the International Relations Department, Odessa National Mechnikov University, Ukraine.

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involved in regional politics, and those of Turkey, which has recently positioned itself as a regional power. It will also be shown how cooperation between these two forces can contribute to the creation of a stable and secure geopolitical situation in the so-called Greater (or Extended) Black Sea region. While a number of problems in bilateral relations—stemming from the partners’ comparable positions in the region—generally decrease the effectiveness of their cooperation, these two spheres of influence, which possess the greatest potential for joint action, will form the main focus of our study. At the same time, the specific visions and approaches of Turkey and the United States will be outlined for each separate issue.

The Extended Black Sea Region as an Area of “Common Concern” The Caspian and Black Sea region was first proclaimed to be an area of American national interests in 1997 as an alternative oil source to the Persian Gulf.2 However, US interests in the Black Sea area—energy transit, security, counterterrorism, proliferation of weapons of mass destruction (WMD), human trafficking (including terrorists), and international trade in conventional weapons and illegal drugs—have taken on a particular significance since 9/11.3 The other country in the region to feel the dramatic impact of terrorist attacks, and to have become concerned about the same problems, is Turkey. The terrorist attacks of 9/11 (11 September 2001, United States) and 20/11 (two explosions in Istanbul on 20 November 2003) have underscored the dangers of a new century and the fact that the greatest threats to both the United States and Turkey are now likely to emanate from the Greater Middle East and its vicinity. As a result of those attacks, relations between Turkey and the United States have changed considerably over the past years. On 24 June 2008, Deputy Assistant Secretary of State for European and Eurasian Affairs, Matthew Bryza, delivered the ninth Turgut Özal Memorial Lecture at the Washington Institute. This is how he characterized the US view on the current state of the partnership between the United States and Turkey: Today, the U.S. government’s appreciation of Turkey’s geostrategic significance is evolving in new and positive ways … . We are starting to understand Turkey as a strategic link between North and South, lying at the center of an extended Black Sea region that connects the European Union, Russia and Ukraine with the Middle East.4

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This new approach of the US administration, which gives the Black Sea basin more importance than ever, together with balanced and realistic initiatives led by its close partner in the region—Turkey—could result in effective cooperation on a number of problems. These problems and other areas of “common concern” for both countries were clearly stated in a document called “Shared Vision and Structured Dialogue,” signed by the US Secretary of State Condoleezza Rice and Turkey’s then Foreign Minister Abdullah Gül in July 2006. This paper outlines the strategic goals of the United States–Turkish partnership for the future and contemplates ways to advance and deepen this cooperation. [Turkey and the United States] pledge themselves to work together on all issues of common concern, [including] promoting peace and stability through democracy in the Broader Middle East; enhancing energy security through diversification of routes and sources including from the Caspian basin; contributing to stability, security and prosperity in the Black Sea region, the Caucasus, Central Asia and Afghanistan … .5

Therefore, security, democracy, and energy are regarded as the cornerstones of United States–Turkish cooperative initiatives. There are indeed many questions to be discussed, and projects to be realized, in each of these spheres. While promoting democracy has more to do with the Greater Middle East, and the search for alternative means of energy supply and transit is more closely connected with the Caspian region, this article will focus mainly on the problem of the security architecture in the Black Sea region.

Shared Security Challenges in the Black Sea Region Cooperation between the United States and Turkey in promoting Black Sea regional security could be said to include fighting against terrorism, preventing the spread of radical Islam, cooperating on maritime security, and resolving “frozen” conflicts. (A) Fighting against terrorism: Given the current state of US relations with Turkey—which have partially improved since 2003 but still leave much to be desired—the only way to invigorate the current, shaky, strategic partnership is to develop cooperation on a broad spectrum of issues of common interest and mutual concern. It is clear that conducting a global war on terrorism is a high priority for both countries. As a victim of terrorism itself, Turkey has ratified all thirteen international counterterrorism

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conventions, protocols, and resolutions adopted by the UN, and has firmly supported NATO’s efforts in fighting terrorism.6 Istanbul hosted the 2004 NATO Summit, where crucial decisions were made regarding NATO’s new agenda for the 21st century, including operations to combat terror in various regions of the world. It is symbolic that the Istanbul Cooperation Initiative affirmed the willingness of all NATO member states “to meet the new and very different challenges found in the post-9/11 world together.”7 Since the NATO Istanbul Summit in July 2004, the idea of pursuing an integrated Western strategy towards the Black Sea region has steadily gained ground. The Turkish Republic has been given one of the leading parts in this play. (B) Preventing the spread of radical Islam: The other point of common interest for the United States and Turkey in constructing a regional security system is that the Black Sea and Caspian littoral has traditionally been—and remains to this day—a pivotal region as a bulwark against radical religious movements. Being perceived as “one of us” by the states of the region, Turkey nonetheless shares Western-type values and has unique opportunities to project them onto the newly independent states in the Caucasus and Central Asia. Thus, for the United States, Turkey is not merely a bridge between the West and the Islamic world, which meet in this basin, but also a strategically important link in the chain between the Southern Caucasus and Euro-Atlantic institutions, and a key element of every possible regional security system. It is also believed that Turkey’s active regional policy and close cooperation with Western institutions will, in turn, consolidate its own Western identity and guarantee a more liberal understanding of international affairs on the part of its foreign policy and security decisionmakers.8 Moreover, having always felt the threat of radical Islam in its own homeland, Turkey lacks sufficient resources to counter its spread and to fight regional terror organizations alone, without the technical, financial, and diplomatic support of the United States. (C) Cooperating on maritime security: Maritime security cooperation includes the following: improving border, maritime, and air traffic surveillance; preventing WMD proliferation and illegal trade in conventional weapons; combating illegal traffic in drugs, persons, etc.; and safeguarding strategically important shipping lanes. Turkey significantly contributes to the resolution of crises and the reduction of tensions by leading or participating in international formations in the region. In this regard, Turkey contributed to the creation

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of the Black Sea Naval Cooperation Task Group, founded in 2001, to support the peace and security of countries in the Black Sea region. Calling for disarmament, weapons control, and increased security measures in this part of the world, Turkey has undertaken to share its experiences with the countries of the Black Sea region, Balkans, Caucasus, Eurasia, and Central Asia. The Turkish Armed Forces continue to support centres of excellence that have come forward as part of the new NATO concept. To this end, the PfP Training Center and the Center of Excellence—Defence Against Terrorism were opened in 2005 in Ankara, and the Center of Excellence—Tactical Air Training was instituted in 2006 in Konya.9 Turkey builds regional peace, security, and prosperity by actively participating in regional organizations and special programmes such as the Black Sea Cooperation Force; Black Sea Economic Cooperation; Confidence and Security Building Measures in the Black Sea; and the Coast Guard Agreements in the Black Sea. It works to expand the scope of these organizations by inserting issues related to counterterrorism into their agreements. In order to promote a policy of a stable Black Sea region, Turkey takes an active part in a number of special regional programmes such as the BLACKSEAFOR and Black Sea Harmony. However, it should be mentioned that, apart from maintaining regional security, these initiatives are often used by Turkey as a unique opportunity to assert its leadership in the region. Ankara has repeatedly declared its firm, negative position on the involvement of “outside forces” in the region, especially in the case of the direct presence of a foreign navy in the Black Sea basin. Turkey considers the BLACKSEAFOR Multinational Maritime Task Force to be crucial for the maintenance of regional security in the Black Sea, because it is first of all a regional cooperation programme thanks to the participation of all six Black Sea coastal nations, namely, Russia, Ukraine, Georgia, Turkey, Romania, and Bulgaria. Still, when it comes to more expanded cooperation with “out of the area” actors, Ankara seems unwilling to break the existing regional power balance by permitting anyone inside its traditional sphere of influence, even if it is its long-standing strategic partner. This is why, in 2006, Russia and Turkey jointly vetoed a US proposal to expand NATO’s Operation Active Endeavor into the Black Sea. Operation Active Endeavor was created in 2001 to combat terrorist and other criminal activities in the Mediterranean. Although they are both NATO members, Russia and Turkey objected to US expansion into the Black Sea. Russia feared that more active US involvement in the region may cause destabilization. Turkey claimed that the NATO activity in the Black Sea could threaten the

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1936 Montreux Convention, which stipulates that Turkey alone controls the Turkish Straits of Bosporus and Dardanelles. Besides, from Turkey’s point of view, Operation Active Endeavor would make Black Sea Harmony, a 2004 Turkey-led initiative to police the southern Black Sea, and BLACKSEAFOR, a multinational regional project, redundant. In fact, while Ankara is ready to cooperate with various multilateral forces to contribute to peace and stability in the region, it has always been strongly opposed to the efforts of any outsider country (even a long term strategic partner) to bring its warships into the neutral Black Sea. Turkey seems determined to uphold its status as “the most stable country in the Black Sea region with effective armed forces.”10 The United States is well aware of Turkey’s concerns about losing its dominant position in the Black Sea basin to its own growing influence in the region. Consequently, the December 2006 report of the Heritage Foundation, a conservative Washington think tank, contains a recommendation “to conduct trilateral Bulgaria–Romania–Turkey military exchanges and consultations” to assuage Ankara’s fears and promote further cooperation in data exchange and joint naval operations.11 (D) Resolving “frozen” conflicts: This set of problems seems to present the most complicated and sensitive issues in the United States– Turkish alliance in the Black Sea region. The South Ossetia and Abkhazia conflicts in Georgia cannot as yet be referred to as “frozen”; Transnistria in Moldova and Nagorno-Karabagh in Azerbaijan require joint peacekeeping efforts by the whole international community and still create new tension points in United States–Turkey relations. This was demonstrated in the case of the 2008 Georgia crisis. On the one hand, Washington has obviously been Ankara’s immutable partner, both on global and regional levels, since the end of World War II. On the other hand, in the Georgia case Turkey feared that the United States might ruin the Caucasus like it did Iraq or Afghanistan, using Georgia as a cover. At the same time, a slight negative attitude on the part of Russia would put Turkey in economic and political trouble. Given that the Black Sea basin has been traditionally regarded as the “near abroad” of the Russian homeland, Ankara is aware of Russian sensitivities and tries to act with circumspection. It does not want to be provocative and takes the utmost care not to threaten vital Russian security interests and internal stability.

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Alternative Security Projects as the Main Dilemma of Turkish Regional Policy The recent period has been extremely rich in various projects of regional security. Some of them stipulate United States–Turkish cooperation and joint action as the first and foremost condition for providing peace and stability in the region. The others are geographically based and, consequently, Moscow-oriented. Evidently, Turkey’s moderate policy in such sensitive questions as geostrategic choice is fair. Not provoking the Kremlin, and protecting its own national interests by not opposing Russia on America’s behalf, is reasonable. But it should not be forgotten that Turkey, by itself, may not have enough power to stop Russia on the edge of the Turkish zone of influence. As one Turkish journalist has remarked, creating such regional security structures as the “Caucasus Platform” with Russia and three small countries (Georgia, Azerbaijan, and Armenia), while excluding the West, is “like entering a small cave with a huge bear.”12 Obviously, Turkey has its own interests in the region which do not necessarily coincide with those of the United States. This makes the diplomatic settlement of conflicts and related joint United States–Turkish decision-making more complicated. However, as the then Deputy Chief of Turkish General Staff, General ølker Baúbu÷, stated in one of his speeches in June 2005, “The long term security and the stability of the Black Sea and Caucasian region very much depend on US–Turkey cooperation.”13 It should be mentioned that the American security and foreign policy elites share this view, emphasizing the importance of being mutual partners and of regional stability in general. In 2001, the US Deputy Secretary of Defence Paul Wolfowitz claimed that nowadays Turkey is essential to peace and stability in the region and beyond. Turkey is the link to building a Europe that is undivided, democratic and at peace … . It is a key to building peace in Southeastern Europe and to preserving peace in the Black Sea region. It is a key to bridging the dangerous gap between the West and the Islamic world. Indeed, Turkey is indispensable. The United States understands this well.14

Today, with Barack Obama having replaced George W. Bush at the White House, the US Administration recognizes the importance of Turkey even more than it did in 2001. This approach proved to be of crucial importance in the aftermath of 9/11. The East–West corridor that Washington had been building from Turkey and the Black Sea through Georgia and Azerbaijan and across the

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Caspian basin became a strategic air corridor, and a lifeline that reaches into Afghanistan, allowing the United States and its coalition partners to conduct Operation Enduring Freedom. Since then, this area, where all the “frozen” conflicts mentioned above are concentrated, has gained vital importance for the United States. The latest events in the area prompted Washington to develop a new, comprehensive approach for the Extended Black Sea and Caucasus region. The other factor to be taken into consideration is that the United States has always put a strong emphasis on the necessity of creating not only a “secure” but also a “peaceful” and “prosperous” Black Sea region, on the grounds that political stability cannot be reached without economic recovery. From this perspective, Ankara could play an important role in resolving the conflicts in the Southern Caucasus by drawing on its large diaspora, which is eager to invest in the region and thus stimulate economic cooperation and social reconciliation.

Conclusion The events of 9/11 have initiated a process of constructing a new system of cooperation among the regional and world powers—a new security system which is based on the ongoing anti-terror campaign. NATO’s new strategy provides a wide range of opportunities for cooperation with traditional partners of the United States and especially with its allies in the East. It is now obvious that the Black Sea region will take a significant place in the new US security strategies. The terror attacks of 2001 and the consequent nexus of international affairs have dramatically changed the geopolitical situation in the region. Since then, the Black Sea region has ceased to be a “Bermuda Triangle of Western strategic studies,”15 lying at the crossroads of European, Eurasian, and Middle Eastern security spaces, yet at the centre of none. Today the Black Sea region can be regarded as a launchpad for military, reconstruction, and stabilization operations in Afghanistan, Iraq, and possibly in Iran, as well as for the protection of energy shipping lanes between the Caspian region and Western markets. The United States has developed strong interests here, which are not limited to “alternative oil sources,” as they were in 1997. In 2007, just ten years later, the US Department of Defense drafted a new strategy for the Black Sea, which represents a concerted effort by Washington to get involved in a region traditionally dominated by Turkey and Russia. The main focus remains on getting the individual countries around the Black Sea to develop a wholesome regional approach to security issues. To this

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end, the United States is throwing its weight behind Turkey’s leadership in Black Sea regional efforts by actively encouraging the littoral states to take part in the Turkey-led Black Sea Harmony maritime security programme. This is, in part, because Ankara and Washington share the same goals in the area, and, in part, because Washington wants to allay Turkish concerns about US intentions. For the United States, it would be risky to offend Turkey and damage its relations with its most important regional ally. It would damage long-term US interests and the success of its far-reaching plans in the Middle East. Ankara should use this unique chance to try to convince the US administration that the security of the Black Sea region can be strengthened with the effective role of Turkey and the other two NATO countries situated on the Black Sea coastline. Currently, the priority task for Ankara is to prove that it really has both the capacity and the will to fulfil the security vacuum in the Black Sea by playing a leading role in the region and cooperating with transatlantic institutions. US diplomatic and technical support to Turkey will guarantee the security and stability of the Black Sea region in those areas where its own resources alone will not be sufficient. It goes without saying that Turkish–United States relations are still in a process of redefinition, both on global and regional levels, but there remain many issues in which both countries should, and will, be able to work together.

Notes 1 Ronald D. Asmus and Bruce P. Jackson, “The Black Sea and the Frontiers of Freedom,” Policy Review (June–July 2004), http://www.hoover.org/publications/ policyreview/3437816.html. 2 Oleksiy Volovych, “Russia’s, Turkey’s, the USA’s, and the EU’s Policy in the Black Sea–Caspian Region: Cooperation and Rivalry,” Chornomorska Bezpeka, no. 1 (2008): 12. 3 Ariel Cohen and Conway Irwin, “U.S. Strategy in the Black Sea Region,” Backgrounder, no. 1990 (2006): 1. 4 Matthew Bryza, “Invigorating the U.S.–Turkey Strategic Partnership,” 24 June 2008, http://www.washingtoninstitute.org/templateC07.php?CID=406. 5 “Shared Vision and Structured Dialogue to Advance the Turkish–American Strategic Partnership,” Statement by the U.S. Embassy in Turkey, July 2006, http://turkey.usembassy.gov/statement_070508.html (link now broken). 6 Selahattin Ibas, “Fighting Terrorism: A Chance to Improve Bilateral U.S.– Turkish Ties,” February 2007, http://www.washingtoninstitute.org/templateC05 .php?CID=2572.

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Ian Brzezinski, “NATO: An Alliance Transforming,” U.S. Department of State, June 2004, http://usinfo.state.gov/journals/itps/0604/ijpe/brzezinski.htm (link now broken). 8 Ali Karaosmano÷lu, “The Evolution of the National Security Culture and the Military in Turkey,” Journal of International Affairs 54, no 1 (2000): 212–213. 9 Selahattin Ibas, “Contributions of the Turkish Armed Forces to Middle East Peace Operations,” Policy Watch, no. 1199 (2007), http://www.washingtoninstitute .org/templateC05.php?CID=2568. 10 Orhan Babao÷lu, “Black Sea Basin: A New Axis in Global Maritime Security,” Policy Watch, no. 1027 (2005), http://www.washingtoninstitute.org/templateC05 .php?CID=2361. 11 Cohen and Irwin, “U.S. Strategy in the Black Sea Region,” 10. 12 Sedat Laciner, “Is Turkey Getting Away from the US in Caucasus?” Turkish Weekly (1 September 2008), http://www.turkishweekly.net/comments.php?id=2973. 13 ølker Baúbu÷, “ Luncheon Remarks,” Genel Kurmay BaúkanlÕ÷Õ, June 2005, http://www.genelkurmay.org/eng/konusma/gnkurIIncibsk_atckonusmasiogleyeme gi_eng_06062006.htm (link now broken). 14 Paul Wolfowitz, “Remarks at the American–Turkish Council Meeting,” U.S. Department of Defense, March 2001, http://www.defenselink.mil/speeches/speech .aspx?speechid=338. 15 Asmus and Jackson, “The Black Sea and the Frontiers of Freedom.”

CHAPTER TEN TURKEY’S SECURITY STRATEGIES IN THE EXTENDED BLACK SEA REGION AFTER SEPTEMBER 11, 2001 MUJIB ALAM*

Introduction Turkey is one of the six Black Sea littoral countries, the others being Bulgaria, Georgia, Romania, Russia, and Ukraine. The Black Sea region, or what is often termed as the greater/wider Black Sea region, comprises these six countries together with the other five members of the Black Sea Economic Cooperation Organization (BSEC), namely Albania, Armenia, Azerbaijan, Greece, and Moldova. It is debatable whether the extent and span of this region can be defined and delimited, whether the region is “intellectually constructed,” or whether it has a weak or strong regional identity.1 As this debate is beyond the scope of the current paper, we will not go into it here, other than to note that this study deals with the “extended” Black Sea region, to include also the adjacent, flanking areas. Here, the term “region” is used not only in terms of geography; rather it also encompasses such aspects as economy, politics, security, culture, etc. Hence, in the discussion relating to aspects such as the security and politics of a particular region, the boundaries are blurred, and it should be noted “that security in the Black Sea region is critically dependent on developments outside it.”2 Therefore, it is necessary to deal with the region in wider perspective. At the outset, it is important to bear in mind that because of Turkey’s geographic location and its multi-regional role, the country has clout in several regions, such as West Asia (the Middle East), the southern Mediterranean, the Balkans, the Caucasus, and central Asia, including the Black Sea region. Although Turkey’s multidimensional approach in *

Jawaharlal Nehru University, Academy of Third World Studies, New Delhi, India.

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foreign policy has provided the country with widespread opportunities, it has also meted out several challenges of varied dimensions and magnitude. Being the country with the longest coastline along the Black Sea, Turkey reaps benefits from this region; but at the same time it directly faces the numerous threats and challenges that emanate from it.3 Like many other countries, Turkey also faces numerous “soft” and “hard” security challenges, including terrorism, trafficking of humans and narcotics, illegal trade, environmental risk, nuclear proliferation, and a host of other problems. The challenges originating from different regions have therefore remained very much in the consideration of Ankara since the end of the Cold War, and especially after the events of 9/11. The importance of 9/11, as far as the extended Black Sea region is concerned, is that it led to the United States, NATO and the European Union taking a renewed interest in the region. Outside interest and engagement are underlined by the emergence of various programmes, including, since 2007, the EU’s Black Sea Synergy initiative,4 its earlier “Wider Europe—Neighbourhood” Communication (2003),5 NATO’s Concept of Defence against Terrorism (2002),6 alongside various US strategies. In view of numerous conflicts and diverse interests, as well as Russia’s growing stake and assertiveness in the region as part of its “near abroad” policy since the late 1990s (and particularly since the beginning of this century), the emerging situation in the extended Black Sea region in the post–9/11 period is worth observing. From Turkey’s perspective several changes have taken place since the early 2000s, with regard to both its general foreign policy and its relations with the major players of the region, such as the United States, the EU, NATO, Russia, etc. This paper therefore discusses and tries to explain the security situation in the extended Black Sea region, with Turkey as the focal point. Moreover, it seeks to highlight Turkey’s security thinking and strategy in the extended Black Sea region.

Turkey’s Security Environment in the Extended Black Sea Region Turkey’s security environment has drastically shifted during the post– Cold War era, especially after 9/11 and the “war on terror.” Unlike the Cold War period, when security challenges largely emanated from the north, i.e., the Soviet Union, during the post–Cold War era, and especially since the beginning of this century, challenges and threats to Turkish security have come from its southern periphery, i.e., West Asia, especially from its south-eastern neighbourhood.7 However, threats to Turkey’s security are not limited to its southern periphery; the country is surrounded

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by several unstable regions, where it confronts a number of challenges. We will however discuss here only those threats and challenges that are relevant for the present paper. The Black Sea region and its adjacent regions are embroiled in various ethnic and other sorts of conflicts, together with security threats including the illegal trafficking of human beings, capital, and banned substances, extremism, armaments, and the struggle for influence among the regional and outside powers. There are several so-called frozen conflicts within the Black Sea region, such as those in Nagorno-Karabach, Abkhazia, South Ossetia, Chechnya, Transnistria, etc., though some of them have been “warmed up” due to the recent crisis in the Caucasus region. The existence of four self-declared or de facto states in the Black Sea region continues to present major security concerns.8 The Kurdish issue within Turkey also has immense bearing on the country’s security stance. Turkey’s concerns are basically due to the perception of threat and the fear of these protracted or frozen conflicts spilling over, with the subsequent likely impact on Turkey’s overall bilateral and multilateral relations in the wider region. Because of various developments and the changing nature of international politics, in this case the regional politics of the extended Black Sea region, there have been some changes in Turkey’s security environment in the post–9/11 period. With significant and growing United States and Euro– Atlantic interest in the region—due to various factors including energy security, terror-related security concerns, and nuclear proliferation—the region has acquired added prominence in Ankara’s calculations. Undoubtedly, the growing involvement of the United States and Euro– Atlantic organizations in this region has a considerable impact on Turkey’s security. In view of Turkey’s membership in NATO since 1952, and its continuing accession negotiations for EU membership since 2005, these organizations’ interests have a direct bearing on Turkey’s security environment. The importance of the presence of both NATO and the EU in the Black Sea region cannot be overemphasized, because with their expansion in the post–Cold War scenario, the borders of both these organizations are very much located in the region, and they now have direct stakes in any sort of development there. In addition, Turkey has been a close ally of the sole superpower, the United States. However, although the United States and the EU attribute great strategic significance to Turkey for a variety of reasons, in recent years some fissures have become noticeable in Turkey’s relations vis-à-vis NATO, the EU, and the United States. For example: friction on account of the EU’s attitude towards Turkey’s potential membership; breaches in Turkey–United States relations during the past several years, due to Turkey’s unwillingness to

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support the US military action against Iraq in 2003, and also due to American reluctance and delay in backing a Turkish military response to the PKK, which was operating out of northern Iraq; and Turkey’s exclusion from the US missile defence system both within and outside of the NATO security umbrella. It is also important to take into account Turkey’s attempt to realign its foreign policy behaviour in the new situation, with significant improvement in its relations with the Russian Federation (the successor to its former adversary, the Soviet Union, and prior to that, the Russian Empire). Russia’s growing capacity to assert its influence in its “near abroad,” as well as in the international domain, can also be taken into account in analyzing Turkey’s security environment in the extended Black Sea region. Keeping some of these factors in mind, we can analyze Turkey’s security strategy in the post–9/11 period.

Turkey’s Approach towards Security and its Strategies After 9/11 Before going into detail about what Turkey’s strategies for its security are, and how Turkey responds to the challenges that are being imposed upon the country, it is necessary to deal with the geo-strategic situation in and around the Black Sea. At the outset, we should keep in mind that Turkey’s approach and behaviour towards the Black Sea region is essentially linked to the status of the Turkish Straits, the Black Sea’s only maritime outlet, which link the Black Sea to the Aegean, the wider Mediterranean, and ultimately to the rest of the world.9 The Turkish Straits have been one of Turkey’s constant security concerns since its independence, and particularly through the Cold War and the post–Cold War period.10 The status of the Turkish Straits is based on the Montreux Convention of 1936, which sanctions Turkish jurisdiction over the Bosporus (Bo÷aziçi) and Dardanelles (Çanakkale), both of which are great strategic assets for Turkey. Although, unlike its predecessor, the Ottoman Empire, modern Turkey does not consider the Black Sea as an “inner sea—an Ottoman lake,”11 Ankara’s priorities and preferences are to maintain the status quo in the Black Sea so far as its maritime policies are concerned; this will be further discussed later on. Besides Turkey’s concerns relating to maritime security in the Black Sea and the Turkish Straits, Turkey is also concerned with ethnic conflicts, energy security, nuclear issues, and so on, in the extended Black Sea region. However, in order to understand Turkey’s approach towards security issues in the extended Black Sea region, one has to differentiate between these two aspects of Turkey’s security concerns.12

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So far as non-maritime security dimensions in the extended Black Sea region are concerned, Turkey endeavours to apply strategies at varied levels, with or without success, in order to tackle both hard (or military) security issues, as well as soft (non-military) security issues, including that of energy security. The approaches to these strategies can be grouped under the following headings, although several of these aspects overlap with each other: (a) through cooperation with the regional powers at bilateral level; (b) through cooperation with the outside powers; (c) through coordinating with various regional groupings/formations; and (d) through its own initiatives.

Turkey, Russia, and the Black Sea Region Regarding maritime security issues, Turkey seeks—and largely obtains—cooperation from another “status quo” power of the Black Sea region, Russia. Although the rivalry for the Black Sea/Turkish Straits between these two powers (or their predecessors) dates back centuries, during contemporary times, both Turkey and Russia favour the status quo situation based on the Montreux Convention, albeit for different reasons according to their respective national interests.13 Despite these divergent interests, the two countries cooperate with each other in order to keep Euro–Atlantic interests at bay.14 Also in relation to non-maritime security issues, cooperation between Russia and Turkey is improving substantially. Towards the end of 2001, that is, a few weeks after 9/11, the two countries signed the Eurasia Action Plan, the primary aim of which was mutual understanding and cooperation in tackling terrorism in the region. Both Ankara and Moscow tried to limit the activities of the secessionists who were operating from each other’s territory: in other words, Turkey took measures to thwart the activities of Chechens operating from Turkish territory, while Russia did the same to curtail PKK activities in its territory. The growing bilateral relations in the economic, energy, and tourism sectors, along with other factors, such as the issue of NATO’s expansion efforts and its escalating interest in the Black Sea region, led Turkey and Russia to share certain common interests regarding security issues in the region. It is noteworthy that in recent years, because Turkey has become substantially dependent on Russia, the latter has assumed an important place in Turkey’s foreign policy calculations. With regard to energy security, for example, Turkey relies on Russia for over sixty percent of its gas consumption, which Russia provides via the Bluestream pipeline under the Black Sea, as well as via Thrace. In addition, Russia is Turkey’s foremost trading partner, with a

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trade volume of an estimated $30 billion in 2008, up from $23 billion during the previous year. Because of their close ties, both of these status quo powers of the Black Sea region generally cooperate with each other in various regional schemes, though with some differences.

Turkey’s Security Concerns in the Extended Black Sea Region vis-à-vis the United States, NATO, and the EU Turkey’s security perspective towards the extended Black Sea region is also shaped by the involvement of the United States, whose interests in this region are based upon three core areas: energy, security, and political developments.15 The region itself is important for the United States for three fundamental and interrelated strategic reasons.16 First, it connects Central Asia with Europe via the Caucasus, and in addition, a number of countries that were under the Soviet Union’s influence during the Cold War period have either come under Euro–Atlantic influence, or have the intention or potential of joining the Western Alliance. Second, the Black Sea region gives access to the West Asian region, which for various reasons has become more important to the United States following 9/11. Third, the Black Sea region serves as a vital commercial route and energy corridor. Given this situation, the United States wants Turkey, until recently its closest ally in the region, to cooperate with its strategies as well as with those of the NATO and the EU. Besides geo-strategic considerations, the United States has political and economic interests. With regard to the issue of energy security, Turkey’s interests generally coincide with United States and European strategies. So far as the issue of maritime accessibility in the Black Sea is concerned, Turkey’s approach and strategy are markedly negative towards the non-littoral countries, especially the United States. Turkey does not want the presence of military vessels of any nonlittoral country beyond the stipulated period of twenty-one days, and it made this approach categorically clear when the USS McFaul, an American guided-missile destroyer, entered the Black Sea to provide “humanitarian help” to Georgia after the Georgia–Russia conflict in August 2008. As mentioned earlier, NATO’s interests towards the extended Black Sea region intensified with the inclusion of two Black Sea states— Bulgaria and Romania—in 2004, and with its intention of expanding further in the Black Sea region. After 9/11, NATO accentuated its strategy for the Black Sea region through its Concept for Defence against Terrorism (published in 2002), which articulated its desire to maintain

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security and stability in the region. NATO also started Individual Partnership Action Plans (IPAP) in 2002, in order to strengthen the military capabilities of the countries of the region that are prepared to collaborate with it. Many countries in the region have signed an IPAP.17 During their operations in Afghanistan (2001) and Iraq (2003), NATO and the United States used Black Sea airspace. These developments generated anxiety for Turkey, causing Ankara to express its disagreement concerning the over-militarization of the already unstable region. The EU’s engagement, however, is concerned mainly with energy security, and other soft security issues over which Turkey also shares some common ground.18 The EU has been involved in the Black Sea region since the early 1990s, taking up and participating in a number of regional schemes. However, until the EU launched its Black Sea Synergy initiative in 2007, its involvement in the majority of its programmes was negotiated on a bilateral basis. The EU, through this initiative, has started to treat the Black Sea region as a neighbour, and has chalked out some specific sectors and issues to tackle for regional security and stability.19 Now it is time to see to what extent Turkey remains comfortable vis-à-vis the EU strategy with respect to its own interests in the region.

Turkey vis-à-vis Various Regional Schemes BLACKSEAFOR: As mentioned earlier, Turkey is particularly concerned about maritime security in the Black Sea. In this context, Turkey actively took the initiative in establishing the Black Sea Naval Cooperation Task Group (BLACKSEAFOR) in 2001, so as to develop maritime security cooperation in the region.20 Besides Turkey, the other members of BLACKSEAFOR are Bulgaria, Georgia, Romania, Russia, and Ukraine. The intended purpose of this venture is to function as a mechanism, through naval cooperation, for confronting any type of risk or threat emanating from the region. Turkey, along with some other members, has also agreed to set up a number of subsidiary and additional units besides BLACKSEAFOR. Originally, the purpose of BLACKSEAFOR was limited to soft security enterprises and military activities, in order to promote security and stability in the Black Sea maritime domain, which included search and rescue operations, mine-clearing, environmental protection, etc. After 9/11, however, BLACKSEAFOR’s activities expanded to the fight against terrorism. Regarding the functional aspect of BLACKSEAFOR, we can say that, for now, it is essentially an on-call force, the command structure of which rotates among the members every six months.

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Turkey, in particular, stresses that these initiatives, taken by the Black Sea littoral countries, are adequate for maintaining the security and stability of the region. On the basis of an assessment report, Maritime Risk Assessment in the Black Sea, which was carried out by BLACKSEAFOR in 2005 and which states that “there are no asymmetric threats in the Black sea region but only risks,” Turkey stresses that this mechanism is selfsufficient, and there is no need for the involvement of other alternative schemes or mechanisms.21 Operation Black Sea Harmony: Since the early months of 2004, Turkey has also been trying to push another mechanism for maritime security in the Black Sea, Operation Black Sea Harmony (OBSH). The Turkish Navy initiated OBSH on 1 March 2004, initially as its national maritime operation, which involved sharing intelligence on sea traffic and maritime security with all the littoral states, with the aim of overseeing and curbing illegal activities in the Black Sea. Russia and Ukraine accepted Turkey’s invitation and have participated in OBSH in some capacity since late 2006.22 Turkey, which wants OBSH to become a multilateral forum of all the coastal states, asserts that it is similar to NATO’s Operation Active Endeavour (OAE) scheme in the Mediterranean Sea, and is in line with UN resolutions that are conceived to prevent terrorism and asymmetric threats globally. Initially, the United States was pushing the idea of extending the OAE into the Black Sea region, and received support from two NATO members of the Black Sea coast, Romania and Bulgaria (which are also members of BLACKSEAFOR), as well as Ukraine and Georgia, the “colour revolution” countries.23 However, both Russia and Turkey opposed the expansion of OAE to the Black Sea. In response to Turkey’s reluctance and uneasiness, the United States withdrew its demand for NATO involvement in the maritime security of the Black Sea, and began to support the OBSH initiative instead.24 With the aim of preventing threats or risks in the Black Sea region, the operation is presently conducted in Turkish territorial waters and beyond in the Black Sea, and in the airspace above these areas. The OBSH’s headquarters are on Turkey’s Black Sea coast near Ere÷li; the Turkish Navy conducts periodic surveillance and reconnaissance operations in the maritime area, and shares the statistics and information collected with NATO and the other littoral states. In order to improve mutual military training and cooperation among the nations of the region, Turkey and some other Black Sea states conducted the Black Sea Partnership Exercise between 26 April and 3 May 2007 in the western Black Sea.25

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BSEC: Though the main aim in creating the Black Sea Economic Organization (BSEC) was economic cooperation between the member countries, lately it has also acquired some functions related to political and security dimensions. Therefore, for the present discussion, it is imperative to include this element of its role, which makes it, in fact, the most comprehensive organization of the Black Sea region. As early as 1992, immediately after the Cold War, Turkey took the lead in forming this organization, which was officially formalized with permanent institutions and international legal personality in 1999. As defined in Article 1 of its charter, the BSEC is primarily “a regional economic organization.” However, in the course of time, it also acquired other dimensions, including the promotion of energy transport, tourism, the environment, etc. After 9/11, the BSEC also adopted initiatives regarding a comprehensive approach towards security and stability in the region, fighting problems such as trafficking and organized crime.26 Given this situation, where the BSEC has acquired certain responsibilities in respect of security matters, Turkey is pressing for further improvements within the institutional framework, and starting additional initiatives and programmes. Turkey has been advocating the traditional doctrine of security through economic cooperation, particularly with regard to the BSEC.27 One of Turkey’s priorities in relation to the BSEC is to have greater cooperation with the EU through collaboration in different fields.28

Recent Developments in the Caucasus and Turkey’s Response The developments following the declaration of independence, in August 2008, of two entities, Abkhazia and South Ossetia, in which two of Turkey’s close Black Sea littoral allies, Georgia and Russia, were on opposite sides, posed multi-faceted concerns for Turkey, which found itself in a sort of predicament as a result. Georgia is important for Turkey, first because it has been an important ally since the end of the Cold War, and second because it serves as the middle leg of the Baku–Tiblisi– Ceyhan oil pipeline, the Baku–Tiblisi–Erzurum gas pipeline, and the Baku–Tiblisi–Kars railway line project.29 On the other hand, Russia has assumed a significant place for Turkey as far as trade and other economic interactions are concerned. For these reasons, amongst others, Turkey does not extend recognition to these two “republics.” In a press release, the Turkish Ministry of Foreign Affairs clearly stated that “Turkey is highly concerned about the recent developments.” It also reiterated that Turkey is

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of the opinion that this conflict should be resolved through peaceful means.30 As part of its approach towards the security and stability of the Black Sea region, in the aftermath of the Georgian–Russian conflict, the Turkish prime minister proposed the establishment of a regional security system in the form of a Caucasus Stability and Cooperation Pact (CSCP), similar to the 1999 Balkan agreement which germinated in the wake of the Kosovo conflict. In addition to Turkey, the names of four more countries of the Caucasian sub-region, Armenia, Azerbaijan, Georgia, and Russia, have been proposed for this pact. However, some sceptics point towards its impracticability on various grounds, including the lack of common interest in integration among the member countries, and their divergent interests.31 Georgian–Russian animosity over South Ossetia and Abkhazia, and the Armenia–Azerbaijan conflict over Nagorno-Karabakh, are essentially zero-sum games. Russia’s formal recognition of the independence of Abkhazia and South Ossetia may hinder the realization of the CSCP, as it may expect the inclusion of these two “entities” in any such pact. The Turkish Government stresses that, besides developing crisismanagement mechanisms, the proposed CSCP may also deal with economic cooperation. It claims that the fundamental aim is to generate conditions for peace and stability in the region through cooperation, which also reflects Turkey’s new foreign policy approach of seeking “zero problems” in the neighbourhood, by playing a vital role in the region as a peacebroker and stabilizer.32 Turkey’s strategy in this connection is therefore to seek cooperation from the countries of the region, as well as the EU, in order to find enduring solutions for the region’s protracted problems and to enhance stability and peace.

Conclusion From the above discussion, it is clear that the Black Sea region has received renewed interest in the wake of 9/11. Several regional and extraregional powers have assigned it priority, which, in turn, has widespread ramifications for the security and stability of the region in general and Turkey in particular. Although Turkey’s interest in regional security and stability is palpable for many reasons, unlike the United States, the EU, and NATO, Turkey has not chalked out a comprehensive strategy for the extended Black Sea region. Turkey’s Ministry of Foreign Affairs has not even earmarked the Black Sea area as a separate “region” in its foreign policy calculations.33 It is obvious that the ministry’s consideration of the region is fragmented, as it mainly focuses on areas like the Southern

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Caucasus or Eastern Europe, and not on the proper Black Sea region as a whole. In respect of Turkey’s security environment in the post–9/11 era, several things should be kept in mind. First, although Turkey is concerned about the general security and stability in the extended Black Sea region, Ankara’s perception essentially revolves around its maritime security, based on the 1936 Montreux Convention. For non-maritime-securityrelated matters, including the issue of energy security, Turkey is pursuing a policy with—or at least attempts to seek cooperation from—both regional and major outside powers, such as Russia, the United States, the EU, and NATO, which aims at security, peace, and stability. Second, as observed during the past several years, Turkey is passing through a “desecuritization process,” and is coming to terms with the changing conceptualization of security in the post–Cold War era. The impact of these changes is clearly visible in the country’s overall environment and policies regarding security issues, particularly those related to the extended Black Sea region.34 While some of the mechanisms and proposals initiated by Turkey can be said to play a role of considerable importance, some of its other attempts are generally unsuccessful, and need greater cooperation from the countries of the region, as well as from influential outside powers, keeping the interests of all parties under consideration.

Notes 1

Mustafa AydÕn, “Regional Cooperation in the Black Sea and the Role of Institutions,” Perceptions (Autumn 2005): 59–60. 2 James Sherr, “Security in the Black Sea Region: Back to Realpolitik?” Southeast European and Black Sea Studies 8, no. 2 (June 2008): 149. 3 For a detailed analysis, see the recently published edited volume by Nursin Ateúo÷lu Güney, ed., Contentious Issues of Security and the Future of Turkey (Aldershot: Ashgate, 2007). 4 “Black Sea Synergy: A New Regional Cooperation Initiative,” Commission of the European Communities COM (2007) 160 final (Brussels), 11 April 2007, http://ec.europa.eu/world/enp/pdf/ com07_160_en.pdf. 5 “Wider Europe—Neighbourhood: A New Framework for Relations with our Eastern and Southern Neighbours,” Commission of the European Communities, COM (2003) 104 (Brussels), 11 March 2003, http://ec.europa.eu/world/enp/pdf/ com03_104_en.pdf. 6 For detail, see “NATO’s Military Concept for Defence against Terrorism,” NATO official website, http://www.nato.int/ims/docu/terrorism.htm. 7 F. Stephen Larrabee, Turkey as a U.S. Security Partner (Santa Monica, CA: RAND Corporation, 2008), 3–5.

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8 The Republic of South Ossetia and the Republic of Abkhazia within the borders of Georgia, the Nagorno-Karabach Republic in Azerbaijan, and the Pridnestrovyan Moldovan Republic (PMR) inside the borders of Moldova. Dov Lynch, “De facto ‘States’ around the Black Sea: The Importance of Fear,” Southeast European and Black Sea Studies 7, no. 3 (September 2007): 483–496. 9 The Black Sea is essentially a semi-enclosed sea with a 420,000 km2 basin, which has the Bosporus, a natural channel 35km long and 40m deep, as its only outlet. It clearly fits the definition of an “enclosed or semi-enclosed sea” enshrined in international law (article 122 of the UN Convention on the Law of the Sea). 10 Gamze Güngörmüs Kona, “Security Concerns of Turkey: Cold War and Post– Cold War Periods,” Turkish Review of Eurasian Studies 4 (2004): 207–253; Elif Hatun Kilicbeyli, “Security Concerns of Turkey: Cold War and Post–Cold War Periods,” Pakistan Journal of Social Sciences 3, no. 5 (2005): 824–826. 11 As pronounced by a seventeenth-century Ottoman statesman, quoted in Suat Kiniklio÷lu, “Turkey’s Black Sea Policy: Strategic Interplay at a Critical Junction,” in Next Steps in Forging a Euroatlantic Strategy for the Wider Black Sea Region, ed. Ronald D. Asmuú (Washington, DC: German Marshal Foundation of the United States, 2006), 55. 12 Kiniklio÷lu, “Turkey’s Black Sea Policy,” 56–57. 13 Ognyan Minchev, Major Interests and Strategies for the Black Sea Region: Framework Analytical Review (Sofia: Institute for Regional and International Studies, 2006), 10. 14 Richard Hatto and Odette Tomescu, “The EU and the Wider Black Sea Region: Challenges and Policy Options,” Garnet Policy Brief, no. 5, www.garneteu.org/fileadmin/documents/policy_briefs/Garnet_Policy_Brief_No_5.pdf. 15 Lincoln A. Mitchell, “More than Location: Crafting a US Policy for the Black Sea Region,” Southeast European and Black Sea Studies 8, no. 2 (June 2008): 130. 16 Ognyan, Major Interests, 4; Daniel Hamilton, “A Transatlantic Strategy for the Wider Black Sea?” in The Wider Black Sea Region in the Twenty-first Century: Strategic, Economic, and Energy Perspectives, ed. Daniel Hamilton and Gerhard Mangott (Washington, DC: Center for Transatlantic Relations, 2008), http://transatlantic.sais-jhu.edu/publications/books/Wider_Black_Sea.pdf. 17 Georgia and Azerbaijan signed an IPAP in 2004 and 2005 respectively. Besides these two countries, Armenia, Moldova, and Kazakhstan are also signatories of an IPAP. 18 Mamuka Tsereteli, “The Black Sea/Caspian Region in Europe’s Economic and Energy Security,” Europe’s Energy Security: Gazprom’s Dominance and Caspian Supply Alternatives (Washington, DC: Central Asia–Caucasus Institute & Silk Road Studies Program—Joint Transatlantic Research and Policy Center, Johns Hopkins University—SAIS, 2008), 41–56, www.isdp.eu/files/publications/books/ 0802energysecurity-3-Tsereteli.pdf. 19 The following are some of the sectors and issues set out in the EU’s Black Sea Synergy initiative: promotion of democracy and respect of human rights, the fight against trafficking and organized crime, frozen conflicts, energy, transport, environmental problems, trade, research, and education.

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20 For a brief and clear introduction to this institution, see Hasan Ulusoy, “A New Formation in the Black Sea: BLACKSEAFOR,” Perceptions: Journal of International Affairs 6, no. 4 (2001–2002). 21 Turkey opposes the Black Sea Border Security Initiative, launched by some of the Black Sea countries’ regional security structures. 22 Russia officially joined the OBSH on 27 December 2006, while on 17 January 2007 Ukraine signed a protocol for the exchange of information with further intention to join the mechanism at a later date. 23 “Turkey, Russia Oppose to [sic] NATO Presence in Black Sea Today’s Zaman (Istanbul), online edition, 2 March 2006, http://www.todayszaman .com/tz-web/detaylar.do?load=detay&link=30409. 24 J. Dorschner, “Black Sea Security—Taking the Helm,” Jane’s Intelligence and Insight, online edition, 18 May 2007, http://www.janes.com/security/international _security/news/jdw/jdw070518_1_n.shtml. 25 Warships of various categories and classes and helicopters from the Turkish Navy, the Russian Federation, and Romania, as well as three Georgian staff officers, participated in this exercise. The exercise was also watched over by observers from eleven countries, including most of the Black Sea littoral states: Georgia, Romania, Russian Federation, and Ukraine; http://www.tsk.mil.tr/eng/ tatbikatlar/2007/blacksea/blacksea_07.htm. 26 Ioannis Stribis, “The Evolving Security Concern in the Black Sea Economic Cooperation,” Southeast European and Black Sea Studies 3, no. 3 (2003): 159. 27 Stribis, “The Evolving Security Concern.” 28 Republic of Turkey, Ministry of Foreign Affairs, 2008, Priorities of the Turkish Chairmanship-in-Office for the Black Sea Economic Cooperation, http://www.mfa .gov.tr/. 29 The first two of these projects are important for Turkey’s own energy security as well as for Turkey’s capacity to serve as a viable transit route for energy transportation to the European markets. 30 Republic of Turkey, Ministry of Foreign Affairs, “Press Release Regarding the Independence of Georgia,” 26 August 2008, http://www.mfa.gov.tr. 31 A similar type of stability pact was also proposed by Armenia in 2000, modelled on a “3 + 3 + 2” formula, meaning three Caucasian countries (Armenia, Azerbaijan, and Georgia), three regional countries as “guarantors” (Russia, Turkey, and Iran), and two extra-regional powers as “sponsors” (the EU and the US). But for various reasons this pact did not materialize. Iran rejects any plan which includes the United States and the EU. The present situation has drastically changed, however. 32 Gencer Özcan, “Turkey’s Changing Neighbourhood Policy,” The Turkish Yearbook 35 (2004), 1–15. 33 See the website of the Turkish Ministry of Foreign Affairs, www.mfa.gov.tr. 34 See, for example, Bülent Aras, “From Conflict to Cooperation: Desecuritisation of Turkey’s Relations with Syria and Iran,” Security Dialogue 39, no. 5 (2008): 495–515; Mustafa Aydin, “Securitisation of History and Geography: Understanding of Security in Turkey,” Southeast European and Black Sea Studies 3, no. 2 (May 2003): 163–184.

CHAPTER ELEVEN THE US MILITARY BASES IN ROMANIA AND BULGARIA AND THEIR POSSIBLE IMPLICATIONS FOR REGIONAL SECURITY SAFFET AKKAYA1

Introduction Almost two decades after the end of Cold War period, it is evident that the world is still divided into two main camps, namely the centre and the periphery. At the beginning of this article, it may be useful to look at the position of states such as Bulgaria and Romania, which were once peripheral members of the Communist bloc, from the broader perspective of global security dynamics. Throughout the latest reformation and restructuring phases of the global age, the new world order has dictated certain unwritten rules that are vital for the future of the global order and of mankind. These can be cited as follows: first, the reformation of the central and peripheral states; second, the dominant rules of the hegemonic liberal order; and third, the need for the establishment of a broader concept of security. To gain a clearer picture, I will explore these conditions in detail.

Really Existing Liberalism and a Broader Security Perception As asserted noted by pre-eminent scholars such as Barry Buzan and Ken Booth, the current world order is completely different from that of the Cold War era. The political, geographical, or cultural principles used then to classify the states into different worlds are no longer relevant. 1

PhD Candidate, Middle East Technical University, Department of International Relations, Ankara.

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Descriptions like South, North, West, second world, third world, etc. have all changed dramatically. The centre is composed of economically and militarily strong states, which are basically the representatives of hegemonic liberalism, no matter which geographic location they occupy on the planet. The periphery is made up of the states that were once the members of the second (Communist bloc) or third world, and some other states that are excluded from the centre for cultural, religious, or ideological reasons. Now that the members of the periphery have begun trying to join the centre at all costs, a struggle is developing amongst the states, due to changing conditions in the classification of states. The expansion of NATO and the EU towards the east, at the expense of old Soviet territories in general, and Russia in particular, is achieved by using the principles of a broader perception of security, attracting the small states of Eastern Europe to join them. The bipolar system has been replaced by a multipolar power structure following the demise of the Soviet Union. In addition to the United States as the superpower of the Cold War era, new powers have emerged, including the EU, China, Japan, and Russia; even India and Brazil can qualify for such a classification. When compared with the strict rules of the bipolar system, this new multipolar system affords a reduction in the intensity of ideological or power rivalry, and boosts regional politics, imposing less pressure on the peripheral states and encouraging them to change position. Another common feature of the states of the multipolar centre is that there is no rivalry of ideologies—such as communism and fascism—among them, and instead they all share a wider consensus, supporting a liberal economic system. Based mainly on this consensus, a “security community” has been created which minimizes the risk of war between the members of the multipolar system. Since they do not need to compete with each other militarily, the members of security community possess an advantage in the international political economy, handling any challenges more easily. Coalitions established during the first and second Gulf Wars and the Afghanistan campaign are good examples of these quick and successful military collaborations. Such coalitions show the general nature of security relations in a future world dominated by a centre which has the ability to isolate any aggressor that threatens the present political order and global economy.1 For the sake of their economic interests (which are based on liberal rules), neither China nor Russia has reacted rigidly, even against the illegal invasion of Iraq in 2003. Instead, they have felt obliged to accept this de facto situation: their resistance has effectively been limited to certain soft, balancing diplomatic manoeuvres at UN platforms.

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Parallel to these radical changes in the global age, a new type of military organization, structure, and culture is developing in the centre, promoting the position of the United States as the hegemonic power, controlling technology, financial resources, the nuclear and conventional arsenal, and international military and economic institutions. In this new structure, military assets are being employed for a wider spectrum of international crises and regional clashes.2 During the Cold War era, the teachings of liberalism were robustly advocated by the Americans, both to assure security in defence of its global achievements, and to respond to a potential Soviet threat which was not solely military, but also ideological, social, and economic. But in the late 1980s, a new security agenda emerged that questioned the position occupied by military–political issues at the centre of security concerns. World politics became more turbulent, and in this new phase, unlike the dogmatic military issues of the Cold War era, the spectrum of security concerns became wider, to include economic, environmental, and social aspects. In this respect, successful liberalism became a strong movement in securitizing a wide spectrum of economic, societal, political, and environmental issues, as well as traditional military ones.3 This relatively broad security agenda consists of five dimensions: military security, which includes the defensive and offensive capabilities of states, and their perceptions of each other’s intentions; political security, which concerns the organizational stability of states and systems of government; economic security, which promotes access to the resources and markets that are vital for sustaining welfare and power of states; societal security, which involves the traditional patterns of language, culture, religion, and national identity of societies; and environmental security, which relates to the local and planetary biosphere on which all humans, without any distinction or favour, are dependent. These five areas of security do not operate independently, but rather they are strongly tied and related to each other.4 On the other hand, the positions of Romania, Bulgaria, the Czech Republic, Poland, and some central Asian ex-Soviet states that host US bases, can be explained from the broader perspective of the new security perceptions of the global age. Simply being a military partner of an organization does not provide states with the sense of full security, since the remaining four aspects of the broader security concept also need to be fulfilled. Pre–Cold War political, social, and ideological descriptions have changed, and peripheral states seem ready to sacrifice their national and regional concerns to join the camp of the centre.

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Footprints of an Empire Parallel to the above-mentioned factors, the history of the US military presence overseas is intimately connected with the growth of the United States as a world power. Military victory in two world wars enabled the United States to assume the controversial role of being the “global police,” rebuilding war-damaged societies and containing communist expansion. The actual police officers carrying out this policy, however, were the men and women of the US armed forces, working in military bases scattered throughout the United States and the world. By the end of the 1950s, as the gap grew bigger between the states on the winning side of WWII, approximately one million American troops and their family members resided on or near overseas bases in all parts of the world.5 In his book Nemesis: The Last Days of American Republic, Chalmers Johnson describes how the United States turned into an empire in the post–Cold War era, from the point view of its military bases distributed across the world. In order to understand the justification for the US bases in Romania and Bulgaria it will be useful to give some details of these bases, which total 735, according to the Pentagon’s figures. An interesting point is that there are thirty-eight large and medium-sized military facilities—mostly air and naval bases—spread all over the globe, almost the same number as the British Empire’s thirty-six naval bases and army garrisons at the beginning of the twentieth century. If we go backwards in time, we note that the Roman Empire had almost the same number of military bases—thirty-seven—during its most glorious days in the second century. It seems that the principles of geo-strategic realm for world supremacy do not change a lot, and the optimum number of major citadels and fortresses for an imperialist aspiring to dominate the world is somewhere between thirty-five and forty. The total value of overseas and domestic US bases is estimated to be $658 billion, and the total number of military personnel stationed in overseas bases is 197,000, with an additional 81,000 locally hired foreigners for service duties. Before giving the details of the US bases in Bulgaria and Romania, here are further details about US overseas bases in general, based on the information given by Chalmers Johnson. The total number of US military personnel worldwide, including those based domestically, is 1,840,000, supported by an additional 473,000 Department of Defense civil service employees, and 203,000 local hires. The overseas bases contain 32,327 barracks, hangars, hospitals, and other buildings, and 16,527 more that are leased. The size of these holdings is recorded in the inventory as covering

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687,347 acres overseas, with a total area of 29,819,492 acres worldwide, making the Pentagon easily one of the world’s largest landlords.

Why does the United States need Bases in the Balkans? The Balkans have been the most volatile and troublesome part of Europe, particularly following the dissolution of the Ottoman Empire, beginning in the nineteenth century. Since that time, the Balkan region has been an economically, politically, and culturally incoherent area. With the demise of the Soviet Union, Russian influence has decreased, whilst Western influence has gradually increased.6 In the first two years of the new millennium, the United States and the EU made reasonable efforts to integrate Eastern Europe and the Balkan countries into NATO and the EU. In 2004, together with five other countries, Romania and Bulgaria joined NATO, representing the largest growth in NATO’s history. From the end of the Cold War these two countries had made huge efforts to join both NATO and the EU, and as a solid indication of their intention, from the very beginning they offered their unreserved support to the US operations in Iraq and Afghanistan, in contrast to some of the other states in Europe. As can be clearly seen in their official statements, the leaders of both countries foresee a future integration with the West in terms of politics, economy, society, culture, and military affairs. In addition, the elites of the two countries perceive US assistance as crucial leverage to enhance their economic transition into the market economy, and they hope that the stronger the strategic ties that they establish with Washington, the further economic and financial cooperation they will have with the United States, and that this will increase US investment in their countries. From the military point of view, it is easy to justify these bases. According to US military authorities, twentieth-century military philosophy is not valid in the twenty-first century, and the important thing is not the size of the force you have, but what you can do with it. The aim is to make the forces strategically more effective and agile. The American forces in Europe will be hosted in three types of bases. The first type are the main operating bases, including installations like the Ramstein airbase in Germany, and the US naval station in Rota, Spain. These bases will remain as hubs and they will continue to be assigned to the American forces. The second type are forward-operating sites known as “light switch operations,” which means that newly arrived troops can simply turn the lights on for operations to proceed. Examples of these bases are Camp Bondsteel in Kosovo, Camp Eagle in Bosnia, and Incirlik airbase in Turkey. The bases established in Bulgaria and Romania are also of this

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type. The third type of base is called a “cooperative security site,” which could be as small as a fuelling agreement, or as complicated as a number of American contractors preparing facilities from which US troops can operate. Within this context, the security challenges for Europe no longer lie to the east, but rather in the south and southeast. The orientation of NATO towards the Middle East and Africa requires forces that can deploy quickly using a combination of inter-theatre aircraft, sealift, and rail movement. Given the volatility of these outlying regions, deployment times must be measured in days, not weeks. Turkey, Greece, Romania, and Bulgaria appear to be the best sites for adopting a posture of power projection towards the Middle East, whereas Italy, France, and Spain provide superb access to the Mediterranean basin and Africa.7

US bases in Romania In December 2005, an agreement was signed by Romania and the United States on the activities of the American forces stationed on Romanian territory, assigning four locations for US troops, namely the army ranges at Cincu, Smardan, and Babadag, and the Mihail Kogalniceanu airfield. The units, which comprise 1,700 personnel in total, form part of the Joint Task Force-East (JTF-E). The Cincu range covers 104 square kilometres, and the location benefits from nearly 100 kilometres of roads. This range is authorized to carry out tactical applications involving live fire by infantry companies and battalions, including artillery. All types of launchers can be fired, including those on planes and helicopters, as tests conducted by the plants manufacturing weapons and ammunition show. The Smardan army range is located in the eastern Galati county. It covers 8,500 hectares and can accommodate 600 personnel. The Smardan range is used for training in infantry, tank, and artillery fire, specialized fire of heavy infantry weapons, training in launching offensive and defensive grenades, shooting at ground targets from helicopters and planes, and the bombing of horizontal and vertical targets from warplanes. The Babadag range is located in the eastern Tulcea county. It covers 2,700 hectares and can accommodate 250 personnel. It can host live ammunition fire by infantry and tank companies and by artillery subunits, specialized fire of heavy infantry weapons, launching of offensive and defensive grenades, and shooting at ground targets from helicopters and planes. The Mihail Kogalniceanu airfield is 3,500 metres long and forty-five metres wide, and has a concrete runway. It can accommodate 900

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personnel, and houses facilities for administration and flight management, buildings for the accommodation of personnel, offices, aeroplane hangars, and warehouses.

US bases in Bulgaria In accordance with the Defense Cooperation Agreement signed between the United States and Bulgaria in April 2006, US military units, also under the Joint Task Force-East umbrella, have been deployed in Bulgarian territory in a similar way to those in Romania. According to the agreement, the following bases in Bulgaria are allocated to the US forces: x x x x

Bezmer Air Base in Yambol province Novo Selo Shooting Range (NSTA) in Sliven province Aitos Logistics Center in Burgas province Graf Ignatievo Air Base (LBPG) in Plovdiv province

Under the Agreement, no more than 2,500 US military personnel will be located at the joint military facilities. Most training rotations will have small numbers and will be of short duration. Possible types of units to be deployed are armoured, mechanized, airborne, or light infantry. The type of equipment they will use will depend on the deployed unit and their training requirements. The Agreement also allows the United States to use the bases “for missions in a third country without a specific authorization from Bulgarian authorities.” The Bezmer Air Base is expected to become one of the major US strategic overseas airfields for housing American combat aircraft. High-level military and civilian officials in both Romania and Bulgaria have repeatedly asserted the importance of this military cooperation, commenting that this agreement will add value to strategic level security because of the commitment of the United States to both countries. They also declared that this strategic partnership with the United States represents a strategic investment for their countries, and will adequately counter new risks and future security threats.

Reactions to US bases in Eastern Europe Some European authorities, particularly the leaders of left-wing political parties, assume that the US military bases in Bulgaria and Romania enhance the US potential to interfere in developments in the Balkans and in southern Europe and the Mediterranean as a whole, in a

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way that contradicts the security and economic interests of Europe. They maintain that these bases are deployed to provide a new instrument in support of US hegemonic policies in the Middle East and the Gulf, a region which is a centre of tension and alarming humanitarian crises, as well as a key offender in terms of the spread of terrorism to the rest of the world. They claim that the purpose of these growing US efforts is to achieve monopoly control over the Middle East’s natural resources, and that this represents a serious menace to European and Mediterranean security. Russia in particular reacts fiercely, not only against the bases in these two countries, but also against the missile defence systems deployed in Poland and the Czech Republic, saying that the United States and EU are using diplomatic and informational cover to hide their real plans. Russian officials state that, despite the closure of their bases in Vietnam and Cuba, the West and NATO continue in a one-way direction, and this may initiate an arms race in ballistic missile systems and force Russia to make certain decisions.

Conclusion As expected, a positive trend in political and strategic relations between the United States and the two southeastern European countries, Romania and Bulgaria, is developing. The elites of these post-communist countries have proved to be more enthusiastic and eager to support US policies in the region. This initiative in establishing the US military presence in the two countries represents the consolidation of a new American geo-strategic initiative in the Black Sea region, which will have important consequences for the EU and United States–Russian relations. Moreover, it also confirms that Washington now seeks small, flexible bases for the possible deployment of forces in Europe, instead of the bigger, permanent facilities that were characteristic of the Cold War. This is precisely why Romania and Bulgaria are considered ideal partners by Washington, and the Black Sea region provides excellent power projection points towards the heart of the greater Middle East. It is also the region which connects the oil- and gas-rich Caspian Sea zone to the eastern Mediterranean, an area of crucial importance for the EU’s energy needs. In this respect, the military superiority of the United States in the Black Sea region is vital for its global interests. Once the United States consolidates its position in the Black Sea region, this will offer it significant opportunities, such as increasing its role in the Caucasus, establishing new initiatives in Georgia and Armenia, and initiating new policies related to

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Turkey—thus having as a consequence an increasing influence on the Turkish straits that connect the Black Sea to the Mediterranean. Among the statements welcoming the US military presence in the Balkans and the Black Sea region, the following words of the Romanian President Basescu are the most interesting: “It is clear that the United States seems to be more interested by the instability in the Black Sea area than the Europeans are. They have already understood the importance of the Black Sea for the security of Europe.” This statement signals that the leaders of the Black Sea and Balkan countries may show positive attitudes towards further US involvement in the Black Sea region. This approach may have serious consequences, and deeply threaten the balance established by the Montreux Convention on the Black Sea and its periphery. History has proved several times that any unbalanced situation in the Black Sea region, in favour either of one of the coastal states or an external great power, has led to bitter conflicts. We are aware of the consequences of the 1856 Paris Conference, that granted advantages to Britain and France at the expense of Russia. Any coercive action attempted by the US or a US-led coalition in the Black Sea region, including the Caspian Sea and the Caucasus, will face a serious reaction from Russia. The Russian interference in Georgia is one solid example of this. The position of Turkey, and cooperation amongst Turkey, Russia, and other Black Sea countries, are very important in order to ensure stability and balance in the region. In the last decade, Turkey’s foreign policy cornerstones have also been tested by international parties, in an attempt to benefit from Turkey’s geo-strategic location. The decision-makers in Turkey should keep in mind that the balance established over the Black Sea and the Turkish Straits is vital for the security of the country, and for future relations with the states of the Balkans and the Black Sea region. Turkey does not have the luxury of taking steps that deviate from its traditional, stable foreign affairs policies. In this respect, the Montreux Convention is one important factor in preserving the interests of the coastal states of the Black Sea, and also in preventing it from being a potential area for any future conflicts in its periphery, such as the Balkans and Caucasus. Turkey should remain aware that throughout history, since the early confrontations between the Russian and Ottoman empires, the Balkans, the Black Sea, the Turkish Straits, and the Caucasus have been an arena of military–political struggles. Turkey, with its unique position at the heart of these three geographic locations, has managed to become a peninsula of peace and stabilization throughout the Cold War era. History has proved that stability and peace in the Black

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Sea region are based on the established balance, where Turkey, as a key role player, and contrary to the adventurous policies of some other states in the region, has no scope for its own adventures.

Notes 1

Daniel Byman and Mathew Waxman, The Dynamics of Coercion: American Foreign Policy and Limits of Military Might (Cambridge: Cambridge University Press, 2006), 15. 2 Barry Buzan, “New Patterns of Global Security in the Twenty-First Century,” International Affairs 67, no. 3 (1991): 71. 3 Barry Buzan and Ole Weaver, “Liberalism and Security: The Contradictions of the Liberal Leviathan” (Copenhagen: COPRI Working Paper 23, 1998), 24. 4 Ken Booth, ed., Critical Security Studies and World Politics (Boulder, CO: Lynne Rienner, 2005), 70. 5 Anni P. Baker, American Soldiers Overseas: The Global Military Presence (Westport, CT: Praeger, 2004), 171. 6 Anton Bebler, “The Western Balkans and International community,” Eurasia Files 14, no. 1 (2008): 7–22. 7 A. Millen Raymond, Reconfiguring the American Military Presence in Europe (U.S. Army War College: Strategic Studies Institute, 2004), 18.

CHAPTER TWELVE SECURITY IN THE BLACK SEA REGION FROM A NEOREALIST PERSPECTIVE ASLIHAN ANLAR1

Introduction The purpose of this paper is to examine how security affairs have changed in the Black Sea region. In order to explore this change, the paper will refer to Neorealist theory, as there is a lack of theoretical studies in the literature pertaining specifically to Black Sea security. With the end of the Cold War, both the international and regional structure of the Black Sea region have undergone a complete transformation. The main subject of this paper is to discuss this change in terms of regional security in the post–Cold War period. It is assumed that the region has a structure that is not dissimilar to other international structures, and that this structure also shapes and drives the policies of countries in the region. Thus, to examine security in the region, the regional structure first needs to be explored. Tools of Neorealism are employed throughout the paper to this effect. There are three defining principles according to the Neorealist theory of international structure: the ordering principle, the character of the units, and the distribution of capabilities. This paper attempts to explore any change to the structural characteristics in the Black Sea region by focusing, in particular, on the ordering principle. Neorealist theory maintains that there is no central or common authority regulating the relationship between units in international relations; therefore, the international system is anarchic. In contrast, the ordering principle of domestic political structure is hierarchical, owing to the existence of central authority. Neorealism does not accept any other arrangement of the ordering principle of the structure: there are only two forms of ordering principle, anarchy or 1

PhD Candidate, METU, Kocaeli University, Turkey.

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hierarchy. However, in this paper, the ordering principle is tackled as a continuum between anarchy and hierarchy. There are mixed political systems which have both anarchic and hierarchic characteristics at the same time. It is argued that there are many different forms of these systems, and that one of them is found in the Black Sea region. To achieve this aim, after a very brief historical background, the theory of structure within Neorealism is explained, followed by a proposed revision of Neorealism. Finally, the situation in the Black Sea region is described, and the implications of these circumstances on security are given as a conclusion.

Historical Background During the sixteenth century, the Black Sea was viewed as little more than a lake within the Ottoman Empire, and under the Ottoman dominance, security and stability in the region grew. However, at the end of this century, another power started to become dominant in the region: Russia. This country continually tried to expand her land into the Ottoman Empire until the time of the 1917 Revolution. During the period between the seventeenth century and the beginning of the twentieth century (the end of World War I), the region suffered under constant wars, deportation, and distress. Following World War I, apart from the region being subject to internal problems, there was stability and security until the global international environment again plunged the region into a devastating war. After World War II, with the strict restraints of the Cold War, security and stability were again established and sustained in the region. In general, while under the influence of a dominant state and an established equilibrium of power in a region, the security of the region is enhanced and the region becomes a safer place. However, where there is competition over land, or where two or more great powers control the sphere of influence, the security of the region is undermined and altered. The Black Sea region has experienced just this type of situation. The region witnessed a period of stability and security under Ottoman rule, then a period of war between the Ottoman and Russian empires (nearly three centuries), followed by a period of intervention by extra-regional powers during the world wars, and finally a period of stability under Soviet Union dominance during the Cold War. Following the collapse of the Soviet Union after 1990, the Cold War period status quo has been challenged by both the presence of more than one power and other extraregional powers trying to be influential in the politics of the region.

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Neorealism and the Structure of the International System One of the basic contributions of Neorealist theory is its assumption of the existence of a structure above the state. This new understanding of the realist position was developed by Kenneth Waltz in his book Theory of International Politics. He argues that “there is an international structure which emerges from the interaction of states and then constrains them from taking certain actions while propelling them toward others.”1 According to Waltz, “structure defines the arrangement, or ordering, of the parts of the system. It is not a collection of political institutions, rather the arrangement of them.”2 It can be inferred then that the structure is just a mechanism that is constituted by states’ interaction, but constrains or limits their policies following its construction. Waltz explains that it is the basic factor behind state policies; therefore, it must be explored and defined. He uses features of political systems (domestic or international) to define the structure of states.3 To define the structure, the first question to be asked is, “What is the principle by which the parts are arranged?”4 Under the term “ordering principle,” he defines the domestic political structure as hierarchic and centralized. Here, there is a super-subordinated relationship that means that some are entitled to command, while others are required to obey. However, “parts of an international-political system … stand in relation to their coordination. Formally, each is the equal of all the others. None is entitled to command; none is required to obey. International systems are decentralized and anarchic.”5 Domestic political structures have a government, but international political structures have no supranational or centralized agent or organization. He does not deny the existence of well-developed international organizations, but states that none of these organizations has the capacity to play a central governmental role for international states in a similar way to that which national governments hold within their own states. Waltz sees that the motivation behind a state’s policies ensures the state’s survival, because only this way can a state pursue policies to realize its other objectives. Survival is a prerequisite for all the other targets of a state. The structure also supports a state’s pursuance of policies, with the ultimate aim of achieving survival by penalizing those who do not pursue this kind of policy, while rewarding those who sustain a neorealist foreign policy. Therefore, all states strive to copy the foreign policies of the most successful state under the weight of the international and political structure. This character of structure leads to the second term in the definition of structure. Units, as parts of the structure, are not “formally differentiated by the functions they perform,” because of the compelling

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effect of anarchy. Waltz claims that, “so long as the anarchy endures, states remain like units.”6 The third characteristic of the structure is the distribution of its capabilities. In international forums, states are functionally alike. Thus, the units are separated by their capabilities, and this characteristic also enables one to distinguish different international structures in different periods according to the number of great powers they contain. For this reason, although the distribution of capabilities appears to be a property of a unit, it is in fact a system-wide concept.7 After defining the characteristics, Waltz lists the results of anarchy by emphasizing differences between domestic and international political structure and comparing the outcomes of hierarchy and anarchy. The first difference is observable in terms of violence. According to Waltz, citizens do not have to use force to defend themselves in hierarchy. In the international realm, however, individual states can and should apply the use of force, for this does not pose a threat to the existence of the system, and all states have a legitimate right to use force.8 The second difference lies in concepts of interdependence and integration. According to Waltz, a domestic system is hierarchically organized by the authority which also organizes relations among individuals. Under this order, units are free to specialize because they have no hesitation in increasing their interdependence. However, in anarchical conditions, all units have to be sufficient in themselves, and this limits cooperation for two reasons. Firstly, states are concerned about a division of possible gain through becoming more dependent on others in cooperative endeavours and exchanges of goods and services.9 Secondly, all units are at the same time striving to be independent.10 He states that “the more a state specializes, the more she relies on others.”11 Waltz sees the source of all differences in the absence or existence of organization. In a domestic political system, under the tutelage of a government, individuals are not alone, but are not free, either. In an international order, individuals are and must be free, a situation which leads to an increase in security threats. Nationally, force is used in the name of rights and justice; internationally, however, the force is used for the sake of a state’s own safety and advantage. Conflicts and struggles among individuals in a domestic system are for acquiring authority and rights; in an international system, on the other hand, they are for the allocation of gains and losses. Nationally, relations of authority are established; while internationally, it is relations of strength that are established. He sums up this view as follows:

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National politics is the realm of authority, of administration, and of law. International politics is the realm of power, of struggle, and of accommodation … The national realm is variously described as being hierarchic, vertical, centralized, heterogeneous, directed, and contrived; the international realm as being anarchic, horizontal, decentralized, homogeneous, undirected, and mutually adaptive.12

After comparing these two political structures, Waltz, who sees the anarchy as a basic factor behind states’ behaviours, depicts that the states who are acting under the effect of anarchy are expected to show certain behaviours. Under the same condition of structure, states may conduct the same policies. Under anarchy (unchangeable according to neorealist theory), and the same distribution of capabilities (bipolar or multipolar), Waltz anticipates two expected policies: balancing/bandwagoning and the emulation of successful policies. Regarding the former, he states that “the balance of power recurrently forms.”13 Only the circumstances of the system may affect states’ preferences for balancing or bandwagoning. States in anarchy prefer to balance rather than bandwagon because in hierarchic conditions, among competing actors, bandwagoning may be possible. This is because there is no threat against their survival.14 However, in an anarchic condition, great powers prefer to balance against the most powerful individual, because a leading power expands, to such an extent that it may pose a threat to all the other countries, including its partners and friends. As regards the emulation of successful policies, equality among competing states is promoted through competition among the states to achieve relative instead of absolute gains, in order to ensure security and survival and to maintain their positions in the system.15 According to Waltz, the two terms—anarchy and hierarchy—are enough to explain international political orders. He argues that all societies are mixed; therefore, there is no need to define any other system. Not all elements of anarchy or hierarchy are necessary to define a system; rather, just a few of them are sufficient to determine a system’s type. However in my view, this crux point is debatable. It is argued that a system, which is in the process of losing its anarchic elements, cannot be defined as anarchic, but it cannot be defined as a hierarchic system, either. After this point, a third (or more) system(s) need to be defined. The rest of this paper will focus on these points, a reformulation of the ordering principle, and an introduction to mixed systems in which those ordering principles are valid.

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Table 12-1 Comparison between domestic political structure and international political structure Domestic Political Structure

International Political Structure

Field of Hierarchy

Field of Anarchy

Centralized

Decentralized

Super-subordinated relationship

Each unit is equal

Existence of government Units are functionally different

No supranational or centralized agents or organization Units are alike

Cooperation

Competition

Units are under the autonomy of the government Only central authority has right of use of force Units are free to specialize

Units are sovereign, they have authority within themselves All states have right of use of force

Conflicts among units are for authority and right Realm of authority

Conflicts are for allocation of gains and losses Realm of power

Realm of administration

Realm of struggle

Realm of law

Realm of accommodation

Vertical

Horizontal

Heterogeneous

Homogeneous

Directed

Undirected

Contrived

Mutually adaptive

All units are striving for independence

The Definition of New Ordering Principles Waltz’s model of international relations aimed to understand the Cold War world, and mostly focused on superpower politics. Hence, it ignores many countries and hinders our ability to understand the new form of relationship that has occurred between different countries in the post–Cold War period.

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There have been regions in which a hierarchical relationship prevails within a wider anarchical international system. Jack Donnelly states that there are many examples both in the history and in the contemporary world which are internally sovereign, while externally they display a subordinate entity. In his Realism and International Relations, he underlines the concept of “sphere of influence.” States within the sphere of influence of another dominant state have the rights and power of a sovereign state internally, but externally they are only confined within hierarchically imposed limits by another state. He gives the relationship among the Soviet Union and Central and Eastern European States and East Germany as an example. Whilst all were sovereign states, they were also subordinate to the Soviet Union; they had a special relationship; not infinite but also not “temporary, contingent or accidental.” While identifying a sphere of influence, three conditions are necessary: the existence of so-called sovereign states, the existence of a subordinated relationship between the units, and a relationship that should not be temporary, contingent, or accidental.16 How can “the subordinated relationship be detailed or defined?” This type of relationship should occur within an anarchic structure but have hierarchic elements. While defining anarchy and hierarchy, Waltz uses the terms “required to obey” and “entitled to command,” and further states that “National politics is the realm of authority, of administration, and of law. International politics is the realm of power, of struggle, and of accommodation.”17 Jack Donnelly criticizes this clear-cut differentiation and claims that Waltz’s formulation of hierarchy and the arrangement of its parts in a domestic political structure, originating from coercion and power and/or legitimate authority, may be observed in an international political structure by giving the examples of the Roman and Ottoman empires in which “some states could not stand under the suzerain and imperial authority of certain other states.” He also argues that Waltz’s description of domestic politics as “a realm of authority, of administration, and of law” should be expanded, since it is also the realm of power, of struggle, and of accommodation. He states, “The differences between international (anarchic) and national (hierarchic) political orders are largely matters of quantity, not quality—making the variable continuous, rather than dichotomous.” Therefore, the answer to the following questions needs to be probed: Is there a relationship between two or more states that consists of the idea “required to obey” and “entitled to command,” or alternatively should the question be concerned with the existence of implicit rules or roles designed by a dominant power? Should a state, having an obligation to obey some rules imposed by another state,

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be punished in the case of disobedience or in any situation which emerges due to the conflicting interests of the dominant power and the weaker country?18 On the subject of Waltz’s balance of power theory, Donnelly states that in the sphere of influence, “states in anarchy often bandwagon rather than balance.” Expanding this argument, he proposes that “the incentive behind bandwagoning stems not from hierarchy, but rather from the anticipated behavior of the winner … and balancing is driven not by anarchy but by fear of predation.”19 Another author who argues for the existence of hierarchical relationships within anarchy is David Lake. In his article entitled “Escape from the State of Nature, Authority and Hierarchy in World Politics” he claims that there is an international hierarchy between a subordinate state and a dominant state across the dimensions of security and economic relations.20 In the security relationship, he states that there are two ends: diplomacy at the anarchic end and protectorates at the hierarchic end. “In diplomacy, polities interact while retaining complete authority over their own action … [while in protectorate], at the other extreme, one state cedes complete authority to another over its security policy.”21 There are various other types of security relationships between these two ends. He asserts that economic relationships vary from market exchange (in which parties have full authority over their decision to choose to trade, invest, or participate in any form of economic engagement), to dependency, meaning a total transfer of authority in economic policies. Furthermore, he defines a sphere with an influence point in the middle of the security relationship continuum, and an economic zone at the middle of the economic relationship continuum. In addition, he nominates a dominant state having the points in these positions as an informal empire, while he defines a dominant state, having a high level of economic and security hierarchy, as an empire.22 To measure the security hierarchy, he uses two parameters: deployment of military forces from the dominant country, and the number of independent alliances possessed by the subordinate state. According to him, a key point is the presence of an outside option for a substantial state to reduce the authority of dominant states. He explains this as follows: “the larger the number of such independent alliances possessed by the subordinate, the less hierarchical the security relationship is likely to be.”23 In the economic hierarchy, he defines two affecting parameters as monetary policy autonomy (which is determined by exchange rate regime), and relative trade dependence. About the former, he explains that there may be other degrees within an individual state—from allowing the flotation of currency to the use of another country’s currency—in addition

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to the degrees in his model, which are defined as going from anarchy to hierarchy. To define the spheres of influence, Lake’s parameters of security relationship (deployment of military forces and the number of independent alliances possessed by the subordinate state) should be empowered by his own parameter of economic hierarchy—relative trade dependence, which is used by dominant states as a political tool. Monetary regime is mostly efficient in trade policies; therefore, trade dependency encompasses the effects of that parameter. As a result, three more parameters are borrowed from David Lake.24 Waltz claims that states trust only in themselves and face a self-help system which makes security cooperation more difficult, because states are compelled to rely on their own efforts and capabilities by the structure.25 Alliances can be constructed; however, they have no real value as states may easily withdraw whenever any troubles arise. However, in some regions where a dominant power is particularly powerful, it may perform special tasks regarding the settling of disputes for the sake of preserving the status quo. The dominant power may initiate organization and programs relating to security matters. In some situations, weak states may be obliged to be a member of these programs or obligations so as not to oppose the dominant power. Maneuverability and freedom of action26 allotted to weaker states in alliances are also another reflection of a semihierarchical relationship between weak states and dominant states. Therefore, security alliances should be reviewed to depict how much freedom of action is allocated among partners and to what extent the transfer of autonomy is realized. Variables that should be examined include: existence of so-called sovereign states; existence of subordinated (or super-ordinated) relationships between units; the relationship between them not being temporary, contingent, or accidental; existence of implicit rules/roles for some states imposed by others; existence of punishment and its methods; deployment of military forces of the dominant country; the number of independent allies possessed by the subordinate; trade relationship— dependency or partnership; protection of any region of a weaker country by a dominant power, or existence of any military occupation, or invasion, or any temporary airborne assaults; structure of security alliances.

The Black Sea Region and Regional Structure In the Black Sea region, the ordering principle of the regional structure can be defined as hierarchy within anarchy. We can identify the so-called sovereign states—the former Soviet countries of Ukraine and Georgia, other

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South Caucasian countries, a very powerful, dominant state (Russia), and Romania and Bulgaria, which are European Union (EU) members. These two countries, located in a more hierarchical position within the EU according to EU acquiescence, have their own various decision-making processes, but these can be superseded by the EU’s central authority, replacing the will of the national authorities, even regarding internal matters. Under this structure, Turkey also has a unique position, which can be placed neither in the EU sphere of influence, nor in the Russian sphere of influence. In the region, the Russian Federation has held an historical sphere of influence since 1990. Therefore, it can be argued that at least one type of historical subordinated relationship is not temporary or accidental. As can be observed in table 12-2 detailing the situation of Ukraine and Georgia, all variables, with the exception of their trade relationship, demonstrate the dominance of the Russian Federation over Ukraine and Georgia. Table 12-2 Situation of Ukraine and Georgia Variables Implicit Rules/Roles

Ukraine

Georgia

Natural gas transporter

Russian ally

Punishment

Natural gas cuts27

Invasion Support to secessionist regions

Deployment of Military Forces

Russian Black Sea Fleet and its extension till 204228

Russian plans to establish military bases In Georgia's separatist regions29

Number of Independent Allies

Trade ConflictResolution32

EU under Russian pressure, (trade volume between Russia and EU-27 is 150.676,3 million Euro)30 Russia opposed these two countries’ membership and the United States, France, and Germany could not provide enough support.31 To what extent are they independent? EU-28

Russia opposed these two countries’ membership and the United States, France, and Germany could not provide enough support. To what extent are they independent? To what extent can the United States be more active in the region?

Turkey Yes, in 1994 Ceasefire between Abkhazia and Georgia33

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Russia, during the past two decades, has been attempting to preserve its sphere of influence over these two post-Soviet countries, whilst at the same time trying to preserve the status quo. However, the foremost difference between the two decades is that during the first decade, Russia was the only great power which was seriously concerned with this region. However, during the same period, Russia was dealing with its own internal transformation and was not powerful enough to maintain its position due to its own power vacuum. Since 2000, Russia has regained its former power, but now both the EU and United States carry ongoing concerns about this region, which is a reflection of a double enlargement. Moreover, the EU initiated various programmes and initiatives within the area as well as promoting both bilateral and multilateral relationships between the two countries. Trade tables also show that the EU has intensified its economic relationships with Black Sea countries, including Russia, which has further complicated the situation for the EU. These three powers seem to be in competition to construct their sphere of influence, which is based on a single economic space, energy security, and strengthening their position in the region. There are many issues on which Russia, Ukraine, and Georgia have conflicting interests, such as energy transit, the Baku–Tblisi–Ceyhan (BTC) pipeline, the gas cut to Ukraine, NATO enlargement, coloured revolutions, their intense relationship with the EU, Georgian policies regarding the South Ossetia and Abkhazia, and so forth. These matters may also strengthen the position of Russia, although they seem to be originating from the relationship of Ukraine and Georgia with the EU and United States.

Trade Tables Table 12-3 Georgia’s trade with main partners (2008)34 Major Import Partners

Major Export Partners

Turkey

17.6%

Turkey

15.5%

Azerbaijan

13.7%

Ukraine

10.9%

Ukraine

9.0 %

Germany

10.0%

Bulgaria

7.2 %

Russia

7.2%

Source: Country Report Georgia, The Economist Intelligence Unit, United Kingdom, March 2009, p. 5.

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Table 12-4 Ukraine’s trade with main partners (2009)35 Major Import Partners

Major Export Partners

EU27

34.0%

EU27

24.0%

Major Trade Partners EU27

Russia

28.9

Russia

21.4%

Russia

China Kazakhstan

6.0% 4.6%

Turkey China

5.4% 3.7%

China Kazakhstan

29.3 % 25.4 % 4.9% 4.1%

Uzbekistan

3.9%

Kazakhstan

3.6%

Turkey

3.6%

Source: http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_ 113459.pdf

Table 12-5 Turkey’s trade with main partners (2009)36 Major Partners EU27 Russia China US Iran

Import 40.5% 14.1% 9.1% 6.2% 2.4%

Major Export Partners EU27 Iraq Switzerland US Russia

46.2% 5.1% 4.1% 3.4% 3.2%

Major Trade Partners EU27 Russia China US Switzerland

42.9% 9.5% 5.9% 5.0% 2.5%

Source: http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_113456.pdf

Table 12-6 Russia’s trade with main partners (2009)37 Major Import Partners 46.8% EU27 14.1% China 5.5% Ukraine 4.5% US 4.0% Japan

Major Export Partners EU27 China Turkey Ukraine US

48.0% 5.7% 4.3% 4.0% 3.2%

Major Trade Partners EU27 China Ukraine US Turkey

47.6% 8.8% 4.6% 3.7% 3.4%

Source: http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_113440.pdf

On Security What are the effects of this entire scenario on the security of the Black Sea region? While dealing with security, some basic questions need to be answered:38

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1. For whom and for what values is security provided (vital interest– core values)—What is to be secured? 2. From what the threats are perceived? How is the referent object threatened? 3. What are different means of achieving security? Regarding the first question, the referent object is the state and the region. This encompasses both the security of the region and of states in the region. However, under the conditions of a mixed political system (a mixture of anarchy and hierarchy), values or vital interests can be complicated. In a mixed political structure, the two matters with which the weaker state deals is to preserve its autonomy39, and to protect itself against any threat to its autonomy from the pressure of a dominant state. The interests of the greater power, however, lie in preserving, extending or intensifying its domination over countries that are found in its sphere of influence, so that it can remain as the only great power. On the other hand, in a case where there is more than one great power, the fundamental concern of each great power is to preserve its sphere of interest, which has already been achieved by the first great power, and to maintain the status quo. A further area of concern is reshaping or re-forming the sphere of influence in accordance with the interests of the latter great power, in other words, it is a revisionist attempt.

By What Means? From among the many means available at the disposal of great powers, the United States establishes regional organizations in a region,40 and the EU initiates new programmes. Therefore, it can be inferred that these organizations and the EU programmes may be seen as examples of the region-reshaping and region-building projects of these two powers. Russian-originated organizations such as the Collective Security Treaty Organization (CSTO), established in 2002, are a reaction against those projects, and aim to preserve its sphere of influence.

Conclusion In the Black Sea region, power holders other than the great powers try to create a balance by using power politics. This is due to the emergence of the United States and EU in the region since 2001, and Ukraine and Georgia’s increasing willingness to have intense relations with them.

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Therefore, they try to balance the Russian Federation through bandwagoning with the United States and EU. Under this framework, we can describe the Russian position in the region as a declining hegemony, and identify the political structure in the region as a loose sphere of influence. Therefore, it can be argued that the regional structure is in a process of reconstruction. The basic factor behind the instability and security in the region is this new reformulation, much like those seen in previous cycles of instability/stability in the history of the region.

Notes 1

Kenneth N. Waltz, Realism and International Politics (New York: Routledge, 2008), 74. 2 Waltz, Realism, 81. 3 For example, domestic politics is hierarchically ordered, therefore the ordering principle of domestic structure is hierarchy. 4 Waltz, Realism, 81 5 Waltz, Realism, 88. 6 Waltz, Realism, 93. 7 Waltz, Realism, 98. 8 Waltz, Realism, 104–105. 9 Waltz, Realism, 106. 10 Waltz, Realism, 104–105. 11 Waltz, Realism, 106. 12 Waltz, Realism, 113. 13 Waltz, Realism, 124. 14 Waltz, Realism, 126. 15 Waltz, Realism, 128. 16 Jack Donnelly, Realism and International Relations (Cambridge: Cambridge University Press, 2000), 87–88. 17 Waltz, Realism, 113. 18 Citations in the paragraph from Donnelly, Realism and International Relations, 91–92. 19 Donnelly, Realism and International Relations, 117–118. 20 David Lake, “Escape from State of Nature Authority and Hierarchy in World Politics,” International Security 32, no. 1 (Summer 2007): 49. 21 Lake, “Escape”: 59–60. 22 Lake, “Escape”: 60–61. 23 Lake, “Escape”: 63. 24 Quotations in this paragraph from Lake, “Escape”: 62–67. 25 Michael Sheehan, International Security: An Analytical Survey (Boulder, CO: Lynne Rienner, 2005), 8.

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26 These concepts are borrowed from Katja Weber, “Hierarchy amidst Anarchy: A Transaction Cost Approach to International Security Cooperation,” International Studies Quarterly 41, no. 2 (June 1997): 323. 27 “Russia Cuts Off Gas to Ukraine in Cost Dispute,” New York Times Online, 2 January 2006, http://www.nytimes.com/2006/01/02/international/europe/02russia .html. 28 “In Pictures: Russia’s Black Sea Fleet,” BBC News Online, 27 April 2010, http://news.bbc.co.uk/2/hi/in_pictures/8646340.stm. 29 “Russia to Sign Deal with South Ossetia on Military Base,” Rianovosti, 9 March 2010, http://en.rian.ru/russia/20100309/158135270.html; and “Russia, Abkhazia Sign Deal to Build Russian Base in Ex-Georgian Region,” Rianovosti, 17 February 2010, http://en.beta.rian.ru/russia/20100217/157913962.html. 30 Russia: Main Economic Indicators, http://trade.ec.europa.eu/doclib/docs/2006/ september/tradoc_113440.pdf. 31 Valentina Pop, “Ukraine Drops NATO Membership Bid,” EU Observer, 4 June 2010. 32 According to Papayoanou, a great power can play a role in controlling and managing conflicts and Russia has taken an approach that seems to be somewhere between a collective security agreement and outright domination towards the former Soviet countries: see Paul A. Papayoanou, “Great Powers and Regional Orders: Possibilities and Prospects after the Cold War,” in Regional Orders: Building Security in a New World, ed. David Lake and Patrick Morgan (University Park, PA: Pennsylvania State University Press, 1997), 134. 33 “Timeline Georgia,” BBC News Online, 7 July 2010, http://news.bbc.co.uk/2/hi/ europe/country_profiles/1102575.stm. 34 “Report: Georgia,” Economist Intelligence Unit, March 2009, p. 5. 35 Ukraine: Main Economic Indicators, http://trade.ec.europa.eu/doclib/docs/2006/ september/tradoc_113459.pdf. 36 Turkey: Main Economic Indicators, http://trade.ec.europa.eu/doclib/docs/2006/ september/tradoc_113456.pdf. 37 Russia: Main Economic Indicators, http://trade.ec.europa.eu/doclib/docs/2006/ september/tradoc_113440.pdf. 38 These questions are for the most part borrowed from David A. Baldwin, “The Concept of Security,” Review of International Studies, no. 23 (1997): 12–16. 39 Davidson comments that “Anarchy not only forces states to seek security but also forces them to seek autonomy … [which means the] ability to act as one who chooses in internal and external affairs.” Jason W. Davidson, The Origins of Revisionist and Status-quo States (New York: Palgrave, 2006), 33. 40 Ikenberry has noted that “Institution building is a key element of the American order-building strategy.” See G. John Ikenberry, After Victory: Institutions, Strategic Restraints, and the Rebuilding of Order after Major Wars (Princeton: Princeton University Press, 2000), 234.

PART III: INTERNATIONAL RELATIONS AND STRATEGY

CHAPTER THIRTEEN THE BLACK SEA REGION: CHALLENGES AND OPPORTUNITIES MOHAMMAD HASSAN KHANI*

Introduction Regional integration, according to many scientists of international relations, is the latest and most effective mechanism for engendering cooperation among state members of the international community living in geographical proximity. It has also been regarded as an effective way of achieving peace, security, and economic prosperity across the globe. To see how this approach may or may not work for the Black Sea region, we first need to look at its historical background, and the theoretical framework on which it is based. For a significant proportion of world history, one or a very few empires have dominated and shaped the world and regional orders. In that context, the establishment and success of any global and regional arrangement has depended solely on the agreement and interests of those powers. This was especially the case during the sixteenth up to the nineteenth centuries across Europe, where large empires such as the British Empire, Russia, the Ottoman Empire, the French Empire, the Austro-Hungarian Empire, Prussia, and lastly the German Empire were the major players of their time. It was in the mid seventeenth century, at the end of the Thirty Years’ War, and as a result of the signing of the Westphalia Peace Treaty, that a significant change was brought to the international system by introducing *

Graduate of the Department of Peace Studies at the University of Bradford, and is currently a staff member of the Faculty of Political Science and Islamic Studies, and the Head of Department of International Relations, at Imam Sadiq University, Tehran. His areas of speciality include regional studies and regional integration in Eurasia and the Middle East. Email: [email protected] and [email protected].

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the nation-state as a basis for redrawing the world map. From 1648 up to 1815—that is, for nearly two centuries—the world witnessed a chaotic transitional period in which a number of great powers, particularly the French and British Empires, were at the centre of the world system. However, for a variety of reasons, they simply failed to create a wider coalition and to establish the necessary blocs to form a lasting world order. As the Napoleonic era came to an end in the early nineteenth century, and as a result of decisions made by the participants in the Congress of Vienna in 1815, it became obvious that a new era in international relations was being born and that a “new world order” was about to come into being. The Congress System was the product of this new era, manifested in the creation of the Concert of Europe, aimed at introducing new arrangements based on the balance of power between the old and the new dominant international players. This era is regarded by many scholars as a crucial juncture, almost a turning point, in the history of international relations. For the first time world leaders recognized the significance of Regional Cooperation based on the principle of organized and systematic cooperation and competition at the same time. The acknowledgment of the existence of areas of common interest between different states was an important development occurring in this era. Although such recognition was not translated instantly into the creation of actual regional arrangements in the form of treaties and organizations, at least in theory it created the mentality needed for such a process, and paved the way for taking first steps towards integration in the following decades. In fact, it later led to the creation of meaningful coalitions and alliances.

The Role of Regional Integration within the International System Although moving towards integration and forming coalitions and alliances soon became the practice of many countries, this process was nonetheless determined by the visions, ambitions, and political influence of certain powers. In other words, in the beginning, and for a significant period, regionalism and integration were practised mainly by a few influential powers, and they imposed it afterwards on the smaller countries surrounding them. At the end of the Second World War and in the early 1950s, this trend began to change, and was replaced by a new kind of practice based on voluntary engagement in regional integration throughout the world. This practice continued during the 1970s, 1980s, and 1990s.

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An examination of the theoretical basis for the notion of regionalism and regional integration shows that, during the past five decades, there has been a good deal of effort invested by scholars of international relations in trying to explain the function and importance of regional integration in international politics. Ernest Hass is among those theorists who have contributed to initiating and developing the idea of regional integration. Hass defines integration as a “process in which political actors in several distinct national settings are persuaded to shift loyalties, expectations, and political activities toward a new centre, whose institutions possess or demand jurisdiction over the pre-existing national states.”1 In this field, the model proposed by Louis J. Cantori and Steven F. Spiegel is among the most convincing. They define the move towards regional integration by neighbouring countries in terms of their desire to work together in the form of a subordinate system within the international system.2 Answering the critical question of how to achieve this, they point to the nature and quality of the contact, interchange, and communication between countries as indicators of successful integration.3 Although there are some analysts who doubt the credibility of such an approach in explaining the role of regionalism in world politics, there are still those who argue convincingly that regionalism and regional arrangements are subordinate systems. This argument has been and will be central to many of the debates about the nature of the future international order. Andrew Hurrel, for example, sees regionalism as a prescription, a moral position, or as a doctrine as to how international relations ought to be organized.4 Regional integration will have effects and consequences for nation-states as well as their citizens. It is likely to bring a sense of commonality among individuals and also institutions, making them feel that they are no longer separated by borders, but rather that they belong to—more or less—the same identity.

How does Regional Integration Work? In the wake of increasing cross-border transactions, communications, and connections between different states, the boundaries of state authorities will tend to become more fluid and the commonalities between states more numerous. The greater the common features across the member nations at individual and societal levels, the greater the likelihood of creating a bloc or subordinate system that will distinguish them from the rest of the international system. Undoubtedly, the efforts made by governments to redraw the boundaries of their authority and to expand at regional level will have a huge impact on the political map of each region,

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and will lead to corresponding economic and social consequences. And in the final analysis, it is the interaction and intercourse between these clusters of nations by which the future of each individual state, and the future of the region will be shaped. Any regional arrangement consists of a number of players of differing size, acting individually or in the form of groups and blocs according to a set of common norms, interests, and concerns. For these common interests and concerns to be formed, established, and defined, there must be a minimum sense of community and commonality between those nations which are about to take part in integration. Karl Deutsch defines this sense of community as an essential element in the concept of integration. In his view it is defined as a matter of mutual sympathies and loyalty; of “wefeeling,” trust, and mutual consideration; of partial identification in terms of image and interests; of mutually successful predictions of behaviour, and of cooperative action in accordance with it.5 States participating in regional integration may take joint decisions on many matters and seek to develop common policies in a very wide range of fields—from security to political relations, from agriculture to culture, from environment and energy to transport and trade, etc. However, as time elapses and as new concerns emerge, fresh areas of cooperation and competition begin to appear on the horizon. Hence, the durability, consistency, and stability of any integration attempt, which demonstrates itself ultimately in a regional bloc and its accompanying organizational structures, does depend to a great extent on how the lines of cooperation and competition between the players are defined and drawn. In regional integration these lines are defined based on the most prominent commonality between the member states, and therefore the risk of a regional bloc collapsing and disintegrating is likely to be considerably decreased.

Challenges and Obstacles to this Approach Although regional integration, which is based on geographical proximity and other practical factors, has called old-fashioned ideological factors into question, it still seems that ideological concerns and differing world views remain among the important barriers to gathering different states around a central political entity. Ideological differences can be regarded as a potential obstacle towards integrating those states that live in the same geographical area but have different ideological orientations. Religious tendencies also continue to form a significant motive for moving towards either integration or disintegration in different parts of the

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world. While economic and geographical factors will increasingly impose themselves on other elements such as religion, religious criteria are still prominent in drawing dividing lines between nations, even at the beginning of the twenty-first century. For example, an evaluation of the reasons for the failure of movement towards integration in Central Asian and Middle Eastern countries shows how religious beliefs and sectarianism have acted as an obstacle in moving towards integration and, in some cases, have served as a cause for disintegration in these regions. The divisions between Sunni and Shia populations in regions such as the Middle East, and specifically in countries such as Iraq or Pakistan, are a pertinent example. The final challenge in this context is the fact that, during the formation stage, these regional blocs must learn to engage with other similar entities and blocs, and to interact with them in a variety of areas in order to be successful. The way these clusters of nations choose to behave towards each other and relate to one another is a very important factor in their success or failure. This interaction between regional blocs will form an important feature in the outline of what I term “the Grand Model of a New World Order.”

The European Experience For centuries, the European continent was the scene of numerous and bloody conflicts in which different nations waged war against each other. The Thirty Years’ War (1618–1648), the Napoleonic wars in the late eighteenth and early nineteenth centuries, the conflicts resulting from the 1848 revolutions in central Europe, and the First and Second World Wars, are all significant examples of how fragile and unstable the previous world orders have been. Past experiences, in spite of the heavy costs incurred, have taught us a valuable lesson, which is that the only way to secure lasting peace among the nations of the world is to bind them together economically, socially, and politically, and to convince them of their common destiny. This unification will not happen overnight, nor solely by adopting resolutions or unilateral policies imposed from above. It is more likely to happen through defining common interests, common concerns, and a common destiny. And the most convincing means by which such a broad communality can be built is regional integration. It is optimistic and idealistic to think that the world’s nations can align their dreams and interests in such a manner as to move towards global integration; but it is quite realistic to imagine that, across the globe, there will be groups of

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nations from the same geographical area with common interests and priorities who will come together to form economic blocs, political coalitions, and even military alliances. This process can begin from the hard fact that they belong to the same region, and therefore have to live with each other, tolerate each other, and, as a consequence, should move towards coexistence and cooperation. Undoubtedly, governments and official institutions have a big role to play in providing the necessary conditions for regionalism to occur. However, if required, the idea of “exerting pressure from above” to push towards regional integration should occur alongside a genuine desire from within and a pressure from below. In terms of the success of European Union (EU) members in integrating and defining common interests over a wide range of issues, the events that have happened in Europe over more than half a century show that regional integration can and will act as an important factor and device to assemble different countries around a centre, so to emerge as a powerful bloc with the capacity to affect the international system as a whole.

Regional Integration and the Black Sea Besides Europe, there are other groups of countries in different regions which are willing and able to follow the European model in their own ways. The Association of South East Asian Nations (ASEAN) is a good example with a relatively favourable record of success; and Central Asia may also re-emerge as a key site of cultural and commercial interchange, since for centuries the Great Silk Road provided the countries in the region with a successful regional work arrangement.6 The Black Sea region is also a good candidate to be a hub for significant regional interaction in the twenty-first century. This region has great potential for cooperation between neighbouring countries, which could ultimately affect each individual country in the region, and also alter the region as a whole. At the same time, regional integration could enhance the role of the Black Sea region in the international system in diverse fields, including economics, security, and political affairs. The following is an outline of how and why regional integration provides a good chance of working in this region. (A) Economic Factors: Neighbouring countries could assist and benefit from each other in many economic areas, including transportation, trade, export and import, and also bilateral or multilateral investments. Energy, and especially energy routes (pipelines and shipment of oil and

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gas) to Europe, are another excellent potential field of cooperation for these countries.7 Besides its own importance and potential in economic terms, the Black Sea region is also seen as a bridge between other regions. This includes the Caspian Sea and Caucasus regions, and even Central Asia, which are all of great importance in terms of both energy and security. The Black Sea is regarded as a natural link between these regions and Europe. It seems that Europe is well aware of this fact, and, logically, in order to reach out to these regions there would need to be benefits accruing to Europe arising from the Black Sea as a connecting influence. (B) Political and Security Factors: The Black Sea region has been described as strategically important in geopolitical terms.8 It is therefore a matter of common interest for all the nations within this region, and for those in neighbouring regions, to develop a close political and security relationship. To be realistic, however, we should also note that there are a number of challenges and obstacles to comprehensive and effective integration in the region. The most important challenges are set out briefly in what follows. The different political orientations of the countries in the region and the diverse priorities in their security concerns can be regarded as a significant obstacle to integration. In spite of efforts so far, it seems that Sofia, Ankara, Moscow, and Tbilisi still remain distant from each other when it comes to their ideals on security and political issues.9 While the Kremlin is concerned with its role in the global economy and obsessed with regaining its major role in the international system, the leaders in other capitals of the region are mostly concerned with maintaining political stability and economic development. Still others are struggling to keep a balance between Moscow and the West. The role and intentions of Russia, the biggest player in the region, form a very important factor here. There are analysts who argue that Russian superiority has a negative impact on the whole process, slowing down integration in the region. The sense of fear, uncertainty, and suspicion that a few small countries in the region, such as Georgia, hold towards Russia is an example of how perceptions of Russian superiority can be influential. Of course, if these perceptions change, the role of Russia would also be able to shift towards a more positive and constructive one as far as regional integration is concerned. In fact, Russian influence may actually be seen as a paradox. Any movement towards integration and its success depends, to a great extent, on its being supported by the membership and inclusion of at least one big power who is willing to share its political and

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economic strength to act as the locomotive of the train. The lack of such a force will lead to its weakness and ultimately its failure.10 However, when this major power is included, it may immediately start to act and behave as a “Big Brother,” tending to make decisions unilaterally and to impose its will, interests, and ambitions upon the other countries. This phenomenon therefore creates a particular obstacle in the way of constructive arrangements in the integration process. The third challenge for the Black Sea region is competition and rivalry between Russia, the EU, and the United States.11 While the EU is trying to attract the nations of the region toward itself and to pull them in the direction of European values and European identity, Russia has its own agenda and is doing its best to make the region a domain of Russian policies. The same challenge also arises in military and security matters. The old memories of the Cold War and the confrontation between East and West that manifested in the Warsaw and North Atlantic Treaty Organization (NATO) treaties, is still a significant barrier between Europe and Russia. This legacy negatively affects other countries that are trapped between the two sides, and this includes the countries in the Black Sea region. The recent conflict in Georgia was a particularly good example. It demonstrated clearly how the security and stability of the region can be a hostage to the relationship between Russia on one side and Europe and the United States on the other. It also showed how Russian security concerns can affect and shape the security arrangements in the region, and can even reach beyond and alter the map of the region.

The Unique Role of Turkey Drawing on the arguments detailed above on regional integration, I argue that, among the neighbouring countries of the Black Sea, Turkey has unique characteristics which enable it to play a very special role. This uniqueness comes from the fact that Turkey stands in the middle between the East and West when it comes to political and security matters in the region. In other words, Turkey can provide a connection between the two extreme ends of the region, both geographically and ideologically. It could form a bridge between the EU, which desires to develop its relations with the region, and the Black Sea countries. At the same time, it reflects in itself the inclinations of some countries to the east and north of the Black Sea to maintain their cultural heritage and historical identity during any movement towards integration. Regarding security issues, Turkey again has the chance to play a major and effective role. Being a member of NATO, Turkey shares many

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concerns of some European countries and of the United States in the region. At the same time, however, leaders in Ankara have acknowledged the security threats perceived by Moscow and have tried to reconcile the opposing views of the two sides. Again, the recent conflict in Georgia, and the willingness of Turkey to play a role in finding a peaceful settlement of the crisis, is a good example of how Turkey can help to accelerate the process of regional cooperation in the area, overcoming the challenges outlined above.12

Conclusion As discussed in this paper, regional integration and agreements offer the scope to reduce security tensions between neighbouring countries, and to promote cooperation among them, paving the way for creating large harmonized blocs. Despite the fact that regional integration has proved to be an effective mechanism for advancing cooperation in the diverse fields of economics, politics, and security in many regions, including the EU and ASEAN zones, it still faces numerous challenges in other regions, including the Black Sea region. Nevertheless, due to its geopolitical significance and the willingness of neighbouring nations to explore common interests, the prospect for regional integration in the Black Sea region seems to be promising. The location of this region—next to Europe on the one hand, and to two other important sub-regions, the Caucasus region and the Caspian Sea basin, on the other—lends a vital role to the Black sea region in geopolitical terms. In this process of integration, the roles of Turkey and Russia remain crucial, though for very different reasons. Furthermore, the roles of external players, namely the European Union and the United States, are also very important. The conflicting views and contradictory interests of Russia and these external players in general, and that of NATO in particular, will also be a determinative factor in the failure or success of integration in the Black Sea region.

Notes 1

B. Ernest Hass, The Uniting of Europe (Stanford, CA: Stanford University Press, 1958), 16. 2 J. Louis Cantori and F. Steven Spiegel, International Politics of Regions: A Comparative Approach (Engelwoods Cliffs, NJ: Prentice-Hall, 1970), 46. 3 J. Louis Cantori and F. Steven Spiegel, “The Analysis of Regional International Politics: The Integration Versus the Empirical Systems Approach,” International Organization 27, no. 4 (1973), 476.

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Andrew Hurrel, “Regionalism in Theoretical Perspective,” in Regionalism in World Politics: Regional Organizations and World Order, ed. Louise Fawcett and Andrew Hurrel (Oxford: Oxford University Press, 1995), 39. 5 W. Karl Deutsch et al., Political Community and the North Atlantic Area: International Organization in the Light of Historical Experience (New York: Greenwood, 1957), 36. 6 Daniel Fried, Assistant Secretary for European and Eurasian Affairs, Statement Before the Subcommittee on the Middle East and Central Asia of the House International Relations Committee, Washington, DC, 27 October 2005. 7 Mustafa AydÕn, “Europe’s Next Shore: The Black Sea Region after EU Enlargement,” Occasional Papers no. 53 (Paris: Institute for Security Studies, 2004), 17. 8 Alexandros Yannis, “The European Union and the Black Sea Region: The New Eastern Frontiers and Europeanisation,” ICBSS Policy Brief No. 7 (Athens: International Centre for Black Sea Studies, 2006). 9 Ian Lesser, “Global Trends, Regional Consequences: Wider Strategic Influences on the Black Sea,” Xenophon Paper Series No. 4 (Athens: International Centre for Black Sea Studies, 2007), 28. 10 Anthony Venables, “Winners and Losers from Regional Integration Agreements,” Globalisation Programme Paper, London School of Economics and CEPR, http://www.cepr.org/meets/wkcn/2/2306/papers/venables.pdf. 11 Nadia Alexandrova-Arbatova, “Regional Cooperation in the Black Sea Area in the Context of EU-Russia Relations,” Xenophon Paper Series No. 5 (Athens: International Centre for Black Sea Studies, 2008), 39. 12 Fred Stopsky, “Turkey Seeks Mediation Role in Georgia War,” The Impudent Observer, 9 August 2008, http://theimpudentobserver.com/world-news/turkeyseeks-mediation-role-in-georgia-war/.

CHAPTER FOURTEEN REGIONAL COOPERATION EFFORTS IN THE BLACK SEA REGION: BLACK SEA SYNERGY ÇIöDEM ÜSTÜN*

Introduction The European Union’s synergy paper Black Sea Synergy—A New Regional Cooperation Initiative, and the Eastern Partnership, have called attention to the increasing importance of the Black Sea region, due to its position at the heart of transportation and trade routes, and of energy corridors. The delicate balance of power of the Cold War years prevented Western powers from focusing on the region, which covers the Caucasus, the Caspian Sea, and the Black Sea as a whole. The increase in energy demands and changes in security threats after the end of the Cold War, particularly in the last decade, have amplified the importance of the region. Especially following the membership of Bulgaria and Romania to the European Union (EU), the prosperity, stability, and security of the countries around the Black Sea are now of immediate concern to the EU.1 In addition to the attention granted to the region by the EU, other international organizations and actors have also given special emphasis to the Black Sea region since the Cold War ended. This paper will primarily analyse the attention afforded to the region, and its effects on regional cooperation. Perspectives on the regional countries and their policy suggestions2 will also be discussed. In this respect, the effect of Black Sea Synergy will be our primary focus, as it aims to develop cooperation both

* Middle East Technical University, Centre for European Studies, Ankara, Turkey; email: [email protected].

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within the countries of the Black Sea region, and between the whole region and the European Union.3

A Region on the Rise In the post–Cold War era, the Black Sea region’s significance has increased in the international arena, especially in the last ten years. Due to issues such as immigration, energy security, transit routes, environmental issues, and trade links, the whole region is vital for European countries as well as the United States and neighbouring states in the region. Additionally, the frozen conflicts of the region not only affect the states involved in these disputes, i.e., Moldova, Georgia, Russia, Azerbaijan, and Armenia, but also their neighbouring countries. At a time when the EU, the North Atlantic Treaty Organization (NATO), the Organization for Security and Co-operation in Europe (OSCE), and other international bodies expend efforts on establishing stable and secure borders, member states of international organizations are placing more emphasis on proper solutions for regional conflicts and problems. For this reason, the region is not only a growing market, but also vital in terms of political conflicts affecting the Mediterranean, the Middle East, Black Sea riparian states, the Caspian Sea Basin, and the Balkans. The demise of the bipolar political system brought a new dimension to international affairs. With the collapse of communism, the Black Sea regional states declared their independence, and this brought new forms of cooperation at regional and international levels, while global economic tendencies and the increasing significance of energy resources heralded a new perception of the region. Several regional organizations for cooperation were established in the 1990s. Especially after Bulgaria and Romania became full EU members, the Black Sea region began to take its place in the foreign policy of the EU, which needed to create a regional policy dimension for the Black Sea region. Since its Mediterranean enlargement initiative, EU policies about enlargement have become common, but it is now an accepted fact that the EU cannot and will not enlarge forever. As enlargement policies have been a very successful foreign affairs tool, the EU is trying to find new ways to continue and re-evaluate these policies. In order to prevent negative attitudes in neighbouring countries, due to being excluded from an enlargement program, the EU is working on specific regional policies with a view to spreading good governance, democracy, and the rule of law.4 The EU devised a Mediterranean dimension for its enlargement in the south. Following the membership of Portugal, Spain, and Greece, the EU

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foresaw that it should also focus on southern Mediterranean countries. To achieve this, the EU launched the Barcelona Process in 1995, which includes northern and southern Mediterranean countries, and aims to cooperate on political, cultural, and economic issues. In the meantime, the need for establishing better links with southern Mediterranean countries forced the EU to revise its Barcelona Process, and in 2008 it launched the initiative of the Union for the Mediterranean (UfM). This aimed to enhance multilateral relations, increase co-ownership of the process, and make it more visible to citizens.5 After Finland and Sweden joined the EU, the Union decided to add a northern dimension, similar to that of the Mediterranean, to its external policies. This was intended to help promote security and stability in the region. It also aimed to establish cooperation in economic affairs, promote trade, investment, and growth of small and medium enterprises (SMEs), facilitate people-to-people contact, and increase cooperation in research and technology. The countries currently involved in this cooperative regional policy are Norway and Russia, for which EU membership is not feasible. Although the northern dimension originally also included Iceland, its application for EU membership in 2009 changed the country’s status. As the conflicts in the Black Sea region and possible solutions for them are of the utmost importance for the EU since membership of Romania and Bulgaria was granted, in 2007 the EU launched Black Sea Synergy, and in 2008, the Eastern Partnership (EaP). Both of these initiatives aimed to increase EU relations with the region in general, and with regional countries in particular. In the EaP, the EU declared its commitment to expanding and developing partnerships in the region, and to enhancing bilateral relations with Armenia, Azerbaijan, Belarus, Georgia, Moldova, and Ukraine. The issues discussed included economic integration, establishing comprehensive free trade areas, fighting illegal migration, upgrading their asylum systems to EU standards, and setting up integrated border management structures. Other matters covered in bilateral relations include enhancing policing and judicial services, fighting against corruption and organized crime, visa facilitation, securing energy resources and routes, preparing regional development programmes, and establishing cross-border cooperation.6 The EaP initially left Turkey7 and Russia out of these bilateral relations, and has therefore been heavily criticized by the two countries, given that the partnership has been used both as a tool to divide the region, and a policy that overrides Black Sea Synergy. Black Sea Synergy aimed to create a more regional approach and to promote multilateral rather than bilateral relations.

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As part of Black Sea Synergy, the EU placed special emphasis on enhancing multilateral relations, in order to react to opportunities and challenges that require coordinated action at the regional level.8 The synergy focused on key areas of energy, transport, environment, movement, and security, while creating sectoral partnerships and increasing relations with regional organizations, particularly the Organization for Black Sea Economic Cooperation (BSEC). Although the expectations of various BSEC countries and of the EU differ, Black Sea Synergy was accepted by regional states, since it had a more inclusive approach than the EaP. Also, bigger regional countries such as Turkey and Russia, who are members of BSEC, opted for enhancing relations between the EU and BSEC, rather than increasing bilateral relations.

Black Sea Economic Cooperation Since its establishment in 1992, just after the end of the Cold War, BSEC has been the most successful regional organization in bringing the countries together at regular intervals, and the creation of BSEC has been perceived as a new model of organization to bring rapprochement between the regional countries9 and Europe. Although this organization has not been able to respond to the political expectations of the countries, it can still be perceived as successful in enhancing trade relations among the states in this particular region. It is rightly asserted that BSEC’s policy of not engaging on political issues, and focusing mainly on economic and financial projects, has facilitated reconciliation and sharing of resources by regional countries. Originally, BSEC was established to serve the people of its member states through creating regional and sub-regional business networks, supporting SMEs and larger enterprises.10 In the meantime, although it has limited resources, it has been successful in establishing an institutional framework for regional states, and a platform for political dialogue among the member states. As a result of not dealing with political issues, BSEC has been able to bring Turkish and Armenian diplomats together in Istanbul, where Armenian diplomats not only acted as BSEC representatives, but also played a role in the rapprochement between Turkey and Armenia.11 Despite the fact that there were other regional cooperation efforts, such as the Organization for Democracy and Economic Development (GUAM), the Community for Democratic Choice (CDC), and the Black Sea Forum for Dialogue and Partnership, BSEC has been the main interaction platform for the countries of the region (Albania, Azerbaijan, Bulgaria, Armenia, Georgia, Moldova, Romania, Russia, Turkey, Ukraine, Greece,

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and Serbia). Therefore, the EU opted for BSEC as its regional partner, placing emphasis on increasing the interaction between the two organizations, which has been one of the main aims of BSEC as well. BSEC has also advocated its active interaction with the EU for more than a decade now. Although this had been the priority of all BSEC chairmanships since 1996, only since 2006 has the EU been able to focus on these multilateral, rather than bilateral, relations. BSEC advocated implementing region-wide projects that facilitate the development of mutual interests, on the proviso that EU institutions have an open and regular dialogue with BSEC, the institutionalized organization representing the whole region.12 It was also argued that the institutional mechanism of BSEC would be helpful in ensuring that EU policies address the real needs of the region. Therefore, it can be seen that BSEC is the only inclusive full-fledged regional organization possessing complete institutional structures, and with a clearly expressed political will to cooperate with EU institutions on a regular basis for the achievement of the agreed goals.13 Between the end of the 1990s and the creation of the synergy paper, the EU had a tendency to keep its relations with the regional states of Armenia, Azerbaijan, Georgia, Ukraine, and Russia at bilateral level, through Partnership Cooperation Agreements. This included the former Yugoslav Republic of Macedonia (FYROM) with Albania, the Stabilization and Association Processes with Serbia and Montenegro, and Stability Pacts with others. However, the EU realized that its policies towards the regional states could no longer meet the expectations of either the EU or the regional states, especially after changes in the understanding of security. The new understanding now includes not only the traditional meaning of state security, but also the security of humanity, energy, and environment. Thus, at BSEC level, the EU’s efforts to strengthen the Black Sea dimension of the European Neighbourhood Policy (ENP) in the form of the release of the synergy paper, have been welcomed and interpreted as a new dynamic of regional cooperation in the wider Black Sea area.14 The new Black Sea dimension aims to increase dialogue between the states and the EU, while enhancing cooperation in fields such as energy, transport, environment, and security. It is clear that the new strategy of the union does not have ambitions towards solving the frozen conflicts on its own. Instead it intends to cooperate in areas such as democracy, respect for human rights, and good governance, as well as managing human movements and improving security, trade, regional development, employment, and social affairs.15 This is with a view to helping resolve the

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conflicts in the long term. Black Sea Synergy aims to bring together the political and economic aspects of the European and regional initiatives. The synergy foresees regular meetings among the foreign ministers of the regional states, along with the EU external services and EU troika, to increase the interaction between the EU and the Black Sea countries. The synergy also foresees utilizing EU funding opportunities together with the regional ones such as the European Neighbourhood Partnership Instrument (ENPI), the European Regional Development Fund (ERDF), regional activities of the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), and the Black Sea Trade and Development Bank. Black Sea Synergy is perceived as a more inclusive approach than that of the EaP, and closer to those of BSEC and regional countries, and has therefore found greater acceptance in the region. Nevertheless, it should be remembered that the cooperation between the EU and BSEC cannot and will not work wonders in terms of regional cooperation and stability. On the one hand, there are specific policies related to energy and immigration that the EU member states want to pursue. On the other hand, there are discrepancies in BSEC. Heterogeneity of the BSEC members prevents them from determining and implementing common strategies and approaches towards the region. Although the national priorities differ, BSEC is trying to find a middle way to bring all the priorities together, and to build an all-embracing regional approach. It is believed that the dialogue between the EU and BSEC will enhance cooperation through creating a political dialogue platform, in order to enhance security and stability in the region. However, it must also be understood that there are inherent political, legal, and operational limitations on joint actions at regional level.16 This explains why BSEC is putting emphasis on utilizing the fundamental international values of pluralistic democracy. These include an open market system, securing human rights, minority rights, and the rule of law, while respecting a multidimensional understanding of security. In this framework, BSEC’s main focus is on topics such as economic cooperation, and cooperation in the energy sector and in infrastructure building, on the environment, and on soft security measures, as well as its relations with the EU. All in all, what BSEC is trying to achieve is to reach the lowest common denominator in all of its projects, without regard to regional political struggles. The logic behind the BSEC’s project-oriented approach is that the projects on issues of transportation, energy, and environment are for the benefit of all. In addition, this approach enables BSEC Working Groups to be formed around agriculture, banking and finance, education,

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energy, environment, statistics, health care, ICT, good governance, science and technology, SMEs, tourism, trade, and transport.

Discrepancies among the Perceptions of the BSEC Members on Regional Cooperation Member states of BSEC have different views on regional cooperation and relations with the EU, both due to their bilateral relations amongst themselves, and their relations with the EU. Turkey’s approach to the region is different to that of Albania and Serbia, and naturally, Romania and Bulgaria, who are EU members, have their own approaches that differ from the rest of the BSEC members. As a founding member of Black Sea regional cooperation, Turkey emphasizes the economic and social well-being of the region, and therefore believes that BSEC should: (i) pursue a project-oriented approach, (ii) raise an awareness of common identity, (iii) facilitate trade and investment, and (iv) focus on sectoral issues like the environment, transport, energy, trade, and the fight against organized crime. In this respect, Turkey welcomed the sectoral partnership17 approach of the EU, which has been advanced as a tool for implementing concrete steps for the interaction between the member states of BSEC and the EU.18 Turkey also favours BSEC to further its relations with the UN, OSCE, and the OECD. Turkey, more ambitiously, welcomes the EU’s efforts in creating a multilateral Black Sea dimension. However, Turkey believes in the necessity of separation of economic and security domains, in order not to block economic cooperation among the members.19 In contrast to Turkey’s policies, Ukraine, in a similar way to Albania,20 focuses more on political issues at the regional level. Due to Ukraine’s foreign policy goals, it believes that cooperation at the regional level should be further developed and should aim at integration with the EU. The priorities for cooperation should be set as: (i) establishing neighbourly relations with the countries of the region, (ii) achieving and maintaining security and democracy in the region, (iii) establishing sub-regional collective security systems, (iv) resolving the frozen conflicts, and (v) increasing influence of BSEC in the region.21 On regional cooperation, Georgia has an attitude similar to that of Ukraine and Albania, who perceive it as a way to attach their countries to Europe. Georgian authorities place emphasis on cooperation in combating organized crime, terrorism, weapons of mass destruction (WMD), illegal trade, and arms trafficking. This is because both the EU as a whole and its individual members focus mainly on these issues in this particular region.

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Moldova, on the other hand, believes in close cooperation on economic and cultural policies, as well as on energy and transportation, in order to increase the attractiveness of the region for the EU. According to the Moldavian authorities, BSEC must be seen by Brussels as an essential partner for implementing the ENP, while the frozen conflicts should be resolved with the help of the EU rather than BSEC.22 Azerbaijan, like Moldova and Georgia, believes in the establishment of dialogue and close cooperation with the EU as well as other international organizations, but prefers BSEC to have a strong political will and commitment. On the other hand, two BSEC member states, Armenia and Russia, are against political cooperation. They favour only economic cooperation, increasing the interaction between the region and other international organizations without integrating with any of them. Armenia favours cooperation in economic policies, as well as energy policies at regional level and an increase in trade and financial relations with the EU, but prefers no further political cooperation or integration. Along the same lines, Russia sets its priorities as: (i) re-establishing passenger and ferry services amongst the Black Sea ports, (ii) realizing the Black Sea Electricity Ring Project, (iii) cooperating in the field of postal services, (iv) commencing project-based cooperation in the energy sector, and (v) using natural gas, instead of petrol, in the automotive sector. Very different from the above-mentioned approaches, Serbia lays out an exceptionally political approach, through which it is searching for political support in its relations with Kosovo and Albania, and thus using BSEC as a forum for its own political causes. Finally, being members of both the EU and BSEC, Greece, Bulgaria, and Romania constitute another group within BSEC. While Greece only opts for economic cooperation, Bulgaria and Romania are keen to establish a Black Sea dimension similar to the northern and Mediterranean dimensions of the ENP. Greece and Turkey, due to historical bonds and familiarities, tend to opt for the same policies, while Romania and Bulgaria ask for more NATO and EU presence in the region. One of the main disputes among Turkey, Romania, Bulgaria, and Georgia has been the issue of NATO forces in the Black Sea. Turkey, as the main gatekeeper of the Black Sea—despite the fact that it is itself a NATO member—does not allow American or NATO forces into the Black Sea in line with the Montreux Convention. This was a problem during the FiveDay War in August 2008 between Russia and Georgia. Although Georgia, Romania, and Bulgaria have asked for a NATO force in the Black Sea similar to the Mediterranean Active Endeavour, Turkey is against this idea. Greece accepts the fact that it is almost impossible for NATO forces

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to enter the region as long as Russia and Turkey are the biggest regional actors in the Black Sea.23

Policy Suggestions by the Regional States Although the BSEC member states’ expectations and priorities differ, they do agree on realizing two main goals: (i) to increase the significance of the region, and (ii) to enhance the cooperation between the EU and BSEC. Starting from these two basic points, the regional states emphasize the importance of the EU for the region as a whole, and the need for the EU to change its policies from bilateral Eurocentric policies to multilateral regional policies. The regional countries frequently state that there is a need for cooperation between the EU and BSEC at policy-making stage in order to prevent Eurocentric Brussels-oriented policies. In this respect, the EaP has been criticized heavily, and accused of overshadowing Black Sea Synergy and multilateral approaches. In general, there have been five main policy suggestions from the regional states with the intention of increasing cooperation at regional level.

Pursuing a Multilateral Approach In order to facilitate cooperation at regional level, there is a need for a multilateral approach, rather than a unilateral or bilateral one. It is strongly believed that EU multilateral policies can be more effective than the unilateral approaches of the United States or Russia. When the region and cooperation efforts within this region are under discussion, one major issue that arises is to find the most objective way of defining the Black Sea region. On this point, it is strongly argued that there is a need to prevent outsiders defining the region according to their own national interests, and rather to pursue a more comprehensive and inclusive approach to defining the region and its needs. As was seen in the Five-Day War in August 2008, frozen conflicts are the most prominent problem; they hinder political cooperation and stability in the region. It is argued by the regional states that neither unilateral nor bilateral approaches help in resolving these conflicts. For this reason, in the quest for a solution for the frozen conflicts, the EU, Russia, the United States, and NATO should work together in order to combine “will” and “power.” However, the more parties that get involved, the more difficulties arise, due to the diverse interests of the abovementioned actors. During the Five-Day War it was observed that the EU received more acceptance than the other actors in the region, and was seen

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as a benign actor with the potential to play a positive role in resolving conflicts. In addition to these actors, non-recognized entities are also critical in creating a cooperative environment in the region. Therefore, regional actors should find a way to include these entities in the system, and to involve them in political dialogue and negotiations, in order to foster more healthy political cooperation. Although not all these entities are recognized, they do have their own agendas; some are de facto involved in political interaction, either with each other or with recognized actors in the region. It is strongly believed that ignoring their existence does not solve the problem, but instead creates new problems. All of these nonrecognized entities have their own unique characteristics, economic relations, and ethnic structures, or they are exposed to Russian influence. Therefore, it is strongly argued that when the EU is building policies towards them, these unique characteristics must be taken into account, and it should be understood that one single policy applied to all would be a mistake. Furthermore, the regional states feel that they are unfairly singled out, as security issues such as smuggling, drug and human trafficking, and terrorism are attributed only to the region, and are presented as problems peculiar to the region. It is believed that these problems are also global problems, and that they should be dealt with accordingly. It is rightly argued that security threats such as WMD, terrorism, organized crime, or environmental issues are induced by, and also affect, the global system. Therefore, in the fight against these threats, a multilateral approach is vital, and cooperation between the EU, regional states, BSEC, and other international organizations such as the UN and OSCE, should be encouraged, in addition to working together with the United States and Russia.

Encouraging Regional Ownership There have been several attempts to build regional organizations and institutions to solve the political issues and conflicts in the region. However, none of these attempts were able to fully function, due to the lack of political will and clashes of national interests. There must be political will in the region in order to have political cooperation, and this will can only be generated through regional ownership. External actors such as the EU cannot be effective in conflictual situations if the states in the region do not show the political will and interest in cooperation. Therefore, the international attempts should be linked to the regional

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initiatives, while including all relevant actors in the process through a multilateral approach, as discussed above. It is the general belief that policies towards the region must include Russia and Turkey, since a policy excluding them has no chance of being effective or persuasive. The Turkey–Russia rapprochement in energy and economic affairs is crucial, and has the potential to create a stable cooperative environment in the region. However, in elevating bilateral relations between Turkey and Russia to the regional level, due attention should be given to external actors’ roles in the process. For instance, the EU’s relations with Russia, as well as its energy policies, need to be taken into account in order to achieve energy security.

Creating a Common Energy Policy in the EU The energy market in the region is distorted, and bilateral relations between European countries and regional energy supplier countries impede cooperation in the energy sector. Therefore, it is believed that bilateral relations that contradict this cooperation should be prevented by the establishment of a common European energy policy, while a transparent energy market is being created in the region. Creation of such a system, and the elimination of state ownership, will bring an end to the distortion of the market, while diversified primary sources of gas and oil and alternative sources of energy are created. In creating a transparent energy market, the members also favour further development of effective and appropriate systems for transportation, and interstate lines of power transmission. Competition in the energy sector will bring the use of new technology in creating energy sources and, in the long term, will be a significant tool that fosters security in the energy field. Cooperation among the BSEC member states’ power systems, and an exchange of experience and know-how, are also crucial in achieving a stable and sustainable energy policy. In the energy sector, there are three main pipelines which have been vital for the EU—north, central, and south—in which the Black Sea countries play an important role as producers and/or transit countries. Regional countries, such as Ukraine, are able to transport gas not only from Russia but from other regional countries, and have the capacity to store a significant quantity of gas. Turkey has the capability to access resources in Azerbaijan, Turkmenistan, Uzbekistan, and other Central Asian countries through the NABUCCO Pipeline. In order to achieve the maximum out of the regional countries in creating secure energy routes for the EU, the EU itself needs to have a credible energy policy. The EU has

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been criticized for lacking such an energy policy, and being led only by big EU member states like Germany. It has been argued that diversification of sources and routes should be approached in a holistic manner, and integration of non-member economies with energy policies of the EU should also be considered.24

Promoting Democratization In theory, states with different political systems are more likely to clash among themselves than those with similar political systems. In this framework, it is strongly believed that most clashes occurring in the region stem from such differences among political systems—systems which cannot negotiate, and which therefore cannot reach a common settlement. In this climate, democratization is seen as a vital ingredient in bringing about a stable and secure environment. Good governance and the establishment of competent administrations should be the first steps towards building consolidated democracies and bringing an end to social disintegration, corruption, and social and economic problems in general. However, it is strongly argued that democratization should not be an elite-driven project. In order for the people to internalize the democratic way of life, including its institutions, practices, and precedents, it should be a project that starts from the bottom. Thus, the democratization of this region should not and cannot be established by external actors such as the EU. In the past, European attempts to construct democratic systems in, for example, the Mediterranean region, were neither successful nor sustainable. In creating democracies in the region, the different needs and characteristics of the societies should be taken into account. Democratic systems should be built with the dynamics of those states, while respecting their identities. External actors’ recipes for democratization can be nothing more than guidelines.

Increasing the Interaction between the EU and BSEC Since BSEC lacks effective political leadership, it needs to urge its members into action to establish further regional cooperation. It is strongly argued by BSEC members that BSEC needs a benevolent leader possessed both of political will and power. However, it should be remembered that a single state cannot take on this leadership position, since this would increase animosity among the states in the region. Thus, it is believed that this leader must be an international entity for which the EU is the most suitable candidate. This is why increasing the communication and

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interaction between BSEC and the EU has been the priority of all the chairmanships of BSEC since 1996. The member states of BSEC are aware that BSEC’s future is closely linked to its relations with the EU, since the high security dilemma in the region prevents the proper function of BSEC. In this context, EU efforts in approaching the region are welcomed by BSEC, and it is acknowledged that was a big step for the EU to recognize the importance of the region. Especially after the Cold War, when the regional countries called for cooperation with the EU through BSEC, the EU’s reluctant attitude towards the Black Sea region resulted in a loss of confidence towards the EU. Thus, the EU’s efforts to increase its credibility and suitability for this role, while presenting itself as a neutral and impartial actor, are crucial steps for building solid and effective cooperation between the EU and BSEC. In this period, it is strongly asserted that the implementation of free trade agreements should be the first step in building this cooperation. Secondly, BSEC believes that the EU’s observer status in BSEC is crucial for further cooperation between these two organizations, as well as for creating stable and sustainable cooperation at the regional level. Thus, the EU’s observer status should be continued and intensified in order to involve the EU more in the region. The third policy area that can be used to increase the relations between the EU and BSEC lies at the heart of the EU’s synergy paper and the BSEC Approach document. When one compares these two documents, it is clearly seen that the priority areas listed are very similar: i.e., good governance, managing movement, trade and economic activities, and human resources. So, in order to increase the interaction between the EU and BSEC, diplomatic relations should be focused on these priority areas, and the EU’s cross-border sub-state approach should be utilized together with BSEC’s interstate approach. Through using this method, it is strongly argued that the EU and BSEC will become closer, and the EU will therefore be able to involve itself more in the regional issues which would, in the long term, initiate a process similar to the Barcelona Process. In this way the lessons learned from the Mediterranean could be applied to the Black Sea region. Another policy area that can be utilized to increase the cooperation between the EU and BSEC countries is visa facilitation. It is believed that the establishment of common visa application centres, and cooperation with third countries in asylum policies, are crucial, not only in increasing cooperation between the EU and the region, but also in increasing cooperation among the countries within the region.

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Finally, BSEC and its member states strongly advocate the inclusion of the Common Foreign and Security Policy (CFSP) in the Synergy Paper. They also advocate further steps to be taken, such as encouraging neighbouring countries’ participation in the CFSP, launching possible ESDP missions, and cooperating with European bodies like EUROPOL and EUROJUST, in order to increase the cooperation between the EU and regional countries. The EU, BSEC, and its member states should work together in order to fight against the global security threats faced by all states in the regions of the Black Sea, the Middle East, the Mediterranean, and the EU. For this reason, there is also a need for intensified cooperation in border management. In addition, extending EU border assistance to countries other than Moldova and Ukraine should also be discussed and implemented.

Conclusion A number of factors have added to the importance afforded to the Black Sea region. These include recent changes in the international arena, the globalization of security threats, efforts of the EU to become a more capable, active, and effective global actor, and increases in the energy needs of Europe. However, heterogeneity of the regional states, differences among the states’ economic and political structures, diverse priorities set by the bigger and smaller states, and an overpopulation of international initiatives at work in the region, complicate further cooperation at the regional level as well as relations with other global actors. At the moment, the most important actor that the regional states are eager to have close relations with is the EU. The ongoing efforts to establish a sustainable and stable regional framework focus on increasing the interaction and dialogue between the EU and BSEC, the most successful regional cooperation organization. While the EU is developing a synergy and implementing its economic and related capacity-building projects in a regional format, BSEC is requesting that the EU have an open and regular dialogue with the organization.25 In this framework, the main projects aiming to increase the interaction between the EU and BSEC are as follows: in environmental issues, the Black Sea Convention and DABLAS Task Force; in transport, the Backy process, TRACECA, High Level Group on the Extension of the Major Trans-European Axes to the Neighbouring Countries and Regions; and in the energy sector, INOGATE. Ad hoc committees have also been established in order to deal with regional security and stability, interconnection of electrical networks, shipbuilding and shipping, and visa facilitation and simplification. It is

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believed that the sector partnerships26 that Greece, Romania, and Bulgaria have been assigned to develop on transport, environment, and energy policies will increase the interaction among the region and the EU, and maximize the possibilities of implementing concrete projects. These partnerships are open to all partner countries who want to participate, and they include institutions that are active in the region, like the BSEC Organization and the Black Sea Commission, as well as the European Investment Bank and the European Bank for Reconstruction and Development. Furthermore, an environment conducive to better cooperation needs a stronger sense of common purpose at the political level. This also involves a stronger political leadership; an improved decision making structure and a strengthened profile for BSEC; and decreased bureaucratic procedures.27 Therefore, BSEC has suggested some fundamental changes in its organizational structures, and has urged the member states to provide the tools necessary for BSEC to act as a partner to other regional organizations. Despite some difficulties, the BSEC member states, the EU, and other international organizations obviously have the political will to enhance cooperation, rather than integration, among themselves. Taking into consideration all the obstacles caused by political struggles and clashes of national interests, the most feasible road to be pursued is to focus on the issues that BSEC has already invested in, such as transportation, energy, and finance. These issues would increase the interaction among the people involved without touching on sensitive political issues. Combining the EU’s people-to-people strategy with BSEC’s project-based approach could bring a better understanding of cooperation at the regional level. In this respect, it is believed that the EU’s Black Sea policy—the Black Sea Synergy and EaP—is striving for cooperation. However, contestation among the multilateral and bilateral approaches, negative Turkish and Russian perceptions of the EaP, and the EU’s ambivalent policies, all complicate the process.

Notes 1

“Black Sea Synergy: A New Regional Cooperation Initiative,” Commission of the European Communities COM (2007) 160 final (Brussels), 11 April 2007, p. 2. 2 These policy suggestions are the outcome of a workshop organized by the Centre for European Studies, METU, entitled “Discussing the EU’s Role in Integrating the Black Sea Region” (8 October 2007). 3 Commission of the European Communities, “Black Sea Synergy,” p. 3.

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4 Michael Emerson and Marius Vahl, “Europe and the Black Sea-Model Regionalism, prêt-a-porter,” in Europe’s Black Sea Dimension, ed. T. Adams et al. (Brussels: CEPS and ICBSS, 2002), 21. 5 Communication from the Commission to the Council and the European Parliament: Barcelona Process; Union for the Mediterranean, COM (2008) 319 final (Brussels), 20 May 2008. 6 Communication from the Commission to the Council and the European Parliament: Eastern Partnership, COM (2008) 823 final (Brussels), 3 December 2008. 7 For further information on Turkish policy towards the Black Sea region, see Çi÷dem Üstün, “Turkey and the European Neighbourhood Policy: The Black Sea Region,” in Turkey and the EU: The Process of Change and Neighbourhood, ed. Atila Eralp and Çi÷dem Üstün (Ankara: Zeplin øletiúim, 2009). 8 Commission of the European Communities, “Black Sea Synergy.” 9 T. Aybak, “Black Sea Economic Cooperation (BSEC) and Turkey: Extending European Integration to the East?” in Politics of the Black Sea: Dynamics of Cooperation and Conflict, ed. Tunç Aybak (London: I. B. Tauris, 2001), 32. 10 Tedo Japaridze, “BSEC: A Road Map to Relevance,” Turkish Daily News, 21 April 2006. 11 Interview with researchers at ICBSS, March 2010. 12 “BSEC–EU Interaction: The BSEC Approach,” Southeast European and Black Sea Studies 7, no. 2 (2007). 13 BSEC–EU Interaction: The BSEC Approach.” 14 Dimitris Triantaphyllou, “Commentary,” ICBSS Black Sea Monitor, no. 3 (March 2007): 3. 15 Commission of the European Communities, “Black Sea Synergy.” 16 ICBSS, Background Paper on the Ways and Means of Enhancing the BSEC Contribution to Strengthening Security and Stability in the Region (Athens: ICBSS, 2005), p. 4. 17 In line with this approach, the EU member states Greece, Romania, and Bulgaria were assigned to the policy areas of transport, environment, and energy, in order to increase interaction between the region and the EU. 18 Ioannis Stribis, “Black Sea Sectoral Partnerships: A Tentative Model,” ICBSS Policy Brief No.14 (April 2009). 19 ICBSS, Black Sea Economic Cooperation: Fifteen Years of Regional Activity 1992–2007, Views by Foreign Ministers and Heads of BSEC Institutions (Athens: ICBSS, 2007), 11. 20 ICBSS, Black Sea Economic Cooperation, 23. 21 ICBSS, Black Sea Economic Cooperation, 14. 22 ICBSS, Black Sea Economic Cooperation, 49. 23 Interviews with Bulgarian and Greek officials in MFA and MoD, March 2010. 24 Sergiy Korsunsky, European Energy Security and Geopolicy of Pipelines, CCC METU, Ankara, 7 April 2010. 25 “BSEC–EU Interaction: The BSEC Approach”: 319. 26 Sector partnerships were launched in Brussels on 16 March 2010.

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27 Panagiota Manoli, “Reflecting on the BSEC: Achievements, Limitations, and the Way Forward,” ICBSS Policy Brief, No. 1 (July 2006), 7.

CHAPTER FIFTEEN US INTERESTS IN THE WIDER BLACK SEA REGION SERGEI KONOPLYOV*

Introduction Developments in the Black Sea region, as in many other regions in Europe, have always depended on external players as well as on the littoral countries. Twenty years ago the Black Sea region did not even exist on political maps. Only in the 1990s did its role become more visible, especially in transporting energy resources from the Caspian Sea and Central Asia to Europe. Historically, this sea was always a source of contention, mostly between Russia and Turkey. During the Cold War, the Black Sea served as the division line between NATO, represented by Turkey and Greece, and the Warsaw Pact, in the form of the Soviet Union, Bulgaria, and Romania. With the demise of the Soviet empire, many new independent states appeared around the Black Sea, and they started to look for new security formats that could bring them closer to other countries of the region. The Black Sea region is occasionally referred to as a “political project.”1 Were the project to be realized, it would unite lands and peoples in an unprecedented manner. However, and perhaps only for the time being, its diversity of cultures, political ideologies, faiths, and histories appears to impede effective coordination as well as the development of a single, one-for-all type United States policy for the Black Sea region. To the dismay of some states, and perhaps to the satisfaction of others, the US government does not have a consolidated approach to security in the region. The lack of a public policy document, however, does not indicate a lack of interest on behalf of the United States. Rather, numerous US institutions are making concerted efforts to identify and realize US *

Director of the Black Sea Security Program at Harvard University.

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objectives for the region. It is the combination of the way the US Congress appropriates money, and the region’s diverse character, which appears to be the reason why a single US policy is not applied to the Black Sea region. In this paper, I will try to analyze US interests and its foreign policy in this part of the world, using three US administrations as benchmarks: those of Clinton, Bush, and Obama.

US policy for the Black Sea Region Speaking in 2005 at a conference on Black Sea maritime security, the US ambassador to Bulgaria John Beyrle noted that US interest in the Black Sea actually goes back a very long way. One of the founders of the US Navy, John Paul Jones, served on the Black Sea as an admiral for the fleet of the Russian empress Catherine the Great; this could serve as a good illustration of cooperation between a Black Sea nation and the United States.2 A memorial plaque with the name of Admiral Jones still hangs on a building in the centre of Saint Petersburg. During the Cold War, Turkey was the country that covered NATO’s southern border. After the breakdown of the Soviet Union, US policy was based on the strong belief that the United States would benefit from promoting peace and democracy in countries that used to belong to the Soviet sphere of influence—the so-called socialist camp. However, the main focus at first was the reintegration of the eastern and central European countries. NATO changed its strategic concept, becoming one of the most important instruments in Westernizing the former socialist countries. Together with EU enlargement, the usefulness of the US policy was proved. Then, the Balkans erupted in a new war. Naturally, it was difficult for the Black Sea region to get attention at that time. The region also lacked charismatic leaders like Vaclav Havel or Lech Walesa. However, some processes focused on building economic, political, and security partnerships—mostly initiated by Turkey (BSEC and later BLACKSEAFOR)—were already taking place. Before, the region did not exist, and was a black hole which nobody wanted to acknowledge. In the definition of Ron Asmus from the German Marshall Fund, it was the Bermuda triangle of Western strategy.3 Ambassador Matt Bryza has noted that, sitting as it does at the crossroads of Europe, Eurasia, and the Middle East, the Black Sea region has not always been treated by US policy as a region unto itself. Yet it has become increasingly apparent in recent years that this distinct geographical area may be forming a political and economic identity.4 Separatist conflicts, the

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lack of common goals and identities between regional states, and lack of well-developed regional institutions were the main obstacles to policy formulation, and this was the situation during the last year of the Clinton administration. Then September 11 occurred. In order to project force during the subsequent US interventions in Iraq and Afghanistan, it was necessary for friendly countries to be located near the theatre of war. The Black Sea region suddenly emerged as a security issue for the United States. However, this was not the only factor which drove the Bush administration to think about crafting a more coherent and comprehensive strategy towards the region. What were the others? The first was a successful NATO enlargement: at the 2002 Prague summit, seven states were invited to begin accession talks with NATO, including three former Soviet republics; and in 2004, two Black Sea countries, Romania and Bulgaria, became official members. According to the US Department of State, NATO was a tool to secure the democratic gains in Eastern Europe and erase Stalin’s artificial division lines. NATO’s Open Door Policy of the post–Cold War period was also a signal to two other Black Sea countries, Ukraine and Georgia. Another factor was the region’s colour revolutions: the rose revolution in Georgia and the orange revolution in Ukraine. These democratic transformations proved that the Bush administration was right in using democratization as a backbone of its foreign policy. In his January 2002 State of the Union Address, President Bush stressed the importance of the democratization of the region: “America will always stand firm for the non-negotiable demands of human dignity: the rule of law; limits on the power of the state; respect for women; private property; free speech; equal justice; and religious tolerance. America will take the side of brave men and women who advocate these values around the world.”5 Democracy support was viewed at that time as a long-term investment in post-Soviet countries. Both the Georgian president Mikheil Saakashvili and the Ukrainian president Viktor Yushchenko became iconic leaders who also helped the United States to project its influence into what was regarded by Russia as its “sphere of interest” and “near abroad.” Felix Ciuta mentions another factor that finally made the United States officially use the term “Black Sea region”: the lobby headed by the German Marshall Fund. Ron Asmus, the former deputy assistant secretary of state, together with his colleagues, put the Black Sea on the agenda by organizing conferences before NATO summits and publishing policy papers which drew the attention of the US administration to this region. In 2005, the Committee of Foreign Relations of the US Senate held a hearing entitled “The Future of Democracy in the Black Sea.”6 Among the

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people who spoke there were Vladimir Socor from the Jamestown Foundation, Zeyno Baran, then director of International Security and Energy Programs at the Nixon Center, and Bruce Jackson, the president of the Project on Transitional Democracies. Following that official recognition, several articles were published by US scholars and presentations made by US officials debating the US policy in the Black Sea region, some of which are worth mentioning. In 2006, Ariel Cohen from the Heritage Foundation published his article “US Strategy in the Black Sea Region.”7 In brief, according to him, because of the geopolitical significance of the region, a rational strategy was necessary. Importantly, Cohen mentioned energy security as a precondition for economic stability, and a top priority for the United States. He proposed that the Bush administration pursue a balanced and realistic strategy to enhance the security and stability of the Black Sea region, noting that the United States should: increase NATO cooperation with non-NATO countries through the Partnership of Peace, including technical and training assistance in security areas; alleviate Turkey’s concerns about losing its dominant position in the Black Sea region to the dominant influence of the United States; encourage Bulgaria and Romania to start new initiatives in the region; contribute to existing regional security structures as participant or observer; maintain good relations with Russia; and, at the same time, maintain and strengthen US influence by developing cooperation across a broad spectrum of issues of common interest and mutual concern. The statements from officials were more general and cautious. In his speech at the ARI Movement’s ninth annual security conference, the US ambassador to Turkey, Ross Wilson, described the region as “a major body of water that draws together the countries around it. But in the recent history this area has not acted like a region at all. Real interaction has been at times blocked, and sometimes it has been an opportunity waiting to happen, but it has always been disappointing. American policy toward the region should flow from what has been its policy toward Europe since the fall of the Berlin wall: to promote a region that is free, prosperous, peaceful, secure, and whole.”8 There are several other statements which are similar in their general content. According to Daniel Hamilton, US interests in the wider Black Sea are derived from four enduring US interests towards Europe itself: x The United States has an enduring interest in a Europe that is hospitable to democratic and economic freedom x It has an interest in a European continent that is at peace with itself

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x It is interested in insuring that Europe or a significant part of it is not dominated by any power or constellation of powers hostile to the United States x It also has an interest in Europe as a partner with which it could work to deal with transatlantic challenges that no nation can tackle alone.9 In 2004, the US Department of Defense decided to devise a Black Sea security strategy. In seeking greater engagement with the Black Sea states, Washington planned to use military aid as an incentive to encourage regional security cooperation. The US European Command, in consultation with the Office of the Secretary of Defense and the Joint Staff, drafted a concept and subsequent plan to implement its Black Sea Initiative (BSI) strategy in the region. According to Jennifer Moroney, “a key facet of this strategy was regional ownership meaning that BSI was not meant to be US led or executed. The specific components of BSI, which included both military and civilian activities, were to be led by regional partners.”10 The George C. Marshall European Center for Security Studies in Germany also started a series of conferences on Black Sea security and regional cooperation. The Pentagon also supported the Black Sea Border Security Initiative and Black Sea Civil Emergency Response planning. The Defense Threat Reduction Agency (DTRA) created its own Black Sea strategy, holding a series of security workshops. The main emphasis of this initiative has been on combatting terrorism, organized crime, and the smuggling of weapons of mass destruction. According to DTRA “a Black Sea program would test concepts and mechanisms which could be expanded to additional regions, such as the Persian Gulf, South Asia, Central Asia, and Northeast Asia.”11 Another less well-known initiative, designed and implemented by the US National Defense Intelligence College and the Defense Intelligence Agency, is the Black Sea and Caspian Sea Symposium. The main goal of this event is to bring together the heads of defence intelligence of Black Sea countries, to promote closer cooperation and information sharing. This programme has taken place in the United States, Romania, Bulgaria, Georgia, and recently in Ukraine. However, despite all these initiatives, the official Department of Defense security strategy towards the region was never announced. This repeated the fate of a similar programme, Caspian Guard, that was launched with great hopes, but was never implemented due to a lack of attention from high levels of the Pentagon. The reasons are quite obvious: first, the US Department of Defense was too preoccupied with the wars in Iraq and Afghanistan to fully put its weight behind this strategy; second, it

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was unclear where Russia fitted; and third, there was resistance on the part of Turkey, which had already launched BLACKSEAFOR and put Black Sea Harmony in place. There have been other initiatives that the United States has supported indirectly: GUAM, which now has permanent headquarters in Kiev; the Romanian-led Black Sea for Partnership and Dialogue; and the Community of Democratic Choice. Recently, the Black Sea Trust was launched in 2007, with the support of the US Agency for International Development, amongst other donors. At that time it became apparent that the United States decided not to have a separate strategy towards the region, but to continue to cooperate with countries on a bilateral basis. The Bush administration counted on the integration of Georgia and Ukraine into NATO to create a strong presence in the region. The final year of the Bush administration, 2008, was crucial for US engagement with the region. At the NATO summit in Bucharest in April 2008, the United States strongly supported Membership Action Plan (MAP) status for Georgia and Ukraine. However, those efforts were blocked by Germany and France. Those countries thought it too early to give Georgia and Ukraine the MAP. Also, Russia made it clear that NATO and the United States were about to cross an important line. Many other European countries were worrying about how that could impact their relations with Russia. The communiqué, however, stated that both countries could become members of NATO anyway. Steve Larrabee from the RAND Corporation noted that the Bucharest summit sent a confusing and ambiguous message. On the one hand, the heads of state of the alliance postponed a decision about the MAP for Georgia and Ukraine, while on the other they gave a commitment that was more worrying to Moscow than if Georgia and Ukraine had simply received MAP status.12 The second event that was to change the regional balance of power was Georgia’s large-scale military attack on South Ossetia, and the following Russian invasion of Georgia. This paper will not deal with details of this conflict. Russia showed that it had important strategic interests in the region, and was ready to use military force to protect them: Moscow sent a strong, clear message that it would not tolerate the US influence in the Black Sea, especially in its former republics. The United States condemned the Russian invasion, but—despite the hopes of the Georgian president Saakashvili—limited its support only to loud statements. The NATO countries did not have a common view, leading it to issue a rather general statement asking Russia to move out of the Georgian territory. No matter who was responsible for starting this war, Georgia’s chances of receiving MAP or becoming a NATO member became practically zero.

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That was the situation at the end of the Bush administration. Using the famous rest button, the Obama administration, which had inherited wars in Afghanistan and Iraq, together with the consequences of the economic crisis, made rapprochement with Russia its foreign policy priority. Support for Georgia continues, but it is far from the previous level. The major recent development in the region is the election of the new Ukrainian president Viktor Yanukovych. One of his first steps was a decision to allow the Russian navy to extend its stay in Crimea until 2042. On 25 July 2010, when Russia marked its annual Navy Day, Prime Minister Putin visited Crimea and told Ukrainian and Russian sailors that “Ukrainian and Russian sailors will be together, just like they were together, like our peoples were together, for many, many centuries even in the hardest and most difficult times. They will be together tomorrow too. I particularly thank Ukraine's leaders for this.”13 Yanukovych’s second step was to announce that Ukraine has no plans to join NATO. Surprisingly enough, the US administration took both of these decisions (which pleased Russia, and took its worries away) very calmly. Visiting Kiev in July 2010, Secretary of State Clinton said that the United States supported Ukraine’s efforts to strengthen its ties with Russia, as long as it did not come at the expense of Kiev’s relations with Europe and the United States: “Ukraine is a sovereign and independent country that has the right to choose its own alliances and NATO’s door remains open. But it’s up to Ukraine to decide whether or not you wish to pursue that or any other course for your own security interests.”14 This was the first stop in the US secretary of state’s tour, which also included visits to Georgia, Armenia, and Azerbaijan. Two days later in Azerbaijan, she said that Washington was “committed to helping you and your fellow citizens build a prosperous, independent, democratic, sovereign Azerbaijan.”15 She delivered the same message in Armenia, urging the use of peaceful means to solve the dispute over NagornoKarabakh. And, closing her trip on 5 July in Georgia, Clinton pledged to “do everything we can to assist our partners, inside and outside the Georgian government, as they strive to strengthen democratic institutions and processes.”16 With her repeated vows of support, Clinton appeared to be attempting what could be called a “readjustment to the ‘reset’”—a pledge that the United States could be friends with Russia without abandoning its smaller allies in the region. The message from the US Department of State was vague: the United States had not forgotten those countries, however no concrete actions were mentioned.

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Nevertheless, the US Department of Defense continues to strengthen its presence in Bulgaria and Romania, where since 2005 the Pentagon has acquired the use of seven military bases. The Japanese magazine Sentaku published an article in July 2010 dealing with the US military build-up in the Black Sea.17 Since last year, the United States has spent $50 million in expanding bases to accommodate 1,700 troops. The principal facility is the Mikhail Kogalniceanu Air Base, located in Constanta, on the Black Sea. There is nothing new about the United States maintaining military bases in Romania, it dates back to the beginning of the Iraq war; what is new is Washington’s announcement of its intention to use them indefinitely. In May, a Marine Corps unit, centred on a tank battalion, was dispatched to the Mikhail Kogalniceanu base for the first time. In Bulgaria, meanwhile, the US plans to expand bases there to accommodate 2,500 troops. The core facility is the Bezmer Air Base, about fifty kilometres from the southern coast of the Black Sea. When the project is complete, the United States will have a strategic air base in Bulgaria that is comparable in scale to the air bases in Turkey and in Italy. Joint American–Bulgarian airforce drills were conducted in May 2010. It is important to note that all these moves represent only the initial steps taken by Washington to expand its military presence in the Black Sea region. Upon completion of these base expansion projects in 2012, twothirds of the highly mobile Rapid Reaction Corps of the US Army in Europe will be concentrated in Romania and Bulgaria. This means that the US front line of defence is shifting from the eastern border of Germany to the Black Sea, which is adjacent to the Middle East, the Caucasus, and Russia. “The establishment of US and NATO naval, air and infantry bases and interceptor missile installations in Black Sea countries is the prototype for expansive and permanent military build-ups in Eastern Europe and into former Soviet space, which is being replicated in the Baltic Sea region,” writes Rick Rozoff from Global Research.18 This military build-up in the Black Sea and potential confrontation with Russia makes Turkey a vital player. As Colonel Saffet Akkaya from the Technical University of Ankara writes, “Turkey has no luxury to attempt any step to deviate from its traditional stable foreign policies. In this respect, the Montreux Convention is one vital factor to preserve the interests of coastal states in the Black Sea, and also to abstain from being a potential area for any future conflicts in its periphery.”19

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Conclusion Although the United States has not made its policy towards the Black Sea region public, and much of its activity continues to take place on a bilateral level, it does have legitimate interests in promoting peace and security here. Thus, throughout the years, more than three US presidential administrations have increasingly recognized the value and importance of the Black Sea region. Special attention has been given to broad matters ranging from democracy and institution-building to hard military issues, including the projection of power, which plays a specific role in this regard. The ongoing wars, conflicts, and tensions in Iraq, Afghanistan, and Iran have led the United States to reevaluate its policies in the region, to the extent of resetting its relations with the Russian Federation. We see here how intervening variables from global politics are able to penetrate regional and even state-level ones. Nonetheless, at least two factors remain stable: the fact that the region’s cultural, political, and societal diversity continues to complicate cooperation; and the fact that Turkey, because of its rich historical character and its control of the Bosporus strait, will continue to be a key player in the promotion and realization of peace and cooperation in the region and far beyond.

Notes 1

Felix Ciuta, “Parting the Black Sea (Region): Geopolitics, Institutionalization, and the Reconfiguration of European Security,” European Security 16, no. 1 (2007): 51. 2 http://sofia.usembassy.gov/remarks/amb_black_sea.html (link now broken). 3 Ronald Asmus and Bruce Jackson, “The Black Sea and the Frontiers of Freedom,” Policy Review, no. 125 (June/July 2004): 18. 4 Matthew J. Bryza, “The Policy of the United States toward the Black Sea Region,” in Next Steps in Forging a Euro-Atlantic Strategy for the Wider Black Sea, ed. Ronald D. Asmus (Washington: German Marshall Fund for the United States, 2006), 38. 5 U.S. Government Printing Office, http://www.gpo.gov/fdsys/pkg/WCPD-200202-04. 6 Hearing before the Subcommittee on European Affairs of the Committee on Foreign Relations, United States Senate, 8 March 2005, http://frwebgate.access .gpo.gov/cgi-bin/getdoc.cgi?dbname=109_senate_hearings&docid=f:23171.pdf. 7 See the Heritage Foundation Website, http://www.heritage.org/Research/Reports /2006/12/US-Strategy-in-the-Black-Sea-Region. 8 See http://digilib.lib.unipi.gr/ket/bitstream/ket/729/1/US%20Policy%20in%20the %20Black%20Sea%20region.pdf.

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Daniel Hamilton, “A Transatlantic Strategy for the Wider Black Sea?” in The Wider Black Sea Region in the Twenty-first Century: Strategic, Economic, and Energy Perspectives, ed. Daniel Hamilton and Gerhard Mangott (Washington, DC: Center for Transatlantic Relations, 2008). 10 Jennifer Moroney and Joe Hogler, “Romania’s Role in the Black Sea Region,” The DISAM Journal (2006): 32. 11 DTRA Review Panel Report, belfercenter.ksg.harvard.edu. 12 Stephen Larrabee, “The United States and Security in the Black Sea Region,” Southeast European and Black Sea Studies 9, no. 3 (2009): 306. 13 “Putin Promotes Russian Black Sea Fleet on Controversial Ukraine Visit,” Radio Free Europe/Radio Liberty, 24 July 2010, http://www.rferl.org/content/Putin _Promotes_Russian_Black_Sea_Fleet_On_Controversial_Ukraine_Visit/2108648. html. 14 “‘NATO’s Door Remains Open’ to Ukraine, Says Clinton,” The Epoch Times, 3 July 2010, http://www.theepochtimes.com/n2/content/view/38470/. 15 “Travel Diary: Secretary Clinton Meets with Azerbaijani Civil Society and Youth Leaders,” U.S. Department of State Official Blog, 4 July 2010, http://blogs .state.gov/index.php/site/entry/travel_diary_azerbaijani_civil_society. 16 “Secretary Clinton’s Press Conf. with President Saakashvili,” Real Clear Politics, 5 July 2010, http://www.realclearpolitics.com/articles/2010/07/05/ secretary_clintons_press_conf_with_president_saakashvili_106202.html. 17 “Black Sea Challenge by U.S. Set to Keep Russia on Edge,” The Japan Times Online, 26 July 2010, http://search.japantimes.co.jp/rss/eo20100726a2.html. 18 “U.S. and NATO Accelerate Military Build-up in Black Sea Region,” Global Reseach, 21 May 2010, http://www.globalresearch.ca/index.php?context=va&aid =19259. 19 “US Military Bases in Romania and Bulgaria and their Possible Implications on Regional Security,” Opinion Editorial, www.ccun.org, 25 January 2009, http://www.ccun.org.

CHAPTER SIXTEEN US POLICIES TOWARDS THE BLACK SEA REGION øDRøS BAL1

Introduction The aim of this paper is to analyze the policies of the United States towards the Black Sea region. To this end, first, I will touch upon the position of the United States in the post–Cold War era. Second, I will outline the importance of the Black Sea region. Finally, I will briefly analyze the United States’ goals and policies regarding the region.

The United States in the Post–Cold War Era1 The West emerged victorious from the Cold War and the United States became the sole superpower of the post–Cold War era. To safeguard its position, the United States needs to maintain the global, as well as regional, balance of power and strives to monitor and direct ongoing developments. On the other hand, the United States has faced some problems in regional and global politics and has had to take some measures in response. Despite the dissolution of the USSR, Russia is still a major power in terms of natural resources, nuclear power, economic capacity, strategic position, and its right of veto in the UN. For similar reasons, China is also an important global power. With its population of 1.3 billion, China has been systematically growing, especially economically. China and Russia have been trying to institutionalize their relations under the umbrella of the Shanghai Cooperation Organization since 1996.2 All Central Asian countries, except neutral Turkmenistan, joined this cooperative group. Under the umbrella of this organization, China and 1

Police Academy, Ankara, Turkey.

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Russia began to criticize US global policies. The United States has reacted by trying to influence developments in the region. Apart from the obvious cooperation with its allies in this area, Japan and South Korea, the United States has also been strengthening its economic ties with China and, increasingly, India. India is an emerging global power, with its population of almost 1.2 billion (2009 estimate),3 a developing economy, nuclear capabilities, and a democratic system of government. Therefore, India is a key country in the region that, as during the Cold War era, continues to compete with China.4 In addition to the European Union, China, and Russia, India—if it continues to develop its economy successfully—is likely to become one of the power centres of a possible future multipolar system. Thus, for the United States, India is a partner, as well as a power, that needs to be kept in check.5 Apart from other reasons, the United States’ determination to be at the heart of Asia and influence developments in that part of the world sparked its occupation of Afghanistan, a move that brought more headaches than benefits and, in many ways, undermined its image. On the one hand, the United States has been trying to deal with global competitors in Asia; on the other hand, it needs to monitor and direct developments in Europe and deal with the EU to be able to safeguard its position in the world. The United States supported Europe during the Cold War and aided its economic and social development to prevent Soviet invasion or possible communist revolutions. For this reason, the United States encouraged movements towards integration in Europe. However, the superpower does not want a united Europe to become its rival. In 2003, the Iraq War highlighted some of the problems in relations between Europe and the United States. Members of NATO and the EU were divided into pro-American and anti-American camps. Critiques by some NATO and EU members against the United States were clear indicators of future developments and opposition from Europe. Regarded as the engines of the EU, Germany and France were highly critical of US actions and their joint stance with Russia in opposition to the United States during the Iraq War was an indicator of the emergence of the EU in global politics. Iran’s position in the Black Sea region, as well as on the global stage, is pivotal to US interests as well. Apart from the Russian–Chinese rapprochement, it might be possible to talk about the Russian–Chinese– Iranian rapprochement. It is claimed that Iran is cooperating with Russia and China on nuclear technology. The Middle Eastern nation is a prominent buyer of Russian weapons. Iran not only changed regional balances with the 1979 revolution; with the end of the Cold War, it saw

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capitalism win the race against communism. However, it is believed that, with the Islamic revolution, Islam has risen as an alternative ideology to capitalism in Iran. Therefore, Iran’s position is vital not only for regional power balances, but for also global power balances. Following Iran’s revolution, it was feared the country would export its ideology to the rest of the Islamic world. Especially in the post–Cold War era, the possibility Iran might export its ideology to Central Asia and the Caucasus and help create an anti-American and anti-Western alliance caused some anxiety in the United States.6 Another threat that has emerged with the end of the Cold War is international terrorism. International terrorism is strengthened by ethnic and religious irredentism, movements that have taken advantage of power vacuums and instabilities created by the end of the Cold War and by globalization. With the 9/11 attacks against the United States, it became clear to everyone that even the world’s great superpower was not immune to terrorism. Consequently, the United States began to regard terrorism as a primary threat.7 Furthermore, radical Islam came to be seen as a dangerous enemy because of the Islamic names of many of the 9/11 attackers, their Islamic motifs, their ties with the al-Qaida terror organization, etc. Therefore, the United States declared a global war against terrorism and overthrew the Taliban regime in Afghanistan in December 2001. The United States defended its occupation of Afghanistan, arguing the country had connections with al-Qaida and was being used as a training ground for terrorist groups. In the second stage of its “War on Terror,” using similar justifications, the United States brought to an end Saddam Hussein’s regime in Iraq in April 2003.8 However, these steps were not enough to bring international terrorism to an end; on the contrary, some critics began to claim these actions were feeding international terrorism. Political opponents of the Bush administration in the United States criticized the invasion of Iraq and argued the United States had lost credibility internally because of the Iraq War.9 The question of terrorism still maintains its significance in the US political agenda and influences US foreign and domestic policies. The Greater Middle East Initiative can be regarded as a method of dealing with international terrorism in general.10 Apart from the damage it caused, one of the positive aspects of the Cold War was that it had, to a significant extent, frozen maps of the world. In the post–Cold War era, new instabilities shook several areas. Ethnic and religious irredentism, which had been unable to find a suitable base during the Cold War era, gained ground. Yugoslavia had dissolved; first Croat– Serbian, then Serbian–Muslim clashes broke out. Then conflicts erupted in

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Macedonia and Kosovo in the Balkans. The Middle East was already an unstable place. Even during the Cold War, Arab–Israeli conflicts took place and the Iran–Iraq War (1980–1988) cost the lives of more than one million people. With the end of the Cold War, Saddam Hussein occupied Kuwait and triggered instability in the region. This was followed by the liberation of Kuwait in 1991, the March 2003 invasion of Iraq, and the capture of Saddam in December 2003. The United States wants to continue the peace process and strengthen the position of Israel in the area. As mentioned above, the United States views Iran as a threat to regional and global peace, therefore it tries to control and isolate Iran. Another area that has been destabilized in the post–Cold War era is the Caucasus, because of the Chechen problem, the occupation of Karabakh by Armenians, and the separatist movements in Georgia. The United States, now the sole superpower, which has sometimes been called the world’s policeman, was supposed to deal with the regional and global problems that have been outlined above.11 In this regard, the United States has tried to use the UN and NATO efficiently to deal with the fresh dilemmas of the new era. However, to enable it to produce policies and take measures in response to global and regional developments and problems, the United States needed global and regional partners. These developments have greatly affected US policies. As will be outlined below, the Black Sea region is so geographically, economically, and politically significant that the United States is impelled to be involved in developments in the area.

Importance of the Black Sea Region The Black Sea region has been a crossroads of civilizations, continents, and global powers. It is situated at the centre of the triangle formed by Europe, the Middle East, and Eurasia.12 Therefore, the region and its peoples share some characteristics with all these territories. Islam and Christianity came face to face in the region. A great struggle took place between the Crusaders and the Turks, then between the Ottomans, Western powers, and Russia. Initially, the Ottomans managed to control the whole area and declared the Black Sea an Ottoman lake. Then Russia gradually took hold of the northern section and reached the sea. However, it failed to penetrate the southern parts of the Black Sea and the sea itself became a dividing line between two global powers and two civilizations. But some people of Islamic faith continued to live in the

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northern Black Sea region though Ottoman authority had declined in the area. The fact that about two thirds of world oil reserves and more than one third of global natural gas reserves are located in the Middle East means the area has an overwhelming strategic importance. However, new petroleum reserves have been discovered in the Caspian Sea vicinity and Central Asia. Central Asian republics, especially Turkmenistan, have rich reserves of natural gas as well. Though having reserves is advantageous, having the resources for production and transportation is essential. In this regard, the Black Sea area encompasses countries that have rich hydrocarbon reserves as well as those that are consumers. Because of its geographical position, most of the pipelines have to cross the Black Sea region. NATO and the EU have vital connections with the region. Three NATO members—Turkey, Bulgaria and Romania—border the Black Sea; Bulgaria and Romania have also been EU members since 2007. Additionally, the Ukraine and Georgia, despite the Russian opposition to NATO’s enlargement, have been eager to become members of NATO. Another feature of the zone is the many long-standing conflicts such as the Abkhazian, Chechen, and South Ossetian problems. Unless these situations are improved, and peace and cooperation strengthened, new disputes, conflicts, and even wars could take place. The Russian invasion of Georgia in August 2008 is one such recent example.

US Policies towards the Black Sea Region As a global power, the United States also has interests in the Black Sea area: “American policy towards the region flows from what has been its policy toward Europe since the fall of the Berlin Wall: To promote a region that is free, prosperous, peaceful, secure, and whole.”13 Reasons for US involvement in the area include the presence of Russia in the vicinity as a former superpower, energy issues, and security threats. US interests in the Black Sea may be analyzed under three headings: democratization; energy security and constitution of market economies; and terrorism and security in general.

Democratization The United States has long been a champion of liberalism; it has a multiparty system of government, a market economy and a free society. Additionally, many Americans believe the United States has a mission to

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advocate democracy and the market economy all over the world. Commitment to democratic values is the foundation of US foreign policy towards the Black Sea countries as well. The United States supports and encourages democratization and economic liberalization in the region; it also emphasizes the importance of a free press, a multiparty system of government, a free society, and an independent judicial system. In this regard, the United States has been aiding many non-governmental organizations (NGOs) acting in the area. To the United States, democratization and the rule of law are the prerequisites for prosperity and development in the region as well as in the rest of the world. Most of the countries in the region were once part of the Eastern Bloc; their systems comprised one-party rule, closed societies, and centrally controlled economies. Only Turkey and Greece had democratic regimes in the region. Following the demise of the USSR, countries of the area gave up the communist ideology. Many have since been working to establish multiparty systems and free societies in their countries and trying to convert their centrally controlled economies to market economies. Since the end of the Cold War, Romania and Bulgaria have been democratized as well. Georgia and the Ukraine have made great progress in building participatory democracies, a process in which the 2003 Rose Revolution and the Orange Revolution of 2004–2005 played a major part. Other countries in the region are also trying to democratize their systems, building new societies and institutions, and the United States strongly encourages these nations in their efforts. “At the heart of freedom lie open political systems, free and fair elections, a vibrant and independent media, strong civil society, and mutual respect among the players—that government will act predictably and honestly, and that citizens and their free institutions will obey the law.”14 It is widely believed the Ukraine’s Orange Revolution and Georgia’s Rose Revolution were the result of the United States’ active involvement in the region. In this regard, United States involvement has disturbed Russia, which has been trying to regain its status as a global power and has come to view much of the area as part of its “near abroad.”15 To strengthen its global position, Russia has been playing the energy card and emphasizing its nuclear might—as well as using conflicts in the region and its right of veto in the UN Security Council. At the Black Sea Forum that took place in Bucharest in 2006, US Deputy National Security Advisor J. D. Crouch announced the United States would participate in a new public–private partnership called the Black Sea Trust.

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The Trust would fund programs across the region to strengthen crossborder cooperation, civic participation, democratic governance, and the rule of law. In partnership with the German Marshall Fund, the Romanian Government and other donors, the United States intends to make a significant financial contribution to the initiative this year.16

Of course, apart from ideological reasons, the presence of democracy and free markets in a country can open the door to cooperation with the United States and other democratic governments, and United States companies also can find fertile ground for investments. It should be pointed out that one of the main stumbling blocks in US foreign policy is the conflict of interest between its ideological, and security and economic concerns. As evidence of this dilemma, the United States has sometimes cooperated with anti-democratic governments and regimes for security and economic reasons. This predicament has undermined the United States’ mission and its position as a champion of liberalism, democracy, and free society.

Energy Security and Constitution of Market Economies The United States supports economic liberalization, democratization, and rule of law in the Black Sea area. It advocates free markets and wants countries of the region to be integrated into the global capitalist system. The United States always criticizes barriers to free trade. Ross Wilson, former US ambassador to Turkey, pointed out that Open and free markets have been the basis of rising European prosperity for sixty years. In the years ahead, market economics, unfettered and open trading and investment regimes, and the effective rule of law to underpin the free marketplace will be essential elements for developing prosperity in the Black Sea region. The rule of law is particularly important in a region where distrust, corruption, and inadequate governance remain the legacy of less democratic and open pasts. Within the region, the US Government encourages the development of more honest courts, more predictable decision-making, simplified regulatory regimes, and the fair treatment of investors, foreign and domestic.17

The United States is also concerned about the diversity and continuity of energy security in the region as well as in the rest of the world. A significant dynamic that shapes US foreign policy towards the Black Sea is energy transportation. Its geographical position makes the region, and the Black Sea itself, a key corridor for delivering energy to the international marketplace. In a broader Black Sea region, new oil and

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natural gas resources have been discovered. Energy reserves in the Caspian Sea area and Central Asia are vital for stabilizing oil prices at a global level as well as securing energy provision. Russia has been a strong player in the transportation of hydrocarbon resources in the region and still controls many of the pipelines that carry oil and natural gas. This gives Russia an effective bargaining card in international politics. The dependency rate of Central and Eastern Europe on Russian gas is high. For instance, because of tense relations with the Ukraine, Russia cut its gas supply to the country in the winter of 2005– 2006. That gave Russia great political power. Aiming to take the energy card from Russia and to undermine its monopoly in energy transportation, the United States encourages construction of new pipelines that will bypass the Russian territory. Though the United States faced problems when the Turkish Parliament refused to cooperate with its efforts to occupy Iraq in 2003, the United States supported the construction of the Baku-Ceyhan pipeline project, which was completed in 2005. In addition to the Baku–Tbilisi–Ceyhan oil pipeline, the South Caucasus gas pipeline is another major accomplishment. Not all the new pipelines, however, are bypassing Russia. For instance, the Blue Stream pipeline project has been completed through cooperation between Russia and Turkey. It might be argued this pipeline project has irked the United States, as it has strengthened Russia’s presence in energy transportation. Another related project is the proposed Nabucco pipeline scheme. This project will undermine Russia’s status as the main supplier of energy to many European countries while easing those countries’ concerns about energy security. The United States supports this project as well, believing that “These and other pipelines—multiple pipelines—will foster competition, help bolster global energy supplies, and enhance the welfare of producing, transit, and consuming countries in the region and elsewhere.”18 Another consequence of the construction of new pipeline projects from north to south, and east to west, is that Turkey is becoming a key energy hub in the area because most of these pipelines cross its territory. This also bolsters Turkey’s regional and global position. The United States, which believes regional integration promotes democratic trends, open market development, prosperity, peace, stability, and security,19 has been supporting initiatives such as the GUAM20 and BSEC (Black Sea Economic Cooperation).

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Terrorism and Security in General After the 9/11 attacks, security became a priority of US foreign policy and this has also shaped its goals in the Black Sea region. To the United States the Black Sea is a gateway to the Middle East. Unless the United States cooperates with the Black Sea countries, it will be impossible to reach the northern entrance to the Middle East. During the Cold War era, the boundaries and conflicts in the world were more or less frozen. Following the dissolution of the USSR, however, some conflicts started to break out in the region. For instance, separatism became a prominent issue in Moldavia and the Caucasus region was destabilized. Chechens, on one hand, tried to separate from the Russian Federation, and Armenia, on the other hand, with the support of Russia, became involved in a bitter conflict with Azerbaijan over the Nagorno-Karabakh region. Armenians occupied a fifth of Azerbaijan’s territory. Though the two sides reached a ceasefire agreement that ended the war after Haydar Aliyev became president of Azerbaijan in 1994, unrest continues and a new war could begin at any time unless Armenia returns the lands it captured from Azerbaijan. Meanwhile Georgia—which contains de facto autonomous regions within its borders—has failed to unify despite winning its independence. Separatist movements in Abkhazia and South Ossetia have significantly undermined Georgia’s attempts at unification. While the United States supported Georgia, it also criticized Russia over the Chechen conflict, especially before the 9/11 attacks. This policy, however, had been diluted so as not to provoke Russia and, therefore, it failed to deliver concrete results. The United States was aiming to promote stability in the area, on one hand; on the other, acting under the influence of the Armenian lobby, it was supporting Armenia against Azerbaijan. These actions contradicted the US policy of isolating Iran and undermining the influence of Russia in the region. Therefore, in December 2001, “the Bush administration succeeded in getting Section 907 of the Freedom Support Act—which barred direct US government support to Azerbaijan—repealed. The section, introduced under pressure from the American-Armenian lobby, significantly constrained US freedom of action and policy options vis-à-vis Azerbaijan.”21 As revealed at the 2005 Istanbul NATO summit, the United States regards the Black Sea region as crucial to the security of the Euro-Atlantic region. This is a dynamic that shapes US policies towards the Black Sea countries. The United States sees NATO as the main provider of security for the Euro-Atlantic region, which includes the Black Sea. Since Bulgaria

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and Romania have joined NATO and the EU, the Black Sea’s western and southern shores now form the boundaries of NATO as well as the EU. The United States wants to extend the operating area of the Organization for Security and Cooperation in Europe (OSCE) and NATO to the region. The United States supports the OSCE’s plans to play an effective role in conflict resolution in the region. However, since 2004, the United States has wanted to extend the mission area of Operation Active Endeavour from the Mediterranean Sea to the Black Sea. This means the United States does not view the cooperation of regional institutions such as the GUAM and BSEC as sufficient for its interests. In this regard, a problem has arisen between Turkey and the United States over the Montreux Treaty. It might be argued that the United States wants some amendments to be made to the treaty. For instance, one of the neocons, Bruce Pitcairn Jackson, claimed the 1936 Montreux Treaty was out of date and needed to be amended.22 The Montreux Treaty puts some limitations on countries that are not littoral states. A non-littoral state’s total battleship tonnage in Black Sea waters cannot exceed 45,000 tonnes and its battleships cannot stay more than twenty-one days, which means, as long as the Montreux Treaty stays in force, it is not possible to extend Operation Active Endeavour to the Black Sea. There are some factors encouraging Russia and Turkey to cooperate against US military presence in the Black Sea. Turkey worries about losing its control of the Turkish straits; Russia wants to maintain its influence in the Black Sea region. Furthermore, both countries believe a strong US presence in the area could reignite age-old conflicts and encourage an arms race. Russia and Turkey are good trading partners and Turkey depends heavily on Russian natural gas for its energy needs. Turkey does not want its relations with Russia to be weakened. But United States–Russian rivalry in the Black Sea could undermine Turkish–Russian relations, since Turkey is an ally of the United States and a member of NATO.23 The United States announced it “is not seeking to establish a permanent naval presence in the Black Sea, but it is committed to engaging with its allies and friends to enhance security and cooperation through the region.”24 Regarding its Black Sea strategy, the United States needs new logistics centres in the region. To achieve this, it has signed some agreements on military cooperation in the area. In December 2005, the United States signed an agreement with Romania allowing it to use military bases in the country. A similar agreement was signed in March 2006 permitting the United States to use bases in Bulgaria. Both Bulgaria and Romania, in

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joining the EU and NATO, have allowed the United States to have bases on their soil. It is also believed that, with the revolutions in the Ukraine and Georgia, the influence of the United States in both countries has increased. However, it might also be argued that, with the January 2010 elections, US influence in the Ukraine started to decline while Russian influence has been growing. Apart from international terrorism, the Black Sea region is also significant as a transit route for new security threats including narcotics, human trafficking, and weapons smuggling. This factor, too, makes the region crucial for US strategy. Another critical factor that shapes US foreign policy in the Black Sea is the strategy to replace Russian influence over former Eastern Bloc countries with United States–Western influence. All in all, it is clear that security is a prerequisite for successful democratization and economic transformation in the Black Sea countries.

Conclusion Having become the lone superpower of the post–Cold War era, the United States wants to maintain its control over global as well as regional power balances. The Black Sea region is important to the United States for reasons of security, energy, and politics. The United States regards this area as part of the Euro-Atlantic security system and urges countries of the region to take effective measures against international terrorism, smuggling, and drug trafficking. Advocating energy security, diversity, and continuity in the region, the United States tries to undermine both the Russian monopoly in energy transportation and Russian influence over Black Sea countries. Meanwhile, the United States encourages those countries to democratize and establish the rule of law, and regards these values as a basis for economic development and prosperity. Overall, the United States wants the countries of the Black Sea region to be integrated into the global capitalist economic system and the Euro-Atlantic security system.

Notes 1

Most of the material in this section is taken from the following chapter by the author: ødris Bal, “Turkey–USA Relations and Impacts of 2003 Iraq War,” in Turkish Foreign Policy in the Post Cold War Era, ed. ødris Bal (Boca Raton, FL: Brown Walker Press, 2004). 2 See ødris Bal, “Rise of Shanghai Cooperation Organization (SCO) in Eurasia: Is it an Effective Tool in a New Big Game?” in Geopolitics of Central Asia in the Post

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Cold War Era: A Systemic Analysis, ed. Ertan Efegil (Harlem, The Netherlands: Research Centre for Azerbaijan and Turkestan, SOTA, 2002). 3 CIA World Factbook, India: https://www.cia.gov/library/publications/the-worldfactbook/geos/in.html. 4 See, George Perkovich, “Is India a Major Power?” The Washington Quarterly 27, no. 1 (2003–2004): 129–146. 5 Colin Powell has underlined that India, along with China and Russia, is a major power. See Colin Powell, “Strategy of Partnership,” Foreign Affairs (February 2004). 6 ødris Bal, Turkey’s Relations with the West and Turkic Republics: The Rise and Fall of the Turkish Model (Aldershot, England: Ashgate, 2000), chap. 3. 7 See Powell, “A Strategy of Partnership.” 8 For the Bush Doctrine, see Robert Jervis, “Understanding the Bush Doctrine,” Political Science Quarterly 118, no. 3 (2003): 365–388. 9 Wesley K. Clark, “Winning Modern Wars: Iraq, Terrorism, and the American Empire,” Public Affairs (October 2003). 10 See ødris Bal, ABD PolitikalarÕ ve Türkiye (Ankara: Lalezar Kitabevi, 2008). 11 Regarding American hegemony, see Burcu Bostano÷lu, Türkiye–ABD øliúkilerinin PolitikasÕ (Ankara: ømge Kitabevi, 1999), 222–237. 12 ABD Bülteni, 31 March–7 April 2006, TÜSøAD. 13 Remarks by Ambassador Ross Wilson at Democracy and Security in the Black Sea, the American ARI Movement’s 8th Annual Security Conference, Istanbul, 29 June 2006, http://turkey.usembassy.gov/amb_062906.html. 14 Remarks by Ambassador Ross Wilson, 29 June 2006. 15 Bal, Turkey’s Relations. 16 Remarks by Ambassador Ross Wilson, 29 June 2006. 17 Remarks by Ambassador Ross Wilson, 29 June 2006. 18 Remarks by Ambassador Ross Wilson, 29 June 2006. 19 Remarks by Ambassador Ross Wilson, 29 June 2006. 20 GUAM comprises Georgia, Ukraine, Azerbaijan, and Moldova. 21 F. Stephen Larrabee and Ian O. Leser, Turkish Foreign Policy in an Age of Uncertainty (Santa Monica, CA: RAND, 2003), 116. 22 “The Future of Democracy in Black Sea Region,” Testimony of Bruce Pitcairn Jackson before the Committee on Foreign Relations Subcommittee on European Affairs, 8 March 2005, www.esiweb.org/pdf/esi_turkeytpq_id_27.pdf. 23 For US policies and Turkey, see Bal, ABD PolitikalarÕ. 24 Remarks by Ambassador Ross Wilson, 29 June 2006.

CHAPTER SEVENTEEN THE EU’S BLACK SEA POLICY ERTAN EFEGIL* AND NEZIHA MUSAOöLU†

Introduction The collapse of the former Soviet Union encouraged the leaders and peoples of Europe to unify their continent, which had been divided after the Second World War due to the ideological competition between the two superpowers. In so doing, they hoped to create a more peaceful international environment based on mutual cooperation, sympathy, and stability. But despite these hopes and expectations, disappointment rose throughout the 1990s as internal conflict, insecurity, and unhappiness became increasingly imbedded within the international system. Amid those positive expectations, the European Union accepted the full membership of ten newly independent East European countries, including the Republic of Southern Cyprus and Malta, in order to guarantee EU national security, prevent the re-emergence of new lines of division within the continent, and put an end to intra-state conflicts in Europe’s eastern regions. This enlargement, however, did not overcome all the EU’s challenges. On the contrary, the EU became confronted with new and unavoidable questions. In order to deal with these new issues, the EU formulated a European Neighbourhood Policy (ENP), a new foreign policy that encompasses Russia, the former Soviet Republics (Ukraine, Belarus, and Moldova), the Baltic countries, South Caucasia, the Middle East, and North Africa. However, it has not pursued a single common comprehensive foreign policy strategy toward these different regions. Instead, the EU has followed diverse strategies that differ according to the local features and concerns of the regions in question. For example, it formulated the * †

Sakarya University, Department of International Relations, Turkey. Trakya University, Department of International Relations, Turkey.

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Barcelona Process for the Middle East countries and the Northern Dimension for the Baltic countries. In the meantime the EU has become a de facto Black Sea power—due to the full membership of Bulgaria and Romania,1 accession negotiations with Turkey, close relations with Russia,2 Ukraine, Belarus, and Moldova, and Greece’s active foreign policy. Thus, due to its geopolitical position, oil and natural gas transportation, ongoing conflicts, and other economic and commercial advantages, the EU was left with no other choice than to engage with the region. With its eye on regional advantage, it adopted a new approach called Black Sea Synergy. This paper examines the general foreign policy mentality of the EU, and then analyzes its approach toward the Black Sea region.

The EU’s Foreign Policy Mentality: A Wider Europe and the European Neighbourhood Policy After the end of the bipolar system, the EU was confronted with challenges as well as opportunities. First of all, it was seen that an enlarged EU could become a powerful actor in world politics by developing its potential in the political and security fields and so expanding its sphere of influence. Second, the EU could enhance its position in the world economy by developing economic and commercial relations with other countries in the wider region.3 Yet despite these opportunities, as a result of its 2004 enlargement, the EU was faced with new challenges, such as ethnic nationalism, environmental issues, corruption, bad governance, and poverty; and now, if it is to feel secure, it has to deal with these issues. For the EU, “the neighborhood relationship needed to be approached with the idea of intensifying cooperation in order to create a zone of prosperity and a good neighborhood within the EU borders.”4 By this, the EU intended to create “a ring of friends” around its borders in order to realize its expectations as well as face its challenges.5 With that in mind, the EU should encourage regional leaders to reshape their countries in accordance with democracy, good governance, respect for human rights, and a free market economy.6 In this respect, it should exert itself to achieve the following objectives: (a) reduce poverty, (b) create an area of shared prosperity and values based on free trade and deeper economic integration, (c) intensify political and cultural relations, (d) enhance cross-border cooperation, and (e) share responsibility for conflict prevention and conflict resolution.7 All these are necessary for the EU to feel secure, develop its commercial relations with other regions, meet its energy needs,8 and deal with present and future challenges. To

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achieve these objectives, the EU should maintain regional peace and security by encouraging regional cooperation. However, the implementation of economic, political, and security reforms by regional states is a precondition for the maintenance of regional security and peace. In line with these priorities, the EU plans to take serious steps in the following fields:9 Security: Intensified cooperation to prevent and combat common security threats (terrorism, organized crime, customs and taxation fraud, drug trafficking, corruption, and so on);10 greater EU political involvement in conflict prevention and crisis management (a more active role in facilitating peaceful settlement for disputes). Politics: Greater efforts to promote human rights, further cultural cooperation and mutual understanding (deeper political relations, enhanced cooperation on justice and security issues, governance, dialogue between civilizations, free exchange of ideas, development of a flourishing civil society to promote basic liberties, exchange programs). Economics: Extension of internal market and regulatory structures (an enlarged EU internal market, a common market based on four free movements); preferential trading relations and market opening (free trade agreements); strategies for lawful migration and the movement of persons; the integration of transport, energy, telecommunications networks, and the European Research Area; new instruments for investment promotion and protection; support for integration into the global trading system (WTO membership). To realize its objectives, the EU desires to cooperate with regional countries on the basis of bilateral ties (such as Action Plans and Partnership and Cooperation Agreements) and multilateral programmes (such as INOGATE and TRACECA). In order to encourage the participant states, in its foreign policy it has proposed a conditionality principle whereby regional countries that have made considerable progress in economic and political reforms will get further financial and technical assistance from the EU. Separately, the EU has recognized that the creation of common free trade areas would also encourage neighbouring countries to cooperate with it.11

The Black Sea’s Strategic Importance Although the Black Sea region is not a concrete and specifically defined geographical area,12 it constitutes a vital trade and political link between Europe, Central Asia, and the Middle East, and thus is strategically important to the EU.13 Due to its large population, it has

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significant economic potential. For example, in the period between 1993 and 1998, the BSEC14 economies shrank by 1% per year with a final GDP of $661 billion. In the period 1999–2005 they grew by 5% per year and their GDP increased from $630 billion to $884 billion. The region was the third-fastest growing region between 2000 and 2006, with a per capita income in 2006 of $6000. Between 2000 and 2005, the level of Foreign Direct Investment increased from $2 billion to $47 billion. In 2005, the EU–25 accounted for 48% of the total exports of the BSEC countries and EU–15 for 37% of manufactured exports.15 As far as energy resources are concerned, the region is not only a producer of but also a transit route for oil and natural gas. Due to the geographical proximity and the energy reserves of the region, the European countries can diversify their energy sources through importing them from the Caspian Sea and Central Asia.16 But, in the meantime, the region has serious difficulties, such as continuing conflicts, uneasy national and ethnic groups, bad governance, widespread unemployment, poverty, corruption, pollution, illegal migration, drug trafficking, organized crime, insufficient border controls, political tensions between regional states, and deficits in transport infrastructure.17 So in the end, despite its difficulties, the region has become a new strategic area for Europe, Russia, and the United States in terms of energy security, trade ties, endemic conflicts, migration, and other key policies.

The EU’s Approach Before the Black Sea Synergy In 2005, the EU discussed several possible options regarding the Black Sea area: (a) strengthening and upgrading EU relations with the BSEC; (b) focusing on GUAM (the Organization for Democracy and Economic Development—Georgia, Ukraine, Azerbaijan, and Moldova); (c) creating new alternatives on the initiative of the EU; and (d) an “NATO–Black sea” dimension.18 Between 1996 and 2000, the BSEC members attempted to establish more intensive relations with the EU. At that stage, both sides produced policy papers that contained their visions. In 2005, with the encouragement of Greece, a Black Sea Forum was promoted. The Forum would take account of the great number of existing formats for sectoral cooperation, such as environment, energy, transport infrastructure, soft security, democracy promotion, etc., around the Black Sea, assuming a coordinating role at the cross-section of specialized networks. The Greek initiative was followed by the Romanian one. Under that initiative, the Black Sea Forum for Dialogue and Partnership organized a

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meeting in Bucharest on 5 June 2006. Together with Romania, Moldova, Ukraine, Armenia, Azerbaijan, Georgia, which are the EU’s partner countries, Bulgaria, Greece, and Turkey also sent delegations. But Russia did not attend. With this attitude, Russia sent a message to the great powers, particularly to the EU and the United States, that “only a Russiainclusive project for regional cooperation could be successful on the Black Sea region.” Additionally, Russia aimed to discourage, even intimidate, small countries.19

Details of the EU’s Black Sea Synergy After the unsuccessful proposal by Romania, the EU adopted its 2006 Commission program called “Black Sea Synergy.” Although the EU has existing relations with the regional states at the individual and multilateral levels, such as the strategic relationship with Russia, Partnership and Cooperation Agreements signed with Ukraine, Moldova, the South Caucasian states, and the accession negotiations with Turkey, the Commission did not prepare a separate and independent Black Sea policy.20 As a result of this, the EU did not intend to create new institutions and/or bureaucratic structures. But it has prepared a Black Sea Synergy, which has been described as a complementary measure to the EU’s existing efforts.21 Hence, it actually desires to develop its relations with regional organizations, such as the BSEC, and provide additional technical and financial assistance to the regional states.22 The European Commission’s Synergy Communication (April 2007) defined the BSEC as its main regional partner. While mentioning the Romanian initiative as a sustainable format for engaging civil society in the process of cooperation, it indicated possible cooperation areas with the Black Sea countries, which were: x Democracy, human rights and good governance x Soft security issues, such as illegal migration and transnational crime x A more active role through increased political involvement in four endemic conflicts (Transdniestria, Abkhazia, Southern Ossetia, and Nagorno-Karabagh) x Energy supply diversification through investment in a new transCaspian trans-Black Sea corridor and a possible common energy policy and legal framework for the ENP countries x Transport corridors x Environmental protection (the Black Sea and the Danube basin),

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x x x x x

Maritime policy Fisheries Trade policy Research and education networks Employment and social affairs

As far as its aims are concerned, the EU expects to promote both regional cooperation within the Black Sea region as well as between the EU and regional states, demanding creation of a comprehensive regional dialogue on energy security and transportation issues, and it wants to cultivate a better climate for peaceful resolution of the regional questions, such as Nagorno-Karabakh, South Ossetia, Abkhazia, and Transnistria, and lastly stimulate democratic and economic reforms.23 In this manner, in 2003, the Black Sea Basin Cooperation Program for 2007–2013 was adopted by the EU. Its objectives are based upon shared experience and good practice between countries in the region, namely, introducing common standards for saving and exchanging information; increasing political involvement for avoiding regional conflicts and addressing ongoing regional conflicts; supporting regional transport cooperation and the construction of a new energy infrastructure; facilitating the development of contacts between communities, cities, universities, cultural institutions, and civil society organizations in the Black Sea region; establishing strategic environmental cooperation; enhancing the implementation of multilateral environment agreements in the region; supporting cooperation between countries in the region in the social and scientific fields; and strengthening cross-border cooperation.24 These programs would be financed by the resources of national, regional, and cross-border cooperation programs under the ENPI as well as other instruments of EU external assistance, such as the European Regional Development Fund, the European Bank for Reconstruction and Development, the European Investment Bank, and the Black Sea Trade and Development Bank. On 14 February 2008, in Kiev, Ukraine, the first EU–Black Sea Ministerial meeting was held. After the meeting, the Ministers of Foreign Affairs of the BSEC member states issued a declaration in which they stated that the BSEC–EU interaction was seen as an integral part of overall European economic, scientific, and environmental cooperation. Their aim was to produce proper synergies by coordinating efforts within various integration and cooperation forums, and international organizations and institutions. They expressed a need for more institutionalized BSEC–EU interaction through identification of common tools and the development of

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synergies; therefore, it was necessary to undertake joint efforts to support development and cooperation in the wider Black Sea area. They also invited the EU to join the efforts of the BSEC particularly in: developing and interconnecting the transport infrastructure in the region; enhancing energy security and environmental sustainability in the region; combatting all forms of organized crime and terrorism; preventing and managing natural and man-made disasters; upgrading communication and information technologies in the region; and facilitating the movement of peoples.25 Although the BSEC document mainly focused on the economic issues rather than political ones, due to the BSEC’s economic character, the EU’s joint declaration addressed purely political matters, including human rights, civil society, conflict resolution, and parliamentary activities.26

The EU’s Instruments The EU has described the following sectors as areas of cooperation appropriate to its Black Sea objectives: transportation, energy,27 environment, maritime management, fisheries, migration, the fight against organized crime, the information society, and cultural cooperation.28 At the bilateral level, the EU has signed Action Plans with Armenia, Azerbaijan, Georgia, Moldova, and Ukraine as well as the Partnership and Cooperation Agreement with Russia.29 In the energy field, it ratified energy cooperation agreements with the Ukraine and Moldova. It also has two energy deals with Kazakhstan in which both parties accepted energy supplies to the EU from Kazakhstan, which meant the extension of the Odessa–Brody pipeline to Kazakhstan, and they decided to cooperate in the peaceful use of nuclear energy.30 At the multilateral level, the EU plans to create a common energy market, known as the Energy Road Map, within the framework of the Baku Initiative between the EU and Caspian and Black Sea countries. This market includes the EU, Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Turkey, Ukraine, Uzbekistan, and Russia, as an observer.31 In the meantime, the EU supports the Nabucco project and wants to construct a new trans-Caspian trans-Black Sea energy corridor.32 Concerning regional projects, the EU has supported TRACECA,33 INOGATE34, Black Sea Regional Energy Centre, the Black Sea Environment Program, the Pan-European Transport Areas, and the Black Sea Cross-Border Cooperation Program.35 Lastly, the EU has deployed its border assistance missions in Moldova and Ukraine,36 and it also intends to facilitate further development of

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contacts between Black Sea towns, communities, universities, cultural operators, and civil society organizations.37

The EU–BSEC Dialogue As mentioned above, the EU38 has planned close cooperation with the Black Sea Economic Cooperation39 as a regional partner, which includes financing the BSEC’s projects.40 On one hand, a close cooperation between the two institutions can seriously contribute to regional development and create a synergy in the region. For example, thanks to the EU’s financial support, the BSEC can materialize its projects within a very short term,41 since they have similar interests. In order to improve the region’s transportation infrastructure and telecommunication systems, the BSEC desires to form a common energy market and an interconnected power system. On the other hand, while the BSEC may not itself find peaceful solutions to ongoing conflicts, it still strives to constitute itself as a constructive forum for the countries of the region to discuss their differences.42 Its practical achievements, however, are minimal and it has some fundamental deficiencies. Firstly, the expectations of the EU member states are different from the objectives of the BSEC countries. Turkey and Greece, for example, want to increase their influence in the region, while Ukraine wishes to break its dependence on Russia and solve its domestic economic and political difficulties by improving bilateral and multilateral relations with the West. Other member states, such as Armenia and Azerbaijan, want to consolidate their state-building processes and preserve their national security.43 Due to their different expectations and problematic domestic structures,44 the member states see the BSEC as an instrument to reach their national goals and fulfil their interests; therefore, they do not give priority to the institutional development45 of the BSEC.46 Secondly, the member countries describe themselves as belonging to different regions. For example, Bulgaria sees itself as a country of Southeastern Europe, while Georgia and Azerbaijan feel attached to South Caucasia, and Russia, on the other hand, is trying to keep the spirit of Commonwealth of Independent States alive.47 Thirdly, there are also serious institutional differences among the member states in the fields of economy, government, military, and social structure. Fourthly, the trade relations between them are poorly developed. Lastly, the BSEC does not have enough financial power to finance its huge projects.

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Russia’s position The EU has to build close relations with Russia if it wants to preserve its national interests in the Black Sea region.48 It is clear that, without Russia’s support, no regional project can be successfully materialized. But the precondition for obtaining Russia’s support is to ensure that the EU does not have any intention to establish its hegemony over the region— otherwise, Russia may see the EU’s and/or other great powers’ initiatives49 as aggressive acts aimed at establishing hegemony over its “near abroad.”50 For Moscow, the region represents a sphere of privileged interests, and the EU should respect its legitimate rights in the region. In March 2009 the Russian Foreign Minister Sergey Lavrov accused the EU of trying to construct its sphere of influence in the former Soviet demographic area.51 For this reason, Russia has pushed for closer security and economic agreements in the CIS framework, and has seen the BSEC as a threat to its regional interests.52 This was the main reason why the European Council adopted a resolution on 19 and 20 March 2009 in which it was mandated that third countries, such as Russia and Turkey, can participate in the Synergy on an ad hoc basis.53

Conclusion Regarding formulating the Black Sea Synergy, the EU has not been able to establish a common understanding among its member states. Although Greece played an active role in preparing the policy, the northern countries, such as Denmark, have been much more attracted to the EU’s Northern Dimension. France and Spain, on the other hand, have strongly supported the Barcelona Process; therefore, the EU has to obtain a consensus among the member states about its foreign and security policies. Otherwise, its efforts will not be supported, not only by the regional states, but by also some of its own member countries.54 Consequently, the implementation of the EU’s Black Sea Synergy will not be easy, mainly because of the strategic competition between great powers, conflicts among the regional states, and lack of political dialogue and infrastructure for regional cooperation. But in spite of these challenges, the EU’s Synergy will—or at least can—make a positive contribution to the regional development.

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Notes 1

On 1 January 2007, two Black Sea littoral states became full members of the EU. The political values and activities of the Europeans are seen by Russia as a threat both at home and in East Europe, where the EU appears as a competing and expansionist actor. See Michael Emerson et al., Synergies vs. Spheres of Influence in the Pan-European Space (Brussels: Centre for European Policy Studies, 7 April 2009), 1–104. 3 Gianni Bonvicini, “The European Neighbourhood Policy and its Linkage with European Security,” in Wider Europe: Nordic and Baltic Lessons to PostEnlargement Europe, ed. Fabrizio Tassinari, Pertti Joenniemi, and Uffe Jakobsen (Copenhagen: Danish Institute for International Studies, 2006), 21–25; Michael Emerson, “Deepening the Wider Europe,” Eurojournal.org, March 2004, 1–4. 4 Nicolae DandÕú, “Cross-border Cooperation: A Strategic Dimension of European Neighborhood Policy at the Eastern Frontier of the EU,” Eurolimes: Journal of the Institute for Euroregional Studies 7 (Spring 2009, special edition, ed. Dorin Ioan Dolghi, Gilles Rouet, and Zsolt Radics): 35–48. 5 “EU and Black Sea Regional Cooperation,” Report on the International Workshop, Südosteuropa—Gesellschaft, Berlin, 26–27 March 2007, pp. 1–9; Mustafa AydÕn, “Europe’s Next Shore: The Black Sea Region after EU Enlargement,” Institute for Security Studies, Occasional Paper, No. 53 (June 2004), 1–34. 6 Jan Hanacek and Jakub Kulhanek, “The Politics of Neighbors,” Harvard International Review (Fall 2009): 80. 7 Council of the European Commission, “Council Conclusions on Wider Europe— New Neighbourhood,” Doc. 10447/03, March 10, 2008. 8 For further information, see Michael Emerson, “From Central Asian Strategy into EurAsian Strategy,” CEPS Commentary (4 November 2009): 1–2; Vladimir Socor, “Caspian–Black Sea Region: Key to Diversifying Europe’s Energy Supplies,” repr. in “European Energy Security: What Should it Mean? What to Do?” ESF Working Paper of the European Security Forum, no. 23 (2006): 26–29. 9 “Wider Europe—Neighbourhood: A New Framework for Relations with our Eastern and Southern Neighbours,” Commission of the European Communities, COM (2003) 104 (Brussels), 11 March 2003, pp. 1–26, http://ec.europa.eu/ world/enp/pdf/com03_104_en.pdf. 10 Concerning the issue of EU security, in the 1990s the EU members were focused primarily on the preservation of the integrity of the single market and maintaining its security against illegal migrants and organized crime; thus the post-Soviet states of the Black Sea region did not find a place in the EU’s security agenda, which was oriented towards classical security threats. But in the course of time, EU officials came to understand that they had to take the security issues emerging from the post-Soviet states into account. For further information on the issue of the European security, see Felix Ciuta, “Region? Why Region? Security, Hermeneutics, and the Making of the Black Sea Region,” Geopolitics 13 (2008): 120–147; Felix Ciuta, “Parting the Black Sea (Region): Geopolitics, Institutionalization, and the Reconfiguration of European Security,” European 2

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Security 16, no. 1 (2007): 51–78; Gareth Winrow, “Geopolitics and Energy Security in the Wider Black Sea Region,” Southeast European and Black Sea Studies 7, no. 2 (June 2007): 217–235; James Sherr, “Security in the Black Sea Region: Back to Realpolitik?” Southeast European and Black Sea Studies 8, no. 2, (June 2008): 141–153; Dov Lynch, “De Facto ‘States’ around the Black Sea: The Importance of Fear,” Southeast European and Black Sea Studies 7, no. 3 (September 2007): 483–496. 11 Fabrizio Tassinari, “Introduction,” in Wider Europe: Nordic and Baltic Lessons to Post-Enlargement Europe, ed. Fabrizio Tassinari, Pertti Joenniemi, and Uffe Jakobsen (Copenhagen: Danish Institute for International Studies, 2006), 13–16; see also “Wider Europe—Neighbourhood, ” COM (2003) 104. 12 Yannis Valinakis, “The Black Sea Region: Challenges and Opportunities for Europe,” Chaillot Papers, Institute for Security Studies, Western European Union, no. 36, (July 1999), 1–57. 13 For further information about the wider Black Sea region, see Charles King, “The Wider Black Sea Region in the Twenty-First Century,” in The Wider Black Sea Region in the 21st Century: Strategic, Economic, and Energy Perspectives, ed. Daniel Hamilton and Gerhard Mangott (Washington, DC: Center for Transatlantic Relations, 2008), 1–22. 14 Twelve countries currently participate in the BSEC, namely Albania, Armenia, Azerbaijan, Bulgaria, Georgia, Moldova, Romania, Russia, Serbia, Turkey, and Ukraine. 15 Burcu Gültekin-Punsmann and Krassimir Y. Nikolov, “European Union Approaches to Fostering Synergies of Cooperation and Integration around the Black Sea,” Southeast European and Black Sea Studies 8, no. 2 (2008): 109–128. 16 “The Black Sea as Boundary or Bridge? Implications of EU and NATO Enlargement, and the Regional Security,” Stockholm International Peace Research Institute, 28 November 2003; Mustafa AydÕn, “Europe’s Next Shore: The Black Sea Region after EU Enlargement,” Occasional Papers no. 53 (Paris: Institute for Security Studies, 2004), 1–34; “Black Sea Synergy: A New Regional Cooperation Initiative,” Commission of the European Communities COM (2007) 160 final (Brussels), 11 April 2007, pp. 1–13; Dov Lynch, “The EU and the Black Sea,” EU Institute for Security Studies, 24 February 2006; “EU and Black Sea Regional Cooperation,” Report on the International Workshop, Südosteuropa – Gesellschaft, Berlin, 26–27 March 2007, pp. 1–9; “Black Sea Synergy: Strategies for Europe’s New Frontier,” European Report, Kennan Institute, 28 June 2007. 17 Valinakis, “The Black Sea Region”; Mustafa AydÕn, “Europe’s Next Shore”; Fabrizio Tassinari, “A Synergy for Black Sea Regional Cooperation: Guidelines for an EU Initiative,” Centre for European Policy Studies, CEPS Policy Brief, No. 105 (June 2006), 1–14. 18 For further information, see Gültekin-Punsmann and Nikolov, “European Union Approaches.” 19 Gültekin-Punsmann and Nikolov, “European Union Approaches.” 20 Dov Lynch, “The EU and the Black Sea,” EU Institute for Security Studies, 24 February 2006; Cansu ÇamlÕbel, “EU looking for Involvement in Black Sea Politics,” Turkish Daily News, 13 April 2007; “EU Aims to Boost Black Sea

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Cooperation,” Radio Free Europe/Radio Liberty, 11 April 2007; “Boosting Regional Cooperation in the Black Sea Region: First Ministerial Meeting of Black Sea Synergy in Kiev,” IP/08/221, 13 February 2008; Commission of the European Communities, “Black Sea Synergy: A New Regional Cooperation Initiative,” Commission of the European Communities COM (2007) 160 final (Brussels), 11 April 2007, pp. 1–13. 21 Michael Emerson, “The Black Sea as Epicentre of the Aftershocks of the EU’s Earthquake,” Centre for European Policy Studies, CEPS Policy Brief, No. 79 (July 2005), 1–9. 22 Valinakis, “The Black Sea Region.” 23 “Towards an EU Regional Dimension in the Wider Black Sea Area,” working paper, International Centre for Black Sea Studies, 28 October 2006. 24 DandÕú, “Cross-border Cooperation.” 25 “Declaration of the Ministers of Foreign Affairs of the Member States of the Organization of the Black Sea Economic Cooperation on a BSEC–EU Enhanced Relationship (Kyiv, 14 February 2008),” Southeast European and Black Sea Studies 8, no. 2 (June 2008): 173–174; Fabrizio Tassinari, “Sailing the Black Sea at last,” EUObserver, 7 February 2008. 26 Michael Emerson, “The EU’s New Black Sea Policy,” in The Wider Black Sea Region in the Twenty-first Century: Strategic, Economic, and Energy Perspectives, ed. Daniel Hamilton and Gerhard Mangott (Washington, DC: Center for Transatlantic Relations, 2008), 253–276. 27 Tassinari, “A Synergy for Black Sea Regional Cooperation,” 1–14. The European Union is dependent on oil and gas imports from Russia, the Middle East, and North Africa; by 2030, 70% of its energy consumption will be imported from these regions. The Black Sea region is thus emerging as a crucial transit area because nearly 50% of EU’s energy imports are expected to cross this region. Concerning the Union’s energy policy, it seeks to diversify its energy sources; to enhance its relations with energy producers, transit countries, and consumers; to promote legal and regulatory harmonization through the Baku Initiative; to develop a clear focus on alternative energy resources; to upgrade existing pipelines; and to construct new energy infrastructures. For further information, see “Black Sea Synergy: A New Regional Cooperation Initiative,” Commission of the European Communities COM (2007) 160 final (Brussels), 11 April 2007, pp. 1–13. 28 Benita Ferrero-Waldner, “Black Sea Synergy: The EU’s Approach to the Black Sea Region,” Speech/08/77, 14 February 2008; “EU Aims to Boost Black Sea Cooperation,” Radio Free Europe/Radio Liberty, 11 April 2007. 29 SIPRI, “The Black Sea as Boundary or Bridge?” 30 Commission of the European Communities, “Black Sea Synergy,” 1–13; Tassinari, “A Synergy for Black Sea Regional Cooperation”; “EU, Caspian, Black Sea Plan Common Energy Market,” ENS (30 November 2006). 31 “Developing External Energy Policy for the EU,” MEMO/07/533, 30 November 2007. 32 “Black Sea Synergy: A New Regional Cooperation Initiative,” Commission of the European Communities COM (2007) 160 final (Brussels), 11 April 2007, pp. 1–13.

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33 The EU actively supports regional transport cooperation in order to improve the efficiency, safety, and security of transport operations. Within the framework of this mentality, the TRACECA was launched in 1993 by five Central Asian and three South Caucasian states together with the EU. This EU-sponsored technical project aims to develop a transport corridor on an East–West axis from Europe, across the Black Sea, through the Caucasus and the Caspian Sea to Central Asia. Further information, see Commission of the European Communities, “Black Sea Synergy,” 1–13. 34 The Interstate Oil and Gas Transport to Europe is an EU-funded regional programme launched in 1995. Its umbrella agreement sets out an institutional system aimed at facilitating the development of oil and gas transportation networks. That agreement is signed by 21 countries, including all BSEC member states except Russia. 35 Commission of the European Communities, “Black Sea Synergy”; Valinakis, “The Black Sea Region.” 36 Commission of the European Communities, “Black Sea Synergy.” Although it does not intend to deal directly with frozen conflicts, this does concern a more active EU role through increased political involvement in ongoing efforts to address the conflict. The EU wants to monitor the crises, promote confidencebuilding measures, and provide financial assistance to the conflicted areas in order to aid their own reconstruction. 37 Commission of the European Communities, “Black Sea Synergy.” 38 In June 2007, the European Commission was granted a permanent observer status within the BSEC. 39 The European Commission adopted a communication to the Council on “The Regional Cooperation in the Black Sea Area: State of Play, Perspectives of EU Action Encouraging its Future Development,” presented on 19 December 1997. This determined a comprehensive political framework for EU–BSEC affairs. In 1999, the BSEC gave a positive response to the Communication. See “Editorial: Bringing the Black Sea Economic Cooperation and the European Union Closer,” Southeast European and Black Sea Studies 5, no. 2 (May 2005): 167–169. 40 Commission of the European Communities, “Black Sea Synergy,” 1–13. 41 For example, the Union and Black Sea Bank for Trade and Development signed a memorandum of cooperation according to which they will finance small and medium-sized enterprises for projects in Bulgaria, Romania, and Turkey. 42 Michael Emerson and Marius Vahl, “Europe and the Black Sea-Model Regionalism, prêt-a-porter,” in Europe’s Black Sea Dimension, ed. T. Adams et al. (Brussels: CEPS and ICBSS, 2002), 1–33; “EU and Black Sea Regional Cooperation,” Report on the International Workshop, Südosteuropa—Gesellschaft, Berlin, 26–27 March 2007, pp. 1–9; “Black Sea Synergy: Strategies for Europe’s New Frontier,” European Report, Kennan Institute, 28 June 2007. 43 Valinakis, “The Black Sea Region,” 1–57. 44 For example, Russia, Turkey, and Ukraine have always considered themselves important countries. A group of the EU member states—Bulgaria, Greece, and Romania—has increasingly aimed at eliciting support from the EU institutions for resolving the problems in the Black Sea area. See Svetlozar A. Andreev, “The

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Future of European Neighbourhood Policy and the Role of Regional Cooperation in the Black Sea Area,” Southeast European and Black Sea Studies 8, no. 2 (June 2008): 93–108. 45 Andreev has proposed four concrete measures in order to improve the BSEC’s performance: (1) upgrading BSEC PERMIS, (2) establishing a permanent representation in Brussels in order to directly influence the EU policies towards the region, (3) implementing a comprehensive media strategy and adopting clear annual priorities; see Andreev, “The Future of European Neighbourhood policy.” 46 Emerson and Vahl suggest three things in order to improve its institutional structure. First, the BSEC has to strengthen its technical staff expertise to prepare projects in priority sectors. Second, it has to have a consensus with the EU on the EU’s policies. Third, the BSEC should be brought closer to a number of core regional activities. For further information, see Emerson, “The EU’s New Black Sea Policy.” 47 SIPRI, “The Black Sea as Boundary or Bridge?” 48 Relations between Russia and the EU cannot be described as a strategic partnership. Bilateral relations are highly rhetorical and economic interdependence has not spilled over into greater political cooperation. There are substantial differences between the two sides on foreign policy. For further information, see Dov Lynch, “The Russia–EU Partnership and the Shared Neighbourhood,” Analysis, no. 1, July 2004. 49 For the United States, the Black Sea region is particularly important because of its energy resources and geographical position. The U.S. has three main policy goals: (1) support of sovereignty and independence of the regional states, (2) support of its own commercial involvement in the region’s oil and gas production, and (3) future dependence on Russia’s and Gulf oil. For further information, see Terry D. Adams, “Caspian Oil and Gas Development and the Black Sea Region: An Overview,” in Europe’s Black Sea Dimension, ed. Terry D. Adams, Michael Emerson, Laurence David Mee, and Marius Vahl (Centre for European Policy Studies and International Center for Black Sea Studies, 2002), 39–72; Valinakis, “The Black Sea Region.” 50 For Russia, the Black Sea has long served as a gateway to the world’s oceans, and is therefore a natural bulwark. For Russia’s policies, see Mark Urnov, “Russia: Geopolitical Views and Domestic Political Context,” in Wider Europe: Nordic and Baltic Lessons to Post-Enlargement Europe, ed. Fabrizio Tassinari, Pertti Joenniemi, and Uffe Jakobsen (Copenhagen: Danish Institute for International Studies, 2006), 101–122; Alexander Sergounin, “Russian Views on the Wider Europe Concept,” in Wider Europe, ed. Tassinari, Joenniemi, and Jakobsen, pp. 123–132. 51 Hanacek and Kulhanek, “The Politics of Neighbors,” 80. 52 “EU seeks ‘Deeper Partnership’ with Ukraine,” Radio Free Europe/Radio Liberty, 27 March 2007; “EU: German Presidency’s Focus on Central Asia, Black Sea, Russia,” Radio Free Europe/Radio Liberty, 19 December 2006; Dov Lynch, “The Russia–EU Partnership and the Shared Neighbourhood”; Valinakis, “The Black Sea Region.” 53 Emerson et al., Synergies.

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54 Marius Vahl, “The EU and Black Sea Regional Cooperation: Some Challenges for BSEC”, Presentation at Parliamentary Conference on the Wider Black Sea Region in the New European Architecture, Athens, 8 April 2005.

CHAPTER EIGHTEEN RELATIONS BETWEEN RUSSIA AND TURKEY UNDER THE NEW CONDITIONS IN THE BLACK SEA AND CAUCASUS REGION ALEXANDER SOTNICHENKO*

Introduction The twenty-first century presented both Russia and Turkey with a new reality. We can now see that the West wants to include neither country in its political and economic structures. Despite pressing ahead with Western-style modernization, Turkey has no chance of being a full member of the EU, while the West views Russia with ever more unfriendly eyes. In the view of the present author, there is now no realistic possibility that Russia will enter the WTO. To the West we are aliens: this is an axiom of contemporary European and US policy, and I see no prospects for change. The political elites of both Turkey and Russia were disappointed by the failed efforts at close and equal co-operation with the West in the 1990s. Turkey has not been invited to the club of well-developed European countries, and there are no hopes that this will occur in the near future. The political and economic support of the United States is withdrawn whenever the interests of Ankara and Washington conflict, as occurred in 1974–1975 in Cyprus, or 2004 in Iraq; and we can now see that the existence of the Kurdish state in Northern Iraq is supported financially by the United States, such that it has its own government, army, flag, capital, and all the other indications of independence.1 Few Turks trust the United States, and polls show that Turkey has one of the highest levels of anti-Americanism in the world. The reasons for these results have been discussed in conferences, journal articles, and *

Assistant Professor, Saint-Petersburg State University, Russian Federation.

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newspaper editorials.2 However, there has been no radical change in the Turkish people since, for example, Daniel Pipes’s 1998 proclamation of the “Birth of a New Middle East Alliance” between Israel and Turkey with the help of Washington;3 rather, it is US policy that has changed. But the possibility of a new Turkish policy as a reaction to the global changes in the newly invented “Great Middle East” region should also be kept under consideration.4 Turkey is incessantly criticized for its human rights violations, for its low level of economical development (even though this is much better, for example, than that of Romania or Bulgaria), for the growing role of its military forces (even while some European NGOs support Kurdish separatism), etc. Furthermore, Turkey does not and cannot recognize the membership of Southern Cyprus in the EU, which is also a factor that impedes Turkey’s possible future full EU membership. Both the political elites and the publics of France and Germany dispute Turkey’s attempts to become a member of the EU. According to a public opinion poll, only 32% of the Europeans want to see Turkey in a united Europe.5 A similar situation is manifest in the relations between Russia and the West. While the West has permitted itself to respond to terrorism by bombing distant independent countries such as Iraq, Afghanistan, and Pakistan, the same style of operations within the territory of Russian states is described as genocide and a violation of the right of self-determination. In 1991, after the fall of the Soviet Union and the Warsaw Treaty Organization, all progressive people were waiting for the disbanding of NATO as a military organization. Instead, however, the US invited new members to join it (most of whom supported Washington’s overseas operations), despite the warnings of leading specialists in international relations,6 and proceeded to bomb the Russian ally Yugoslavia and to play an active role in the anti-Moscow “Orange Revolutions” in Georgia and the Ukraine. We now see the United States pursuing a really hostile policy in the Caucasus, and constructing a new anti-missile system in eastern Europe. The later history of Russia–United States and Turkey–United States relations could be summarized as follows: we can be allies of Washington only if our interests are consistent with mainstream American policy. The same situation can also be seen in Europe. While the East European countries are generally hostile to Russia because of the communist past, Western Europe, with the exception of Britain, does not usually support America’s aggressive gestures. France and Germany refused United States offers to take part in Iraq campaign and did not criticize Russia for launching a war against Georgia in the Caucasus. They

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are more interested in establishing peaceful relations and having a stable supply of oil and gas, although they do not see Russia as part of Europe. In the view of this author, Russia’s political elites have begun to understand this reality and thus refused integration into the main Western institutional developments of the 1990s.

Russia–Turkey Relations Relations between Russia and Turkey in the twentieth century were more hostile than friendly. We were enemies in World War I; during the Cold War, in 1945–1946, Turkey was an object of Stalin’s expansionist plans; and in the 90s Ankara tried to displace Moscow’s influence in the Caucasus and Central Asia regions. These initiatives were not naturally conducive to the prospects of future friendship; but concerns of economy, geopolitics, and security brought us closer, even though this contradicted the Turkish proverb Moskovdan dost olmaz (A Russian cannot be a friend), as well as the old Russian word for an enemy, basurman (literally, Muslim). It was only in the twenty-first century that our countries found common ground. This was, I think, a result of several failures in foreign policy on the parts of both Russia and Turkey. The fall of the Soviet Union brought an end to all the threats caused by the Russian policy of supporting the Kurdish nationalist movement, Turkish communists, and Syrian claims on the Hatay province. In the 1990s, Turkish public organizations unofficially supported the Chechen nationalist movement, and Turkey tried to expand its influence and its model of development to Muslim Turkic regions of the post-communist world. Russian authors commented that Turkey was spending resources needed in-country on foreign Eurasian projects, and that this was one of the main reasons for its economic instability, inflation, and annual crises.7 This history teaches us a lesson. The consequences of our antagonism have been equally negative for Russia and Turkey, both in the nineteenth century and in the last decade of the twentieth. Since the beginning of the twenty-first century, the two nations have became closer. New governments rejected the “going West” tradition of the 90s and turned towards each other. Each stopped supporting separatist movements in the territory of its partner.8 The level of commodity circulation grew more than tenfold, from about $2 billion in 2000 to $25 billion in 2007, and this tendency continued through to 2008. Russia became the second most important economic partner of Turkey, even if our economic relations have not always been reflected in the political

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field. The recent conflict in Georgia provided a good opportunity to turn a new page of real partnership between Russia and Ankara in the Black Sea and Caucasus region, and Ankara made the first step on the road towards political co-operation, suggesting a new regional initiative—the Caucasian Alliance. The first and the main aspect of the Turkish plan for a Caucasian Alliance is to stave off the West’s policies in the Caucasus. Armenian commentators have mentioned that “Turkey suggested to Russia that they divide the Caucasus and … exclude the West from the position of a mediator.”9 Indeed, in the last twenty years, Western political organizations or conflict-resolution theories and programmes have not solved any ethnic conflicts in the region. The only attempt at resolution was in Georgia, where the United States at first supported the “Rose Revolution,” and then armed Tbilisi for future wars against Abkhasia and South Ossetia. But while for the United States the war in the Caucasus meant nothing but a chance to sell arms and an opportunity for interference, for the neighbouring countries it means thousands of refugees, the closing of active trade routes, and a possible foreign presence in a zone of conflict. This is a major difference between the Western and the traditional approaches to peacekeeping in the Caucasus. The countries of the region (such as Turkey and Russia) not only know better how to establish peace and stability because their historical fates, peoples, and religions are associated with the Caucasus, they are also sincerely interested in stability over war, since this is necessary for their own security and economic prosperity. In the view of the present author, it was an omission by Russia that the idea of a Caucasian Alliance came not from Moscow but from Ankara. This means Turkey will play a leading role in this organization. But there is no other way to make the Caucasus a “zone of peace and stability” except co-operation between Russia and Turkey, and Russian suggestions also have to be coordinated with the main plan.

What are the Points of Co-operation for Turkey and Russia in the Caucasus? Dialogue between Turkey and Armenia cannot be positive without the mediating role of Russia. Armenia is a political and military partner of Russia, a member of the Collective Security Treaty Organization (CSTO), and home to Russian military bases. People of Armenia have little trust in Turkey10 and I do not think that bilateral initiatives will be successful.

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Only Russia can help Yerevan to interpret Turkish suggestions correctly and connect both sides within a common political platform. The same can be said about relations between Russia and Georgia. Ankara did not break relations with Tbilisi in August 2008, but Moscow did. For Russia, Turkey is a more promising mediator than any other candidate—especially the United States. Turkey is interested in expanding its capital resources to Abkhazia as an experienced investor in real estate and tourism, and there are thousands of abaza muhajeers (Turkish people with Abhaz origin) in Turkey, who want to do business with their native land. Solving the problem of the international recognition of Abkhazia and South Ossetia is important, not only for Russian official structures, but also for Turkish businessmen. The Armenian Security Council has commented that a mediating role for Turkey is impossible in resolving the Karabakh conflict,11 and one may expect the same reaction from Azerbaijan should Russia offer itself for the same role. The OSCE mission failed: after fifteen years of negotiations we have not seen any positive outcomes from their activities. Only the joint efforts of Turkey and Russia, framing their position in common and acting as joint mediators, can make peace between Armenia and Azerbaijan and solve the problem of Karabakh. The conditions suggested by regional superpowers related to the Karabakh problem will be unacceptable to both Armenia and Azerbaijan. However, we have to understand that there is no right or wrong side in a national conflict, and the priority must anyway be to stop it. The Caucasus is an important transition region for oil and gas. The conditions of permanent low-intensity conflict are causing multibillion losses from the Baku–Tbilisi–Ceyhan pipeline, and preventing the establishment of Nabucco and several other projects.12 All countries of the Caucasus are interested in exporting or importing energy resources such as oil, gas, and electricity. Perhaps these projects will not be profitable for all the countries of the region, but negotiations could solve these problems for the general benefit of the whole Caucasus. There is, however, one problem: Iran is also situated in the Caucasus. Interestingly, a month after Erdo÷an’s statement they answered the Turkish initiative with their own suggestions. Iran has good relations with Armenia, and Yerevan does not want to refuse Iran’s support. Iran has some points of antagonism with its neighbours, including the status of sea borders on the Caspian sea, the religious implications of Iranian funds expended in Azerbaijan, and the distribution of the ideology of Turkic nationalism among Iranian Azeris through the pan-Turkism organizations of Turkey and Azerbaijan. Iran is on “Axis of Evil” list and is stringently

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criticized by the West. The participation of Iran in the project of collateral co-operation could invite negative reactions from the West (especially the United States and Israel) which might prevent the positive development of the peacekeeping processes in the Caucasus.

Conclusion We are now very close to a fantastically promising future alliance, which may change the roles of Turkey and Russia in the region and present our countries with new possibilities for development and cooperation. We can establish an equal coordination system between our countries in the Caucasus and transform our relations from economic exchanges to full-blown partnership. All that is needed is a coherent programme of co-operation, the establishment of the elements of a dialogue, and the political will of our governments.

Notes 1

According to the Independent Kurdistan Law (accepted 4 July 2006), the display of the Iraqi national flag is restricted. 2 See, for example, Omer Taspinar, “The Anatomy of Anti-Americanism in Turkey,” Brookings Institute, 15 November 2005, http://www.brookings.edu/ articles/2005/1116turkey_taspinar.aspx; interview with Arnaud de Borchgrave, editor at large of the Washington Times and United Press International, http://archive.newsmax.com/archives/articles/2005/3/11/182953.shtml; Aylin Guney, “Anti-Americanism in Turkey: Past and Present,” Middle Eastern Studies 44, no. 3 (May 2008): 471–487. 3 D. Pipes, “The Birth of a New Middle East Alliance,” Washington Times, 5 January 1998. 4 The problem of the Great Middle East project and the role of Turkey was discussed in a conference organized by Mahir Kaynak and Emin Gürses in Sakarya University. Also see articles by M. Perincek, ɉɟɪɢɧɱɟɤ Ɇ. ɉɪɨɟɤɬ “ȼɟɥɢɤɨɝɨ Ȼɥɢɠɧɟɝɨ ȼɨɫɬɨɤɚ,” ɢ ɧɨɜɚɹ ɪɨɥɶ ɇȺɌɈ// ɉɪɨɮɢɥɶ, ʋ29 (584) 28 ɢɸɥɹ 2008. 5 “Europeans have more faith in Turkey’s EU bid than Turks,” Today’s Zaman Online (Istanbul), 11 September 2008. 6 One opponent of the expansion of the military alliance, for example, is George Kennan: see his “Fateful Error,” New York Times, 5 February 1997. 7 Ʉɢɪɟɟɜ ɇ.Ƚ. Ɍɭɪɰɢɹ ɦɟɠɞɭ ȿɜɪɨɩɨɣ ɢ Ⱥɡɢɟɣ. Ɇ., 2001. ɋ. 413–458; ɍɪɚɡɨɜɚ ȿ.ɂ. ɗɤɨɧɨɦɢɱɟɫɤɨɟ ɫɨɬɪɭɞɧɢɱɟɫɬɜɨ Ɍɭɪɰɢɢ ɢ ɬɸɪɤɫɤɢɯ ɝɨɫɭɞɚɪɫɬɜ ɋɇȽ. Ɇ., 2003. ɋ. 169–170. 8 The PKK offices in Russia were closed, while Turkey did the same with the supporters of Chechnya. See ɉɪɢɦɚɤɨɜ ȿ.Ɇ. Ʉɨɧɮɢɞɟɧɰɢɚɥɶɧɨ. Ȼɥɢɠɧɢɣ ȼɨɫɬɨɤ ɧɚ ɫɰɟɧɟ ɢ ɡɚ ɤɭɥɢɫɚɦɢ. Ɇ., (2007), 456–489.

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9 Ɍɸɪɤɨɥɨɝ: Ʉɚɜɤɚɡɫɤɚɹ ɩɥɚɬɮɨɪɦɚ - ɩɨɩɵɬɤɚ Ɍɭɪɰɢɢ ɩɨɞɟɥɢɬɶ ɪɟɝɢɨɧ ɫ Ɋɨɫɫɢɟɣ. Interview with R. Safrastyan, http://www.panorama.am/ru/politics/2008/ 10/01/safrastyan2. 10 Negative comments on Turkey are abundant on Armenian news and analysis websites, such as panarmenian.net, newsarmenia.ru, hayinfo.ru, and many others. 11 Security Council of Armenia, “Turkey can’t be the Mediator in Resolution of Karabakh Conflict,” http://www.regnum.ru/news/polit/1057068.html. 12 See Ɂɚɫɥɚɜɫɤɢɣ ɂ. Ⱦɟɥɨ – ɬɪɭɛɚ. Ȼɚɤɭ-Ɍɛɢɥɢɫɢ-Ⱦɠɟɣɯɚɧ ɢ ɤɚɡɚɯɫɬɚɧɫɤɢɣ ɜɵɛɨɪ ɧɚ Ʉɚɫɩɢɢ. Ɇ., 2005.

CHAPTER NINETEEN BLACK SEA REGIONAL POLICIES OF RUSSIA AND THE UNITED STATES AFTER SEPTEMBER 11 GIRAY SAYNUR BOZKURT*

Introduction Our world is simultaneously experiencing two transformations: first, globalization through economic means; second, the formation of blocs. At first glance these changes would appear to be fundamentally antithetical; in fact, however, they complement each other. In reference to this situation, Keyder makes the following observations: The new world has surrendered to the logic of capital, and we are no longer in the era in which the national economy is built by the state; we are living in a world where global capital chooses the place to invest according to its desire, and condemns to exclusion and regression the places it dislikes. If we diagnose this event correctly, it is possible to develop a policy accordingly. A characteristic of the new order is that the cities which supply the necessary services to capital have the initiative. These global cities have to become experts in some specific qualified services. Objective geographic and historical situations determine which cities would become to such a location only according to the presence of a potential.1

Today it is apparent that cities support their countries, rather than vice versa. Thus, the main economic rivalry occurs between cities, not countries. With respect to changing world conditions, no country now has the ability to act on its own. While deciding on a matter, states have to minimize the negative impacts in the international arena that might occur *

Faculty of Economics and Administrative Sciences/Department of International Relations, Sakarya University, Turkey, www.uli.sakarya.edu.tr, [email protected], [email protected].

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in the case of its application. A new action that is unapproved or is perceived by the major world powers as a threat to their interests will not have much chance of success.2 The first part of this study explores the importance of the Black Sea region and its significance to world peace. The second part investigates the Black Sea policies of certain countries—especially the United States and Russia, the two great regional powers—subsequent to the attacks of September 11. This part also explains the states’ policies in relation to the worldwide change in the conception of security, and their efforts to become more active in the Black Sea region.

The Position and Importance of the Black Sea Region in Global Relations and World Peace While having strong links with Asia, the Black Sea region also partly belongs to Eastern Europe and partly to the Middle East, and is also related through its southern parts to the Mediterranean.3 A project planned for implementation in this region, or one that will affect it, must be considered in the light of its full implications throughout the Black Sea region.4 Historically, the Ottoman Empire (today the Republic of Turkey) constituted the southern part of the Black Sea area, while the Russian Empire (later the USSR, today the Russian Federation) constituted the northern and eastern parts. Being situated where Asia and Europe meet has always made this area a natural arena for rivalry and struggle.5 The Black Sea region is one of the most strategically important regions in Europe, providing a major trade link and transit route for Caspian energy supplies.6 It forms the core of the vast area that extends from Europe to Central Asia and the Middle East, and is closely related to the unstable Balkan, Caucasus, and Caspian regions, which are characterized by common risks and challenges—first and foremost “frozen” conflicts and international terrorism. It would not be an exaggeration to say that the Black Sea region remains one of the most challenging regions in Europe due to its cultural and political heterogeneity, its bipolar legacy, and the diverse interests of regional and nonregional actors that are embodied in a multiplicity of external policies. It falls within the competence of different international institutions and security arrangements, such as the Organisation for Security and Cooperation in Europe (OSCE), the European Union (EU), the North Atlantic Treaty Organisation (NATO), and the Commonwealth of Independent States (CIS). The region’s countries have rarely enjoyed full security, democracy, and prosperity. They still confront

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numerous problems, including state-building or consolidation, conflict resolution, democratization, economic under-development, and energy insecurity.7 But the end of bipolarity and the removal of ideological differences between the East and West have opened new windows of opportunity for the newly independent states and the region at large.8 Today, in the near vicinity of Turkey, a significant process of change is underway in the Black Sea basin, where Europe, Asia, and the Middle East meet.9 The region is going through a painful period of adopting democracy, during which the regional countries also have to put great effort into economic development, maintaining stability, and preventing ethnic conflicts and separatist movements. At the same time, they have to preserve a balance between continuing integrity with the Western world, and limiting Western influence over regional affairs.10 Europe, being dependent on Russia for a great extent for energy, sees having access to Caspian resources via a region which is outside of Russian control—namely, the Black Sea—as a vital priority. For Europe, the importance of the Black Sea is not limited to energy security. Maintenance of security and stability in the near vicinity of Europe has been a policy pursued by the EU for many years. Seeing the Black Sea as a buffer region against the east, the EU wants to eliminate instabilities and security gaps resulting from weak state structures and frozen conflicts in the area.11 Geopolitically, the Black Sea region is situated on one of the most important pathways which ensures the Russian Federation’s access to warm waters. Historically, most of the wars between the Ottoman Empire and Russia broke out because of Russia’s aim of gaining access to warm waters. Another particular feature of the Black Sea region is that it is the backyard of the Russian Federation. Russia tends to try and control those countries around its periphery, in order to maintain its security.12 In the Cold War era, as a result of the East–West rivalry that took place in the Black Sea region, the two then “equal” superpowers were both politically and militarily present in the region, and this maintained a kind of stability.13 While the dismantling of the USSR exposed the old suppressed and concealed strains and grievances, it also provided a suitable atmosphere for cooperation.14 With the enlargement of NATO and the EU, new and powerful players joined the game, and the Black Sea now forms the eastern border of the EU.15 The United States and NATO have made attempts to expand into the Black Sea region and influence the former Soviet countries. This part of the world, through which many important trade routes pass (primarily the

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“new” Silk Road), is marked by extreme diversity. The countries located around the Black Sea were polarized, on the one hand by the onset of public riots and revolutions on the part of civil society organizations, which are supported by the West in the name of democratic expansion; and, on the other, by Russia beginning to follow a more aggressive policy and trying to place the regional states back under its influence.16 Black Sea coastal countries such as Bulgaria, Romania, and Georgia, which represent different stages of this polarization, seek refuge under the umbrella of the West through membership of NATO and the EU, and even provide military bases for the use of the United States.17 As the activities of regionalism, including regional cooperation initiatives, accelerate in the international arena, it is increasingly possible to see them not as alternatives, but rather as enterprises that are mutually complementary. Although they do not possess the economic power of the more developed countries, the member countries of the Black Sea Economic Cooperation (BSEC), with their rich natural and human resources, have important potential, and are capable of taking their place amongst the world’s important regional economic entities.18 The Black Sea project presented in this volume is based on the belief that the benefits provided to the regional nations will increase once the economic cooperation founded between them is completed via a multilateral mechanism. As well as governments, independent businessmen and firms have important missions to fulfil in the success of such progress. Thus, in the design of new cooperation schemes, taking measures that increase the mobility of the business world is the main objective.19 Meanwhile, the distress experienced in Eastern Europe with the collapse of the USSR, as well as the ongoing conditions in the republics that declared their independence, must be taken into consideration. It is therefore very important to form a system that consists of a cooperative bilateral and multisided network, rather than an organization that rules over the member countries; and also to follow an incremental progression, rather than a model that goes into effect immediately after establishment.20 With projects produced and carried out under the auspices of BSEC, an increase is expected in potential trade and in the acceleration of the region’s economic relations. An improvement in economic relations will yield a more stable economic and political environment. Political stability, a natural result of progress in democratic and economic improvement, will have a positive impact on regional trust and peace.21

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The Role of BSEC BSEC was established at a time when Russia was desperately trying to find its place in post-bipolar international relations, and to reinstate its position in the CIS. BSEC membership helped Russia to retain its presence in the region when Russia’s position was weak, while the country was undergoing a painful process of systemic transformation. Regardless of existing conflicting interests and tensions between Russia and some other regional states, BSEC contributed a great deal to practical cooperation in the region. Russia’s participation and contacts in BSEC have created an additional framework for political dialogue at the regional level. BSEC is a relatively young international organization—something which explains most of its problems. Established in 1992 to promote trade and economic cooperation among the Black Sea states, it later expanded its interests and activities to security in the region.22 BSEC’s role in developing regional infrastructure and advancing cooperation in sensitive sectors undoubtedly provides advantages to the EU, Russia, and other regional countries. BSEC is a product of both globalization and regionalism, aimed at making the Black Sea area a region of peace, cooperation, and prosperity. This aim, however, is not the easiest one to achieve, given its lack of homogeneity, implementation mechanisms, resources, international visibility, and a clear vision of priorities.23 Russian foreign minister Sergey Lavrov stated on 1 June 2006 in Istanbul that “Russia considers the BSEC to be a viable regional international organisation which possesses necessary mechanisms for cooperation. What we need now is to devote the bulk of our efforts to the practical realisation of the possibilities that have been created.”24 BSEC can be seen as a potential positive influence in regional cooperation, and is the main working structure covering all Black Sea states (much like a regional OSCE). At the same time, particularly in the security sector, this potential influence is limited in the degree to which it can discuss political problems that bear on Russia’s national interests (again like the OSCE). For this reason, Russia is more focused on economic projects within the BSEC. A breakthrough in EU–Russia relations at the strategic level would undoubtedly increase the political role of BSEC in the region. The EU and BSEC are complementary in many respects. However, a great deal will depend on the EU’s ability to present a viable strategy for the region.25 For the time being, it is based on the ENP (European Neighbourhood Policy), which represents a bilateral approach rather than a sub-regional one.

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Chapter Nineteen The BSEC, as an organised area oriented to stability, development and peace, fills a vacuum the EU is unable to fill until it can get out of its political minority status by enforcing a real EU common foreign and security policy. The BSEC, in alliance with the EU, can perform a series of political and security functions with respect to an area the EU cannot manage by itself. In this sense, a downgrading of the BSEC within the context of the ENP would not be a plus for the EU itself.26

Under the best-case scenario, then, BSEC could become the EU’s regional sub-contractor and the main coordinator for regional cooperation.27

Changes after September 11 and Regional Policies of the United States and Russia The world leadership efforts of the United States, which for over twenty years has been considered the only superpower, progressed with increasing speed, both economically and politically, after the end of the Cold War era and the dismantling of the USSR. The United States put into action a strategy based on involvement in regional economic organizations on the one hand, and increasing military cooperation in the region on the other.28 While in the process of globalization, the United States forms structures that facilitate the easy economic exploitation of the world, it also tries to create dependence in those countries that resist adaptation to globalization through the use of indirect methods, by changing their social or political structures, expounding universal values such as the fight against terrorism, or establishing democracy and human rights; or by de facto occupation with the use of direct military power.29 In order to achieve close control of Russia, one of its key rivals, the United States seeks to display its presence in the Black Sea and Caspian regions. After the Middle East, the Caspian region is one of the most important energy centres for the region and the world. As much as a corridor that controls the transportation route of this energy to the West, the Black Sea region is itself potentially an energy resource.30 Russia, which monopolizes the transport of energy from Central Asia and the Caspian region to the West, has begun to use energy as a deterrent weapon, to the agitation of the United States as well as the regional states.31 The United States interests in the region have gained a new form and direction in the context of the fight against terrorism following September 11. From the United States point of view, this territory is not only important for its rich energy resources: in the National Security Strategy announced in 2002, the Black Sea and Caspian regions are accepted as

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important not only for their oil reserves, but also for providing a route to the markets of India, Pakistan, and south-east Asia.32 Regarding the US operations in Iraq and Afghanistan after the September 11 terrorist attacks, this region is now also critical as it presents a number of security threats. The primary goal of the United States is to shift the power balance of the region in its own favour, and to decrease the political, economic, and military influence of Russia in the region. Another important aim is to bind the states that emerged after the dismantling of the former USSR to the Euro–Atlantic bloc.33 This appearance of the United States and its allies as the dominant geopolitical force alters the power balance in the region. The United States wants to increase the presence of NATO in the Black Sea, in order to control the security issues caused by borders that are uncontrollable due to frozen conflicts. The demands of Ukraine and Georgia for NATO membership were met by the US president’s signature of the “NATO Freedom Consolidation Agreement” in 2007, which opened the way to also Albania, Croatia, Macedonia, Ukraine, and Georgia, and guaranteed military support to these countries between 2008 and 2012. Since the United States is not part of the region, at present it tries to exercise authority through NATO members such as Turkey, Romania, and Bulgaria. Since the Black Sea is a potential route for terrorism, organized crime, and weapons of mass destruction, the United States also wants to carry through to the Black Sea those NATO operations performed in the Mediterranean under the “Operation Active Endeavour” banner, and to this end it plans to build military bases in Bulgaria and Romania. The EU and United States are behind NATO’s aim to expand towards the east. The United States wants immediately to influence the region in such a way that will inhibit countries separated from the former USSR from establishing close cooperation with the Russian Federation. The US thinking is that if it can control the Black Sea, it will also be able to curtail the development of friendship and cooperation between Russia and Turkey. In this context, it was requested that Operation Active Endeavour should also cover the Black Sea, which represents an attempt to change the Montreux Agreement. The main goal here is to establish the presence of US ships on the Black Sea.34 From the point of view of the United States, whose global hegemony is such that virtually its only significant power rivalry is confined to this region, China forms the greatest rival power, and this makes it the most urgent strategic priority for the United States in the region.35 The assertion that the “USA’s international permanent priority carries utmost importance for the wealth and security of the citizens of USA, for the future of freedom, democracy and open economy and for the international system in

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the world,” in fact means that the central US goal is close to being a global power struggle.36 Besides maintaining the balance of power, among the United States’s political objectives in the region are supporting the activities of democratization and market economy, developing human rights, and containing nuclear weapons. It also declares that its presence in the region is intended to prevent possible conflicts that may break out between major powers and the Central Asian republics.37 At present, Turkey and Russia share strategic interests in the Black Sea region. However, Russia does not want to lose its influence over the former USSR states; it reacts to changes in the regimes of these countries, and worries that they are cooperating increasingly with Western organizations such as NATO and the EU.38 For this reason, it pays special attention to the organizations in which it takes part, and appears intent on protecting the regional status quo, including, in this context, BSEC.39 With this aim, Russia declared support for Turkey’s project of making BSEC more dynamic. Though Turkey is a member of NATO, its opinion on the Black Sea is similar to that of Russia. Like Russia, Turkey views it as an inland sea, and reacts determinedly against the prospect of any external force entering the region.40 Turkey worries that the US desire to make NATO more active in the Black Sea may reopen the debate over the Montreux regime, which establishes Turkish control over passage through the straits.41 The presence of NATO forces in the Black Sea bases, and the alteration of the regime to support the expansion of Operation Active Endeavour, threaten Turkey’s strategic advantages.42 In 1998, Turkey and Russia assembled BLACKSEAFOR, in which the coastal countries’ navies collaborate to counter NATO’s plans to expand their operations to this region for the sake of the US maintenance of Black Sea security; they also instituted “Black Sea Harmony,” a counterpart to NATO’s Operation Active Endeavour in the Mediterranean.

Influence of Russian Efforts in the Black Sea after September 11 Russian foreign policy in the Black Sea region in the post-Soviet period seems to be reactionary, with the basic aim of destroying the regional strategies of Western countries and international organizations. This stance lacks strategies that would give effective support to an extensive and multi-sided regional cooperation progress. The reactionary policy followed by Moscow in the region can be seen as Russia’s inability

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to develop an extensive alternative Black Sea strategy which is able to respond to the changing international conditions of the post–September 11 era, despite the fact that Russia is one of the big players, with legitimate interests in the Black Sea region.43 For many years, Russia perceived the lands that belonged to the neighbouring Ottoman Empire as its natural expansion zone, and with this goal it continually followed a policy of descending southwards, attempting to capture Ottoman territory during the Ottoman–Russian wars.44 Since the Black Sea provides Russia with important access to warm waters, this region always carried great geopolitical importance in Moscow’s foreign policy during the Tsardom and the Soviet period. The Black Sea is a region in which Moscow’s attention has always focused not only on transportation, but also on geopolitical, economical, and sociocultural aspects.45 In the post–Cold War era, the Black Sea is also the region in which Moscow experienced the bitter, violently negative consequences of the collapse of the USSR. In addition to the steps taken by Bulgaria and Romania, the attempts of former Warsaw Pact members in the Black Sea region to become full members of Western organizations and institutions, and the declarations of independence from the USSR on the part of Moldova, Ukraine, Azerbaijan, Armenia, and Georgia, placed Moscow in a very difficult situation. The collapse of the USSR in 1991 gave rise to the birth of a very harsh international atmosphere for Russia in the Black Sea region. Russia is no longer in a privileged position to manipulate events and progress in the Caucasus and Central Asia.46 Turkey, whose military and economic power has increased in the Black Sea, has also increased its diplomatic influence. For this reason, Moscow’s Black Sea policy in the post-Soviet period began to concentrate more on counterbalancing Turkey’s increasing power. Looking from only one side, the Russian decision-makers see the increasing regional influence of Turkey as a result of the decreased influence of Moscow, with zero-sum logic.47 Russia’s approach to countries in the Black Sea region (other than Turkey, Bulgaria, and Romania) is formed according to the “near abroad” doctrine which it put into action after 1993, through which it tries to establish special relations with the former Soviet Republics in the region.48 Although the near abroad doctrine constitutes a Russian Black Sea policy that includes all former Soviet Republics, it does not care much about the genuine conditions of the Black Sea region.49 Since Russia has undergone regional power loss during the transition process, Moscow does not possess sufficient state power to be able to put this hegemonic policy into

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action in real terms. When, from a geographical perspective, the capacity of the other former Soviet Republics in the Black Sea region to establish relations with countries like Turkey, Romania, and Bulgaria is considered, a further weak point of the Russian policy can be seen. According to the Russian Federation, control of the region is mandatory for historical, socio-psychological, economical, political, and strategic reasons, such as the protection of the unity of the country, the continuation of its influence on its backyard, maintaining its authority over the routes of energy resources, preserving the Russian presence in the region, and preventing radical Islamic terror.50 In the post–September 11 period, the strategic equilibrium in the Black Sea region has significantly shifted. The major change that made the Russian policy ineffective was the US aim of increasing its military and political activity in the region after the attacks of September 11, on the grounds of combatting international terrorism. The US expansion towards the South Caucasus and the Black Sea region directly affects Russia’s traditional economic, strategic, and political position.51 The military interventions in Afghanistan, and later Iraq, using the pretext of the September 11 attacks, have exceeded the limits of the fight against international terrorism, and turned out to constitute a process of international reconstruction. The events of September 11, and the subsequent developments, have paved the way for a change in the traditional line of the Russian Federation’s foreign policy and security doctrines. President Putin, having recognized that Russia is no longer an international superpower, or at least is far from maintaining the economic fundamentals of an international superpower, is drawing Russia back from the global arena with the intention of transforming it into a regional, but effective, power. In this context, by becoming closer to the United States, Moscow is starting to follow a policy of integration with the Western world in general. With this decision depending on political as much as economic reasons, Russia gives the appearance of surrendering its global claims, at least for a while. After taking control in Russia, Putin turned to its near vicinity and began rearranging relations with the former Soviet countries, which had been frozen during Yeltsin’s period in office. But after September 11, a new expansionism appeared in Russian foreign policy. In the new geopolitical environment, President Putin started to develop intimate relations with the West.52 After the attacks of September 11, taking important risks in domestic policies, President Putin offered full support to the United States in the fight against terrorism; Russia’s direction, which tended to be

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characterized as an axis between the West and Eurasianism, has now shifted to integration with the West, to the extent that at certain points Russia now acts as a US ally. The brisk honeymoon with the United States resulted in the US acquisition of military bases in Central Asia, one after the other. But the rise in ideas directed against the West in Russia on one side, and the failure of US expectations on the other, have caused the support given to the United States by Moscow to be questioned, opening the Kremlin up to other foreign policy alternatives.53 Russian foreign policymakers looked on the Black Sea region within the scope of the near abroad doctrine, and assumed that Moscow would regain its former power whenever it became possible to control Turkey’s influence in the region.54 But in the period after September 11, significant changes occurred in the balance of the Black Sea region. The policy followed by Russia, which failed to take these changes seriously, placed it in a marginal position and caused it to behave in a reactionary manner. On the other hand, the United States increased military and technical personnel aid to Georgia—which has nothing to do with Afghanistan, but is on the Caspian oil transportation route. This prompted Russia to develop an alternative policy. Although the United States significantly damaged Russian geopolitical interests by settling in Central Asia, President Putin kept quiet about this in order not to damage the process of cooperation that he had begun with the West. However, that the United States has allowed its authority to extend to the Black Sea and the Caucasus, on top of Central Asia, and its increasing support for Georgia, have began to annoy Russia, causing it to take a competitive position vis-à-vis the United States.55 Russia’s priorities in the region are as follows: to continue its political, economic, and military dominance; to control the foreign policy of the Caucasian states in line with Russian interests; and, especially, to inhibit the influence of Turkey, the United States, and the West.56 Nowadays, the most important point on which Turkey bases its foreign policy is to see Russia as a partner, rather than an expansionist country. Russia, on the other hand, sees itself as a country that faces the threat of further disintegration, as it still has a population that is formed of multiple ethnic groups; as it is still a multi-cultural federation, and to an extent still resembles an empire, it does not want to risk disintegrating to an even greater degree.57 Despite the apparent conflict between Turkey and Russia in the matter of energy pipelines, the warmth between these two countries that began in 2001 with the signing of the Action Plan for the Development of Cooperation in Eurasia has, in parallel, caused them to develop closer and more intense relations in the fields of energy, trade, tourism, and defence.

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Development in the bilateral trade capacity, increased Turkish investments, costly projects carried out by Turkish contractors, and energy cooperation projects like Blue Stream have eased the intensification in political relations. This situation, however, has created anxiety in the Black Sea region in response to the Turkish–Russian cooperation. Countries like Romania and Georgia, which want to profit from the United States’s increasing interest in the region, find this closeness dangerous. In this context, the similar reactions of Turkey and Russia to the presence of foreign naval forces in the Black Sea region must also be emphasized.58

US Strategies to be Effective in the Black Sea The relationships and interactions of the Central Asian countries with their neighbouring countries drew the direct attention of the United States. The Central Asian states have great natural resources, and the United States is busy with the distribution of these resources. On the other hand, it is also aware of Russia’s power, and does not want to confront Russia again. The United States, having taken its share in Central Asia, considers it beneficial to maintain the equilibrium, and because of its commercial anxieties will not allow any kind of trouble to emerge in the region. In this respect, BSEC and other regional economic cooperation projects will generate a closeness among the countries that are already linked to each other economically, hence the minimal likelihood of uneasiness in the region developing into a warm war.59 Between 1991 and 2001, the true nature of the United States’s aims towards the Central Asian republics was in the direction of maintaining stable, pro-Western progress, opening up the rich hydrocarbon resources of the region, inhibiting the spread of radical trends, and bringing an end to drug and weapon smuggling in the region.60 The general frame of US foreign policy has been designated as “expansion” or “augmentation” of the market democracies, rather than the “encirclement” of the threat, an approach which came to an end with the end of the Cold War.61 With the collapse of the USSR, the geopolitics of the Black Sea and the US strategies in the region altered dramatically. The Black Sea is currently accepted as the centre of the “Devil’s Triangle” formed by the European, Eurasian, and Middle Eastern security zones. According to the strategies formed towards the Black Sea, the United States does not identify the region solely through the coastal states. The Black Sea is

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evaluated as a “basin” and is arranged in a new system under the name “the wider Black Sea region,” similar to the greater Middle East.62 The Eurasian energy corridor, which unites the Euro–Atlantic system with Caspian and Central Asian energy resources, forms the eastern part of the wider Black Sea region. This fact makes it clear that Azerbaijan and Armenia, though not Black Sea littoral states, are included in the Black Sea basin. The projection of the wider Black Sea region into the northwest follows the great commercial rivers that flow into the Black Sea, namely the Danube and the Dniester, and proceeds up the flow pathways of the Dniester.63 Two basic dynamics can be discerned that lie beneath the US strategies towards the region. The first is that, with a new viewpoint in the wake of September 11, Washington changed its national security concept. For the United States, the Black Sea region represents a gate to the Middle East, and it would be impossible to reach the northern approach to the greater Middle East without cooperating with the Black Sea states. On the other hand, with the participation of Bulgaria and Romania the western and southern coasts of the Black Sea now form the European borders of NATO, and in the near future they will also be the borders of the EU. Consequently, the United States sees the Black Sea as an important part of the Euro–Atlantic security zone as described in NATO’s 2004 Istanbul summit. The other dynamic that determines the strategy of the United States towards the region is that the appearance of the energy axis, due to the intense demand for Central Asian and Caspian oil on the part of important international actors, has made the Black Sea an important water route for energy transportation.64 Likewise, the Central Asian and Caspian energy reserves are important for the stability of world oil prices and the energy supply of the United States. According to the thesis defended by the United States, the world oil supply will come to an end in thirty years if reserves are not managed and operated by United States oil companies.65 Along with these two dynamics, the additional factor of the Black Sea being used as a pathway in drug, human, and weapon smuggling, which are named as the new regional security threats, has also made the region strategically important to the United States. All of these dynamics combine to reveal a situation that is also closely related to global policy behaviour: the substitution of Russian influence over former Eastern Bloc countries in the Black Sea with US or Western influence.66 Meanwhile, the United States is in need of new strategic and logistics headquarters that will meet the requirements of its Black Sea strategy, and supports those political formations that would legitimize its

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presence in the countries which host its these headquarters. This aim is fulfilled for the west Black Sea region by Romania and Bulgaria. These two countries, backed up by their NATO and EU membership powers, gave the United States permission to found American bases in their territories (Romania in December 2005, Bulgaria in March 2006).67 Though progress is not yet in the exact direction desired by Washington, with the revolutions in Georgia and Ukraine the United States now exerts more concrete influence over the northern and eastern coasts of the Black Sea.68 In order to counterbalance the Russian Black Sea fleet, the new US strategy projects a continuous naval presence in the Black Sea, for durations of not greater than twenty-one days.69 The goal of this kind of constant display of military power is to discourage Russia from intervening in Georgia and Ukraine, and offering support to the countries mentioned above.70 In its Central Asian policy, the United States is trying to establish an equilibrium between the global and regional powers. Russia, on the other hand, which is still a superpower in terms of its military means, holds great potential thanks to its population and natural resources.71 This situation elevates the importance of Russia in the region, and because of its possession of nuclear weapons with the capacity to target the United States, the Russian factor must be given an important place in the United States’s general world policy.72 The US soldiers settled in the Caucasian and Central Asian countries and its regional bases are important indicators of the greatness of the energy game that is being played.73 Here, the final aim of the United States will be to expand into Iran and the Caspian over the Caucasus, after gaining a permanent settlement in the Black Sea. The most interesting and radical US move is its target of keeping a permanent naval force in the Caspian Sea. In this matter, the United States keeps negotiating with Turkmenistan and Kazakhstan. Thus the two inner seas, the Caspian and the Black Sea, neither of them coastal to the United States, are to be patrolled by its forces. This ironic and extremely dangerous strategy cannot be carried out without the support of the regional countries. There is no doubt that any country that offers its support to this strategy will suffer the consequences in the future. In addition, the continuation of this support is likely to threaten the territorial integrity of the supporting countries. In order to affect the Caucasus and Middle East, the United States has used several pretexts to try and keep its military power in the Black Sea. The United States has attempted to realize this goal three times in the last

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five years. The first of these attempts was in 2003 when it put the plan of passing military forces through Turkey into effect, and entered Iraq from the north, advancing in the direction of Baghdad. During that time, many negotiations were carried out with Turkey. An agreement was formed after long political, military, and economic discussions, and it was presented for the confirmation of the Turkish National Assembly (TNA) with the status of a treaty (later known as “the March 1 Certificate”)—but was not accepted by the TNA.74 During these negotiations, the United States’s desire to send naval ships to the Black Sea and to own a base in Trabzon was regarded as odd; it was well understood that the United States saw the agreement, which was supposedly about the US intervention in Iraq, as an opportunity to gain access to the Black Sea in order to influence the Caucasus. This wish, which was largely irrelevant to the main matter, was justly rejected by Turkey. The United States’s second attempt was in 2005. After the terrorist attacks of September 11 in 2001, NATO assembled a force, made up of ships from the naval forces of United States, Turkey, England, Italy, Germany, Greece, Norway, Denmark, Spain, Portugal, and Holland, to perform Active Endeavour operations with the aim of fighting terrorism and crime in the east Mediterranean.75 On the other hand, with the same aim, the coastal countries of the Black Sea signed the BLACKSEAFOR agreement in 2001. The military power formed under this agreement has been active since 2004 under the name of Black Sea Harmony. Besides Russia and Turkey, Ukraine also partially took part in this initiative. But in 2005, the United States presented an unofficial plan that suggested expanding the duty zone of Operation Active Endeavour to include the Black Sea. The United States’s rationale was to fight against terror and crime, and provide full security to the Black Sea. This was despite the presence of a similar structure, Black Sea Harmony, in the Black Sea (which also involved Bulgaria and Romania, the new NATO members); this attempt on the part of the United States was understood to be a pretext to gain control over the Black Sea and restrict the influence of Russia. The last action of the United States in this regard was its wish to send two seventy-ton military hospital ships that belonged to the US naval forces to Georgia, in the guise of humanitarian aid. Since it would have been possible to carry the aid via air, land, and also sea routes, in accordance with the Montreux Treaty, the United States’s desire to send heavy military ships was not considered reasonable.76 All of these three attempts represented potential violations of the Montreux Treaty.77 According to Turkey, initiatives such as BSEC, Black Sea Harmony, and BLACKSEAFOR are sufficient to address the region’s

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problems. Turkey’s opposition to the United States owning military bases in the region has driven the United States to seek to exert diplomatic influence there. The United States saw these Turkish Black Sea policies as Turkey becoming more distant to the United States and EU, and growing closer to Russia. Having been pulled in opposite directions by history, national interests, religion, and national pride, Russia and Turkey are now hesitant to choose between the East and the West. While Bulgaria and Romania support the US presence in the Black Sea, Turkey, Russia, and Ukraine are much less enthusiastic, and Turkey and Russia did not offer their full support to the Iraq war.78 In the changing geopolitics of the Black Sea, Turkey and Russia act in cooperation against the attempts to manipulate the Montreux treaty; however, this upsets some global plans. In order to demonstrate its growing presence in the Black Sea and its open support for Georgia, in late August 2008, in the wake of the Russian– Georgian hostilities, NATO sent a small flotilla of warships through the Turkish Straits. The flotilla comprised three American warships and support vessels from Spain, Germany, and Poland. Moscow subsequently accused Turkey of breaching the 1936 Montreux Convention, and hinted that this might have some unwanted consequences for Turkey’s energy security. As the last war in the Caucasus showed, Russia is not about to give up on its strategy of controlling the energy resources of the former Soviet Union, and using them as a political weapon in relations with its neighbours and the EU. In particular, Russia is preoccupied with the possibility of losing control over energy networks and pipelines for the export of oil and natural gas from the Caspian basin. The BTC pipeline, which transports oil from Azerbaijan through Georgia to the Turkish terminal at Ceyhan, experienced a stoppage, as the Turkish section of the pipeline suffered an explosion that was allegedly engineered by the Kurdish terrorist PKK. Russia’s threat of using the energy weapon against its neighbour and major trade partner makes it even more urgent for Turkey and other Western countries to pursue energy independence from Russia.79 Russia seeks any pretext in international law, including the Montreux Convention, to demonstrate that it is the main regional power in the region and the final arbiter of all conflicts in the Caucasus. Simultaneously, the United States has sought to assure Turkey that it does not intend to undermine that international convention. Admiral Michael Mullen, Chairman of the US Joint Chiefs of Staff, told journalists during a recent visit to Turkey that “we have no plans to change the Montreux Treaty. All

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the US ships that pass through the straits complied with the treaty and we will continue to do so.”80 Given the proximity of Turkey to Georgia, and its intense economic and political involvement in the region, the Turkish government’s reaction to the conflict between Georgia and Russia was remarkably muted. While NATO (of which Turkey is a member) openly sided with Georgia, and the EU (which Turkey wants to join) strongly condemned the Russian recognition of Abkhazian and South Ossetian independence, the Turkish government made no such statement.81 Instead, the Turkish foreign ministry issued a short statement limited to expressing Turkish anxiety over recent events. The growing tensions between Washington and Moscow were clearly viewed nervously from within ruling circles in Ankara, and currently present them with a dilemma. On the one hand, Turkey is deeply involved in US and European attempts to gain access to the Caspian region, and to exploit its oil and gas reserves while bypassing Russian territory. The two most important pipelines in this respect—the Baku–Tbilisi–Ceyhan oil pipeline and the projected Nabucco gas pipeline—both pass through Georgian and Turkish territory. The same is true of the recently planned railway project that links Turkey with Georgia and Central Asia. Meanwhile, economic relations between Turkey and Georgia have continued to grow.82 On the other hand, Russia has become an indispensable partner of the Turkish economy, which, despite experiencing considerable growth rates in recent years, remains extremely vulnerable.83 During the Cold War, Turkey and the United States had a close cooperation, the most important element of which was a military partnership; the two countries were close allies against the common threat of the former Soviet Union. At the end of the Cold War, in place of United States–Soviet rivalry and the dividing lines that differentiated the Western world from the Soviet bloc, they faced new conditions. Thus, taking them beyond being allies, a new concept known as “enhanced partnership” was introduced in 1991 to Turkish–United States relations, which has widened the scope of the partnership beyond security, in particular during the last decade.84 Especially in the Black Sea region, the United States and Turkey have been working together to advance democracy in Georgia, as Georgia pursues its NATO aspirations. Turkey can play an important role in resolving the conflict in Abkhazia, drawing on its large Abkhaz diaspora, which is anxious to invest in Abkhazia and thereby stimulate cooperation and reconciliation. More broadly in the Black Sea, the United States strongly supports Turkey’s leadership in Operation Black Sea Harmony,

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fostering maritime security cooperation with Russia, Romania, Ukraine, Bulgaria, and Georgia against threats of proliferation and terrorism. It also welcomes strong information-sharing between Operation Black Sea Harmony and NATO’s Operation Active Endeavour in the Mediterranean Sea.85 In summary, United States–Turkish relations now enjoy a new and modern agenda which profoundly differs from the partnership they demonstrated during the Cold War era. The United States reshaped its bilateral agenda radically during the Bush administration. Although it has weathered some serious difficulties, the United States–Turkey strategic partnership is now broader and richer than at any time in the past. Relations between the two countries are based on common interests and shared values. Today, the United States appreciates Turkey as a key Euro– Atlantic ally that uniquely enjoys multiple identities as a European, Middle Eastern, Eurasian, Balkan, Black Sea, and Mediterranean country. Cooperation on energy, security, and democracy provides the foundation for a partnership that is more deeply and genuinely strategic than it was in the past. As the United States contemplates the threats that will confront the Euro–Atlantic community in the coming decade, Turkey has emerged as an indispensable partner. Maximizing the potential of its strategic partnership will require the next US administration to keep all these factors in mind, and require Turkey to sustain political and economic reforms even when tempted by its propensity to avoid tough decisions.86 In conclusion, at its simplest, the common interests of Turkey and the United States are: x ensuring stability in the area, which includes the Middle East, the Gulf, the Caucasus, and the Caspian basin, as well as Central Asia and Afghanistan–Pakistan; x ensuring security of energy supplies and energy corridors; x avoiding proliferation of failed states in the region to more effectively fight against transnational terrorism; x reinforcing the economies of the countries in the region which would in turn strengthen economic actors and help create an integrated economic area that will partake of globalization; and x promoting peaceful resolution of conflicts in the region, preventing proliferation of weapons of mass destruction, and keeping Russia as a responsible non-aggressive power in the critical regions of the Caucasus and the Black Sea.87

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Conclusion It is obvious that the importance of the Black Sea basin is increasing day by day. The Black Sea, as a transport route for Caspian Basin and Central Asian oil and gas to Western markets, is a dynamic region in the control of energy. What is more, the oil reserves recently found in the Black Sea have further increased the significance of the region as far as energy is concerned. The Black Sea is in a location which permits the direct control of the Caucasus. If it succeeds in attaining control of the region, the United States will have the opportunity to transfer its power to the Caucasus and Central Asia, enabling it to restrict Russia in the region and encircle it from the south. In Georgia, the events related to South Ossetia show that Russia is still active in the region and is determined to continue such activity. This situation has a negative influence on the United States’s prospects of dominating the Caucasus and Central Asia together, and on the greater Middle East project. The Black Sea region constitutes the most crucial area in Russian foreign policy, due both to its geopolitical and geo-economic importance, and to specific Russian interests during the period of systemic transformation following the collapse of the USSR. It is marked by a string of destabilizing factors, such as the “Chechenization” of the North Caucasus, “frozen conflicts” in the trans-Caucasus, strained relations between Russia and the countries of the ENP Organization for Democracy and Economic Development (GUAM), and rivalry over transit routes for Caspian oil. Thus, from a Russian viewpoint, the Black Sea is the focus of many vital concerns that will affect not only national, but regional and international stability, if not handled properly. Russia’s interests in the region are defined under the following three points. First, Russia’s primary interest is to retain position in the region as one of the main actors, given the emergence of new strong regional and external actors (Turkey and the United States/NATO, respectively), which are prone to exploit, with the collapse of the USSR, a historic opportunity to increase their influence in the region. Since the demise of the USSR, both Turkish and US policies have been heavily dominated by the goal of undercutting Russia’s position in the region, including in the CIS. In addition, Turkey has been supported by the United States as a balancing element in the Caspian–Black Sea region against Iran’s influence. American support for the Ceyhan pipeline is seen as being in line with US priorities in the region, while keeping in mind the interests of American companies. EU involvement in the region was minimal in the 1990s. Romania and Bulgaria’s membership in the EU highlighted the importance

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of the Black Sea region for the ENP, and raised the question of the EU’s sub-regional approach to the Black Sea. Today, the EU’s active role in the region is heavily affected by its Euro–Atlantic ambivalence, namely, its security links with NATO. The predominant opinion of the Russian political elite is that the West, and above all the US/NATO, does not want Russia to regain the influence that it used to have in the time of the USSR. And when a deep crack emerged between the GUAM and the rest of the CIS, the West was quick to drive in a wedge, supporting the GUAM countries to cause them to drift from Russia, and to use their vulnerability for its own goals: to have new oil and gas routes that bypass Russia, and new military installations and bases not necessarily directed against Russia, but that have Iraq, Iran, and Afghanistan within range. “The GUAM was established to limit Russia’s influence in the Caucasus ... With the change in the geopolitical situation in the world and Russia bouncing back, the Caucasus has become even higher on America and NATO’s agenda in part due to its lucrative strategic location.”88 Driving a wedge between Russia and the GUAM would be a disservice to the US/NATO security interests in the wider Black Sea area, which require cooperation with Russia on the Kosovo problem, the Iranian nuclear programme, international terrorism, and many other issues. But the major threat is related to the risk of a new divide in post-communist Europe. Russia’s second main interest in the region is to counter and suppress extremism, separatism, and terrorism. Evolving problems in the North Caucasus between the autonomous Russian republics (not only Chechnya, but also Karachay–Cherkessia, Kabardino–Balkaria, North Ossetia, Ingushetia, etc.) and growing religious pressures (from the Wahhabis, among other groups) make this area perhaps even more important to Russia than the CIS in terms of interests and stability. Given the regional interdependence, Russia is interested in security and stability in the wider Black Sea region. Moscow’s major concern is the radicalization of Russian Muslims who have traditionally lived in Russia, as well as in the North Caucasus and in the Volga–Urals region. This process is fraught with terrorism and separatism, and many of the region’s countries are faced with the same problems. Under the best-case scenario, this common challenge creates sound fundamentals for cooperation. The Kosovo problem provides the most telling evidence for this; though there are political forces in Russia which view Kosovo’s independence as a precedent for the rebellious regions in the Black Sea area—Abkhazia, South Ossetia, and others—the Kremlin is not interested in this precedent, not only because it wants to avoid new tensions with the West, but first

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and foremost because it would confront the Russian leadership with a serious challenge. To recognize the rebellious autonomies along the lines of the Kosovo model would mean reconsidering the main principle of the Russian foreign policy that centres around the inviolability of the postSoviet borders. So, the Kremlin still represents a wall, albeit thin, that bars the way to Russian nationalists. The third main Russian interest in the region is to ensure uninterrupted and secure energy, trade, and civil and military communications within and throughout the Black Sea and the Straits. In contemporary world politics, the Black Sea is a pivotal region for the global powers. After the demise of the USSR, the number of coastal states of the Black Sea increased, and not only these coastal states, but also the United States, the EU, Russia and many other global and regional powers are today involved in the struggle to exert influence over the Black Sea region, with its critical strategic significance. Since the wider Black Sea is indispensable to both the United States and Russia, the future of United States–Russia relations will be instrumental in establishing cooperation in this region.

Notes 1

Ça÷lar Keyder, Ulusal KalkÕnmacÕlÕ÷Õn øflasÕ (Istanbul: Metis YayÕnlarÕ, 1993), 97. 2 Jeffery E. Garten, So÷uk BarÕú, trans. Yavuz Alogan (Istanbul: Sarmal YayÕnevi, 1994), 19–37 (originally published as A Cold Peace, New York: Times Books, 1992). 3 Panayotis Gavras, “The Black Sea and the European Union: Developing Relations and Expanding Institutional Links,” Southeast European and Black Sea Studies 1, no. 4 (January 2004): 23. 4 Yaúar HacÕsaliho÷lu, “Karadeniz HavzasÕnda Jeopolitik Hamleler,” 1. Türk Rus Ortak Karadeniz Sempozyumu (Ankara: Ankara Üniversitesi BasÕmevi, 2008), 170. 5 Nejdet Pamir, “Karadeniz: Enerji Güvenli÷ine ve KaynaklarÕn Çeúitlendirilmesine AçÕlan KapÕ,” Avrasya DosyasÕ 13, no. 1 (2007: Karadeniz’in Yeni Jeopoliti÷i): 250. 6 Gareth Winrow, “Geopolitics and Energy Security in the Wider Black Sea Region,” Southeast European and Black Sea Studies 7, no. 2 (June 2007): 219. 7 Iris Kempe and Kurt Klotzle, “The Balkans and the Black Sea Region: Problems, Potentials, and Policy Options,” Bertelsmann Group for Policy Research: CAP Policy Analysis 2 (2006), 6. 8 Nadia Alexandrova-Arbatova, Regional Cooperation in the Black Sea Area in the context of EU–Russia Relations (Athens: International Centre for Black Sea Studies, 2008), 15.

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9 Stephen Blank, “Black Sea Rivalry—Turkish Straits,” Perspectives 17, no. 2 (March–April 2007), http://www.turksam.org/en/a209.html. 10 Stephen Blank, “Security in and Around the Black Sea: Is a Virtuous Circle Now Possible?” Mediterranean Quarterly 16, no. 2 (2005): 44–66. 11 Black Sea Regional Profile: The SecurÕty Situation and the Region-Building Opportunities (Sofia: Institute for Security and International Studies), 2. 12 Cihangir DumanlÕ, “So÷uk Savaú SonrasÕ Karadeniz’de De÷iúen Dengeler,” 1.Türk Rus Ortak Karadeniz Sempozyumu (Ankara: Ankara Üniversitesi BasÕmevi, 2008), 155. 13 Mustafa AydÕn, “Regional Cooperation in the Black Sea and the Role of Institutions,” Perceptions 10 (Autumn 2005): 57. 14 Pamir, “Karadeniz,” 250. 15 Roberto Aliboni, “Globalization and the Wider Black Sea Area: Interaction with the European Union, Eastern Mediterranean and the Middle East,” Southeast European and Black Sea Studies 6, no. 2 (2006): 157–168. 16 Özgür SarÕ, “Yükselen Karadeniz ve Karadeniz Ekonomik øúbirli÷i Örgütü,” Stratejik AraútÕrmalar Dergisi, no. 10 (2007): 123. 17 Alexandrova-Arbatova, Regional Cooperation, 15. 18 Canan BalkÕr, Karadeniz Ekonomik øúbirli÷i Bölgesi (KEøB)—Ekonomik Bir De÷erlendirme (Istanbul: TÜSøAD yayÕnlarÕ, 1993), 55. 19 Sinan Ogan, “The Black Sea: New Arena for Global Competition,” http://www .turksam.org/en/a195.html. 20 BalkÕr, Karadeniz, 52. 21 Sergiu Celac, ed., Black Sea Economic Cooperation: Fifteen Years of Regional Activity 1992–2007, Views by Foreign Ministers and Heads of BSEC Institutions (Athens: ICBSS, 2007), 11. 22 BSEC, “About BSEC” (2008), http://www.bsecorganization.org/main.aspx?ID =About_BSEC. 23 Yannis Valinakis, “The Black Sea Region: Challenges and Opportunities for Europe,” Chaillot Papers 36 (1999). 24 See “The Russian Federation’s Chairmanship in the BSEC: Priorities and Expectations,” http://www.greece.mid.ru/int_e_04.html. 25 Dmitri Trenin, “Russia, the EU and the Common Neighbourhood,” Centre for European Reform, September 2005, http://www.cer.org.uk/pdf/essay_russia_ trenin_sept05.pdf. 26 Roberto Aliboni, “Globalization and the Wider Black Sea Area”: 166. 27 Alexandrova-Arbatova, Regional Cooperation, 35–36. 28 The White House, “A National Security Strategy for a New Century,” Avrasya DosyasÕ (Küresel De÷erlendirme Özel) 9, no. 3 (Autumn 2003): 28. 29 Tuncer KÕlÕnç, “Karadeniz’de Yeni øúbirli÷i AlanlarÕ ve OlanaklarÕ,” 1. Türk Rus Ortak Karadeniz Sempozyumu (Ankara: Ankara Üniversitesi BasÕmevi, 2008), 73. 30 Tedo Japaridze, “The Black Sea Region: Meaning and Significance,” American Foreign Policy Interests 29 (2007): 114. 31 KÕlÕnç, “Karadeniz’de”: 75. 32 Sinan Ogan, “Küresel Mücadelenin Yeni Rekabet AlanÕ: Karadeniz ve Montrö AnlaúmasÕ,” Türksam, 3 December 2008, http://www.turksam.org/tr/a907.html.

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33 Ronald Asmus and Bruce Jackson, “The Black Sea and the Frontiers of Freedom,” Policy Review, no. 125 (June/July 2004): 4. 34 KÕlÕnç, “Karadeniz’de”: 76. 35 Mehmet Seyfettin and Çi÷dem Tunç, “11 Eylül SonrasÕ ABD’nin Küresel Güç Mücadelesinde Orta Asya,” Avrasya DosyasÕ 9, no. 3, (2003): 6. 36 Samuel P. Huntington, “Why International Primacy Matters,” International Security 17, no. 4 (Spring 1993): 83. 37 S. Frederick Star, “The War Against Terrorism and US Bilateral Relations with the Nations of Central Asia,” Evidence before the U.S. Senate Committee on Foreign Relations, Subcommittee on Central Asia and the Southern Caucasus, 13 December 2008, http://www.cacianalyst.org/Publications/Starr_Testimony.htm. 38 Timothy Bancroft-Hinchey, “Russia Asked to Cover NATO’s Back,” Pravda, 17 December 2009. 39 Micaela Gustavsson and Bezen Balamir Coúkun, “The Black Sea as Boundary or Bridge?” SIPRI Seminar Report (Stockholm: Stockholm International Peace Research Institute, 2003), http://www.sipri.org/research/conflict/publications/ black_sea. 40 Elena Urazova, “Russia and Turkey: Eurasian Integration Processes,” Insight Turkey 2, no. 4 (2002): 85–94. 41 “Regional Initiatives aimed at Enhancing Security in the Black Sea Maritime Domain,” http://www.tsk.tr/eng/uluslararasi/karadenizdenizisbirligigorevgrubu .htm (link now broken). 42 David J. Smith, “Opinion: Turkey Needs to Let NATO Safeguard the Black Sea,” Jane’s Defence Weekly, 12 October 2005, p. 21. 43 Ronald Asmus, “Next Steps Forging a Euroatlantic Strategy for the Wider Black Sea,” Avrasya DosyasÕ 13, no. 1 (2007: Karadeniz’in Yeni Jeopoliti÷i): 31. 44 Ömer Göksel øúyar, Bölgesel ve Global Güvenlik ÇÕkarlarÕ Ba÷lamÕnda SovyetRus DÕú PolitikalarÕ ve Karaba÷ Sorunu, 1.BasÕm (Istanbul: Alfa YayÕnlarÕ, 2004), 195–196. 45 Oktay FÕrat TanrÕsever, “Sovyet SonrasÕ Dönemde Rusya’nÕn Karadeniz PolitikasÕ,” Avrasya DosyasÕ 13, no. 1 (2007: Karadeniz’in Yeni Jeopoliti÷i): 174. 46 Cenk BaúlamÕú, “Rusya’nÕn Arka Bahçesindeki Diken,” YüzyÕlÕn Son Petrol Savaú, Stratejik AraútÕrmalar Grubu, 1. BaskÕ (Istanbul: Elya YayÕncÕlÕk, 1998), 39. 47 TanrÕsever, “Sovyet SonrasÕ,” 175. 48 TanrÕsever, “Sovyet SonrasÕ,” 176. 49 Ziya Öniú, “Turkey and the Post-Soviet States: Potential and Limits of Regional Power Influence,” MERIA: Middle East Review of International Affairs 5 no. 2 (June 2001), http://meria.idc.ac.il/journal/2001/issue2/jv5n2a6.html. 50 Seyfettin and Tunç, “11 Eylül SonrasÕ,” 6. 51 Alla A. Yazkova, “Karadeniz Bölgesi’nde Rusya’nÕn BaúlÕca ÇÕkarlarÕ ve Siyaseti,” 1. Türk Rus Ortak Karadeniz Sempozyumu (Ankara: Ankara Üniversitesi BasÕmevi, 2008), 93. 52 Alexandrova-Arbatova, Regional Cooperation, 25. 53 Sinan Ogan, “Küresel Mücadelenin.” 54 TanrÕsever, “Sovyet SonrasÕ,” 176.

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Alexandrova-Arbatova, Regional Cooperation, 26. Stephen Blank, “Time for a Transatlantic Initiative,” New Europe Review 2/3 (2005): 5. 57 Özdem Sanberk, “Türkiye, ABD ve Yeni Karadeniz Dönüúüm için øúbirli÷i,” Avrasya DosyasÕ 13, no. 1 (2007: Karadeniz’in Yeni Jeopoliti÷i): 18. 58 Yazkova, “Karadeniz Bölgesi’nde,” 94. 59 Kemal Kiriúçi, “US–Turkish Relations: New Uncertainties in a Renewed Partnership,” in Turkey in World Politics: An Emerging Multiregional Power, ed. Kemal Kiriúçi and Barry Rubin (Boulder: Lynne Rienner, 2001), 129–149. 60 Serap Yavuz, Avrupa Birli÷i’ne giderken AfrikalÕlar için Nobel: AçlÕk Ödülü, (Istanbul: Mektep YayÕnlarÕ, 1990), 39–40. 61 Ahmet Bu÷ra Belevi, “So÷uk BarÕú Döneminde Dünya’da Ekonomik Güvenlik ArayÕúlarÕ: KEøB,” YayÕnlanmamÕú Yüksek Lisans Tezi, Marmara University, Avrupa Toplulu÷u Enstitüsü, 1996, p. 89. 62 “The Black Sea Region: New Challenges and Opportunities for Regional Cooperation,” Opening Speech of State Minister Gernot Erler at the Conference of SOA and DGO, 14 May 2009, Berlin, http://www.auswaertiges-amt.de/diplo/de/ Infoservice/Presse/Reden/2009/090518-ErlerSchwarzmeer.html. 63 Bo÷aziçi Üniversitesi-TÜSøAD DÕú Politika Forumu, ABD’nin Karadeniz Stratejisi ve Türkiye, 21 November 2008, http://www.dispolitikaforumu.org/ index2.php?option=com_docman&task=doc_view&gid=10&Itemid=6. 64 Zeyno Baran and Robert A. Smith, “The Energy Dimension in American Policy towards the Black Sea Region,” Southeast European and Black Sea Studies 7, no. 2 (June 2007): 265. 65 Ça÷rÕ Kürúat Yüce, Kafkasya ve Orta Asya Enerji KaynaklarÕ Üzerinde Mücadele (Istanbul: Ötüken YayÕnlarÕ, 2006), 111. 66 Stephen Blank, “Towards a New Russia Policy,” Strategic Studies Institute, http://www.scribd.com/doc/4871316/Towards-a.new-Russia-Policy, http://www .strategicstudiesinstitute.army.mil/. 67 Panayotis Gavras, “The Black Sea and the European Union: Developing Relations and Expanding Institutional Links,” Southeast European and Black Sea Studies 1, no. 4 (January 2004): 27. 68 Bo÷aziçi Üniversitesi-TÜSøAD DÕú Politika Forumu, ABD’nin Karadeniz Stratejisi ve Türkiye, 21 November 2008, http://www.dispolitikaforumu.org/ index2.php?option=com_docman&task=doc_view&gid=10&Itemid=6. 69 Ariel Cohen, “U.S. Strategy in the Black Sea Region,” 13 December 2006, http://www.heritage.org/research/russiaandeurasia/bg1990.cfm. 70 Dr. Nejat TarakçÕ, “ABD’nin Yeni Karadeniz Stratejisi ve Türkiye’ye Etkileri,” 17 November 2008, http://www.turkpolitika.com/component/content/article/ 3son-dakika/2629-abdnn-karadenz-stratejs. 71 Yüce, Kafkasya, 193. 72 ødris Bal, “ABD’nin Orta Asya PolitikasÕna Yön Veren øç ve DÕú Dinamikler,” Stratejik Analiz Dergisi 1, no. 12 (2001): 61. 73 Yüce, Kafkasya, 111. 74 Arma÷an Kulo÷lu, “ABD Montrö’yü yine Zorluyor,” 5 December 2008, http://busam.beykent.edu.tr/resimy/kuloglu-agustos.pdf. 56

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75 Lincon A. Mitchell, “More than Location: Crafting a US Policy for the Black Sea Region,” Southeast European and Black Sea Studies 8, no. 2 (June 2008): 131. 76 Sinan Ogan, “The Black Sea: New Arena for Global Competition,” Turkish Policy Quarterly Journal (Summer), 28 May 2006. 77 Lozan AntlaúmasÕ, Montreux Sözleúmesi ve Paris BarÕú Sözleúmesi (Istanbul: Harp Akademileri BasÕmevi, 1987), 111. 78 Tanju Erdem, “ABD, Karadeniz’de VarlÕk Göstermek østiyor,” Cumhuriyet Strateji, 17 April 2006. 79 Alexander Murinson, “Russia Accuses Turkey of Violating Montreux Convention,” Issue of the CACI Analyst Central Asia Caucasus Institute Analyst, 15 October 2008, http://www.cacianalyst.org/?q=node/4960. 80 Murinson, “Russia Accuses Turkey.” 81 On Georgia, see R. Legvold and B. Coppieters, eds., Statehood and Security: Georgia after the Rose Revolution (Cambridge, MA: MIT Press, 2005). 82 Some 100 Turkish companies are active in Georgia, mainly in the building sector, and have invested approximately US$600 million. The trade volume between the two countries is US$1 billion a year. Turkey is also selling arms and ammunition to the Georgian military and providing training for its officers. 83 Sinan Ikinci and Peter Schwarz, “Georgian Conflict Poses Dilemma for Turkey,” 9 September 2008, http://www.wsws.org/articles/2008/sep2008/turks09.shtml. 84 Nilüfer Karacasulu Göksel, “The Post-Cold War US–Turkey Partnership,” Review of Social, Economic & Business Studies 7/8: 116, http://fbe.emu.edu.tr/ journal/doc/78/08.pdf. 85 Giray Saynur Bozkurt, “Gürcistan’daki Etnik ÇatÕúmalar KarúÕsÕnda Türkiye ve Rusya’nÕn Tutumu” [Attitudes of Russia and Turkey towards Georgia and ethnic problems], Karadeniz AraútÕrmalarÕ [Journal of Black Sea Studies], Central and Eastern European Online Library 19 (2008), www.ceeol.com. 86 Matt Bryza, “Invigorating the U.S.–Turkey Strategic Partnership,” Turgot Ozal Memorial Lecture at the Washington Institute for Near East Policy, Washington, DC, 24 June 2008, http://merln.ndu.edu/archivepdf/EUR/State/106232.pdf, 87 Stephen Blank, “Towards a New Russia Policy.” 88 “Round Table at Military-political Research Foundation,” Military Diplomat 4 (2007): 45–46.

CHAPTER TWENTY INTERNATIONAL ORGANIZATIONAL INITIATIVES IN THE BLACK SEA REGION ALAEDDIN YALÇINKAYA*

Introduction Realism versus idealism is one of the major debates in international relations, law, and organizations. The idealistic approach posits that if a peaceful background is provided, the virtue present in human nature will render us inclined to resist all kinds of evil and adversity. Therefore, should a peaceful and steady international background emerge, people will avoid war and conflict, and disputes would be resolved through peaceful means. To be able to reach this goal, international law has to be improved and a sanctions regime developed. This mission is to be undertaken by international organizations which will function as the sanctioning unit of international law and supervise its application. The League of Nations was founded for this purpose and was equipped with all relevant powers, including the right to intervene in the sovereign rights of its members in pursuit of its wider goals. However, the Permanent Court of International Justice and the League of Nations, founded at the end of World War I, ended up safeguarding the system built up by the victorious powers, and when the defeated side began to prosper, the system of the League lost its raison d’être and faded away. Thus did an idealistic international organization come to be nothing but a means for strong powers to advance their interests. In this case, since there was a discrepancy between the intended and declared goals of certain organizations, which created mistrust amongst its members, the continuity and membership of the organization became open to question. While the realists approve of such international organizations, they also oppose the manipulation of these organisations in pursuit of self interest. The realist approach claims that *

Sakarya University, International Relations Department, Turkey.

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international organizations should be built up in a way that prevents—or at least impedes—such manipulations. The disintegration of the Soviet Union marked the end of the Cold War, and the ways in which a new world order should be formed are still being debated. The repercussions of developments in the last decade have shaken the dynamics of the world order and have been pivotal to the direction of the twenty-first century. Although the collapse of the Soviet Union marked the end of the bipolar world order, the true parameters of the present world order are still open to debate. Following the deadly attacks of September 11, the world is cautious about what risks might yet emerge with regard the stances of powers such as the United States, the European Union, and China. The basic strategies of the Black Sea and the Caspian coastal countries, and the success or failure of their policies, will no doubt be one of the major factors to determine the contours of the new international system. Needless to say, the collapse of the Soviet Union and the formation of the Commonwealth of Independent States (CIS) have had an impact that has been more visible on the ex-Soviet Republics and the countries of the Black Sea region than on the international world order more generally. Upon the abolishment of the Warsaw Pact and COMECON, the eastern European countries gained their political and economic independence, while the fifteen republics of the Soviet Union declared their independence under international law. Against this background, the Black Sea coastal countries and some of the inland states founded the Black Sea Economic Cooperation (BSEC), following Turkey’s initiative. In respect of the diversity of economic views and the social and ethnic traits of its members, BSEC can fairly be considered a unique organization. There are various reasons for the overall change in the international world order following the disintegration of the USSR, as well as for why the impact of this change has been seen most vividly in the Black Sea region. Firstly, the Black Sea coastal and inland states have witnessed major disputes due to their strategic, economic, and socio-political characteristics. Furthermore, developments in global politics, though they may not have had direct relevance to the Black Sea region, have in some cases come to affect the stability in the region.1 As a grouping which is primarily economic, BSEC is a regional organization limited to the Black Sea region, sharing commonalities with other regional organizations. However, the social, economical, cultural, and religious traits of the countries in the region exhibit stark differences. Their unification under the same umbrella, despite these differences, is an amazing feat. However, one might also argue that the reason BSEC has

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not been very effective since its establishment is precisely due to these discrepancies. Thus, these differences might cause the end of the organization or, conversely, provide it with the vital momentum needed to sustain the organization.2 This paper will focus on the significance of a sub-organization of BSEC, the Black Sea–Caspian Energy Community (BSCEC), and will mainly look at the energy cooperation of the countries in the region, which offers a strong and durable common ground in their relations. In this region, some countries are oil and gas producers, while others are consumers and transporters: cooperation is therefore surely very useful for all parties. Our study will also consider the hardships experienced during the period of establishment of BSEC due to the lack of economic infrastructure.3 Besides providing political momentum for BSEC, the major purpose of the economic cooperation aimed at by the organization is to provide for secure common prosperity in the countries of the region by promoting other modes of cooperation amongst them. Their economic and commercial relationships will create ways for the littoral countries to come together to tackle their legal, political, and security issues. The solidarity achieved through cooperation will likely lead to the development of the region’s rich natural resources. The transport of Caspian oil and natural gas to world markets has long been an issue of international concern. After long discussion, the Baku–Tbilisi–Ceyhan (BTC) pipeline was finally considered safer than other routes. It has frequently been reiterated that routes through the Persian Gulf and Russia would be more competitive compared to the BTC, since, when pipeline lengths are calculated, the BTC route proves to be the longest and the most costly; however, the side supporting the BTC project insisted on this route, emphasizing that, as well as ecological and political advantages, to transport oil via this route was also economically more feasible. In this context, it was important for the countries of the region to come together and constitute a system that would smoothly perform the different roles of oil producing, consuming, and transporting. It is expected that the ongoing developments in technology and communication in the countries of the region will lead their societies to become more participatory and their governments to be more transparent. Eventually the countries will become more cautious about foreign exploitation of their natural resources and such solidarity as gained on energy issues will be carried over to other branches of their economies. In due course, then, mutual trust and understanding will be established among them, instead of imperialistic, aggressive, and expansionist policies.

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In the present course of international relations, self-interest is manifestly taken into consideration more than prestige. In this respect, the countries of the region might make the mistake of treating the transport of Caspian oil through the Persian Gulf, the Mediterranean, or the Black Sea only as a matter of gaining or losing prestige for Turkey, Iran, Russia, or the Caucasian countries. If the perceived gains were to be limited to achieving prestige, it would be unfortunate for regional security and welfare. Besides the issues of oil and gas production and their transportation— which have caused political and economic conflicts among third parties— the Caucasus and Middle Asia have also been areas of competition for colonial powers who desired to exploit the raw materials and geopolitical advantages of these regions. During the nineteenth and twentieth centuries, the policies of the Western powers towards the Caucasus and Central Asia were referred to as the “Great Game.” Zbigniew Brzezinski echoes this history in the title of his recent work on the region—The Grand Chessboard.4 In the eighteenth and nineteenth centuries, during the colonial era, the colonies were simply shared amongst the colonialist powers, whereas subsequent to the developments of the end of the nineteenth century and the beginning of the twentieth, colonialism persisted in more latent forms. Furthermore, the so-called competition (in fact cooperation) of the Western powers over the region, particularly in the Caucasus, Central Asia, and Afghanistan, can be defined as a more complex form of latent colonialism. However, an energy system which comprises all Caspian and Black Sea countries will enable the optimum use of alternate transportation routes for oil consumers and producers and would be equally fruitful— both economically and ecologically—for all parties. In this context, BSEC can constitute a suitable ground for implementation, provided that the actual and potential complementary traits of each country are considered. As a web of cooperation develops among them, welfare will start to prevail, and eventually this economic cooperation will lead to political proximity which will further increase prosperity in the region. Global powers and multinational companies will have to deal with the region only through BSEC. Although to some extent this will hinder economicoriented political cooperation, such a trend can be seen in all other regional organizations. Before discussing the BSCEC, we should first focus on its principles and basic components.

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The Establishment of BSEC and its Major Goals The declaration of the Black Sea Economic Cooperation was signed in Istanbul on 25 June 1992 under the framework of the Bosporus Statement. This development followed the founding statement of CIS (Commonwealth of Independent States), the Minsk Agreement of December 1991, and the Almaty Declaration. The BSEC Declaration was signed by Albania, Azerbaijan, Bulgaria, Armenia, Georgia, Moldova, Romania, Russia, Turkey, Ukraine, and Greece. In addition, in 2004, Serbia and Montenegro5 became members of BSEC. With this declaration, the presidents of these countries expressed their determination to provide all the necessary conditions for the realization of full cooperation, enabling freedom of movement, free exchange of goods, labour, services, and assets.6 The signatory states of the Bosporus Statement, abiding by the terms of the UN Charter and the OSCE Statement, agreed on the following: securing the necessary legal arrangements to provide the infrastructure for the development of a free market; promoting democracy, the rule of law, and respect for human rights; enhancing cooperation on the basis of friendly and good neighbourly relations to bolster peace, progress, and stability in the region; and promoting regional cooperation among the people of the region. Such cooperation is indispensable when we consider the serious ongoing political and ethnic turmoil in the region which the members of BSEC are trying to resolve under the framework and principles of the OSCE, as well as the need for common measures to be agreed in the face of tension, violence, terrorism, and political illegitimacy. In my opinion, a common belief in promoting the prosperity of the whole region can be built only under these terms.7 In the discussions leading to the Bosporus Statement, there were references to the regional conditions which make cooperation essential. There were also references to the crises in the region due to the disintegration of the USSR. The most remarkable aspect of this statement was that the signatories agreed on the implementation of a free market economy, although many had only recently abandoned the socialist system. However, the political, ethnic, and security concerns of the transition stage were also considered and it was noted that accomplishing full cooperation might take time. According to the statement, a new era of peace and security could be initiated in Eurasia through implementing a new system based on human rights, and individual rights and freedoms. Cooperation in the region would be enhanced and within this context the potential of the various states and their geographical proximity would be considered. Mutual

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interests would be maintained during the settlement of possible conflicts throughout the foundation of BSEC. Ecological and environmental concerns were also emphasized. Comprehensive cooperation would pave the way to integrate its members into the world economy without hindering their present or future commitments to the third parties and to other organizations like the EU and CIS.8 On issues like commerce, industry, science, technology, and environment, this would also provide for mutually beneficial contacts including standardization of products, sharing and updating each others’ economic know-how, utilising and managing natural resources, and promoting tourism and agriculture. In accordance with the Bosporus Statement, the private sector will be supported, and new financial and legal arrangements will be established which will avoid double taxation and provide loans for trade and investment. The financial resources needed to accomplish those objectives are intended to be provided from the international financial institutions, and efforts will also be made to establish a Black Sea Foreign Trade and Investment Bank; parties will hold annual meetings to evaluate the accomplishments and make new plans for further projects in which delegates from the international business world will also be invited.9 Despite the high ambition of the participants, BSEC commenced operation no less than six years after its goals and principles were agreed in 1992. Within this period, contacts were made and various meetings were held in the capitals of the participating countries. During the meeting in Tbilisi on 30 June 1994, it was decided to form the Black Sea Trade and Development Bank, while on 30 June 1995, with the Bucharest Statement, the parties reiterated their intentions on fostering cooperation and proceeding with the institutionalization of BSEC. On 25 October 1996, the presidents and prime ministers of the member countries signed the Moscow Declaration which indicates the need to accelerate commercial cooperation within the region, and on 7 February 1997, the foreign ministers signed the Istanbul Declaration which expressed the intention to build a Black Sea Economic Free Trade Zone in which new mechanisms were to be initiated for the further fostering of cooperation in the region, and the final target of the BSEC was laid out.10 In relation to this, a conference was held in Istanbul on 28–30 April 1997 entitled “New Business Opportunities in the Black Sea Region.” Relevant business circles were invited and they were informed of the developments while their suggestions were also solicited. Finally, a key development took place in the beginning of 1998 when the Black Sea Trade and Development Bank was founded in Thessaloniki, Greece.

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The most significant development within the BSEC process since its foundation in 1992 was accomplished with the Yalta Summit Declaration in June 1998. This declaration emphasized that the international recognition of BSEC was essential and thus it had to be internationally supported. The declaration stated that economic cooperation had to be added to the stability and security of the region and BSEC had to be developed into a fully capable international organization; to this end, the BSEC Charter was adopted. It was also declared that the economic program of BSEC was necessary to meet demands of globalization and modernization, to create employment opportunities, and improve economic cooperation amongst the countries of the region. It was further noted that regional countries should improve their foreign trade regimes in order to improve trade movements in the region, and that a free trade zone should be established. In this process, contributions and support from the private sector were to be encouraged. In the context of this cooperation, the significance of BSEC–EU relations was stressed. It was also strongly averred that a Europe–BSEC economic region should be formed. In the meantime, the contributions of Austria, Egypt, Israel, Italy, Poland, and the Republic of Slovakia as observers to BSEC were mentioned and it was declared that further contributors would be welcomed.11 Once BSEC was established as a functioning institution, various sub-institutions were established, such as the BSEC International Permanent Secretariat,12 the Term Presidency, the Tripartite Administration, the Foreign Affairs Ministers Council, the BSEC Deputy Council, the BSEC Business Council, the Black Sea Trade and Development Bank, the Working Group, the Experts Group, and the Tax Group.

The Main Traits of BSEC Countries Before focusing on the accomplishments or deficiencies of BSEC and determining the place of BSCEC in the overall picture, we should briefly deal with the interrelations of the BSEC member countries and their particular traits.13 In a study examining the political and economic strengths of the countries in the region, Turkey, Russia, and Ukraine play key roles. Considering that it has similar traits, Greece can also be included in this group. Meanwhile, despite some mutual clashing of interests, Turkey and Russia are also seen as being the core of the BSCEC, as well as of any regional cooperation efforts. There are two different groups of states in this region. One group of countries, which have concerns about building their own future independently, are trying to avoid Russian influence, while the others are giving priority to

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establishing political, economic, strategic, and military cooperation with Russia. At this point, it is interesting to note that Greece, which is also a member of NATO and the EU, is more inclined to side with Russia than with Turkey. Excluding Turkey and Greece, all other member countries of BSEC were ruled by socialist regimes until the 1990s and have since adopted free-market economies and demonstrated considerable progress in this direction. The supervision of the state over the economy has loosened to a great extent, although the private sector is not yet entirely effective in undertaking services such as manufacturing, transport, and the distribution of goods. We must recall that most of these countries had state-run economies and were members of either the Warsaw Pact or COMECON. Six countries were republics of the USSR and these states are now members of CIS—with the exception of Georgia, which left the CIS in August 2009, and acknowledging that others have at times declared their desire to leave this organization. With Greece, Bulgaria, and Romania as members of the EU, and Turkey a candidate, BSEC has now closer links to the EU. The rest of the countries already have relations and have concluded agreements with the EU in different dimensions. Another promising project of BSEC and BSCEC is forming a Caucasian Parliament. In this parliament, Azerbaijan, Armenia, Georgia, Chechnya, Dagestan, and seven other autonomous republics of the former Russian Federation will be represented. All the countries or autonomous republics to be included in this projected parliament are members both of BSEC and the CIS. Russia’s “big brotherhood” dominance over the ex-Soviet republics, particularly over the Caucasus countries, persisted in the first decade of the twentyfirst century under Putin’s leadership. In this context, Turkey suggested to the countries which were in need of foreign support that they should form a Caucasian Pact under the OSCE. The pact, which will also include Russia, is also supposed to function as a defence mechanism for BSEC members against any Russian threat.14 The pact, put forth by the then Turkish president on 15 January 2000, was supported by Georgia and Azerbaijan.15 Furthermore, in view of the strategic and economic developments of the 1990s, these two countries had already agreed on the formation of the new Silk Road, its centre being the South Caucasian corridor, which was planned to connect Central Asia to Europe via the Caspian and Black Sea.16 The new web of rail, road, and sea transportation networks was to a great extent completed in this region. It has not only created opportunities for the South Caucasus but also for the Central Asian economies and has considerably curbed their dependence on Russia.17

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In addition to the variations in the political structures of the BSEC countries, their economic traits have also caused these countries to be interdependent on each other, energy resources being the most prominent locus of this dependency. Excluding the Russian Federation and Azerbaijan, all other BSEC countries have to meet their energy needs through imports (one should bear in mind that Kazakhstan and Turkmenistan are exporters of energy but are not members of BSEC, although some of their export routes go through BSEC member countries). Among the energy-dependent countries in the region, Georgia takes the lead and, in some cases, Russia takes advantage of this leverage. In this context, it is remarkable that in the beginning of 2000, when Russia cut the energy supply and imposed a sort of embargo on Georgia, Turkey donated fuel oil to Georgia, which gives a hint of the internal contradictions and the importance of Turkey in the region. As noted above, BSEC was founded under the initiative of Turkey in the early 1990s. To understand how Turkey’s interest in the region has evolved, we should take a brief look at the Turkish economy since the 1980s—a period of fundamental change in which Turkey abandoned state rule and took the necessary steps to promote the free market. At this stage, Turkey had to find markets for her agricultural and industrial products. After implementing significant structural changes, the foreign trade and tourism capacity of Turkey, as well as the business contracts and influence of Turkish investors abroad, have considerably increased. Its imports and exports also increased in number, variety, and quantity—meanwhile, however, Turkey has continued to face the reality of a balance-of-trade deficit. As exports of textiles and food products increased, small enterprises started growing and consequently a more competitive market was formed. The successful neutral policy pursued by Turkey during the Iran–Iraq War offered Turkey a good opportunity to expand into global markets. During this war, and until the Gulf crisis, Turkish producers have been quite happy with their business and they were making a good start in dealing with foreign buyers without state assistance. This atmosphere of prosperity, however, ended due to the Gulf crisis and the embargo imposed on Iraq in early 1991. This interruption closed off the fruitful Iraqi market to Turkish exporters, while, at the same time, the terrorism threat in southeast Anatolia began to grow following developments in northern Iraq. When the situation in the region worsened, the economy in southeast Turkey also worsened, which soon caused terror attacks to rise; accordingly, defence expenditure increased while the contribution of the region to the Turkish Gross National Product (GNP) suffered a marked decline.

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Consequently, the need to explore new markets became essential for Turkey in the beginning of the 1990s and its previous rather neutral policy towards its neighbours had to be abandoned. At the same time, the disintegration of the USSR created new potential markets for Turkey. However, due to the collapse of the state-controlled economy, new obstacles tied to the new social, political, and economic realities of the region emerged. Although trading with the region was profitable, the regional risks increased, alongside political and social instability, and all these have thwarted new businesses. In the aftermath of the USSR, due to production loss and unemployment, violence and terrorism in the region increased and negative feelings towards foreigners became more acute. In this transition period, it was foreseen that there would be a golden opportunity for Turkey to build up trade connections in the region both for the sake of its economy and for political gains. At this point, it also became apparent that Turkey had to be more involved in the region and should foster its position as a bridge between the Balkans and the Middle East and the Caucasus. However, due to certain socio-political factors Turkey failed to realize this project. Finally, Turkey had to put an end to its isolation in the beginning of the 1990s and then became fully cognizant of its unique position. It also turned out that penetration into the region was going to be difficult in many respects. Under these circumstances, new bases of cooperation were looked into and new initiatives had to be conducted by Turkey. In this context, at the beginning of the second millennium, Turkey played a major role in a number of international organizations in order to expand its influence in the region. Some of these organizations served for ending the political conflicts in regional crises and reducing violence, and increasing socio-political stabilization and economic progress as well as creating new markets and employment areas for Turkey. Among these organizations was the proposal for the Caucasian Pact by the Turkish president, as mentioned above. The need for this pact had grown when Russia started threatening Azerbaijan, Georgia, and Turkey’s BTC pipeline following repeated Russian intervention in Chechnya in the autumn of 1999. Moreover, at the summit in Bucharest on 13 February 2000, attended by Turkish, Greek, Romanian, Macedonian, Albanian, and Bulgarian presidents and foreign ministers, the Southeastern European Countries Good Neighbourly Relations, Stability, Security, and Cooperation Charter was concluded. The organization consisted of the western Black Sea Countries with Turkey and Macedonia, and was named the SEEC (Southeastern European Countries). The former Yugoslav states of Bosnia-Herzegovina and Kosovo were considered to be potential

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members of the SEEC. The proposed Caucasian Pact constituted the reverse side of the cooperation on the eastern side of the Black Sea. In April 2001, BLACKSEAFOR was founded by the six Black Sea coastal states under the initiative of their navies in order to hold collective military exercises. These six states are all members of BSEC. However, despite its being mentioned in the BSEC Charter, there is no relation between BLACKSEAFOR and BSEC.18 It is true that Turkey’s relations with BSEC countries are mainly based on trade and the economy. Amongst the BSEC members, Russia’s economy is no doubt the largest. Turkey’s oil imports began during the Soviet period. Russian gas is very important for both Turkey and most of the BSEC member states. Turkish entrepreneurs had also concluded significant contracts both in the former USSR and in the post-Soviet period, which had helped address Turkish unemployment problems. The contracting companies accomplished outstanding work in the USSR and their contribution supported the Turkish economy. In the 1990s, mutually fruitful relations were pursued with the Russian Federation. Turkey imported most of its oil from Russia and exported textiles and consumer products in return. In 1995 the total amount of trade between the two countries reached $64.9 billion. In the same year, Turkey’s total imports from Russia were $22.6 billion and 59% of this constituted oil, natural gas, and other raw materials. Turkey’s exports to Russia, on the other hand, amounted to $18.3 billion with textile goods, food, and agricultural products constituting 58% of this amount.19 In 1995, 55% of Ukraine’s total exports of $14.2 billion consisted of metal products, and 21% of its total imports of $16.09 billion consisted of food and agricultural products. In the same year, the same products were dominant in the exports of Azerbaijan at 58%, Armenia 23%, Georgia 14%, and Romania and Bulgaria 6% each. Turkey’s exports to the BSEC countries and imports from them reached considerable heights. Some of the BSEC countries are oil exporters. For instance, 66% of Azerbaijan’s total exports of $547 million consisted of oil and natural gas. Compared to them, Turkey’s exports exhibit some variety, but the quality and the quantity of Turkish exports can yet be increased. In this context, mostly due to Turkey’s rising energy requirements, its imports from the BSEC countries, which was previously $1,517 million, climbed to $4,019 million, whereas its exports covering miscellaneous items only increased to $1,238 million from $905 million.20 Due to this difference, a considerable foreign trade gap exists between the BSEC countries and Turkey. Despite their demand for food, textile products, and durable consumer goods, Turkish exports to the region have not yet made the expected leap.

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BSEC as a Realist International Organization A significant degree of cooperation in and out of the scope of BSEC had existed and has continued to exist among the countries of the region before and after the formation of BSEC. Turkey had sat at the negotiating table with the countries of the region as far back as the 1960s, and accomplished quite fruitful trade relations with the USSR and Eastern bloc countries in the 1970s. These contacts have continued since the disintegration of USSR. At this point, one might ask the following questions: “Can’t other similar organizations such as the UN, the OSCE, the IMF, the World Bank, etc., with their already laid-out principles, also work for the same purpose in this region?”; and “Is it essential for another organization to be founded for this new region?” The answer is that, if it were necessary for the EU and CIS to be formed despite the availability of the other political structures, it is equally essential for BSEC also to be set up. For instance, if we look at the reasons underpinning the creation of the CIS, we see that, although Russia’s imperial ambitions were the main engine of this organization, irrespective of Russian intentions, there was still demand from the countries comprising the CIS, which deemed it necessary for their collective representation in the world. Likewise, BSEC’s existence has to provide the same function for their members and become a way to improve commercial relations in the region. In the early 2000s, during the CIS summit in Moscow, Vladimir Putin (as the deputy president of the Russian Federation) imposed Russia’s presidency on the other CIS members. In this sense, Turkey has never dared to impose such binding claims on BSEC members and does not hide behind idealistic pretexts. In fact, Turkey has chosen to be fair to every country to such a degree that, in a sense, Turkey has been unfair to herself.21 While drawing the map of BSEC, Albania, Greece, Moldova, Azerbaijan, and Armenia were also included in the scope even though they were not Black Sea coastal states. This is one of the realist facets of BSEC. There are some unfounded speculations that the Aegean is the continuation of the Black Sea and likewise that the Adriatic Sea is somewhat tied to the Aegean.22 This idea is implausible since the Aegean and the Adriatic are commonly accepted to be branches of the Mediterranean. However, some Caspian countries which are probable members of the BSCEC should also be members of BSEC. This is for political and economic reasons rather than for geographical ones. Yet, when Turkey insisted on Albania’s and Azerbaijan’s accessions, Russia instead suggested Greece and Armenia. Although it might be considered that the accession of the last two states was not in the interests of Turkey,

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it was also apparent that Russia had been effective in politicizing economic relations.23 As a matter of fact, during the formation stage of BSEC, while Russia was going through difficult times, Turkey could be considered to have been acting in a realist manner by accepting Russia’s suggestion that Greece and Armenia be included. However, upon the formation of BSCEC and its enlargement, Russia also adopted a more realistic attitude. In the relations amongst BSEC members, there are common as well as clashing interests. If the organization pursues a cautious policy so as to harmonize the clashing interests and promote integration, BSEC will continue to be viable. Until recently, the transport routes of the region’s oil and natural gas to world markets have been the main causes of conflict. Russia has adamantly insisted on the use of Novorossiysk for the transport of Caspian oil and natural gas and has argued against the BTC pipeline. This was the major clashing interest within BSEC for quite some time. A similar policy by Russia may be observed with the Nabucco project. Russia will keep an eye on the economic and political progress in the exSoviet countries and consequently will try to impede their efforts to leave its sphere of influence. In this context, Russia has entered into a natural and historic alliance with Iran. It might also be expected that the instability in the ex-Soviet republics would persist and remain a threat to regional and world security. However, under an umbrella provided by BSEC, conflicts between Russia and these states can be avoided and any potential conflicts can be held in check. Moreover there is always a chance for addressing such conflicts through negotiation and cooperation. No doubt Russia did not welcome the realization of the South Caucasian Corridor, which is going to bridge Azerbaijan, Georgia, and Ukraine between Central Asia and Europe. This route, defined as the New Silk Road (and later the Transport Corridor Europe–Caucasus–Asia, TRACECA), paradoxically loosens Moscow’s dominance over the exSoviet countries. Likewise, it is probable that Greece would not be very pleased with Turkey’s key and improving position in BSEC. Moreover, it is most likely that BSEC’s progress will inevitably reduce the importance of the CIS. However, if the CIS is based on realist principles and the organization is seen favourably by its members, and if Russia does not use the organization for its own benefits, CIS members might start seeing benefits in the membership and the organization will endure. However, if membership is seen to offer more risks than benefits, the organization could fail. In the case of BSEC and the CIS, these two organizations should not be taken as overlapping one another, but complementing and adjoining, just as in the case of EU and other neighbouring organizations.

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Regional countries might as well be members of both, which will promote communication between countries that are members of only one organisation at present. In the present age of globalization and integration, the number of organizations which, like BSEC, target regional economic development, is increasing. Amongst them are the EU, NAFTA, and many others which have not yet gained significant importance. As for Turkey’s relations with the EU, starting in 1996 Turkey was granted customs union privileges with respect to EU member states. This was a unique process which has not been applied to any other candidates and, unless it is accompanied by full membership status, will hardly be advantageous for Turkey. However, BSEC does not constitute an obstacle to Turkey’s EU membership and can be seen as part of European integration.24 In light of this claim, it is speculated that Turkey is using the BSEC card as leverage vis-à-vis the EU. The proposed BSCEC, formed within BSEC, will provide solidarity among BSEC members with respect to their commercial and economic relations and will work like the European Coal and Steel Community, which pre-existed the EU.

Conclusion As a positive indicator of its viability, none of the BSEC members has attempted to leave the organization, though this is allowed in Article 7 of the BSEC Charter. Nor has there been any direct or indirect pressure by a central member against another member to leave the organization. However, the same cannot be said for the CIS: at the CIS Summit held in Moscow in January 2000, even Uzbekistan and Ukraine (countries known to stand closer to Russia compared to others) expressed their concern over the hegemonic attitude of Russia within the organization and added that they might review their membership. In fact similar arguments remained on the agenda before and after January 2000. In this context, Turkey has been very careful both during and after the foundation of BSEC in 1992 not to adopt a dominant stance in the organization. As mentioned before, Turkey has been over-realistic and even to some extent self-denying, even though it played a key role in the formation of BSEC. However, one has to admit that BSEC has not been sufficiently effective in realizing its basic principles, such as enhancing economic relations amongst its members, institutionalizing cooperation, and making the necessary arrangements in the interests of its members. The pluses and minuses in regional relations cannot be attributed to the success or failure of BSEC. In any case, it is generally concluded that the

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organization should have been more effective.25 This inadequacy is due to BSEC’s realistic policies, as well as Turkish foreign ministry’s traditionally over-cautious diplomacy. That is to say, there is always a risk of eroding the tool you are using when it does not fully fit the labour you are doing; but should that tool not be used at all, it will definitely get rusty and decay. As for the degree of workability and the efficiency of international organizations, the results from previous studies have pointed to principles such as the organization itself pursuing consistent policies, and members complying with the rules of the charters, as signs of the organization’s efficacy. Fair distribution of authority amongst members and consideration of common interests are also paramount. Moreover, proximity amongst members on the issues of language, religion, culture, and common histories and ideologies also contribute to cooperation and efficiency. In light of these findings, organizations like the NATO and the EU will no doubt be more fruitful since their members have similar traits. Accordingly, it is impossible to expect the same results from BSEC, the members of which are very diverse compared to the EU. As a result, the present status of BSEC is still far from being satisfactory. In any case, there has been some considerable improvement within BSEC with the establishment of BSCEC, which functions at the moment just as the European Coal and Steel Community did for EU. Although BSEC was only mentioned during regular meetings, it is a fact that Turkey has also been a key player in other regional attempts to promote economic and political cooperation, as well as to increase the number of members. As mentioned above, Macedonia is the only member in the SEEC which is not a member of BSEC, and in fact its future membership in BSEC is more appropriate than Albania’s. On the other hand, all the potential members of the proposed Caucasian Pact are also members of BSEC, and the same is true for BLACKSEAFOR. Under these circumstances, it would be worthwhile to stay within the framework of BSEC rather than look for new arrangements. Turkish policy makers should make more effort in this respect in trying to include all the countries in the Balkans, the Caucasus, the Danube River basin, and Black Sea coastal states under probable regional and functional subdivisions of BSEC. The BSCEC can easily function as the centre of such a system. The Turkish foreign ministry has until recently not paid enough attention to BSEC. We believe this is due to their overlooking the organization, rather than a deficiency in Turkish foreign policy.26 However, it might also be due to their trying to stop Russia from obstructing the Nabucco Project, to

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provide background for Russian companies to take part in such projects, and eventually prepare the ground for BSCEC. We propose that the time has come for BSEC to step up its activities and focus on the basic purposes of its charter, rather than simply continue holding regular summits in magnificent palaces. For the sake of its continuity and in the interest of all its members, it is essential that relations within BSEC grow more operational and institutional. Moreover, products that are produced in the region should be standardized to improve competitiveness in trading. We would like to conclude with a last—though surely not least—suggestion. Article 23 of the BSEC Charter concerns academic cooperation amongst its members. This article, to which reference is unfortunately rarely made, states that: In the scope of academic cooperation, within the capacity of BSEC and in the direction of its major principles, relations amongst BSEC members will be promoted, namely scientific gatherings will be held, and researchers and scientists will be supported in their collective studies.

In the context of this article, financial support should be provided by the Black Sea Trade and Development Bank and from relevant foundations, and scholarships should be offered to candidates from each member. The grant numbers for each member should be designated by the BSEC Secretariat in proportion to their population. These scholarships are to be offered for research studies focused on cooperation, standardization, accelerating economic, social, cultural and political rapprochement, environmental issues, fishery, marine transport, and similar areas. Topics of specialization could change each year, giving a chance for the unique specialties of each member to be promoted. In the meantime, international conferences should be held and publications issued. The “Blue Black Sea International Congress” is one of the first steps in this direction. It is expected that Turkey, financing most of the BSEC budget, should divert at least some of its funds to promoting academic activities and research, the results of which will no doubt reveal helpful solutions for the workability of the organization. New trade and finance centres should be created within the region to work for BSEC operations. For instance, for the Turkish city of Sakarya (AdapazarÕ), which collapsed during the Marmara earthquake in August 1999, it is recommended that a new city should be built on the Black Sea coast in accordance with the “free zone” project. Moreover, it should also be considered whether this “free zone” should have trade priority for BSEC. New investments in the region are also necessary for BSCEC. The

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projected Black Sea Motorway will also include this area and will be an important part of the New Silk Road corridor. Consequently, the Nabucco pipeline project, which will transport Caspian gas to Europe, would also be important for the region, just as the BTC oil pipeline aided in the transportation of Caspian oil to world markets. These pipelines will certainly increase regional economic cooperation and contribute to regional peace and prosperity, as well as offering vital relief for environmental concerns. Deprived of Russia’s participation, on a long-term basis it is impossible for Nabucco to aid regional peace and development. Accordingly, the attempts of Russian companies to join the project were welcomed by relevant countries. This improvement will give rise to dispersed, collective, and intense regional cooperation. As well as this, in the short or mid-term, BSCEC will constitute a firm base for cooperation among producers and consumers of the Caspian and Black Sea region by contributing to regional peace and development, and will also provide a suitable implementation ground for the workability of BSEC.

Notes 1

Duygu Bazo÷lu Sezer, “Evolving Balances in the Black Sea Region,” Seminar on Russia and the NIS, 29–31, Ankara, March 1996 (SAM Papers 1, no. 96:48–52). 2 10th Summit Declaration, Istanbul, 25 July 2002, Articles 5 and 6, reporting on cooperation and developments in the last decade, www.bsec.gov.tr/summit_.htm. 3 Energy Cooperation is addressed in Article 13 of the 5 June 1992 Istanbul Summit Declaration. The same issue is taken up in Article 5/c of the Bucharest Document, 30 June 1995; Sections 2 and 4 of Moscow Declaration on 25 June 1996; and Article 8 of the Yalta Summit Declaration, 5 June 1998. 4 Zbigniew Brzezinski, The Grand Chessboard: American Primacy and its Geostrategic Imperatives (New York: Basic Books, 1997). 5 Today Montenegro is an independent state and only the Republic of Serbia is a member of BSEC. 6 BSEC Basic Agreements, the Bosporus Statement (25 June 1992); Summit Declaration (25 June 1992); Declaration of Intent for the Establishment of BSEC Free Trade Area (7 February 1997); Charter of the Organization of BSEC (Yalta, 5 June 1998); see www.bsec-organization.org. On BSEC, see V. Chechelashvili, “The Way from Regional Initiative to Full-Fledged Organization,” Turkish Review of Eurasian Studies Annual 2001 (Istanbul: OBIV, 2001), 5–20. 7 In the Bosphorus Statement of 25 June 1992 the name “Conference on Security Cooperation in Europe” (CSCE) was used, later amended to the Organization for Security and Cooperation in Europe (OSCE). 8 Article 7 of the Declaration mentions the “EU and other international regional organizations.” The EU was the only name mentioned, despite Greece being the

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only full member at the time, and the CIS was not mentioned although half the countries were members of it. 9 Summit Declaration of BSEC, Istanbul, 25 June 1992. 10 Declaration of Intent for the Establishment of BSEC Free Trade Area, 7 February 1997. 11 Yalta BSEC Summit Declaration, 5 June 1998. 12 For the offices of the BSEC Secretariat, the Turkish government allocated Mushir Fuad Pasha Kiosk, situated on the Bosporus, in Istinye, Istanbul. 13 BBC News, 4 June 1998. Turkey’s initiative and its efforts during the foundation stages of BSEC were interpreted as part of its regional dominance strategy by the Western press. 14 Ambassador ùükrü M. Elekda÷, “ABD’nin Çetrefilli Kafkasya Politikasi” [Contradictory Caucasian policy of the USA], Milliyet,17 January 2000. In his article, Elekda÷ comments on the Stability Pact suggested by former Turkish president Sezer, under the OSCE’s umbrella, saying “this is going to be a rather imaginary protection, since it is clear by now that stability in the Caucasus is a matter of the Americans’ choice.” 15 “Kafkaslar’da Istikrar Pakti” [Stability pact in the Caucasus], Milliyet, 16 January 2000. 16 A. Gegeshidze, “The New Silk Road: A Georgian Perspective,” Perceptions (June–August 2000): 132–140, regarding the political viability of the New Silk Road. 17 The summit meeting, which was held in Baku on 7–8 September 1998 under the title “Restoration of the Great Silk Road” and “The Baku Declaration,” was concluded and signed by the representatives of Armenia, Azerbaijan, Poland, Bulgaria, Romania, Georgia, Tajikistan, Kazakhstan, Turkey, Kyrgyzstan, Ukraine, Moldova, and Uzbekistan. Thus the Declaration was signed by eight BSEC members, plus Poland and four Central Asian republics. All of them are amongst the suggested BSCEC members. This was also the formation process of TRACECA (Transport Corridor Europe, Caucasus, Asia), http://www.tracecaorg.org. 18 Hasan Ulusoy, “A New Formation in the Black Sea: BLACKSEAFOR,” Perceptions (December 2001–February 2002). 19 “Turkey and the Russian Federation,” New Opportunities in the Black Sea Region Conference, 28–30 April 1997, Istanbul (DE Bulten). The following figures are from DEIK Bulletins of Ukraine, Greece, Armenia, Georgia, Romania, Azerbaijan, Bulgaria, and Moldova. The business activities of the BSEC Business Council is mainly directed by DEIK (Foreign Economic Relations Council) in Turkey, as can be noted from the name of the conference. 20 Turkey and the BSEC Countries, DEIK Bulletin, April 1997. 21 The financial expenditure of the organization is mostly covered by Turkey, and in this sense being considered in the same category with the other members is not wholly fair. Some CIS members have some doubts about Russian dominance, whereas this is not a concern for BSEC. 22 Interview with Ambassador (R) Cihat Alpan on 17 January 2000. The ambassador had leading duties during the formation of BSEC and indicated that

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Greece’s membership in BSEC is in the mutual interest of both Turkey and Greece. He also said that the Aegean is important for the Black Sea, confirming the system of Lausanne and the Montreux Convention, the protection and the continuation of which was also approved by the Black Sea states. 23 ùükrü Elekda÷, Milliyet, 5 May 1997. Ambassador (R) Elekda÷ has said on several occasions that the initial idea for BSEC was his own, and in his article “KEø’nin Zafiyetleri” (The weaknesses of BSEC) added that Greece’s accession into BSEC was Turgut Özal’s initiative and that the establishment of the Black Sea Trade and Development Bank in Thessaloniki would undermine the development of the organization (DEIK Bulletin (March 1997): 23–24). However, in the Turkish–Greek Forum on 21 October 1996, the Greek Finance and Economy Minister Papantomou declared that they were amazed by the improvement in bilateral relations, and that the establishment of the Black Sea Trade and Development Bank in Greece, which was to be directed by a Turkish banker, was another indication of improved relations between Turkey and Greece. No doubt his phrases counted for more than mere wishful thinking. BSEC Charter Article 17 states that two-thirds of the members are sufficient to take decisions and Article 33 of the Charter indicates that only the votes of the nine founding members would be adequate for the BSEC Charter to go into effect. Under these circumstances it is unlikely that any one member could hinder the organization. 24 Ercan Özer, “The BSEC and the EU,” Perceptions (September–November, 1996): 72–86. 25 The Turkish foreign ministry organized a seminar in Ankara in March 1996 entitled “Russia and the NIS.” None of the sessions in the seminar looked at BSEC, and no papers were presented on BSEC although the session topics were related to it. This suggests that although the Turkish foreign ministry had spent a good deal of its budget on BSEC, it had as yet not fully embraced the organization. Even in the proceedings of the seminar, BSEC is hardly mentioned. See: Seminar on Russia and the NIS, 29–31 March 1996, Ankara, MFA, Center for Strategic Research (SAM Papers 1, no. 96). 26 Despite the over-cautiousness of Turkish diplomacy, Article 6 of the Baku Declaration states its determination for cooperation with BSEC alongside other similar international organizations. The Baku Declaration, Baku, 8 September 1998.

CHAPTER TWENTY-ONE THE ROLE OF MEDIATORS IN SETTLING CONFLICTS IN THE BLACK SEA REGION HANNA SHELEST*

Introduction For centuries, the Black Sea has been a region of competition and confrontation. Despite the change of geopolitical situations in the region after the end of the Cold War, the paradigm of relations has remained almost the same. Regardless of the advanced level of cooperation and the transformed nature of confrontations, the level of competition in the area only rose. Moreover, at the beginning of the twenty-first century, the region became a focus of interest for many external and internal actors that used every opportunity to advance their roles, and even used peace processes to spread their influence in the conflict area. The aim of this article is to analyse the role of mediators during the process of conflict settlement in the Black Sea region and to study possible variants of cooperation or coordination among these actors. The problem of conflict settlement in the Black Sea region continues today and is especially important in the context of the stable and wellrooted democratic development seen in the region. This issue became even more important after the August 2008 war between Georgia and the Russian Federation. The Black Sea region has unique potential to become an area of prosperity and stability, but many projects related to the fields of economy, transport, politics, and energy cannot be implemented because of ongoing conflicts over the territory. From the mid-1990s to 2008, many academics and politicians identified conflicts in Transnistria, Nagorno-Karabakh, South Ossetia, and Abkhazia as “frozen,” because none of these conflicts had been resolved in *

Senior researcher at the National Institute for Strategic Studies, Odessa Branch (www.niss.gov.ua, www.niss.od.ua), Ukraine.

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any way even though ceasefire agreements had been signed. However, minor skirmishes on the Armenian–Azerbaijani border and the Russian– Georgian crisis that broke out in August 2008 have “melted” the situation, and now the only conflict that can be categorized as “frozen” is the one related to Transnistria. The instability caused by these conflicts created fertile ground for the growth of criminal activities, terrorism, and illegal migration. Political stability in the region cannot be guaranteed unless these conflicts are settled. They further repress socioeconomic development and block trade links in the region. These problems not only pose challenges to the states involved in conflicts, but also threaten the security of both their neighbours and Europe, and even touch the interests of more remote powers such as the United States. There are many external and internal actors in the Black Sea region that are vitally interested in the peace process in the area. Several of these actors have taken on mediating roles, including the Russian Federation, Romania, Ukraine, the United States, the European Union, the Organization for Security and Cooperation in Europe (OSCE), and the United Nations (UN). Some of these actors are neutral, while some have very strong vested interests—or support one side—in the conflicts.

The Role of International Organizations The first international organizations to enter the four conflicts in the Black Sea region as mediators were the United Nations and the OSCE. They were initially involved in monitoring and peace-building processes, rather than in the search for an ultimate solution. Due to the limited resources of these international organizations, some of their functions have been delegated to peacekeepers from the Commonwealth of Independent States (CIS), which consists, de facto, of only Russian soldiers. In the general euphoria inspired by the collapse of the Soviet Union in the early 1990s, the UN Secretary-General, Boutros Boutros-Ghali, proclaimed the Agenda for Peace which delegated some functions of the UN to regional organizations involved in the peace process. From the very beginning, the Russian participation in the mediation process caused problems which put Russia’s future role in question. Most of the CIS members did not sign the Tashkent Pact and, as a result of this, they did not participate in the CIS peacekeeping forces either. This is why, since the UN delegated its functions in Georgia to the CIS, it appeared that only Russian troops participated in the peace mission.

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In November 1992, the United Nations office was opened in Tbilisi to provide a multidimensional UN approach in the region and to assist in the peacemaking efforts of the Secretary-General. On 24 August 1993, the Security Council decided to establish the United Nations Observer Mission in Georgia (UNOMIG). This mission was responsible for finding a solution to the Abkhazian conflict. In July 1994, however, due to accusations that the principle of neutrality had been violated, monitoring of the activities of CIS peacekeepers was added to the mission mandate.1 The tasks of the OSCE mission to Georgia have gradually been widened since its start in late 1992. The mission promoted negotiations between the parties of the Georgian–Ossetian conflict (1992), and supported the UN-led peace process in the Georgian–Abkhaz conflict (1993). The mission also monitored the Joint Peacekeeping Forces (JPKF) in the Georgia–Ossetia conflict zone, and led an initiative which was funded by international donors for economic and infrastructure rehabilitation projects in the region. Another task in which the OSCE mission has been engaged is promoting interagency coordination and international cooperation on border issues, and assisting the Georgian government in fulfilling its OSCE commitments on human rights, rule of law, and democratization.2 In the Transnistrian and Nagorno-Karabakh conflicts, the United Nations did not play any role other than giving its “blessing” for some positive developments in the region in the form of official resolutions and statements, and the regular work of some UN agencies on the ground. The OSCE Minsk Group was created in 1992 by the Conference on Security and Cooperation in Europe to encourage a peaceful resolution to be reached through negotiations held between Azerbaijan and Armenia over the Nagorno-Karabakh conflict. The main objectives of the Minsk Process were set as follows: “providing an appropriate framework for conflict resolution in the way of assuring the negotiation process supported by the Minsk Group; obtaining conclusion by the Parties of an agreement on the cessation of the armed conflict in order to permit convening of the Minsk Conference; promoting the peace process by deploying OSCE multinational peacekeeping forces, comprised from civilians.”3 Negotiations carried out under OSCE supervision and within the OSCE Minsk Group’s framework are on a permanent basis. The OSCE, as one of the peace guarantors, is more active in Transnistria and assists in democratic reforms, but has never suggested a final solution for the conflict and has mostly mediated for other mediators. At the beginning of the twenty-first century, the role of the UN and the OSCE in the peace settlement was challenged because of their low level of

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involvement. They have been more engaged in issues of humanitarian aid, human rights, and peace-building than in the search for the final resolution of the conflicts, guaranteeing peace and security in the region. This proved especially relevant during the August 2008 war in Georgia when neither organization could provide an adequate response to the crisis. To a great extent, this reflected the veto power of Russia in the UN Security Council and its active restraining policies within the OSCE. Two of the practical implementations of this veto power, and of the weakness of the organizations, have been the cessation of both the OSCE and the UN missions in Georgia in 2009.

The European Union Wishing to enhance its own stability and security through different peace initiatives, the European Union has started to get involved in settling conflicts in the Black Sea region. Until 2005, apart from some statements advising certain peace methods, the European Union was absent from the conflict resolution efforts in the Black Sea region. During the Chisinau Summit, which was held by GUAM states under the initiative of Ukraine in 2005, the EU participated for the first time in solving the Transnistrian conflict. This initiative had positive consequences primarily because of the activities of EUBAM (European Union Border Assistance Mission). Modernizing border management systems and enhancing cooperation between customs services across the region has increased the level of security and facilitated control of conflict-related activities, such as organized crime, human trafficking, movements of arms and drugs, and goods smuggling. These activities were targeted by the European Union, which provided a sizable contribution to the conflict settlement. The situation with the South Caucasian states was, from the very beginning, far more complicated than the Transnistrian conflict. It was only in 2004 that the European Union appointed its Special Representative to the Caucasus and the first situation assessment was conducted on behalf of Brussels. The Special Representative’s mandate was, however, limited to supporting UN and OSCE actions in the region. In its 2006 report, the International Crisis Group recommended that the EU should and could become more “intimately” involved in the conflicts by participating in the negotiations, contributing to the peacekeeping missions in NagornoKarabakh, and providing border management assistance.4 In 2006, the mandate of the EU’s Special Representative was enlarged to include facilitation of conflict resolution.5 However, the real problem with the EU

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involvement was that it did not entail direct participation in the negotiation process itself. The real mechanisms of the involvement were not set. All three of the Caucasian states involved were eager to see greater European Union involvement in the resolution of the conflicts for promotion of their individual interests. The EU, however, found it difficult to accommodate all of the clashing aspirations and zero-sum games of the warring parties, particularly in the case of Armenia and Azerbaijan over Nagorno-Karabakh, which had diametrically opposing views on how the conflict should be solved. The European Union considered the attempts of Azerbaijan to include the issue of “territorial integrity”—as was done in the cases of Georgia and Moldova—as excessive “politicization” of the Action Plan. At the same time, Armenia managed to include the principle of “the right of the nations to self-determination” as one of the pillars of resolution of the conflict in the 2006 Action Plan.6 This experience demonstrates the limits of the EU’s direct influence on the settlement of such ethno-territorial conflicts as the Nagorno-Karabakh war. By supporting the OSCE and the UN Security Council actions in the Azerbaijani Action Plan and by underlining the right of nations to selfdetermination in an Armenian one, the EU confined itself to the promotion of democracy and people-to-people contacts as the most acceptable variant of conflict resolution in this case. On 11 April 2007, the European Commission presented a new strategy of cooperation with the Black Sea region—the Black Sea Synergy7—in which some attention was paid to the question of the “frozen” conflicts. The position of the European Union was that enhancing regional cooperation, though it did not aim to resolve long-lasting conflicts in the region, would facilitate the generation of higher levels of mutual confidence, which would eventually contribute to removing existing obstacles. The soft language of the document, and the small amount of attention given to the threats of such a strategy, support the idea that the European Union is still not ready to be involved in the affairs of the Black Sea region and underestimates the effects and threats of these conflicts to the security and stability of the region and of the EU itself. Perhaps the most complicated conflict in the GUAM states for the European Union to deal with is the one affecting the territory of Georgia, South Ossetia, and Abkhazia. In February 2008, Javier Solana mentioned the possibility of sending EU peacekeepers to the two breakaway regions of South Ossetia and Abkhazia. Estonia, Latvia, Lithuania, Poland, Greece, Ukraine, and Turkey expressed their readiness to join this operation. The EU has rejected the option of launching an EUBAM mission due to Russian objections.8

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On 5 May 2008, Slovenia, while presiding in the EU, made a statement on behalf of the European Union calling all parties to abstain from any steps that might fuel tensions and tried to persuade them to take confidence-building steps. The EU also re-confirmed its obligations concerning the sovereignty, independence, and territorial integrity of Georgia within the framework of its internationally recognized borders.9 The situation changed drastically in August 2008 when crossfire on the Georgian–Ossetian border led to the direct involvement of the Russian army. Meanwhile, it is very peculiar that nobody knows how this conflict restarted. The European Union was the first international organization to plunge into the hot waters of mediation while the fire was still raging. For the first time, official statements have been made, not by individual members, but on behalf of the EU: all the European Union states seem to have come to a firm agreement regarding the conflict. The EU officially recognized Russia as a party to the conflict by starting negotiations with Moscow and not with Tskhinvali. Finally, the territorial integrity of Georgia—a cornerstone of the clash of views between the belligerents— was once again reconfirmed, and the EU expressed readiness to send its peacekeepers to the conflict zone. Weaknesses shown by the EU on the matter can be defined as follows: the EU was unable to impose any viable sanctions on Russia after Russia violated the first peace agreement in August 2008; in its haste to announce restarting its negotiations with Russia in October, the EU did not make sure that the Russian army would withdraw from the Georgian territory; the EU was not able to negotiate on the deployment of an EU peacekeeping force in South Ossetia and Abkhazia; and the EU did not propose any suggestions concerning the future management of the conflict. In September 2008, the first peacekeepers arrived in Georgia, demonstrating the EU’s readiness to play a more significant role in the security sphere in the Black Sea region. Nevertheless, due to strong Russian opposition, the peacekeepers were deployed only on the territory of Georgia and merely as observers, and have not been able to carry out their activity on the territory of the conflict zones, namely, South Ossetia and Abkhazia. Another considerable weakness of the EU lay in its inability to coordinate its policies and mediation efforts in this region with other international actors, even with the UN and OSCE, acting mostly as a separate player. On the other hand, the EU is perceived as a more acceptable peacekeeper than the United States, because it faces less opposition from the Russian Federation. Nevertheless, the EU still has its weak points. The European Union is not always ready to speak with a single voice because

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of the different views of its member states. Some EU member states, such as France, Germany, and Italy, are not ready to plunge into a bigger confrontation with Russia, while others, notably Poland, the Baltic States, and the UK would like the EU to have a firmer stance in guaranteeing the interests of the newly independent states. The August 2008 crisis demonstrated that the EU was not ready to manipulate its relations with, or put sanctions on, Russia. The Russian Federation was not moved at all by the EU’s call for peace and the withdrawal of troops. An independent investigation was undertaken by the European Union. Its comprehensive and long-awaited report was led by the EU mediator, who was seen as the “honest broker” during the crisis. Thirty experts in various fields carried out a nine-month investigation and the report was presented on 30 September 2009, after it was compiled by the famous Swiss diplomat Ms. Heidi Tagliavini. Russia and Georgia presented evidence and documentation to the Commission, supporting their interpretations of the facts, and independent field trips and interviews were conducted in Paris, Washington, Moscow, Tbilisi, and Kiev. Both parties to the conflict appeared satisfied by the conclusions of the report, although they both simply emphasized the parts that suited them. Most of the media read the report as concluding that Georgia had started the war, but after a long provocation from the Russian side, and that those actions of the Russian Army were not equivalent to the threat made by the Georgian side. All Russian diplomats and journalists announced on the same day that the report described Georgia as an aggressor. On the other side, however, in his article published in the Wall Street Journal, Svante Cornell, a famous specialist on the Caucasus, stated that: anyone who bothers to read the document will find that the Tagliavini Commission apportions the overwhelming part of the responsibility for the conflict on Moscow. In fact, it rejects practically every item in Russia’s version of what supposedly happened last year. The press has so far focused on the commission’s conclusion that Georgia started the war. That should, however, not be confused with the question of responsibility: Firing the first shot does not necessarily mean being the aggressor.10

The report, though it faulted Georgia for lacking a legal basis for its attack on the South Ossetian capital of Tskhinvali and for using indiscriminate force, castigated Russia’s recognition of the independence of the two breakaway territories as illegal and as a dangerous erosion of the principles of international law. The Commission rejected the claim that the Russian invasion was to protect Russian citizens (Ossetians had received Russian passports only a year before), but concluded, rather, that it was for protecting Russian peacekeepers (who actually did not protect

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civilians). The Commission also found Russian allegations of genocide based neither in law nor on any evidence. Russia was further faulted for failing to intervene against the “ethnic cleansing” of Georgians from South Ossetia and Abkhazia that took place during and after the war, however it was not named who had committed the cleansing. It was also mentioned that the use of tanks and heavy weapons for the military actions outside the territory of the conflicting regions was an inappropriate and exaggerated use of force.11 In defining its policies on settling conflicts in the Black Sea region, it is important for the EU to determine its position and present clearer conclusions on these conflicts. Western scholarship describes these conflicts as “ethnic,” which is logically followed by the principle of the right of nations to self-determination. Georgia and Moldova, however, are firmly against this and insist that these conflicts are political, rather than purely ethnic or ethno-territorial.12 The possible directions of future mediation will depend on the position that the EU takes with regards to the essence of these conflicts. If these conflicts are recognized as purely ethnic, it will be difficult to argue in the future that to use the Kosovo precedent for their settlement is impossible. Elaborating new approaches is only possible if the political origin of these conflicts is reaffirmed.

The Russian Federation Despite the fact that the mediation of the Russian Federation has provoked many disputes, crises, and tough discussions, the final resolution of the conflicts is simply impossible without Russia’s close involvement. At the very beginning, it posed as an impartial and neutral mediator between the parties to the conflicts and most of the negotiations took place in Moscow, during which Russian diplomats suggested Peace Plans (e.g., the Kozak Plan for Transnistria). However, slowly but surely the situation on the ground was changing, with actual Russian involvement directly challenging its impartiality vis-à-vis the warring parties. The first blow to this role was the conflict in Transnistria. After dissolution of the USSR, Transnistria declared independence, which led to a war with Moldova in March 1992. This brief war ended with a ceasefire in July 1992, which resulted in the formation of a tripartite Joint Control Commission composed of Russia, Moldova, and Transnistria, with the task of overseeing security arrangements in the demilitarized zone. Although the ceasefire was received with great respect, the political status of the territory still remains unresolved. While the official policy of the Russian Federation proclaimed its neutrality, many

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soldiers and officers of the 14th Army were sympathetic to the Transnistrian cause, and defected to the unrecognized republic and participated actively in the fighting as a part of its armed forces. Furthermore, a considerable amount of the army’s ammunition was taken without resistance.13 In October 1994, Russia and Moldova signed an agreement, according to which the Russian Federation was given three years to withdraw its troops from the conflict territory. This, however, never happened since the Russian Duma did not ratify the commitment of the state. The Moldovan government managed to ensure that a paragraph about the removal of Russian troops from Moldovan territory was introduced into the text of the OSCE Summit Declaration of Istanbul (1999), through which Russia had committed itself to pull out its troops from Transnistria by the end of 2002. However, even after 2002, the Russian Duma had not ratified this document. Only in 2004 did President Putin sign the Law on the Ratification of the CFE Treaty in Europe, and, although the CFE Treaty was not fully ratified, in order to comply with it, Moscow withdrew some of its troops from the Transnistrian region. In November 2003, Dmitry Kozak, a counsellor of the Russian President Vladimir Putin, proposed the memorandum on the creation of an asymmetric federal Moldovan state in which Moldova would hold a majority and Transnistria would be a minority. Known as “the Kozak memorandum,” it did not coincide with the Transnistrian position, which sought equal status between Transnistria and Moldova, but it gave Transnistria veto powers: hence Transnistria agreed to sign. Moldovan President Voronin was initially supportive of the plan, but refused to sign it after internal opposition and international pressure from the OSCE and the United States. The Russian Federation also endorsed the Transnistrian demand to maintain its military presence for the next twenty years as a guarantee for the intended federation. The ongoing presence of Russian troops has been a stumbling block in peace talks. Long-running negotiations sponsored by the OSCE, Russia, and Ukraine have not yet yielded a political solution.14 Rather often, the Russian Federation perceives facts, statements, and activities in a very different way from that of the world community. For instance, on 3 March 2006, Ukraine introduced new customs regulations on its border with Transnistria and declared that it would only import goods from Transnistria with documents processed by the Moldovan customs offices, as part of implementation of the joint customs protocol between Ukraine and Moldova on 30 December 2005. Transnistria and Russia termed the act an “economic blockade.”

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In the referendum held in September 2006, which was not recognized by Moldova or by the international community at large, the region reasserted its demand for independence and proposed a plan to eventually join Russia. This event, as well as regular visits of the Transnistrian authorities to Moscow and meetings with top-level Russian officials, demonstrated that the Russian Federation was not satisfied with the status of a neutral mediator. Moreover, Russian officials use softening of their position towards Moldova as a “carrot” to move it away from the Western direction in its foreign policy, to thwart its participation in GUAM, and to ensure that the country abstains from any sizable step towards possible future NATO membership. At first glance, involvement of the Russian Federation in the NagornoKarabakh conflict was less visible. Here it played the role of a real mediator within the Minsk Group, where it held a co-chair position. The role of this group is mostly political and supervisory. However, the fact still remains that Armenia is a long-lasting strategic partner of the Russian Federation in the region (including hosting on its territory the Russian troops that were re-deployed from Georgia) and all its actions are supported by Moscow. Moreover, on a number of occasions, Russian officials tried to apply energy leverage to keep the interest in Azerbaijan at a minimum and persuade Baku to decrease its level of cooperation with NATO, GUAM, and the United States. The autumn 2008 efforts of the Russian Federation to facilitate in Armenian–Azerbaijani negotiations over the final settlement were mostly used as an attempt to redeem the image of a mediator after the Russian–Georgian war. Evaluating the Russian role in Georgia is the most difficult task. When conflicts in South Ossetia and Abkhazia started in 1992, the Russian Federation voluntarily became a mediator and peace guarantor, deployed CIS peacekeeping forces in Abkhazia, and hosted regular negotiations. By that time, the Russian Federation had officially confirmed the territorial integrity of Georgia. Indeed, for a number of years, the Russian role was actually a true mediation in the conflicts. However, the situation has slowly changed: Georgia gradually shifted its foreign policy towards a closer cooperation with the Western political institutions, such as the EU and NATO, with whom Russia traditionally had rivalry over spheres of influence in the post-Soviet space and in Eastern Europe. Acknowledging that it was losing its influence in the region, Moscow started a manipulation game by using the separatists as an influence-exerting tool on Tbilisi. Moreover, the official foreign policy of Moscow became more aggressive and imperialistic. Its strong support to separatist leaders ranged from reconstruction of the railway from Russia to Abkhazia without

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Georgian permission, to mass issuing of Russian passports to Abkhazians and South Ossetians, and putting a cap on the process of Georgian refugees returning. This support increased after the Rose Revolution in Georgia in 2003 and was enhanced by strong criticism of Saakashvili’s regime amidst regular peace plans. On a number of occasions, Russian troops were accused of breaching their neutral status and giving direct support to the separatist forces. Several times, Georgia called the world community to withdraw the CIS troops and replace them with international forces, to which there was strong opposition from the Russian side.15 The South Ossetian crisis in August 2008 showed the real boundaries to which Russia was ready to advance to destabilize the situation in Georgia. Its strategic use of planes, warships, and regular army forces; its bombing of Gori and Poti; its military actions on the territory beyond the immediate conflict zone and the territory within its direct responsibility; its official recognition of South Ossetia and Abkhazia; and its de facto ignoring of the opinion of the world community exposed the Russian Federation as a party to the conflicts.

Ukraine Ukraine, being a partner of all the states in the region and neutral in the conflicts in Abkhazia, South Ossetia, Nagorno-Karabakh, and Transnitria, would like to play a more significant role as a mediator suggesting peace plans and joint projects. Ukraine is the only GUAM state never to have had any conflicts on its territory. However, the existence of unsettled conflicts on the territory of its partners is a threat to its own national security and economic development. Ukraine has some experience in conflict management. Two peace plans for the Middle East and Kosovo were elaborated but not implemented and, what is more important, Ukraine is very active within the framework of international organizations, such as the UN, NATO PfP and the OSCE. Ukrainian peacekeepers have a reputation as the most professional ones within the UN, and they assist in peace processes in many parts of the world. Ukraine has always enjoyed a reputation as a neutral and efficient supporter of peace. Moreover, Ukraine has never had any desire to spread its sphere of influence or to restore any “imperial desires.” For a long time, Ukraine was a part of the peace process in Transnistria. Ukrainian peacekeepers, together with their Russian and Moldovan colleagues, observed the situation on its border. Ukraine has also acted as a mediator and has offered its territory for peace negotiations.

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Since 1997, Ukraine has been the official mediator and guarantor of the peace settlement, according to the provisions of the Primakov Memorandum. In 2005 at a GUAM Summit in Chisinau, President Yuschenko presented the Ukrainian peace plan for Transnistria. This proposition was supported positively by all sides and became the main document for the conflict resolution process. This plan was the first to suggest widening the format of negotiation from three plus two (Ukraine, Russia, OSCE plus Moldova and Transnistria) to five plus two (Ukraine, Russia, OSCE, Moldova, and Transnistria plus the EU and the United States). It did not lead to a greater involvement of the United States but envisaged a strong role for the European Union in the process. The EUBAM mission was established in Odessa (Ukraine) and, through all its actions, the Ukrainian side pushed the EU towards a greater involvement in the negotiations. After the positive experience of the Transnistrian plan, leaders of Caucasian states suggested that Ukraine elaborate peace plans for other GUAM conflicts. Also, for many years, Georgia proposed the inclusion of Ukraine in the peacekeeping forces on its territory. Ukraine has always supported the territorial integrity of Georgia and Azerbaijan, but was unable to be a peacekeeper. It has not signed the CIS Tashkent Pact, which would allow it to be part of the CIS forces. Furthermore, the UN, EU, NATO, and other organizations did not want to widen their mandates and replace Russian troops in Georgia, which would have allowed Ukraine to join one of these possible missions. However, Ukrainian observers worked within the UN and the OSCE missions in Georgia. On a number of occasions, Ukraine offered its “good offices” to Azerbaijan and Armenia for negotiations. Ukraine’s peace-making efforts amongst the Black Sea states is weakened by strong opposition from the Russian side and also by the difficulty of establishing good relations with all parties to the conflict. When Ukraine tried to negotiate over the conflicts in Georgia, Russian officials started a campaign claiming that Ukraine only supports Tbilisi as its strategic partner, so it is not be neutral either.

Conclusion We can conclude that nearly all of the mediators in the region are either working on their own initiative or fully conform to a mediator status. Most of the actors, however, have their own strong ties and interests in the region, which limit their involvement. The Russia–Georgia crisis of 2008 has demonstrated the weak sides of the mediators as well as the readiness of the EU to get more involved in the peace process in the

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region. Furthermore, the latest trends in the region show that real negotiations should take place not only between “official” parties to conflicts, but also with the Russian Federation as a party to conflict. It is necessary to build a more comprehensive coordination between different mediators so that they can benefit from each others’ strong sides. In this respect, the positive experience yielded by the EU–Ukrainian cooperation in the Transnistrian conflict has demonstrated an encouraging example. However, the final solution is possible only if all actors will be interested in and agreed upon such a final settlement rather than deriving benefit from the instability for increasing their influence in the region.

Notes 1

United Nations Organization, “Georgia—UNOMIG—Mandate,” UN Official Website, 2009, http://www.un.org/en/peacekeeping/missions/past/unomig/mandate.html. 2 Organization for Security and Cooperation in Europe, “OSCE Mission to Georgia,” OSCE Official Website, 2009, http://www.osce.org/georgia/13199.html. 3 Organization for Security and Cooperation in Europe, “Minsk Process,” OSCE Official Website, 2009, http://www.osce.org/item/21979.html. 4 International Crisis Group, “Report on the 20 March, 2006.” 5 EU Special Representatives, Council of the European Union Official Website, http://www.consilium.europa.eu/showPage.aspx?id=263&lang=EN. 6 Leyla Alieva, “EU and South Caucasus,” Bertelsmann Group for Policy Research, discussion paper, December 2006, p. 12, www.cap.lmu.de/download/2006/2006_Alieva.pdf. 7 “Black Sea Synergy: A New Regional Cooperation Initiative,” Commission of the European Communities COM (2007) 160 final (Brussels), 11 April 2007. 8 J. Devdariani and B. Hancilova, “EU Broaches Peacekeeping Possibility in Georgia,” CACI Analyst (2007) http://www.cacianalyst.org/?q=node/4468. 9 EU Talks, ‘ȿɋ ɩɪɢɡɵɜɚɟɬ Ɍɛɢɥɢɫɢ ɢ Ɇɨɫɤɜɭ ɜɨɫɫɬɚɧɨɜɢɬɶ ɞɨɜɟɪɢɟ— ɡɚɹɜɥɟɧɢɟ’ (ES prizÕvaet Tbilisi i Moskvu vosstanovit doverie-zayavlenie)[The EU calls on Tbilisi and Moscow to restore confidence—Statement], 2008, http://www.eutalks.info/2008/05/05/565/. 10 S. Cornell, “Europe Exposes Russia’s Guilt in Georgia in an Invasion, When can a Spade Be Called a Spade?,” Wall Street Journal, 1 October 2009, http:// online.wsj.com/article/SB10001424052748704471504574446582737784064.html. 11 Independent International Fact-Finding Mission on the Conflict in Georgia, “Report,” Council of the European Union, 30 September 2009. 12 Z. Süslü, “Georgia at a Glance: Abkhazian and South Ossetian Conflict,” IBSU Scientific Journal 1 (2006): 105. 13 ɇɟɡɚɜɢɫɢɦɚɹ ɝɚɡɟɬɚ(Nezavisimaya gazeta), 18 June 1992. 14 “Regions and territories: Trans-Dniester,” BBC News Online, 2009, http://news.bbc.co.uk/1/hi/world/europe/country_profiles/3641826.stm.

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ɇɚ ɤɨɝɨ Ƚɪɭɡɢɹ ɯɨɱɟɬ ɫɦɟɧɢɬɶ ɪɨɫɫɢɣɫɤɢɯ ɦɢɪɨɬɜɨɪɰɟɜ ɜ Ⱥɛɯɚɡɢɢ (Na kogo Gruziya hochet smenit rossiyskih mirotvortsev v Abhazii) [To whom Georgia would like to change Russian peacekeepers in Abkhazia], UNIAN, 2007, http://www.unian.net/ukr/news/news-185892.html.

PART IV: ENERGY

CHAPTER TWENTY-TWO THE GEOPOLITICS OF ENERGY IN THE BLACK SEA CONTEXT NICOLAE IORDAN-CONSTANTINESCU*

Energy, politics, and power have been clearly intertwined forces in international security for more than a century. The stakes are raised as these issues reach beyond national prosperity and security, to the viability of the entire planet. The driving factor is energy. If the resource economy is the driving force of globalization—half of the one hundred biggest multinational companies in the world belonging to the energy and resource economy—then the geopolitics of energy is the driving factor in global prosperity and security. The political nature of energy, which comes to public attention at moments of crisis, can no longer be questioned.

Challenges If we look at the energy dossier, we cannot ignore its complexity at both the national and international level, for both the developed and developing countries. Such complexity highlights a number of challenges facing the world’s nations that need to be approached with full responsibility, a sense of solidarity and concern for the future of both the planet and mankind. Let us examine some of these challenges. First we have to note a paradoxical situation. There is a constantly growing demand for energy, estimated to rise by more than fifty percent by 2030. There is also the apparent incapacity of science, technology, and industry to create sufficient alternative energy sources, so that approximately eighty percent of the energy needs of 2030 would still need to be met by fossil fuels, which are limited resources.

*

Associate Professor of Economics, Romanian Banking Institute; President of Paneuropa Foundation, Romania.

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Energy consumption is growing constantly. The most energy-hungry sectors—industry and transport systems, particularly in the United States—are largely reliant on oil and gas, and will remain so indefinitely. Access to energy has become critical to sustaining growth in China and India. Importers compete for supplies, driving up the unpredictable prices. Moreover, in numerous countries critical energy infrastructure is vulnerable to political instability, natural disasters and other threats. Increasing import dependence in many countries is paralleled by a growing interdependence between producing, consuming, and transiting countries, with enormous investments required along the entire energy chain. The market power of energy suppliers has become a political power. Countries such as Russia, Venezuela, and Iran have gained the capacity to play important roles in shaping regional and international politics that go well beyond what their GDP would suggest. As populations become more educated and demanding, failure to deliver on the promise of greater prosperity threatens to unravel both authoritarian and democratic regimes. And last, but not least, there is an imperative need to protect the environment and to tackle climate change. In Figure 22-1, energy supplied from natural gas and oil can be seen to constitute more than sixty percent of all energy resources for all time periods. The table suggests that the world’s primary energy demand will continue to rely on fossil fuels for the foreseeable future. A number of estimates predict the continuation of this trend till 2050. Fossil fuels (which are carbon dioxide emitters) account for eighty percent of energy used, with coal continuing to represent a high proportion (twenty-three percent). However, pollution concerns mean that consumption of oil, gas, and coal will have to be reduced (1,900 cubic metres of carbon dioxide is released by the burning of one ton of coal, for example). If the relative proportion of fossil fuels remains steady in the overall energy balance, the absolute figure will rise tremendously. According to French nuclear scientist Jacques Foos, between 1900 and 2000 worldwide energy consumption increased tenfold from 1 to 10 Gtep per year (Gtep = gigatonne-equals-petrol). Maintaining that level of increase will take consumption to 37.5 Gtep per year by 2050. However, a more realistic increase, based on the last decade’s growth, takes consumption to 57 Gtep per year by 2050. Meanwhile, under present economic conditions 57 percent of today’s oil and gas resources will be gone in 50 years.1

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Fig. 22-1 Supremacy of fossil fuels

Source: Derived from the data in http://www.iea.org/weo/

Taking the European Union as a whole the situation is not significantly different. Figure 22-2 below shows that the gross inland energy consumption of the EU-29 is approximately seventy-eight percent oil, gas and solid fuels. Alternative sources of energy, such as nuclear and renewable, do not yet represent a realistic alternative to classical fuels.

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Fig. 22-2 Gross inland consumption of the EU-29 (2005)

Source: Used by permission of the World Energy Council, London, www.worldenergy.org.

Growing Dependency on Energy Imports Table 22-1 shows clearly that despite the EU’s efforts to develop alternative energy sources and reduce industrial and home consumption, there is an increasing dependence on imported energy. This trend is set to continue. Table 22-1 EU-30 Energy dependency by 2030 Oil Natural gas Solids Total

2000 76% 50% 30% 48%

2010 81% 61% 38% 53%

2020 86% 76% 51% 62%

2030 89% 81% 66% 68%

In 2000, EU countries imported less than 50 percent of their oil, gas, and solid fuel needs. By 2030 this is expected to rise to 70 percent. Twenty-five percent of these imports were from Russia, and this is likely to rise to 40 percent by 2030, with a further 45 percent coming from the Middle East. On the other hand, US imports of oil are likely to remain stable at 58 percent.

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Table 22-2 Global oil import dependency (as % of global demand)2 OECD North America OECD Europe OECD Pacific China India Other Asia

2002 36% 55% 90% 34% 69% 40%

2010 35% 69% 93% 55% 80% 54%

2030 56% 87% 94% 74% 91% 76%

World Reserves According to the BP Statistical Review of World Energy 2008, the world proven reserves of oil were 1,237.9 billion barrels at the end of 2007. This is mainly concentrated in the Middle East (755.3 billion barrels—currently calculated at 61 percent of the world proven reserves, mainly in Saudi Arabia, Iran, Iraq, and UAE)—followed by Africa (about 9.5 percent, mainly in Libya and Nigeria) and Central and South America (about 9 percent, mainly in Venezuela). As for the world proven reserves of gas, the same statistics indicate a total of 6,263.34 trillion cubic feet, concentrated mainly in the Middle East (2,585.35 trillion cubic feet, or approximately 41 percent of the world proven reserves, mainly in Iran and Qatar) and Eurasia (1,881.14 trillion cubic feet, or 30 percent of the world proven reserves, mainly in the Russian Federation).

The Issue of Caspian and Central Asian Energy The Caspian Sea region (the South Caucasus and Central Asia) contains about 3–4 percent of the world’s oil reserves (47.5 billion barrels at the end of 2005) and 4–6 percent of the world's gas reserves (estimation, no complete data available).

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Table 22-3 Proven reserves of oil at end 2007 (thousand million barrels)3 Asia-Pacific North America S. and Cent. America Africa Europe and Eurasia Middle East

40.8 69.3 111.2 117.5 143.7 755.3

Table 22-4 Proven reserves of gas at the end of 2007 (trillion cubic meters)4 Asia-Pacific North America S. and Cent. America Africa Europe and Eurasia Middle East

7.73 7.98 14.46 14.58 59.41 73.21

The states neighbouring the Black Sea do not have significant proven reserves of oil and gas. There is some potential on the Black Sea continental shelf, in the disputed area between Romania and Ukraine around Serpent Island. This is estimated to be around 100 billion cubic meters for gas and 10 billion tons for oil. This is quite insignificant in terms of world reserves, or even the Caspian potential. Even though the oil and gas reserves in the Black Sea, especially the Caspian and Caucasus areas, are not high, their importance is significant. This is due to the energy policies developed by consumer states in the West seeking to diversify their import sources and decrease their dependence on Russia and the Middle East. The main problem concerns transportation and, of course, the security of the very long pipelines that must pass through several countries before reaching their destination. The transport of Caspian and Central Asian (Kazakhstan and Turkmenistan) energy supplies to the west via the Caucasus has assumed vital importance. A number of states and organizations are taking steps to end Russia’s near monopoly of the transport of energy supplies in the Eurasian region by creating alternative pipeline routes to transport these supplies. Some of these are now operational, others are under construction or planned: namely, the Atasu–Alashankou oil pipeline (China and Kazakhstan); the Baku–Tbilisi–Ceyhan (BTC) pipeline; the Baku–Tbilisi– Erzurum (BTE) pipelines (Georgia, Azerbaijan, Turkey, and Kazakhstan);

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and the Nabucco gas pipeline (European Union, Turkey, Bulgaria, Romania, Hungary, and Austria). From this perspective the role of Turkey is crucial. Though lacking significant energy resources of its own, Turkey, due to its location, is ideally situated for a gas or oil pipeline which will not cross Russian soil.

The Geopolitics of Oil and Gas From the above we can present some preliminary conclusions: Fragility of international oil and gas markets on the supply side: there is limited ability to expand production rapidly in the short term, and even long-term prospects are not certain; Saudi Arabia has limited additional short-term capacity; due to commercial disputes, local instability or ideology, Russia, Venezuela, Iran, Nigeria, and Iraq are not investing in new long-term production capacity. The limited supply elasticity can engender political volatility through rising prices. Political instability in and around countries considered marginal oil suppliers can cause major price spikes. For example, when Turkey threatened to take its fight against PKK into Kurdish Iraq on 17 October 2007, oil prices jumped from $87.40 per barrel to $94.53 per barrel by the end of the month. Causes of instability: conflict in the Middle East; risk of Iraq war spilling into the Persian Gulf; risk of any US conflict with Iran over its nuclear program or over Iranian support for militias in Iraq; conflict in the Niger Delta; populist state controls in Iran and Venezuela; difficulty of securing major oil transport routes.

A Glance at Russia Russia controls over a quarter of the world’s proven gas reserves at 1,680,000 billion cubic feet, and ranks eighth in the world in terms of proven petroleum reserves (60 billion barrels). In terms of oil production Russia ranks second only to Saudi Arabia (9.4 billion barrels per day)— Russia is producing at its peak; and Russia is also the world’s second largest oil exporter. Russia depends on European consumers and Europe depends on Russia as a supplier (Europe imports twenty-three percent of

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its gas from Russia), but there is no comparable reciprocal leverage. Russia refused to ratify the Energy Charter Treaty, which would have guaranteed transit rights for energy through Russia regardless of the ownership and precluded cutting off energy supplies as a political weapon.

The Issue of Nuclear Energy High oil and gas prices and the need to take action to address climate change make nuclear power a more attractive option for national energy strategies, but also raises legitimate concerns about the risk of nuclear proliferation. The risk of the availability of civilian nuclear power leading to weaponization would increase dramatically, as would the risk of materials and technology falling into the hands of terrorists. No issue, therefore, is more urgent than creating a strong firewall between civilian power and weaponization programs, before more countries seek to develop weapons from civilian programs. Today, of the sixty countries with some form of nuclear capacity, just twelve can enrich and commercially produce uranium and, arguably, nine countries currently have nuclear weapons. For economic, environmental and security reasons, it is likely that more and more countries will seek to incorporate nuclear energy into their mix of power generation capabilities.

An Alternative: Fusion Energy Nuclear fusion energy has significant safety advantages over current power stations based on nuclear fission. Fusion only occurs under very specific conditions and will cease if proper control is not maintained, whereas fission can lead to runaway reactions and catastrophic failure. These features make fusion energy a safer and environmentally benign source of meeting the needs of the ever-growing and demanding world population. The long-term objective of fusion research is to harness energy generated by the fusion of light atomic nuclei. In recent decades research by scientists throughout the world has made great progress. While knowledge of the physics and engineering required for a fusion-based power station is not yet complete, it is encouraging that the basic principles are well understood. The fusion community have together designed the international ITER5 experiment, which aims to show that fusion could be used to generate electrical power and to gain the necessary data to design and operate the first electricity-producing plant.

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Table 22-5 Current participants of the ITER project USA European Union Russian Federation India China Korea Japan

In June 2005 it was decided to construct ITER in Cadarache, Southern France. The construction costs of ITER are estimated at five billion Euros over ten years, with a further five billion Euros anticipated for the twentyyear operation period. Detailed plans for the construction, operation, and decommissioning of ITER indicate that it should be ready for its first plasma by the end of 2016.

Seeking Solutions At the G8 Summit in St. Petersburg in July 2006, the Declaration on Global Energy Security stated that “Neither global energy security, nor the Millennium Development Goals can be fully achieved without sustainable access to fuels for the 2.4 billion people and to electricity for the 1.6 billion people currently without such access in developing countries.” With the political goals already expressed, the “ways and means” must be found to attain these objectives in the shortest possible time. This will benefit both mankind and the environment. To this end “energy diplomacy” must play an important and decisive role. Diplomacy and effective management of reserves must be critical tools in finding solutions to topical energy matters. We will now examine how this can be done. First, debate must be stimulated around the tough questions relating to energy politics. For example, organizing a pan-European conference, with the compulsory inclusion of the Black Sea–Caspian region, and the participation of both exporting and importing countries, could prove very useful. This would mainly address security issues in the energy sector and identify transit systems that merit international cooperation and investment. There must be also a strong policy commitment, from at least the largest economies and energy users, to a focused and sustained agenda pursuing alternative and secure sources of energy.

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Countries must be encouraged and aided to facilitate the development of a centre dealing with energy security, climate change, and nuclear energy and proliferation. Certainly, it is important to establish regional security arrangements that can mitigate risk and create shared incentives across states, especially in the Middle East, the Persian Gulf, and Central Asia. It is also important to ensure the completion of the Energy Charter Transit Protocol, the signing of the Energy Charter Treaty by Andorra, Monaco, and Serbia and the ratification of the Energy Charter Treaty by the Russian Federation and Norway.

A Shared Medium-term Strategy If we could agree on these objectives in the field of energy production, supply, and security, we could also envisage at least a medium-term strategy to foster convergence around political, environmental, energy, and economic goals. Such a strategy must revolutionize the way that we acquire and use energy and so break the petroleum dependence, stimulate innovation and job creation, and provide significant political and environmental dividends. Countries should witness a radical departure from current patterns in the use of fossil fuels—which, for most states, compromise national security, and for all nations threaten the planet—and move to a sustainable energy mix. Such a move should be sustained by establishing financing and policy measures to support the development, testing, demonstration, commercialization, and dissemination of clean and efficient technologies that can transform the terms of the debate on energy use and climate change. Last, but not least, the measures that must be introduced should include the pricing of carbon emissions and the coordination of prices across states, if not the creation of transnational carbon markets.

Notes 1

Jacques Foos, “No More Nuclear Energy? A Lost Fight Before it Even Starts!,” 2007, http://scitizen.com/future-energies/no-more-nuclear-energy-a-lost-fight-before -it-even-starts-_a-14-846.html. 2 OECD Factbook 2005: 28, http://www.oecd-ilibrary.org/economics/oecd-factbook 2005_factbook-2005-en. 3 BP Statistical Review of World Energy 2008, 7, http://bit.ly/SK3q8. 4 BP Statistical Review of World Energy 2008, 23.

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5 ITER—“The way” in Latin. Formerly stood for “International Thermonuclear Experimental Reactor”, although this usage has been discontinued.

CHAPTER TWENTY-THREE ENERGY POLITICS IN THE BLACK SEA REGION: THE SUPERPOWERS’ RACE FOR FUEL JATINDER KHANNA*

Fig. 23-1 The Black Sea Region1

Introduction Blue Black Sea: A Sea Encircled by a Million Shores Physically, the Black Sea region is defined by its six littoral states: Bulgaria, Romania, Ukraine, Russia, Georgia, and Turkey. Geographically, it is the region where Russia and the territory of the Middle East intersects *

Jawaharlal Nehru University, New Delhi, India.

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with the European Union (EU). Strategically, the Black Sea region forms the crossroads of the European, Eurasian, and Middle Eastern security spaces. Three NATO Allies—Turkey, Romania, and Bulgaria—and two EU members—Romania and Bulgaria—surround the Black Sea. Culturally, the region is a rich mélange of Islamic and Christian traditions. The geopolitical significance of the region is often expressed by calling it “a nexus of cultures, international trade (both legal and illicit), ideas and influences.”2 With all of these features, the region is perceived as, most importantly, a union of energy producers and consumers and a “playground” for the major superpowers, namely the United States, Russia, and even China.

The Black Sea Region and its Identity The Black Sea is surrounded by diverse cultures. The six littoral states do not share a collective identity, unlike the Baltic nations whose common identity has grown around the “Balticum” throughout history. The littoral states have different ways of referring to the Black Sea. As late as the nineteenth century, each group of people had a different name for the sea in its respective language. For some it was the “Inhospitable Sea,” for others “The Great Sea,” or it simply Pontus (“The Sea”).3 Historically, the region has not been uniformly “European.” Georgians and Ukrainians have identified themselves with Europe, while Russians and Turks have been nationalistic in their identity. Ukrainians, Georgians, and Turks are reluctant to define themselves as “Black Sea people.” Countries like Ukraine, once part of the Soviet Union, find themselves caught between the West and Russia. Turkey and Russia find themselves on the same side against the West’s “destabilizing influence.” Georgia is in conflict with Russia, which it feels endangers its sovereignty and territorial integrity in the secessionist territories of Abkhazia and South Ossetia. The term “Black Sea region” is a recent development but the long-standing identity crisis can be a metaphor for the kinds of policies that different nations currently follow. However, changing politics and the interventions of the West have hastened the development of the Black Sea area as a distinct geo-political region. In the light of Euro-Atlantic integration, the idea of a Black Sea region comparable to the Caspian Sea and Caucasus regions has emerged. This phenomenon is best understood as a result of common strategic and economic interests.

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Growing Interests in the Black Sea Region The Black Sea has been politically a “dead sea,” acting as a clear pathway between the Soviet Union and Turkey. The rest of the world’s interest in the region is a recent phenomenon. Prior to the dissolution of the Soviet Union, the region was not at the centre of policy debates, lying as it does outside of the epicentres of geopolitics, namely the Middle East and Central Asia. The newly independent Soviet states, barely self-sufficient at the time of dissolution, were in dire need of hard currency. In that situation, since European powers readily accepted them as an alternative to Russia, developing their energy resource capability proved to be a sound strategy. Ukraine, Georgia, Azerbaijan, and others were also in need of access to European markets, not only for the exportation and transporting of hydrocarbons, but also to promote additional economic opportunities with other resources and agri-business products. 4 In 1992, the member states organized themselves into the Black Sea Economic Cooperation Organisation (BSEC) to ensure peace, stability, and prosperity by encouraging friendly and neighbourly trade relations within the Black Sea region. The founding members included Albania, Armenia, Azerbaijan, Greece, Moldova, and Serbia in addition to the six littoral states. With the accession of Serbia (then Serbia and Montenegro) in April 2004, the number of the organization’s member states increased to twelve. Austria, Belarus, Croatia, the Czech Republic, Egypt, France, Germany, Israel, Italy, Poland, Slovakia, Tunisia, and the United States became its observer states. BSEC has slowly but steadily evolved into an international organization. It has formed a permanent secretariat (PERMIS) in Turkey, a regional bank in Greece, and the Black Sea University in Tbilisi. PERMIS, located in Istanbul, coordinates twelve working groups with specific agendas. Its financial arm, the Black Sea Trade and Development Bank (BSTDB), was established at Thessaloniki in June 1999. A parliamentary assembly (PABSEC) was chartered in 1998 and ratified by the member countries by May 1999. In addition, BSEC acquired official observer status at the United Nations. The organization shows all the signs of becoming a fully fledged regional bloc. The identity of the Black Sea is evolving from a new realization of mutual dependence. At the 2008 NATO Summit in Bucharest, leaders acknowledged the importance of the Black Sea in their closing communiqué: We reaffirm the continued importance of the Black Sea region for EuroAtlantic security. In this regard, we welcome the progress in consolidation

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of regional ownership, through effective use of existing initiatives and mechanisms. The Alliance will continue to support, as appropriate, these efforts guided by regional priorities and based on transparency, complementarities and inclusiveness, in order to develop dialogue and cooperation among the Black Sea states and with the Alliance.

The Black Sea itself has no energy resources, but the region determines the extent of exploitation of the nearby Caspian Sea. The US Energy Administration reported in July 2001 that the Caspian Sea held about thirty-four billion barrels of proven oil reserves and 235 billion barrels of possible oil reserves. In 2006, British Petroleum estimated that oil reserves could be about 47.1 billion barrels. In addition to its oil, the Caspian Sea has substantial quantities of natural gas reserves estimated at about 243– 248 billion cubic feet, as compared to about 300 billion cubic feet of natural gas in North America.5 In view of the potential of the Caspian Sea’s resources, energy security is a critical issue for buyers and for suppliers. The Black Sea is fast becoming Europe’s major energy transfer corridor. The Black Sea region plays a critical role in the transporting of oil and gas from the Caspian region to Europe. Western powers are increasingly looking to diversify their energy sources beyond Russia. Following the cutting of the Ukrainian gas supply, Russia is perceived as a “bully” supplier, and US Vice President Dick Cheney has reprimanded it for its increased state control in the sector.6 The EU has accused Russia of pushing its stateowned natural gas giant, Gazprom, in the global energy arena to help it gain leverage.

The Black Sea region: Guiding Geo-political Strategy and Energy Security US Energy Interests The United States understands that gaining supremacy throughout the Eurasian zone is of the utmost importance. On the “global chessboard,” the United States cannot afford to miss the Black Sea region, which is an important consideration in tapping Eurasian potential. Zbigniew Brzezinski opens his 1997 book “The Grand Chessboard”7 with this statement: Ever since the continents started interacting politically, some five hundred years ago, Eurasia has been the centre of World power … How a globally engaged America copes up with the complex Eurasian power relationships

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and particularly whether it prevents the emergence of a dominant and antagonistic Eurasian power, remains central to America’s capacity to exercise global supremacy. What happens to the distribution of power on the Eurasian continent will be of decisive importance to America’s global primacy and to its historical legacy.

The attempt to circumvent Russian influence and reach the oil sources of Central Asia forms the backbone of US policy in the Black Sea region. The superpower has woken up to a new world view since the terrorist attacks of 9/11. The West has realized that new and potent threats can emanate beyond their continents, specifically from the greater Middle East region. Cohen and Irwin (2006) of the Heritage Foundation contend that “The United States has strong interests in safeguarding the movement of some goods, preventing the movement of others, and maintaining a presence in the Black Sea region.” Maintaining peace and harmony in the region is a strategic need for the United States. The United States and China have strengthened their political, economic, and military engagements in the region, especially in and around petroleum-producing Caspian Sea countries like Kazakhstan and Turkmenistan. In the Caspian Sea region, the United States is trying to bypass Russia to build oil pipelines from Baku in Azerbaijan via Tbilisi in Georgia to Ceyhan and Erzurum in Turkey.

Russia’s Energy Interests Geographical proximity, historical ties, and strategic and economic considerations have shaped Russian policy towards the Black Sea region. Since the end of the bipolar world signalled by the demise of the Soviet Union, the importance of Eurasia, specifically the Black Sea region, has re-emerged due to strategic and economic imperatives. Before the 1990s, energy transfer in the region was the Soviet Union’s prerogative. After the disintegration of the Soviet Union and the formation of new Russian offspring, the republics began on a high note, leaving Russia feeling out-distanced. Russia had historically focused its resources on developing Siberia, and had ignored its territory in the west of the Urals. Now these newly developed countries were eager to exploit their own economic resources and they became Russia’s competitors. With Caspian Sea resources proving to be an attractive alternative for the West, Russia is experiencing unease over its own immeasurable reserves of under-utilized energy resources in Siberia. It seems that these resources could appeal to

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its Asian energy-guzzling neighbour China. Naturally, as buyers in the energy bazaar diversified, the suppliers also wished to extend their market. Since the Russia–Ukraine face-off in January 2006, energy security has become a key question. Russia is afraid of losing its buyers, a fact demonstrated by the Group of Eight (G8) Summit on global energy security which it hosted in the summer of 2006 in St. Petersburg. Currently, Europe imports approximately 50 percent of its energy over the often dangerous routes through the Bosporus and the English Channel. By 2020 Europe will be importing 70 percent of its energy from sources beyond Europe. The Black Sea is Russia’s only direct link to the Balkans and the Mediterranean region. Losing the use of its Baltic and Black Sea ports has affected Russia’s energy exports to Europe. The wider Black Sea region dominates the entire Euro–Asian energy corridor, from trans-Ukrainian oil and gas pipelines running to the markets in North Europe to the Baku–Tbilisi–Ceyhan (BTC) pipeline which runs to the Mediterranean. Projects like the Odessa–Brody pipeline, the Burgas–Alexandroupolis pipeline and the Nabucco pipeline signal the end of Russia’s monopoly on energy resources.8 Russia has been making a concerted effort to ensure that a large volume of Euro–Asian trade passes through its territory. Poising itself to become the “transit superpower,” it has been making major investments to upgrade its domestic transport infrastructure and is rapidly developing its ports along the Caspian Sea coast. The port of Olya in the Astrakhan region is operational, and a railway track has been built to link it with Russia’s well-developed rail network, connecting its Black Sea and Caspian Sea ports.9

China’s Energy Interests China is the world’s second largest oil consumer after the United States. According to Chinese official estimates, by 2020 the country’s energy consumption will top 3 billion tons of standard coal, with its Gross Domestic Product (GDP) quadrupled and energy use doubled.10 Given the untapped potential of its extensive resources, the wider Black Sea region is undoubtedly capable of satisfying this hunger for energy. China, an emerging global economic power, is not only working with Russia to counter the US influence in the Caspian Sea area, but is also seeking to develop and import more from the region. Increasingly, China and Russia are developing closer relations with one another and are showing more willingness to defend each other’s foreign policy interests in the international arena. Recently, through the Shanghai Cooperation

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Organization (SCO), China has shown solidarity with Russia in its conflict with Georgia and has supported Russia’s de facto control over two major Black Sea ports.11 China prefers to purchase its oil from Russia because although the shipping route is twice as long as the route from the Middle East, the cost of Russian crude oil is still below the price set by OPEC.12 Although dependence on Russia’s oil will continue in the short term, China is keen to source oil from a different route so as to lessen Russia’s control in the long term. It has expressed interest in developing the Baku–Tbilisi–Kars (BTK) Railway, which would allow access to Europe more quickly than the existing trans-Siberian route. The BTK will link Baku in Azerbaijan with Kars in eastern Turkey via Tbilisi in Georgia: the railway is scheduled to be completed in 2009–2010 and will mainly transport oil. In November 2007, China and seven other Central Asian states announced a plan to build a modern version of the ancient Silk Road, to include a network of highways, airports, rail lines, and seaports which will connect China with Western Europe.13

Fig. 23-2 BTC Pipeline14

Convergence of Interests on the BTC Pipeline The construction of the Baku–Tbilisi–Ceyhan (BTC) oil pipeline caused bitter disagreements between Russia and Turkey, particularly in the

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1990s. The pipeline would allow the transportation of Kazakh and Azerbaijani oil to the West. Turkey and the United States sided against Russia. Russia felt that the BTC could pose a threat to its own delivery to Europe. The situation changed in 1997 when Turkey and Russia signed an agreement on the construction of a gas pipeline known as Blue Stream, which would pass beneath the Black Sea to Turkey. Due to this pipeline, Russia has become the primary supplier of natural gas to Turkey. Turkey received 80 percent of its natural gas (16 billion cubic meters) from Russia in 2005. Despite the United States’ suspicion of Russian oil delivery via pipelines to the Mediterranean Sea (since this would strengthen Russia and reduce delivery of oil through the BTC), Ankara is ready to participate in such projects. The BTC pipeline is a recent example of how the different interests of Black Sea countries and superpowers can collide. Such clashes of interests in the energy arena are likely to continue in the future.

Conclusion The Black Sea region is developing its own unique identity due to changing global conditions. Since the ending of the bi-polar world, the Eurasian game has become more complex, with superpowers competing and cooperating to gain access. Russia’s influence as a supplier has diminished, but it is trying to re-establish itself as the “Black Sea power.” The most important factor guiding these geopolitical changes is the presence of energy resources in the wider Black Sea region. The United States and China, due to their energy interests in Central Asia and the Caspian Sea, are trying to counter Russian influence by developing infrastructures throughout the Black Sea region. In view of its crucial role as a transport route, the superpowers, both far and near, cannot ignore the region. Its development is not in the hands of the Black Sea states alone, but is guided by multiple players.

Notes 1

Map taken from http://www.yorku.ca/ylife/2005/10-17/acrupo-101705.htm. A. Cohen and C. Irwin, “U.S. Strategy in the Black Sea Region,” Heritage Foundation, 2006, http://www.heritage.org/Research/RussiaandEurasia/bg1990.cfm. 3 Proceedings paper of 134th Bergdorf Round Table, “The Black Sea Between the EU and Russia: Security, Energy, Democracy,” Odessa, 2006, http://www.koerberstiftung.de/bg/recherche/pdf_protokoll/bnd_134_en_text.pdf. 2

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M. Tsereteli, “The Black Sea/Caspian Region in Europe’s Economic and Energy Security,” http://www.isdp.eu/files/publications/books/0802energysecurity-3-Tsereteli.pdf. 5 R. G. Gidadhubli, “Energy Politics in Central Asia, Great Game Replayed,” unpublished paper, University of Mumbai, 2008. 6 S. Weisman, “Russia Plays Energy Card vs. Western Investment,” International Herald Tribune, 12 June 2006, http://www.iht.com/articles/2006/06/11/news/moscow.php. 7 Z. Brzezinski, Grand Chessboard: American Primacy and its Geostrategic Imperatives (New York: Basic Books, 1997). 8 R. D. Asmus and P. B. Jackson, “The Black Sea and the Frontiers of Freedom,” Policy Review (2004) http://www.hoover.org/publications/policyreview/3437816 .html. 9 Keynote Address at the Woodrow Wilson Center Conference: “Trans-Atlantic Perspectives on the Wider Black Sea Region,” U.S. Perspectives on the Black Sea Region, US Bureau of European and Eurasian Affairs, 2008, http://www.state.gov /p/eur/rls/rm/105827.htm. 10 “China to Boost Use of Renewable Energy by Law,” China’s Embassy in India, http://www.chinaembassy.org.in/eng/zgbd/t190356.htm. 11 M. K. Bhadrakumar, “Russia remains a Black Sea power,” http://www .globalresearch.ca/index.php?context=va&aid=9986. 12 A. Wolfe, “China's Demand for Energy is Reshaping Power Structures around the World,” Power and Interest News Report, 2004, http://www.pinr.com/report .php?ac=view_report&report_id=146. 13 S. Bocioaca, “The Baku-Tbilisi-Kars Railway: The First Step in a Long Process,” Power and Interest News Report, 2007, http://www.pinr.com/report .php?ac=view_report&report_id=733&language_id=1. 14 Map taken from http://www.wealthdaily.com/articles/russia-georgia-war/1448; original map credit BP.

CHAPTER TWENTY-FOUR ENERGY AS A FOREIGN POLICY TOOL IN THE WIDER BLACK SEA REGION SERCAN SALöIN*

Introduction Daniel Yergin, the president of the Cambridge Energy Research Association, concludes his famous bestseller, The Prize: The Epic Quest for Oil, Money and Power, with the following words: Energy is the basis of industrial society. And of all the energy resources, oil has loomed the largest and the most problematic … For ours is a century in which every facet of our civilization has been transformed by the modern and mesmerizing alchemy of petroleum. Ours truly remains the age of oil.1

Since the second half of the twentieth century, constant access to energy resources has remained indispensable for sustainable development Notwithstanding the ongoing efforts to find alternative energy resources throughout the twentieth century, hydrocarbon reserves have continued to be the primary source of energy.2 Meanwhile, despite the increasing pressure of demand for uninterrupted supplies of energy, global fossil fuel reserves were kept constant. Behind ever-rising global energy demands are a number of factors, including the rapid and intense industrialization of developing countries, the increasing population, and the “Chindia effect.”3 With the ongoing significance of oil and the growing role of gas, the regions that are rich in both of these resources are likely to remain at the centre of both regional and international rivalries on energy politics. The first reason for this is the scarcity of reserves and the increasing levels of demand. In its projection to 2030, the US Energy Information Administration (EIA) assumes that world energy consumption is estimated to increase by 44 percent in the period between 2006 and 2030.4 The *

Dokuz Eylül University, Department of International Relations, Izmir, Turkey.

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second is the need for decreasing dependence on a certain number of producer countries, especially Russia and OPEC.5 In 2030, 75 percent of the growing demand will be from China and India, with the rest coming from developing non-OECD countries.6 How China and India will provide for their energy needs will determine the new balance of power in the international system. Although consumer states have made various efforts to access alternative energy resources, such as coal, nuclear, and renewable energy sources, hydrocarbon reserves are likely to maintain their vital role in the foreseeable future. The wider Black Sea–Caspian region presents a complex picture to its observers. Comprised of Russia, Georgia, Ukraine, Romania, Bulgaria, Turkey, Azerbaijan, Kazakhstan, Turkmenistan, and Iran, the region is, on the one hand, often identified with frozen conflicts, political instability, and controversies regarding the national minorities. On the other hand, the same region also boasts promising hydrocarbon reserves, and is located right next to another region that is prominent in world politics, the Middle East. Due to these complex and even controversial points related to its geopolitical and geostrategic significance, since the end of the Cold War, the wider Black Sea–Caspian region has attracted the attention of IR scholars. The Middle East will undoubtedly preserve its central position in world energy supply, with 60 percent of the world’s proven oil and 40 percent of proven gas reserves. Although the wider Black Sea region cannot become the top energy supplier in the world, it can still offer consumer states a chance to diversify their energy supplies. Meanwhile, the future of the states in the region is directly proportional to their ability to produce and commercialize their oil and gas resources. There have been a number of constraints to the development of a regional energy trade. Frozen conflicts in the region, including Nagorno-Karabakh, Chechnya, and Ossetia-Abkhazia, the legal status of the Caspian Sea, lack of transport infrastructure, political instability, and lack of trade liberalization are some of these constraints. Although the newly independent ex-Soviet Caspian states are assumed to be capable of using their energy reserves as an effective and unrestricted foreign policy tool, allowing them to become regional powers by using their resources to further their objectives in this field, they have been unable to realize these goals. In fact, as this study aims to point out, using their hydrocarbon reserves as a foreign policy tool to integrate with international organizations and the Euro–Atlantic community has resulted in the dependence of these states on Russia being exchanged with other international players, including the United States, the European Union, and a number of intergovernmental organizations. Meanwhile, in addition to

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their new dependency on Western countries and institutions, their dependence on Russia, while somewhat lessened, has also persisted. The result is ironic: according to mainstream IR theories, energy reserves are supposed to help the Black Sea and Caspian states to gain the upper hand in their relations with other states; in reality, they have hardly lessened their dependence on other countries. Along with energy, these states have security-oriented foreign policy agendas, which indicate that high politics still prevails over low politics in these states. In other words, energy diplomacy in the region has been subordinated to the outcomes of the geopolitical struggle of the global powers over the region. Contrary to the general assumption that the regional states are perfectly capable of utilizing their resources for sustainable development, this study argues that a number of constraints limit their choices, causing them to fail to reach their objectives through energy diplomacy. Unfortunately, the number of academic studies dealing with the dynamics of wider Black Sea energy politics in the post–Cold War era from the viewpoint of international relations theories is limited. Some of these approaches remain weak in explaining regional dynamics, while others offer satisfactory arguments about regional oil politics. Rather than applying a single approach, with its weaknesses and strengths, in studying wider Black Sea and Caspian oil politics, this study aims to combine the valid assumptions of these approaches, complement them with each other, and to offer its own approach, composed of the powerful assumptions of mainstream IR theories which generally use a single level of analysis, either at the state, the individual, or the system level. The Euro–Atlantic community has intensified its efforts to secure access to the oil and gas resources in energy-rich regions, one of which is the Black Sea–Caspian region. European studies on the region mainly focus on forging a Euro–Atlantic strategy for the wider Black Sea–Caspian region on a variety of issues, ranging from security to energy trade.7 Particularly following the end of the Cold War, the EU has increased its efforts to secure its energy resources.8 It recently allocated a €2.3 billion budget for a variety of pipeline construction projects, in order to decrease its dependence on Russia.9 Meanwhile, other studies focus on the extraregional involvement of certain international actors, such as the United States, NATO, and the EU, as well as Russia. Most of these studies concentrate on the emerging Euro–Atlantic strategy of creating a “wider Black Sea” region, which is expected to underline the role of the Caspian Basin as an alternative energy supplier to the European energy markets. This approach is currently employed in a variety of studies, whose subjects range across NATO enlargement, the Partnership for Peace (PfP) project,

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the EU’s programmes, including the European Neighbourhood Policy (ENP), the Baku Initiative, Interstate Oil and Gas Transport to Europe (INOGATE), and the East–West Energy Corridor. In order to narrow the scope, this study proposes to focus on Azerbaijan and Kazakhstan. This selection is further supported by the prevalent assumption in the existing literature that the topic of energy plays a significant role in their formation of foreign policy. Both countries display remarkable similarities which are mostly observed in post-Soviet states in the Caspian region. To begin with, both have similar presidential, autocratic, neopatrimonial, and centralized political systems. Secondly, in terms of economy, both are characterized by considerable national resources of gas and oil and low economic diversification.10 Thirdly, they have similar traditional social network structures, made up of clans, families, and tribes which date back to the pre-Soviet era. Finally, both countries have weak national identities due to the repression of Soviet rule. These factors have exacerbated the ethno-national cleavages between ethnic minorities and the dominant Kazakh and Azeri nationalities of these countries.11 They also experienced similar post-independence developments, such as deep security concerns about neighbours, dependence on foreign capital and investment for growth, and efforts to preserve an interest-based balanced foreign policy. Despite these outstanding similarities, Azerbaijan and Kazakhstan also differ in some characteristics. For instance, while Azerbaijan has maintained a pro-Western stance in its foreign relations since its independence, and has challenged some of Russia’s manoeuvres in the region, Kazakhstan has maintained a more cautious stance, for reasons that are outlined later in the study. At the same time, however, Baku’s newly found independence from Russian domination seems to have been replaced by its emerging dependence on the Euro–Atlantic community; Astana still has deep concerns over the early exclusion of Russia and an absolute dependence on the United States. Unlike Azerbaijan, the foreign policy initiatives of Kazakhstan are further complicated by its eastern orientation in Asia, where China has taken the leading role with a new pipeline project. This study follows the indicated outline. First, it focuses on the historical background of the wider Black Sea–Caspian region. While doing this, it briefly explains certain concepts, such as “energy security,” for a better comprehension of the regional politics. The studies in the current literature usually consider the region from a Euro–Atlantic perspective. However, considering the region from the perspective of the Caspian states also promises different assumptions which will be discussed in the

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second chapter. Here, the focus will be on three extra-regional actors: the EU, the United States, and NATO. Secondly, the study takes into consideration the wider Black Sea through a regional perspective, applying IR theories to Azerbaijan and Kazakhstan’s foreign policy approaches to their Caspian oil politics. By sketching some of the distinctive characteristics of both Azerbaijan and Kazakhstan, it aims to underline that these differences and similarities have proven significant in their respective foreign policy orientations concerning their hydrocarbon reserves. As previously mentioned, the Caspian region in general, and Azerbaijan and Kazakhstan in particular, do not suit the confines of a single approach or theoretical model. For this reason, we view these countries through the lens of a blend of theoretical models (Dekmejian and Simonian’s approaches, for example) that can help to provide a comprehensive understanding of the role of hydrocarbons in the foreign policies of Baku and Astana.12 Dekmejian and Simonian argue that international relations theorists were caught unprepared by the disintegration of the former Soviet Union and the end of the Cold War. As a result, the field of IR has remained weak in building a dominant theory that can cope with diverse structural alterations, including ethnic conflicts, the clash of cultures, the increasing role of regional cooperation initiatives, and the impact of globalization. Given the diversity of such issues that preoccupy contemporary international relations, and the interaction between global, local, and regional actors and dynamics, the construction of a comprehensive approach for the analysis of the Caspian region needs to be both theoretically and methodologically eclectic. Thus, any framework for analysis requires the inputs of geopolitical theories, neorealism, social constructivism, and interdependence theories. This study deals with Azeri and Kazakh foreign policies separately. Azerbaijan foreign policy in the axis of energy is reviewed at three levels of analysis: the individual level, the state level, and the system level. Then, Baku’s foreign policymaking is viewed through the lens of neorealism. The study deals with the Nagorno-Karabakh conflict with a special emphasis, since it has kept its priority position on the agenda. Kazakh foreign policy is also evaluated at three levels. At the state level, the chapter examines the roles played by geography and the Russian population. At the individual level, it discusses the leadership of Nazarbayev. The system-level analysis focuses on relations with the external and regional actors, namely the United States, Russia, Iran, and China. Each country’s foreign policy goals are also a focus of the study. Since these two states share some key constraints in using their

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hydrocarbon reserves as efficient foreign policy tools, the chapter deals with these common barriers, such as the legal status of the Caspian Sea, geographical factors, and the transportation of oil and gas from the Caspian region to global markets.

The Historical Background of the Wider Black Sea–Caspian Region There is a missing link between IR theorizing and energy politics, both in the regional and the international scope. Energy has become an efficient factor in shaping the natural power balance in the international system. Since national security and political power concepts were redefined in the post–Cold War era, “economic security” has come to provide indispensable leverage in foreign policymaking. The three dimensions of energy— namely supply, transit, and consumption—are examined within the economic security of the new security environment as defined by Buzan.13 According to Buzan, Wæver, and Wilde, “economic security” refers to: (1) The ability of states to maintain independent capability for military production in a global market or, more broadly, the relationship of the economy to the capability for state military mobilization. (2) The possibility that economic dependencies within the global market, particularly oil, will be exploited for political ends or, more broadly, questions of the security of supply when states abandoned the inefficient security of self-reliance for the efficient insecurity of dependence on outside sources of supply.14

Security studies have radically changed in the post–Cold War era. The new security environment has introduced two new processes: “broadening” and “deepening.” Broadening refers to the inclusion of nontraditional issues, including organized crime, terrorism, human and drug trafficking, epidemics, and illegal migration into the traditional security concerns of the Cold War era, while deepening refers to the interplay of traditional referent objects with new non-state actors in the security field.15 The term “energy security” is accommodated within the framework of economic security conception of the Copenhagen School, but it also includes other components of new security sectors.16 It simply refers to total efforts of governments to secure an adequate amount of energy supply at affordable prices. This is the first and most vital element of energy security. The second is the aim of reducing the vulnerability that stems from dependence on a single or limited number of suppliers.

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Consumers are advised to diversify their suppliers in order to reduce their dependence, through using alternative resources. Over-dependence on a single supplier is an inadvisable situation which can easily be abused by the supplier, exerting political and economic leverage over the consumer. The third element is secure access to energy, which refers to the safe delivery of oil and gas to the market via pipelines or other means of transport, without the risk of any terrorist attacks or sabotage.17 The second element proved vital for energy security in the gas crisis between Moscow and Kiev in 2006. The third is also relevant for the region, having been a particular problem due to frozen conflicts and instability, rooted in ethnic separatism and the activities of radical Islamic groups. John Roberts, an energy security specialist, examines the wider Black Sea region from a historical perspective. During the 1970s, the global energy market intensified its efforts to secure energy supplies transported from the Persian Gulf to Mediterranean ports and then to Europe via tankers. In the 1980s, the construction of the first pipeline from Russia to Western Europe was a turning point in energy security and economic interdependence. Since the 1990s, the world has witnessed new areas of cooperation and new rivalries in feeding the global energy market with oil from the Caspian basin.18 To achieve these objectives, the Black Sea area emerged on the scene as a new transit route for oil and gas between the two continents. The balance in the transatlantic engagement for energy security in the region has been very dynamic. For instance, according to the United States, energy security refers to the security of oil supply and maritime routes for energy transport, while for Europe, it encompasses the security of overland pipelines delivering oil and gas. Therefore, key interdependent variables are believed to depend on developments in the Euro–Atlantic community, Iran, and Iraq, and other global trends in the energy trade. In other words, the regional actors seem to be incapable of controlling the key variables. The strategic and economic environment of the wider Black Sea region is strongly influenced by shifts in the global balance of power, the emergence of new poles, and new global and regional alignments. In contrast with the greater Middle East, there has not been a single dominant external actor in the wider Black Sea region. The EU, India, and China have also been influential external actors as effective as the United States.19 Since the early years of the new century, Western states, both individually and collectively through NATO or the European Union, have begun to take the region into account as a new point of geographical analysis. According to Ronald D. Asmus, the director of the German Marshall Fund, this new approach attempts to build a new political and .

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strategic framework, integrating different topics, such as security, democratization, energy security, and conflict resolution; and also different geographies, including Turkey, Ukraine, and the South Caucasus. In this new framework, scholars deal with diverse topics and different actors in an eclectic manner. Asmus claims that the efforts spent in the early 1990s to re-define “Eastern Europe” as “Central and Eastern Europe” could be a model for this new wider region, the Black Sea.20 Within this process, there are three main factors that play important roles in increasing European awareness towards the region. The first is the growing hope for democratization and collective security through integration with Western institutions, including NATO and the EU, especially after several “colour revolutions.” These revolutions have given rise to new leaders who have committed themselves to integration into the Euro–Atlantic community. The second is the intervention of the United States in Iraq. The focus of the transatlantic alliance on terrorism and instability stemming from the Middle East obliged the Western world to view the Black Sea through a new prism. The main motive behind the rising American interest in the Black Sea has been the events of 9/11. After these terrorist attacks, the Pentagon came to the conclusion that the greatest threat to US security and stability originated from the Middle East. Thus, democratization and stability in the wider Black Sea region promises positive results for the chaotic environment of the Middle East.21 In this new context, the wider Black Sea has become a keystone in the bridge between Europe and the broader Middle East. The third factor is, of course, energy security. The Black Sea has been a transit corridor for energy reserves, especially from the Caspian basin to the European markets—notably after the first gas crisis between Kiev and Moscow in the winter of 2006 obliged Europe to immediately diversify its energy suppliers and pursue a multilateral approach towards the littoral states of the Black Sea. These developments make it necessary for us to consider the wider Black Sea–Caspian region from an extra-regional perspective.

Extra-regional Actors in the Oil Politics of the Wider Black Sea Since the Black Sea region has been considered in a wider context, including deepened interactions between new actors and interrelated issues, energy has become the keystone of these interactions, along with the economic and political enlargement of European and Euro–Atlantic institutions around the region. The EU and NATO are the two most

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popular of these new actors in the region. They became Black Sea powers following their respective eastern enlargements. Although there is a growing interest in the region as a potential bridge to a wider strategic environment, the region is likely to be driven by extra-regional developments in the short run. The most promising centres of influence are Washington, Brussels, and Moscow, and also Tehran, Delhi, and Beijing. In addition, changing trends in the global energy market can also be considerably effectual.22 This section tries to utilize an “outside–inside” approach in presenting some implications of the policies of extra-regional actors towards the region. The study will focus on three fundamental external actors which have made several attempts to become effective regional players: the EU, NATO, and the United States. As pointed out by A÷acan, certain factors have prompted the interest of the Euro–Atlantic community in the Black Sea, such as the enlargement of NATO and the EU. Bulgaria and Romania initially became NATO members in 2004, and then EU members in 2007. Turkey represents another link that connects Europe to the region. Triantaphyllou explains the growing interest of the Euro–Atlantic community in the region through a combination of two conflicting factors. The first is a geopolitical/ geostrategic approach which focuses on Western institutions’ efforts to counterbalance Russian influence over the region. This approach requires geopolitical revisionism or a “soft war” in the Black Sea, including the replacement of the Russian monopoly with a possible alternative, such as Turkish domination. The second approach involves cooperation, mutual benefits, constructive diplomacy, and sustainable development. Obviously, these two approaches clash. The first approach involves challenging traditional Russian dominance over and interests in the region, whereas the second does not attempt any confrontation with Russia, and is optimistic about Moscow’s potential to cooperate with Europe. Triantaphyllou argues that energy security has been the key element in this debate. The wider Black Sea area is expected to become a key geographic transit point, thanks to the emphasis on energy security.23 These developments oblige the West to pursue a more certain and concrete strategy towards the region.24 As a result of this altered environment, the new wider Black Sea– Caspian region became, as Asmus describes, a “lynchpin” between Europe, Eurasia, and the Middle East.25 In other words, the transatlantic alliance intends to use the region as a ground for collective security and diversity of energy supply. Asmus also highlights a significant point: the Western community, especially the EU, has been dependent on Russia for gas support. This is likely to remain stable in the short and medium term. Moscow is likely to

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remain the major energy supplier of the EU. However, to bring an end to this dependence on an unreliable supplier, which constitutes a severe vulnerability for Europe, the Euro–Atlantic community has been applying a new strategy toward the wider Black Sea region. The Baku–Tbilisi– Ceyhan pipeline project is the first and the best indicator of this rising interest in the region. The focus point was the growing Western interest in a wider Black Sea strategy that has been mostly motivated by the need for energy security and diversification of the energy suppliers.26 Cooperation in the energy sector would probably result in a spill-over effect, creating new spheres of cooperation in a wider agenda, including collective security, democratic reforms, and market economy. Before dealing with these actors separately, to explain why the wider Black Sea has been significant for the extra-regional actors it is appropriate to discuss the three dimensions offered by Lesser. Firstly and most significantly, the Black Sea and its hinterland have been an indispensable component of the European security environment. From the transatlantic perspective, American interests seem to stem from the security concerns of its European allies. Second, the roots of European interests lie in the role of the Black Sea as a political and logistical base that is available for crisis intervention and management in the crisis-prone areas beyond the Black Sea basin. Thirdly, the Black Sea is prominent in transatlantic perceptions, due to its strategic significance, with multiple frozen conflicts. Therefore, the region has been considered as a focus point in the wider security agenda because of non-traditional security concerns, including human trafficking, terrorism, organized crime, and radical Islamic activities.27

European Energy Security and the Wider Black Sea The history of EU energy security policies towards the region goes back to the 1990s. The launch of the Transport Corridor Europe– Caucasus–Asia (TRACECA) in 1993, to facilitate the countries’ access to the world markets by developing a transport and transit corridor, was one of the initial attempts to ensure European energy security.28 This initiative, which was viewed as the revitalization of the ancient Silk Road, tried to offer a cheaper and shorter alternative to the traditional Moscow route.29 Another concrete step was taken in 2005 when the European Commission published a green paper on energy efficiency, which estimated that by 2030, 90 percent of the oil and 80 percent of the gas needs of the EU would probably depend on imports.30 This indicated a great vulnerability for Europe. The following year, the Commission published another green

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paper titled “European Strategy for Sustainable, Competitive and Secure Energy.” This paper claimed that Europe was entering a new energy landscape. Its dependency on imports, currently 50 percent, would rise gradually. Taking this into consideration, a need for a common and coherent energy policy emerged. This policy identified six key priority areas, also including diversity of suppliers, for which the EU is highly recommended to take action.31 Energy security has been a considerable factor in shaping the strategic perceptions of Europe over the past two decades. The delivery of oil and gas from the Caspian reserves to Europe via the Black Sea attained a critical significance for extra-regional actors, mainly consumers, and also became a notable source of revenue for the regional states. Lesser describes the region as a “leading theatre in which the new dynamics of energy security are being played out, a theatre in which transit countries as much as producing countries are leading stakeholders.”32 The role of the Black Sea in European energy security has three dimensions. First, the geographical dimension includes the possible transit routes for oil and gas from the Caspian to Europe. Second, the political dimension forces Black Sea states to calculate their domestic energy security and their potential to ensure broader regional or intercontinental energy security. Finally, the economic dimension focuses on the potential of regional states to influence the terms under which oil and gas reach Europe.33 According to Cornell and Nilsson, the collective and individual security perceptions of EU member states have become dependent on the wider Black Sea as a consequence of four developments. First is the increasing role of NATO in the reconstruction and security of Afghanistan, and its implications for the South Caucasus and Central Asia. Second is the resolution of Turkey’s EU membership prospects in 2004, with the start of accession negotiations. Third is the wave of colour revolutions, resulting in a marked increase in the ability of Georgia and Ukraine to integrate into Euro–Atlantic institutions. Finally, and of most relevance to this study, is Europe’s growing anxiety about the increasing dependency on Moscow for the security of energy supply. The Black Sea has high potential, both as an alternative resource and as a transit route, for the diversification of European energy resources.34 The 2006 gas crisis between Ukraine and Russia was the most critical event to give rise to anxiety in the EU about growing energy dependency on Moscow. By constructing a direct pipeline to the Caspian energy producers, the EU states are expected to obtain three benefits. First, they will be able to buy gas more cheaply than at the current prices fixed by

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Moscow. Second, due to the diversity in suppliers and transit routes, they will decrease their dependency on Russia. Third, Europe is likely to bring to an end the Caspian producers’ dependency on Moscow for market access, in a “new colonialist” manner. Due to its role as an alternative market, it would have the potential to support pluralism and democratization processes in the region.35 Asmus argues that the EU is unlikely to ignore the wider Black Sea region because of its critical importance, stemming from its energy reserves, its closeness to European borders, and the obvious European aspirations of the regional actors.36

EU Initiatives towards Cooperation in the Wider Black Sea Region The EU intends to create a pan-European energy community within the region. The Energy Community is a project that aims to extend the European internal energy market beyond the south-eastern European region.37 The Energy Community Treaty entered into force on 1 July 2006. It includes the EU members, south-eastern European states, and also some states in the wider Black Sea region. Its fundamental principles are the extension of harmonization of the legal structures, the enlargement of the common market, and the creation of a free, competitive, and transparent energy market.38 Another initiative that assists this energy community is the European Neighbourhood Policy (ENP) and its action plans. The action plans emphasize wider cooperation, dialogue mechanisms, and legal harmonization, with the transit and producer states of the region.39 This is the first tool through which the EU intends to achieve deeper influence over the region. The accession of Romania and Bulgaria to the EU in 2007 as full members extended the borders of the union to the Black Sea. Therefore, new opportunities and risks emerged for the EU. Following the membership of these two Black Sea littoral states on 11 April 2007, the Commission published a document titled “Black Sea Synergy: A New Regional Cooperation Initiative.”40 The intention was not to create an independent Black Sea strategy, since the Union’s policy was formulated in the pre-accession strategy with Turkey, the aforementioned ENP, and the strategic partnership with Russia. However, the primary task of the Black Sea Synergy is the development of an area of cooperation within the wider Black Sea region, and also between the region and the EU. The EU expected the scope of the cooperation to extend beyond the region itself to the Caspian basin and Central Asia. Energy security and transport issues are among the major objectives of the synergy.41 The Black Sea Synergy

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without doubt represents an attempt to complement all the activities and strategies of the EU towards the region, rather than an alternative strategy. The Baku Initiative is another European approach towards the region, launched in 2004. As a multilateral mechanism which works for converging energy markets and ensuring greater energy security, it covers the Caspian basin, the Black Sea, and neighbouring states, including Russia as an observer. Its long-term purpose is to integrate the energy markets of the Black Sea–Caspian region and Europe with each other.42 Both the Baku Initiative and the ENP interact with the Interstate Oil and Gas Transport to Europe (INOGATE), which was developed in 1996– 1997 and has been in force since 2001 as an international framework. It aims to link Caspian and Black Sea energy markets to Europe.43 Turkey’s pre-accession strategy and future accession to the EU as a full member is a further important connection between Europe and the wider Black Sea. Turkey’s geographic position as a littoral state of the Black Sea, its political leverage as a NATO member, its high potential as a transit route for Caspian energy to Europe, its democratic and civilized identity as a model in the region, its traditional cooperation with Euro– Atlantic institutions, and its Western commitment since the early years of the republic, make it an indispensable ally of the Euro–Atlantic community.

The United States and NATO The United States has indispensable interests in the region. It has been the most enthusiastic actor in shouldering the responsibility for the Euro– Atlantic strategy towards the region. NATO is the institution in which Washington has the most leverage in decision-making. This section deals with the strategies of the United States and NATO towards the region, and the relations between these two actors and the regional states in the axis of energy security. According to Hamilton, US interests in the region derive from four enduring interests towards Europe.44 The first is Washington’s interest in Europe as a fortress of democratic and economic freedom. The EU has made several attempts to expand this democratic environment. The wider Black Sea, as a potential expansion area for the EU, has strategic importance for the United States. Second, it has interests in the peace of the continent. The Black Sea region still hosts frozen conflicts that fuel anxiety on the part of the Western community. Third is the fact that Europe has not been dominated by any power hostile to the United States. Fourth, the United States has an interest in Europe as a traditional strategic

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partner, to deal together with transnational threats that cannot be tackled alone. The Black Sea region has become a focal point of transnational security threats, and this makes cooperation with its European counterweight indispensable for the United States. The United States has an interest in constructing additional pipeline networks which would facilitate competition and diversity of supply and production. Washington has also been concerned about Moscow’s policy of using energy supply as a foreign policy tool.45 Matthew Bryza claims that the United States has three sets of strategic interests in the Black Sea region, namely reforms that facilitate democracy and market economy, security, and energy. The first refers to the expansion of political freedom, achievement of fair elections, the rule of law, human rights, and economic freedom. The second, security, refers to the fight against terrorism, organized crime, proliferation of weapons of mass destruction, and relations with NATO. The third, which falls into the field of our study, is energy security, involving the expansion of oil and gas pipeline networks, which would contribute to competition in the European energy market, and also to trade and economic progress through transportation and communication.46 In the field of energy, Washington has fundamental objectives towards the region, first, and most importantly, ensuring that energy needs are met through diversifying energy supplies, then establishing mutually beneficial relations with Russia based on a free and competitive market, and constructing an additional pipeline that bypasses the Bosporus to deliver the Caspian hydrocarbon reserves to global energy markets.47 Stephen Larrabee agrees that the American leadership has a critical role in the new Euro–Atlantic strategy towards the wider Black Sea. The United States, as a counterweight to Russia, has favoured a proactive policy of engagement and enlargement towards the region. For this purpose, it supports the involvement of NATO and other transatlantic institutions in the region.48 The Black Sea already hosts three NATO members: Bulgaria, Romania, and Turkey. There are also those that participate in the NATO Partnership for Peace (PfP), such as Armenia, Azerbaijan, Georgia, Moldova, and Ukraine. Even if the EU will not strengthen its European Security and Defence policy (ESDP), NATO has the capability of contributing to military cooperation and providing stability.49 This security umbrella offered by NATO makes a vital contribution to the energy policies of the regional actors, holding a significant place in their foreign policy agendas. In an unstable and chaotic environment, it is unlikely to negotiate about long-term energy supply contracts and to attract foreign investment to construct additional

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pipelines. With the accession of Bulgaria and Romania to NATO in 2004, the number of members on the Black Sea coast increased to three. This enhances stability and security, and also proves the virtues of extraregional involvement in the region. The transatlantic community and regional actors can pursue mutual security interests which would permit the countries of the region to use energy as foreign policy leverage, if the United States, NATO, and the EU commit to a more proactive strategy.50 To achieve this, first the Black Sea must be considered as an essential sub-regional area. The region has become important not only for the transatlantic community, but also for Russia, Turkey, and other local powers. Hence, Washington is strongly advised not to alienate local powers in its strategy towards the region. It should encourage the wider Black Sea states to participate and even take the lead in different areas of cooperation, such as maritime, air reconnaissance, border control, and civil protection.51 Within this context, Russia deserves special attention. Although Moscow’s regional approach is absolutely against the American interests in the region, Washington has preferred not to see it as a rival, and has avoided an exclusive policy towards Russia for the transportation of Caspian energy reserves to global markets. The existence of the “first Russian” group in the parliament has been influential in US foreign policymaking.52 Although it seems early to determine which roles NATO can play in terms of energy security, the military dimension of the matter was discussed at NATO’s Riga Summit. The gas crisis between Moscow and Kiev prompted new arguments for NATO’s revival as the main security framework of the Western community. Russia was criticized for being the main threat against Western energy security, and energy was singled out as an Article 5 commitment of NATO.53 This argument was criticized not only by Russia, but also in the EU countries. Accordingly, using Article 5 for such a situation would probably lead to a radical re-examination of NATO’s defence doctrine.54 Jamie Shea, Director of Policy Planning at NATO, sees four possible areas of NATO involvement. The first area is monitoring and assessing the energy security situation, in accordance with which NATO can establish a permanent monitoring mechanism to keep an eye on developments related to energy security. The second possible role is providing security assistance to allies, involving a variety of flexible responses, including security assistance, to a member or group of members, and NATO operations for the security of vulnerable energy infrastructure. The third is maritime surveillance and threat-based response, in which NATO could grant members a “niche” capability to deal with the security aspects of

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maritime lanes of communication. The final possibility is interdiction operations, which are intended to secure the uninterrupted supply of hydrocarbon reserves in a crisis situation.55 These are the four possible areas in which NATO can take a role, depending on its military assets. NATO’s potential roles in energy security, however, require additional political aspects, such as developing relations and cooperating with the regional organizations and/or partners. In other words, NATO has to develop a political-military concept for energy security in order to play a more effective role in the wider Black Sea region. A report on “NATO’s Role in Energy Security” was declared at the Bucharest Summit held in April 2008. The report identifies five key areas where the NATO can contribute to energy security: information and intelligence fusion and sharing; projecting stability; advancing international and regional cooperation; supporting consequence management; and supporting the protection of critical infrastructure.56 Nevertheless, NATO is likely to acquire a political role regarding the issue in the near future. Azerbaijan and Kazakhstan, the two prominent energy producers and PfP countries, confident in NATO’s ability to provide security for their energy infrastructure, committed themselves to cooperation with NATO in order to lessen their dependence on Moscow. A counter-argument supposes that including energy security according to NATO’s agenda could result in misunderstandings between the Western community and the local powers. Accordingly, NATO partners in the wider Black Sea region might be reluctant to support NATO-led operations and assistance programmes for stability which are indispensable to their survival. This may be because of the widespread belief in the Middle East that the United States invaded Iraq for its hydrocarbon reserves. From this perspective, it is quite possible in the region to witness strong popular opposition to NATO involvement in the name of energy security.57 The recent crisis in the Caucasus between Georgia and Russia made it obvious that certain fault lines have emerged in EU–NATO relations. The EU has preferred diplomatic approaches to lessening the tension, whereas the United States has pursued a harsher policy and challenged Moscow. NATO’s attitude is closer to the American approach.58 Although energy security has been considered an effective variable in these developments, none of the sides can benefit from securitization of the topic. Dealing with the matter as a second Great Game only leads to a polarization in the region between actors that have committed themselves to integration with the Euro–Atlantic community, and those that still depend on Russia to export their energy reserves to global markets. In such an environment, the

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possibility of cooperation and increased interdependence on energy remains a utopian objective.

Regional Perspectives: Explaining the Foreign Policies of Azerbaijan and Kazakhstan with IR Theories Since the disintegration of the Soviet Union, the ex-Soviet states in the Caspian basin have gone through a transformation process. The incorporation of these states, which were initially established on the basis of central planning and complex interdependence among republics, into the market economy has been a matter of survival for them. This remarkable transition process, however, has hardly been explored through the lens of IR theories in the existing literature. The major reason behind this shortcoming is the neglect of the original characteristics of the transition economies.59 Most Caspian studies compare the transition periods in Azerbaijan and Kazakhstan with other transition economies in any other part of the world, without considering any other variables, such as the demographic structure or geographical conditions of these two countries. In an attempt to address this lacuna, the intention here is to apply IR theories to the foreign policy steps taken by Azerbaijan and Kazakhstan concerning their Caspian oil politics. By sketching some of the distinctive characteristics of both Azerbaijan and Kazakhstan, it argues that these differences and similarities have proven significant in the respective foreign policy orientations of Azerbaijan and Kazakhstan concerning their hydrocarbon reserves. As mentioned earlier, the Caspian region in general, and Azerbaijan and Kazakhstan in particular, do not suit the limitations of a single approach or theoretical model. We will, therefore, examine these two countries using a blend of theoretical models that can help to provide a comprehensive understanding of the role of hydrocarbons in the foreign policies of Baku and Astana. Although there are distinct characteristics shared by the transition periods of ex-Soviet states and those of other regional countries, there are also certain differences between the cases of Azerbaijan and Kazakhstan. Despite their common historical background, in the post-independence period these states began to differ in their foreign policymaking. The current literature about oil and gas politics in the region assumes that these differences arise from their diverse policies regarding oil and gas reserves. The future of these states depends on how they will use their reserves.60 However, whether they will be able to use their reserves to lessen their foreign dependence, to achieve sustainable development by allocating oil revenues to other sectors such as industry and agriculture, and implement structural

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reforms, is unclear. In addition to these factors, leadership and geography have also become significant factors during the transition period. Thus, to identify the futures of Azerbaijan and Kazakhstan only with oil and gas is likely to lead to misleading conclusions.61 The history of the Caspian region is replete with harsh struggles between major powers to fill any existing regional power vacuum. Following the demise of the former Soviet Union, reminiscent of the nineteenth century’s Great Game between Great Britain and Russia, the Caspian region attracted the attention of international relations studies. Despite some common points, however, the new Great Game is far more complex than the earlier one: today, extra-regional actors, including the United States and the European states, regional powers, multinational oil corporations, and international financial institutions are simultaneously engaged in rivalries and disputes over the Caspian. Nevertheless, to examine the differences in scope and some of the main factors and future implications of the new Great Game, we will apply some of the more notable IR theories to the Caspian region. While pursuing this goal, we will utilize Dekmejian and Simonian’s approach to post–Cold War Caspian politics.62 Dekmejian and Simonian argue that the disintegration of the former Soviet Union and the end of the Cold War caught IR theorists unprepared. As a result, the field of IR has remained weak in building a dominant theory that can cope with diverse structural alterations, including ethnic conflicts, clashes of cultures, the increasing role of regional cooperation initiatives, and the impact of globalization. Given the diversity of such issues in contemporary international relations, and the interaction between global, local, and regional actors and dynamics, the construction of a comprehensive approach to the analysis of the Caspian region needs to be both theoretically and methodologically eclectic. Thus, any framework for analysis requires the input of geopolitical theories, neorealism, social constructivism, and interdependence theories.63

Azerbaijan Foreign Policy in the Axis of Energy Politics: Three Levels of Analysis In studying the elements of Azerbaijan foreign policy, Sadri uses three major levels of analysis: the international system level, the state level, and the individual level.64 The state level of analysis describes the geopolitical and economic situation in Azerbaijan, and its effect on foreign policy. The individual level concerns leadership and its influence on foreign policy. The system level of analysis considers the country’s international relations.

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The aim of this categorization is to reveal the main patterns in the international relations of Azerbaijan, and to explain the external factors that constrain Baku’s foreign policy options. These external variables are split into two groups: global and regional. Global variables include global actors such as the United States and Russia, while regional variables include regional players, such as Turkey and Iran.65 The state-level analysis, mentioned above, involves two issues. Firstly, the geographic situation of Azerbaijan, as a land-locked country, limits its foreign policy choices. Secondly, economic factors also constrain its foreign policy preferences. Following the occupation of NagornoKarabakh, about one million refugees caused a serious economic burden on the Baku government. Besides this, oil price volatility has also been a problem, as the long-term pipeline projects depend on the stability of oil prices.66 The individual-level analysis deals with the leadership factor. As a young democratic republic, Azerbaijan still suffers from the predominant role of leadership in the formulation and implementation of foreign policy. Within this context, Azerbaijan’s foreign policy has gone through considerable changes since Heidar Aliyev became president in 1993. The most prominent feature of the Aliyev government was a balanced foreign policy agenda.67 On the one hand, he avoided antagonizing Russia by developing relations with the Euro–Atlantic community; and on the other, he tried to lessen the influence of Moscow over Baku by pursuing a Western-oriented foreign policy agenda. The system-level analysis includes two groups of players: global players, namely the United States and Russia, and regional players, Iran and Turkey. Russia’s role is significant as a constraining factor in Azerbaijan’s foreign policy. It intends to regain its former role as the dominant regional power, and increase its influence over the region. Baku has been a focus of interest for Moscow, especially where oil is concerned. Moscow, like Washington, tries to increase the share of its national oil companies, Gazprom and Lukoil, in oil production projects in Azerbaijan. It also seeks to influence the routes of the pipelines, to increase revenues from transit fees. The ultimate goal of Russia is to achieve absolute control over the global energy market, like the United States. 68 The United States, the other global player, has major general interests in Azerbaijan. First, it aims to lessen the dependence on OPEC countries through diversification of oil supplies from alternative producers, such as Azerbaijan. Furthermore, Washington intends to increase its control over the global energy market, where it is the largest consumer. It also tries to feed its domestic economy by increasing the profits of the American oil

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companies that operate in the Caspian region. Besides economic interests, the United States has made several efforts to contain Russian influence over its “Near Abroad,” for instance by encouraging American oil companies to invest in neighbouring states, in order to lessen their dependence on Russia for foreign capital. Azerbaijan has been one of the pivotal states in Moscow’s “Near Abroad.” Another regional power that Washington tries to contain is Iran.69 The demise of the Soviet Union left Iran in an undesirable condition, where newly independent states became its new neighbours. It faced new threats rising from ethno-political conflicts near its northern border. In its relations with Azerbaijan, Iran recognized that Baku’s primary concern was the Nagorno-Karabakh conflict. Therefore, Iran has sought to maintain a balance of power in the Caspian region. It aims to prevent Azerbaijan from fully exploiting its resources, and to keep the NagornoKarabakh conflict unresolved. In this respect, Iran’s strategic goals have been in a great harmony with those of Russia.70 Iran, in its relations with Azerbaijan, has generally focused on three points. First is to resist and counter American policy that aims to sustain US influence over the region. Tehran has tried to resist the containment efforts of the United States in the Persian Gulf and the Caspian basin. Iran has also looked with anxiety upon developments in Azerbaijan, due to the large Azeri population in its territory near that country’s border. Iran considers this condition to represent a threat to its national security and territorial integrity.71

Neorealism According to the basic tenets of neorealism and its “balance of power” framework, the five littoral states of the Caspian Sea, along with the extraregional actors, quite rationally pursue their self-interests defined in terms of their capabilities. In order to analyze the complex power struggles and interactions between these actors, neorealism suggests using the balance of power approach. It posits that the behaviour of states is shaped by the number of actors and the pattern of distribution of power among these actors, based on hegemony, bipolarity, and multipolarity. State-level changes pave the way for the collapse of the current balance of power, until a new equilibrium is established. Since the demise of the former Soviet Union, the Caspian states have sought to reach a new equilibrium of power.72 Here, we will try to analyze the international politics of the Caspian region through a neorealist paradigm, to show how Azerbaijan’s policies and strategies are outcomes of the anarchical system that emerged

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after the end of the Cold War, and to what extent they correspond to balanced foreign policymaking. Gresh argues that, by using Kenneth Waltz’s neorealist paradigm, it is possible to explain the actions and policies of the Caspian states.73 The neorealist approach provides a better lens to view Azeri foreign policy, such as its priority of maintaining national independence. Azerbaijan’s national interests, including national security, the solution of the Karabakh conflict, and the oil and gas trade, should be underlined in order to monitor their influence on the country’s policies over the region. The balance of power in the Caspian region still favours Russia. This power imbalance depends on Moscow’s superior military power, GNP, population, and industrial production.74 This Russian dominance severely constrains the foreign policy choices of Azerbaijan. Turkey and Iran have usually been proposed as potential balancing actors in the region.75 However, there is no evidence that Azerbaijan, being economically weak and still dependent on Russia, can achieve independent foreign policymaking through its oil resources.76 Moscow prefers bilateral agreements, rather than multilateral agreements, to maintain its economic and political interests in the region. It tries to maintain close relations with each of the regional states, to keep them under its control. However, it avoids initiating a multilateral regional cooperation, which could encourage them to cooperate against Russia, or increase their independence. This strengthens its dominant position. US efforts to become an active player in the region are still in their early stages. In addition, the United States is not capable of offering a security guarantee to the region, which is desirable by Azerbaijan and Kazakhstan, which are relatively weaker than Russia and Iran. Neither NATO nor the EU can assume this role, as NATO’s PfP programme is a consultative mechanism, and is not capable of solving frozen conflicts in the region.77 Neighbours such as Iran, Turkey, and China cannot easily challenge the Russian dominance over the region, because Moscow, which still enjoys its organic ties with the exSoviet republics, would not allow this. The Organization for Security and Cooperation in Europe (OSCE) also remains too weak to offer a durable stability for the region, as long as Russia has the right of veto in the decision-making process. Consequently, in the near future Russia is likely continue to hold its dominant position in the region. When we analyze the behaviour of Iran through the neorealist lens, we see that it is the outcome of the anarchic system that emerged after the fall of the Soviet Union in the 1990s. Because of its fear of losing its economic power in the region, Iran felt obliged to collaborate, both economically and politically, with Russia and Armenia against Azerbaijan’s new pro-

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Western attitude and rising regional role.78 Today, Iran’s foreign policy on the Karabakh issue mostly depends on preserving its national security and sovereignty. This also makes neorealism a valid approach, as it assumes that states determine their foreign policies according to their national interests, such as security.79 Azerbaijan, too, tries to preserve its national security by forcing the Armenian troops to withdraw from occupied Nagorno-Karabakh. Unlike realism, neorealism considers the economic power of states to be a factor that can play a role in the structure of the international system. It posits that the actors of the system not only consider gaining political power, but also give importance to economic power.80 In the unipolar system that emerged after the demise of the Soviet Union, the United States felt itself obliged to strengthen its hegemony. Therefore, it had to secure access to the resources on which its hegemony and superiority depend. Oil and gas resources are the most critical of them. The United States thinks that these should be under either its direct control or that of its allies, which can be easily controlled, and that they must be kept away from anti-American forces such as Iran. As a result, neorealism posits that the United States must get closer to Azerbaijan. However, Azerbaijan cannot ignore the Russian influence, and therefore it may prefer a balancing approach between these two powers. Meanwhile, the Kazakh strategy would be totally different from that of the Azeris due to the geographic and demographic facts. A neorealist analysis would expect Astana to get closer to Russia, since it cannot afford a confrontation because of its common border and considerable ethnic Russian population. Iran, Russia, and Armenia formed an alliance against the rise of Azerbaijan in the region. They support the same arguments about the legal status of the Caspian Sea, and Russia and Iran support Armenia in the Nagorno-Karabakh conflict. Another motive for the alliance was the possible increase in the American presence in Azerbaijan, Kazakhstan, and other Caspian states. These countries perceived the rapprochement of Azerbaijan with the United States and NATO as a serious threat to their national security. However, this alliance between the three states weakened following Putin’s election as Russian president in 2000. Putin worked to stabilize and improve relations between Moscow and Baku until the end of his presidency in May 2008. He signed significant economic and political agreements with the president of Azerbaijan, Aliyev. Putin also adopted a “new non-confrontational economic approach” to the Caspian region.81 As a result, the lack of a bipolar system in the Caspian brings the risk of an emergence of a greater conflict than that of NagornoKarabakh.82 The balance of power established in the Caspian since the last

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decade has been multipolar, and remains anarchic due to the existence of frozen conflicts such as Nagorno-Karabakh, and because of the legal status of the Caspian Sea.83

The Occupation of Nagorno-Karabakh: Security Concerns and the Oil Card In the post-independence period, due to the collapse of the Soviet Union and its central economy, Azerbaijan’s economy weakened and faced several crises. In the Soviet system, the Azeri economy was focused on the extraction and production of natural resources, especially hydrocarbons. The collapse of the Soviet Union left Azerbaijan as a country whose economy was based only on oil production, without any other industrial sector. To ensure economic progress, the country depended on foreign direct investment and a constant flow of capital. The oil and gas sector in particular required foreign direct investment, to boost the economy by increasing exports. Besides this, security concerns have continued to have critical importance for Azeri foreign policy.84 Together with the energy trade, and geopolitical rivalries with Iran and Russia, security threats became a chief concern for Azeri foreign policy. This part of the study examines Pinar øpek’s argument that there has been “interplay between the oil-led development process and post-independence regional conflicts that enforced a Western orientation in the country’s foreign policy.”85 According to øpek, a particular focus on these conflicts can help “to demonstrate the interplay between the interests and foreign policy of Azerbaijan, and its relations with oil companies that enforced a Western orientation in its foreign policy.”86 Here, we will consider only the Nagorno-Karabakh issue. The Nagorno-Karabakh conflict occurred in 1988, in a province of Azerbaijan which is mostly populated by Armenians. Armenians argued that Karabakh remained underdeveloped due to the inefficiency of the Azeri administration. In 1989, Karabakh was thus removed from Azerbaijan’s jurisdiction, and was subordinated directly to the Soviet Union. The ongoing conflict ultimately escalated into war in 1991, when the Armenian people living in the region began demanding their independence. Nagorno-Karabakh was then declared an independent republic by Armenians on 2 September 1991. In February 1992, Armenian troops, backed by the Russian army, invaded the Khojali settlement of Azerbaijan. The Khojali carnage was one of the most tragic outcomes of the Armenian occupation. After taking the strategically significant Shusha city, Armenians proceeded to seize six more provinces in Azerbaijan. As a

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result of this conflict, the country lost one fifth of its territory, and approximately one million people were internally displaced.87 Following these events, the conflict was internationalized after Russia, the CSCE (Conference on Security and Co-operation in Europe), and the UN got involved in the conflict. In 1992, both conflicting parties became members of the CSCE and the UN. Following the Khojali carnage, the CSCE organized a conference on the Karabakh issue in Minsk, and a “Minsk Group” was formed by nine countries.88 Meanwhile, the UN also took some decisions over the issue, and the UN Security Council published Resolution number 822 on 30 April 1993.89 The document required Armenia to immediately withdraw from Azeri territory, and officially recognized the territorial integrity of Azerbaijan. However, notwithstanding the UN decision, Karabakh declared its sovereignty in a referendum. The key point of the conflict stems from the fact that while Karabakh Armenians do not want to reunite with Azerbaijan, the latter is unwilling to consent to the establishment of an independent Karabakh.90 The involvement of Russia requires particular attention in the process due to its explicit support for Armenia, as Russian national interests lie behind its involvement.91 First, Russia has economic interests in the region, most prominently related to the control over the pipeline infrastructure, that it cannot afford to abandon. The Caspian is also crucial for the security of Russia. Putin, who changed Russia’s Caspian policy, declared after a National Security Council meeting in 2000 that their rivals in the region had become so active that they had to conduct similar activities in the region for security reasons.92 Secondly, Moscow feels responsible for the ethnic Russian population living in the newly independent republics. The largest ex-Soviet Russian population outside Russia lives in Kazakhstan. This factor adds an ethnic dimension to the Russian foreign policy over the region.93 The Nagorno-Karabakh conflict is vitally important for regional powers and their future policies. This is because it is significant in pointing out to the world that, despite its weakening dominance over its backyard, Russia will continue to use its military power to help maintain its influence over the former Soviet territories.94 The conflict has further shown that Russia is capable of destabilizing the governments of regional states that challenge its primary interests. The recent war between Russia and Georgia, and the longstanding Karabakh conflict, have renewed the awareness of geopolitical rivalries within the region. They have also emphasized the vulnerability of the energy infrastructure and cross-border pipelines that supply energy to global markets.95 In this regard, the two sources of regional instability, the Nagorno-Karabakh conflict and the

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legal status of the Caspian Sea, deserve particular attention. According to øpek, this can help “to demonstrate the interplay between the interests and foreign policy of Azerbaijan, and its relations with oil companies that enforced a Western orientation in its foreign policy.”96 As a result of these factors, security concerns seem to prevail in the energy policies of Azerbaijan. For at least three reasons, the Karabakh issue has proved to be one of the most critical amongst Azeri foreign policy issues.97 First, it has threatened the country’s domestic stability. Whilst a considerable amount of Azerbaijan’s territory was occupied by Armenia, the opposition groups politicized the issue, which then became a tool to illustrate the government’s incapability. For instance, between 1991 and 1993, Baku had three presidents, each of whom had to resign as a consequence of the opposition groups complaining about this issue. In retrospect, it seems fair to argue that the failures in the battlefield weakened those governments.98 Second, the issue became the primary factor to shape Azerbaijan’s foreign policy in the early post-independence period.99 The first two presidents of the country gave the first priority to the issue; however, both of them lost their presidencies due to their failures in achieving a solution. Third, and most important, Azerbaijan has to use its oil and gas reserves in order to achieve its foreign policy goals; but such security concerns prevent the country from focusing exclusively on economic concerns. On the one hand Azerbaijan, thanks to its increasing oil revenues, can develop its military capacities, which help address some of these concerns. On the other hand, dependence on Russia for oil exports cancels out the first option as a viable possibility. Despite the changing face of Azeri foreign policy, strengthening the independence and national security of the country remain the permanent core policies, in pursuit of which its hydrocarbon reserves and relations with the West are considered to be effective instruments.100 Despite this goal, the Nagorno-Karabakh conflict has also underlined that using the oil card to provide security to the country is not an easy task for Azerbaijan. Following the disintegration of the Soviet Union, Azerbaijan and Armenia were left alone for a couple of years, and the conflict escalated into a war. Azerbaijan’s foreign policy changed dramatically after Elchibey came to the presidency in 1992, when the country abandoned its priority towards its ex-brother Russia and approached Turkey as a strategic ally. Reducing Russia’s influence on the country had been one of the main purposes of the Elchibey government.101 Elchibey rejected the Russian proposal, which included military assistance in return for allowing Russian military bases on Azeri soil, and a pro-Russian foreign policy.102 As a reaction to this, Russia decided to support Armenia. While pursuing pan-Turkic policies,

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such as delivering Azeri oil from Baku to Ceyhan, the Elchibey government also gave importance to developing economic and political relations with the West.103 This orientation was considered vital to maintain the country’s independence and economic growth. Its rich oil reserves also became important tools in this process. The Elchibey government also explicitly courted Western oil companies in the hope of establishing long-term contracts with them.104 Despite these plans, however, following the defeat of the Azerbaijan army in Karabakh in 1993, General Surat Huseyinov launched an antigovernment insurgency.105 The opposition attacked the government for its military defeats. While taking a stance against Armenia and Russia, the Elchibey government anticipated that the Euro–Atlantic community would support Azerbaijan, because of their earlier agreements on oil extraction with the Western companies, but this never took place.106 A reason for this failure can be traced back to the Armenian lobby’s effective campaigns in the United States, which achieved the exclusion of Azerbaijan from the Freedom Support Act.107 This act passed in the US Congress in 1992, with the aim of giving assistance to the former Soviet republics in their transition to democracy and the market economy.108 Thus, having been denied Western support, and unable to tap its economic resources effectively, Azerbaijan could not use its oil card to provide security, during what was probably the most important threat to its survival since its brief independence. Based on these factors, it is possible to draw out some of the pros and cons of Azeri oil diplomacy since independence.109 In the early years, thanks to developing relations with the Western oil corporations, there were great hopes for the resolution of the Karabakh conflict. The early hopes to achieve the foreign policy goals of the country depended heavily on its oil reserves.110 However, the oil card did not work as expected in the security field, and in fact worsened the situation. The “new Great Game” between Russia, Armenia, and Iran on the one hand, and the EU and United States on the other, posed a serious threat to Azerbaijan’s security. Within this context, Baku could endure the pressure from Russia and Iran, owing to the support of the Euro–Atlantic community. When its expectations failed to come to fruition, the hopes for a resolution of the conflict in favour of Baku through the support of Western countries and oil companies came to naught.111 Also, recent developments in South Caucasia showed Azerbaijan to be an inexperienced country in foreign policymaking.112 Contrary to the national interests of Baku, Turkey took part in a process called the “Armenian initiative,” with the aim of normalizing diplomatic relations between the two countries. As a response

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to this accommodation, which disturbed Azerbaijan, the Baku government started a rapprochement with Russia. This very amateurish move on the part of Azerbaijan was part of the heritage of the communist age, when the country always had to take a monotone approach to foreign policymaking.113 The Baku government conducted this move simply to counter Turkey’s approach to Armenia, rather than taking possible mutual gains and solutions for the frozen conflict into consideration.

Azerbaijan’s Foreign Policy Goals As a response to these global and regional dynamics, Azerbaijan has some important issues on its foreign policy agenda, most prominent of which is attaining economic development through oil exports. In order to implement its other foreign policy goals, Azerbaijan needs a strong economy. Also intending to lessen its dependence on Russia, Baku has sought to establish good economic and diplomatic relations with the United States and the EU, and has signed a series of production-sharing agreements (PSAs) with them. In doing this, however, Azerbaijan seems to be exchanging its traditional dependency on Russia with a new dependency on the Western states.114 Finally, Azerbaijan also wants to become a regional power, both economically and politically, so that it can develop its military power and regain its territories in Nagorno-Karabakh that are occupied by Armenia. Based on these points, the foreign policy priorities of the republic of Azerbaijan can be listed as follows: x Promotion of the establishment of a pluralistic democracy based on market economy and the rule of law; x Conducting an independent foreign policy that will restore its sovereignty and territorial integrity; x Eliminating the threats and risks against its security, political independence, sovereignty, and territorial integrity; x Achieving a peaceful settlement to the conflict with Armenia over the Nagorno-Karabakh region of Azerbaijan, through negotiations within the framework of the OSCE Minsk Group, based on the principles of the OSCE Lisbon Summit; x Eliminating the consequences of Armenian military aggression against Azerbaijan; x Developing positive and mutually advantageous relations with neighbouring countries; x Promoting security and stability in the region;

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x Preventing the transfer of illegal arms and other illegal goods through the region; x Adherence to existing global non-proliferation regimes and establishment of a nuclear-free zone in the Southern Caucasus; x Demilitarizing the Caspian Sea basin; x Integration into European and Transatlantic security and cooperation structures, including NATO, EU, WEU, CE; x Developing various sectors of the country’s economy by using its geostrategic advantages; x Further developing the Eurasian transport corridor of which Azerbaijan is a part.115

Kazakh Foreign Policy and Energy Kazakhstan’s foreign policy is influenced by many factors, including the nature of the regime in the early state-building process, demography and national identity, domestic interest groups, the country’s landlocked geography, the regional powers, and the role of multinational oil corporations.116 Here, we will try to explain to what extent the role of oil and gas has been limited by the demography and national identity of the country in its foreign policymaking. Like Azerbaijan, we will analyze Kazakh foreign policy at three levels: the state level, the individual level, and the system level. The state level of analysis involves geographical and demographic factors; the individual level deals with the leadership factor in Kazakhstan; and finally the system level focuses on the relations between Kazakhstan and major players in the region, including the United States, Russia, and China.

State Level: Russian Population and Geographical Conditions Since its independence, Kazakhstan’s foreign policy has been predominantly influenced by two factors: geography and the ethnic Russian population in the country. Sharing a long border with Russia and hosting a large ethnic Russian population increases Kazakhstan’s dependence on Russia. Besides these two factors, this dependence also has economic roots, because despite its considerable hydrocarbon reserves, the oil and gas extracted in Kazakhstan is delivered to Russia to be processed.117

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The current literature offers contrasting estimates about the ethnic Russian population in Kazakhstan. According to the last Soviet population census in 1989, 39.5 percent of Kazakhstan’s population was composed of Kazakhs, while ethnic Russians made up 37 percent. When the Russians were combined with Ukrainians (5.4 percent) and Belorussians (1.1 percent), the Slavic population swelled to 44 percent of the total population.118 On the other hand, according to the results of the 1999 census, as published by the CIA World Factbook, Kazakhs constituted 53.4 percent and Russians 30 percent of the population.119 Geography and demographics are two interrelated factors in Kazakh foreign policymaking. The Kazakh foreign policy priorities are thus driven by large territories of the country, its geographical proximity to Russia, and the demographic balance between its ethnic Kazakh and Slavic citizens. The landlocked position of the country between Russia and China constrains Kazakhstan’s pipeline options, and this causes a vulnerability and dependence on neighbours for the delivery of oil and gas. Some observers argue that the relationship between Kazakh foreign policy and its national identity is “symbiotic.”120 Geographical proximity to Russia poses a separatism threat against the territorial integrity of Kazakhstan. As a result of this proximity, the country has neither a strong national identity nor a multinational identity. Rather, regional kinship networks and clan politics, named oblast in the Soviet era, have been effective in domestic politics.121 Since independence, Kazakhstan has been ruled by an authoritarian regime, which included a clan-balancing strategy.122 The state plays off each clan against the others, and prevents one single clan from becoming dominant. This balancing strategy has consequently delimited the role of the domestic interest groups in foreign policymaking.123 Nazarbayev’s primary objective has been to eliminate the risk of partition through a policy of alliance with Russia, and also to maintain bilateral and multilateral integration initiatives.124 Nevertheless, Nazarbayev’s policy of “Kazakhization”125 has strengthened the status of native Kazakhs within the political, economic, and social and demographic structure of the country.126 Due to such measures, demographics and national identity seem to have a dual effect on the country’s foreign policymaking. First, geographical proximity to Russia and the ethnic Russian population pose a separatist threat against the integrity of the Kazakh state. Thus, Kazakhstan cannot attempt to ignore Russia in its foreign policy agenda. It has to take Moscow into consideration more seriously than the other Caspian states. It is, furthermore, also reliant on Russia for transporting its products to international markets. Second, the lack of effective domestic

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interest groups in the foreign policymaking process grants leaders significant room for manoeuvre in foreign affairs. Lack of accountability in domestic politics strengthens the autocratic regime in the country. Political leaders in authoritarian regimes are much more independent in domestic and foreign policymaking than those in democratic regimes. In Kazakhstan, having also changed the foreign policy orientation of the country, Nazarbayev has used the oil and gas reserves of the country to strengthen his position, rather than allowing these resources to develop the country in a democratic and industrialized manner.127

Individual Level: The Leadership Factor The Kazakh president Nursultan Nazarbayev follows a multi-vector foreign policy to legitimize and consolidate his authoritarian rule. The main instrument he uses to sustain his power is his ability to manipulate the influential groups within the public, and play on rivalries among themselves, which in political science is known as a “balance of checks and counterweight.”128 According to øpek, the leadership has used foreign policy to legitimize its rule and reshape the national identity.129 She argues that the geopolitical context of oil and gas supported the authoritarian regime, and did not allow an alternative foreign policy discourse to emerge other than the pragmatism of the president.130 Nazarbayev used the management of the clan (oblast) rivalries in Kazakhstan to achieve his goals, and his pragmatism included the reconstruction of the clan identities and clanbalancing to keep their potential for internal politics weak.131 Thus, he was able to easily strengthen his position, to exert influence on foreign policymaking. One example of this policy is the use of the “oil fund” by Nazarbayev. As discussed above, nearly all oil-rich states face the risk of corruption.132 Oil increases the tension in struggles for political power. Norway eliminates this risk by transferring revenues from oil to finance hospitals and universities.133 Other developing oil-rich states have taken this policy as a model. Caspian states such as Azerbaijan and Kazakhstan, with the encouragement of their Western counterparts, also established oil funds. In Kazakhstan, Nazarbayev saw this fund as a means of strengthening the position of Kazakhs against the ethnic Russian population. This oil fund in Kazakhstan has usually been referred as the “Kazakh fund.”134 According to Kleveman, nepotism in Kazakhstan is not seen as corruption, but rather as a responsibility towards the Kazakh nation.135

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In regard to this responsibility, President Nazarbayev has developed a geopolitical approach in his pragmatic foreign policy. He refers to his country as a Eurasian state, having origins in both west and east. Nazarbayev often underlines the Turkic roots of the Kazakh nation and their blood-ties with Russia. He generally uses symbols such as the snow leopard, an animal that lives only in the Kazakh mountains and combines “Western elegance” with “oriental wisdom.”136 Nazarbayev has been unable to separate the domestic and foreign affairs of the country, and has been unwilling to implement the requirements of a liberal and democratic regime, as long as he perceives it as a threat to his power.137 In 2010, Kazakhstan became the chairman in office (CiO) of the OSCE, a key intergovernmental organization that monitors every aspect of international politics, from security to political and human rights, with fifty-six members. Kazakhstan is the first former Soviet state and the first Muslim country to assume this role. By taking up the chair of the organization, the leadership of Kazakhstan intends to make it obvious that the country has consolidated its independence and is prepared to act as a major player in the Euro–Asian region. Although such a responsibility might be interpreted as a signal that Kazakhstan would be committed to European values, especially democracy, the country faced criticism for assuming this role.138 The Kazakh president, on the other hand, described the role as “an extremely important recognition of Kazakhstan’s international authority.”139 Within the context of Nazarbayev’s authoritarian regime, and thanks to his pragmatism, based on the geopolitics of oil and gas, he has been the motivating force behind foreign policymaking in Kazakhstan.140 The clanbalancing strategy has left interest groups with no room for manoeuvre to exert influence on foreign affairs. Foreign policy has become an instrument for the maintenance of presidential power, and for gaining the recognition and support of the Western community.

System Level: Relations with the United States, Russia, Iran, and China Since the early years of independence, Kazakhstan has intended to pursue a multi-vector foreign policy that aims to decrease its dependence on Russia by cooperating with American and European allies, but at the same time keeping Russia as the primary counterpart. Russian president Putin’s proactive policy in the Caspian region, on the other hand, aggravates this foreign policy strategy of Kazakhstan.141

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Nevertheless, Astana tries to achieve its multi-vector foreign policy by means of the pipeline projects. Today, Kazakhstan is still dependent on Russia for its oil and gas exports, due to the dominance of Russia over the pipeline infrastructure in the region. Together with the Russian minority, this has been another reason for the Russian-centred security perspective in Kazakhstan. However, Kazakhstan has begun to support the construction of multiple pipelines that bypass Russian territory and provide alternative routes.142 The country thereby expects to decrease its dependence on Russia to a certain extent. Russia continues to play a zero-sum game in the Caspian region. It uses its national oil companies, such as Gazprom and Lukoil, to produce Caspian oil and gas. It focuses on relative gains rather than absolute gains, and thus avoids cooperation with Western firms to make use of better technology and gain efficiency—the Russian companies do not possess the high technology and financial resources to produce oil and gas efficiently. According to øúeri, oil and gas production in Kazakhstan would not provide the country with an effective foreign policy tool, until Russia begins to consider absolute gains rather than relative gains.143 In the aspect of energy, the primary objective of the United States has been to buy the Caspian oil and gas at affordable prices, to lessen its own dependence on OPEC and decrease the influence of Russia over the global energy market.144 In this respect, Kazakh oil and gas attracts considerable attention. A non-OPEC oil development in the Caspian region, mainly in Kazakhstan, would maintain the stability in the energy market, which best serves US interests. Since the balance of power in the Caspian region changed after the demise of the Soviet Union, the US objectives towards Kazakhstan have also changed. These are: political stability, nuclear nonproliferation, containment of Islamic fundamentalism, secure access to energy supplies, promotion of democracy, and protection of the alliance against enemies.145 Kazakhstan’s response to the US policies has been to develop its economic interests through investments, and to counterbalance the Russian influence. The issue of nuclear non-proliferation provided a good indicator of this policy. When Kazakhstan established independence, it had to deal with hundreds of Soviet nuclear weapons on its territory. On 13 December 1993, Kazakhstan signed an agreement with the United States on the dismantling of its missiles. It also ratified the Nuclear Nonproliferation Treaty.146 This move disturbed Russia and showed that Kazakhstan was no longer purely dependent on Moscow. According to Oliker, Kazakhstan differs from the other Caspian states in its relations with the United States.147 The difference stems from its relative wealth and its long-term relations with Washington. Along with

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the nuclear issue, the hydrocarbon reserves of the country make Kazakhstan a country that the United States cannot ignore in the region. Washington convinced Astana to accept American assistance for the removal of weapons of mass destruction that belong to the Soviet era. Kazakhstan also accepted US military training, and assistance in attaining economic reforms, regional stability, law enforcement, and implementation of institutional reforms.148 However, developing relations with the United States should not be defined as a zero-sum game with Russia or China. One of Kazakhstan’s primary aims is to achieve a situation where Russia, China, and the United States will balance each other, and none of them can influence Kazakhstan more than the other.149 Along with these major states, Nazarbayev also maintains his multilateral foreign policy, through intense interaction with international security organizations such as NATO and SCO. Washington favours an alternative route to the Russian ones for the transportation of oil and gas to the markets. The Iranian route has so far been the easiest, cheapest, and the most secure for delivering Kazakh oil.150 However, Iran has not been one of these alternative routes, due to antagonism between Tehran and Washington rising from Islamic fundamentalism and nuclear proliferation. Kazakhs undertook serious lobbying activities in favour of the Iranian route, where they have significant economic interests.151 The terrorist events of September 11, however, worsened the situation. One month later in 2001, the US president George Bush declared Iran part of the “axis of evil.” According to Kleveman, this was an obvious warning for Kazakhstan.152 This was an important case, in which Kazakhstan reached the limit of its independent foreign policy, and was totally disappointed by its failure. The Bush administration began to seek “a commitment to a deeper, more sustained and better-coordinated engagement in the region,” and thus focused on relations with Kazakhstan in the axis of energy.153 Then the two countries signed an Energy Partnership, on 21 December 2001.154 On the one hand, this agreement strengthened the energy cooperation between the two sides. On the other hand, it increased American influence over the Kazakh foreign policy agenda. This was best indicated when Nazarbayev and Ilham Aliyev signed a pipeline agreement which posited that Kazakh oil would be delivered via the BTC pipeline. The agreement perfectly complied with the US interests in the regional pipeline projects, and improved its position in counterbalancing Russia in the region.155 Another candidate for Kazakhstan to counterbalance against Russia has been China, which is likely to remain an ally of Kazakhstan in the energy field. It would like to see Kazakhstan as a major energy supplier of the

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country, which will not only contribute to energy security, but also improve the geopolitical position of China in Central Asia.156 The main Chinese interests in the region are to guarantee secure supply of hydrocarbon reserves through pipelines and railroads, and to suppress secessionist movements on the part of ethnic minorities, especially the Uighurs in the western city Xinjiang.157 Particularly after 11 September 2001, China began to use the US “war on terror” as a pretext to suppress the Uighur separatists, just as Russia did in the case of Chechnya.158 Ethnic tensions between the Chinese Government and the Uighur people continue to influence international affairs in the region, alongside energy politics. Recent developments have indicated that the political unrest is likely to continue. In July 2009, more than 140 people were killed in Uighur riots in China.159 In a speech he gave in December 2009, Nazarbayev said that Russia, China, and the United States will continue to occupy a special place in their foreign policy agenda.160 According to the president, regional security, energy, trade, transport, and communication will be the main topics of the cooperation. “Further strengthening of the partnership relations with the European countries holds key place in our foreign policy while the agreements on strategic partnership with Spain, France and Italy raise our relations to a brand new level,” stated the president.161 Nazarbayev added that, apart from these major powers, Kazakhstan will also seek to develop “active cooperation” with the Caspian states. He also declared that his government has been working on improving relations with the Middle East, the Gulf and Pacific regions, and Latin America.162

Kazakhstan’s Foreign Policy Goals The overwhelming effect of geopolitics and the pragmatism of Nazarbayev in foreign policymaking will determine whether Kazakhstan will move towards the east or west in the future. The above-mentioned geopolitical factors oblige the country to preserve its close relations with Russia, the United States, the EU, and China, as counterbalancing allies. Kazakhstan is likely to continue to pursue the policy of not favouring any of these powers at the expense of the others. Despite the efforts of Nazarbayev to make ethnic Kazakhs the dominant group within the demographic structure, Russia seems to continue to dominate Astana’s foreign policy calculations. Although Kazakhstan has established multiple ties with the Western powers, the proactive Russian policy towards the region constrains its foreign policy orientations.163

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Kanat Saudabayev, the minister of foreign affairs of Kazakhstan, made a visit to NATO and met with Anders Fogh Rasmussen, the secretary general, on 27 January 2010.164 They discussed the priorities of Kazakhstan for the year as chair of the OSCE. They also talked about cooperation between the two parties in the framework of the Individual Partnership Action Plan (IPAP).165 Another visit as CiO was to Brussels in Belgium, where Saudabayev met with the Belgian minister of foreign affairs, Steven Vanackere. Saudabayev said that “deep integration with the European Union is one of the major directions of Kazakhstan’s foreign policy,” and added that Kazakhstan is ready to develop bilateral cooperation with European states as a means of strategic partnership.166 This visit can be interpreted as an effort on the part of Kazakhstan to strengthen its multilateral foreign policy. The ongoing rivalry over energy projects has been “only a part of a multi-dimensional strategic game to politically control the Eurasian landmass.”167 The future of Kazakh oil and its delivery to global markets will be shaped by the competition among three powers, namely Russia, China, and the United States.168 Although Kazakhstan can be seen as a country that achieves independent foreign policymaking, we know that it has been driven by the outcomes of the policies of these powers over the region. In the medium term, Kazakhstan is likely to seek to sustain close relations with the United States, and to benefit from cooperation in the fields of security and its support for WTO membership.169

Key Constraints to Using Energy Reserves as an Efficient Foreign Policy Tool Sharing a similar ethnic and religious background, Azerbaijan and Kazakhstan confront a number of common problems about their hydrocarbon resources, foreign policy orientations (especially towards Russia), and ethnic minorities.170 Foreign policymaking in Azerbaijan and Kazakhstan has been affected by a wide range of factors, such as the nature of the regime in the early state-building process, demography and national identity, domestic interest groups, their landlocked geography, regional powers, and the role of multinational oil corporations.171 Despite their huge energy reserves and the harsh struggle for influence over the region, a number of issues—the determination of the legal status of the Caspian Sea, the transportation of oil and gas from the Caspian basin, and overcoming geographical factors—need to be addressed before Azerbaijan and Kazakhstan can realize their full potential. These constraints are

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complex and interrelated. They serve both as leverage and challenge to the Caspian states, regional actors, and foreign oil companies.172

The Legal Status of the Caspian Sea As Sinker comments, “The management of transboundary energy resources is extremely important to international relations. Poor or ineffective management can have damaging consequences. This was most recently seen in the Middle East in 1991.”173 On the one hand, the Middle East case is a good precedent that shows how a weak legal regime regarding transboundary energy resources can cause unexpected outcomes.174 On the other hand, transboundary energy resources can be managed in various ways. For instance, the management of resources in the Gulf of Thailand and the Timor Gap are good examples of cooperation between the parties.175 Although disputes related to transboundary energy resources do not always lead to a war or an invasion, they often lead to instability.176 Since the Caspian basin is not entirely stable, the management of resources in the seabed and in offshore reserves has caused several problems. The ongoing controversy has also restricted riparian states from making longterm contracts with Western oil corporations. Without the commitments of these large firms to large amounts of capital and technology, off-shore reserves in the region cannot be used as an effective foreign policy tool. In this respect, the lack of a legal regime in the Caspian Sea has serious consequences for the foreign policymaking processes of the littoral states, Azerbaijan and Kazakhstan being our focal points. The legal issue surrounding the Caspian is based on the treaties signed by Iran and the former Soviet Union in 1921 and 1940.177 The disintegration of the Soviet Union effectively ended the legal understanding of the Caspian Sea between Tehran and Moscow. Following the disintegration, while Russia and Iran supported the claim that the Caspian is an inland lake, and should be jointly governed by all the riparian states, Azerbaijan argued that the Caspian is a sea and should be divided into national sectors. Azerbaijan further stated that such an arrangement would enable each state to possess exclusive sovereignty rights over these divided sectors. Azerbaijan, supported by Kazakhstan, rejects Russian arguments supporting condominium178 and joint sovereignty. There are only slight differences in Kazakhstan’s approach, which argues that the Caspian should be given a new legal regime based on the norms of international law. The principles of the United Nations Conference on the Law of Sea (UNCLOS 1982) should be applied, since Kazakhs also define the Caspian as a sea.

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The lack of a legal framework concerning the Caspian Sea is another major obstacle for Azerbaijan and Kazakhstan in using their energy card as a foreign policy tool. Since the majority of their reserves lie offshore in the seabed, demarcation of the seabed and determination of continental shelf borders have become crucial issues in the process. The territorial disputes in the Caspian Sea thus have become a frozen issue between the littoral states. Each party seeks to fulfil its own interests and keeps away from an agreement until its national interests are guaranteed.179 This condition creates an obstacle to regional cooperation and development. The controversy stems from the different perceptions of resources by littoral states. For instance, Azerbaijan, Kazakhstan, and Turkmenistan see the energy resources of the Caspian Sea as a means of development, independence from Russia, good relations with the Western community, and efficient foreign policymaking. On the other hand, for Iran, the same resources are regarded as a key to end Iranian isolation in the region, achieving a regional cooperation initiative led by Tehran, without the involvement of Western oil companies, especially those of the United States.180 According to Cohen, “the Caspian Sea basin is expected to produce and export increasing amounts of oil. This would benefit not only Azerbaijan, Kazakhstan, and Turkmenistan, which depend almost exclusively on oil revenues, but also Russia and Iran, which have major oil deposits in their sectors of the seabed.”181 Similar to Iran, Russia pays more attention to the strategic promises of the hydrocarbon resources than to the potential economic gains. For Moscow, controlling the flow of hydrocarbon reserves is an important tool to ensure Russian control over its near abroad.182 There have been three phases in search of a new legal regime for the Caspian Sea.183 Early approaches were initiated between 1992 and 1994, immediately following the collapse of the former Soviet Union. New littoral states emerged, each of which had different attitudes and ambitions regarding the demarcation of the sea. Russia claims that the treaties signed with Iran in 1921 and 1940 still constitute the legal basis for the new status of the Caspian Sea.184 The Elchibey government, however, opposed this idea.185 Although Azerbaijan and Kazakhstan did not sign these treaties, they automatically became parties to them, since they signed the Alma Ata Declaration of December 1991 that established the CIS: this declaration has a special provision that makes the treaties signed by the USSR valid for all signatories. Azerbaijan also claimed that UNCLOS 1982 should be applied to the demarcation of the Caspian Sea.186 In 1994, the signing of an agreement with an international consortium, which was also called the “contract of the century,” represented a landmark in Azerbaijan’s attitude

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towards the issue, because this agreement included the oil fields 120 miles east of Baku and far beyond the median line of the sea. The country depended heavily on the production and export of the early oil in these offshore reserves. Despite the Russian opposition against the division of the sea into national sectors, Azerbaijan intensified its efforts to secure its sovereign rights over the sea.187 In 1994, Baku was isolated by Western governments, which did not give enough support in the issue, thus in its foreign affairs it was obliged to try to use its energy resources as leverage against Russian pressure.188 The second phase includes the years between 1995 and 1997, which started with a noticeable change in Russia’s position. As discussed earlier, this change stemmed from the inclusion of Russia in the “contract of the century.”189 Despite Moscow’s inclusion in the consortium, however, Baku continued to face Russian opposition to the demarcation of the sea.190 Thus, Heidar Aliyev felt obliged to yield a considerable amount of Azerbaijan’s share in the consortium to Russia to develop oil in the Karabakh oil field.191 The concessions given by the Aliyev government to its powerful neighbours such as Iran and Russia was an indicator of Azeri subordination to the decisions of the regional powers, despite its possession of considerable hydrocarbon reserves. In the third phase, momentum increased for a Russian-made legal regime. The turning point for making littoral arrangements regarding the Caspian Sea came in 1998. Russia declared that the demarcation of the Caspian should be implemented on the basis of a legal status acceptable to all riparian states.192 As that country put it, the issue was no longer whether the sea should be divided into national sectors or not; rather it was how that division should occur. By that time, all the riparian states had come to favour the sectoral division of the Caspian. In 2003, Azerbaijan, Kazakhstan, and Russia signed bilateral agreements based on a principle developed by Russia known as the “modified median line.”193 The northern part of the Caspian Sea (64 percent) was thus divided into three unequal parts by these three littoral states, giving Kazakhstan 27 percent, Russia 19 percent, and Azerbaijan 18 percent.194 The most recent development concerned the negotiations between Azerbaijan and Turkmenistan, which remained fruitless due to the unwillingness of the participants to compromise. The president of Turkmenistan Berdimuhamedov accused Azerbaijan of using Caspian reserves unilaterally, and underlined the urgent need for a compromise by the two countries.195 Ultimately, fundamental issues regarding the legal status of the Caspian Sea remain unresolved. The treaties signed between Russia and Iran still form the basis of the current legal regime. Despite the lack of a

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universally accepted agreement, Kazakhstan, Azerbaijan, and Russia have abandoned their ideal solutions and made some concessions. Despite its influence on both countries, Russia abandoned its ideals and made concessions, since it intended to reach bilateral, rather than multilateral, agreements.196 These concessions have also paved the way for a bilateral division of the seabed. Azerbaijan and Kazakhstan recognize that they have to sacrifice their original objectives in order to ensure a working solution for all parties. However, these littoral states did not sign any legal document that determines the legal status of the sea. The absence of a solution that is accepted by all littoral states prevents Azerbaijan and Kazakhstan from using their energy card effectively in their foreign affairs. Kazakhstan, however, has been left in a more disadvantageous position than Azerbaijan during this process. Kazakh officials pursued a more moderate approach than Azerbaijan for cooperation with the sea’s other riparian states.197 Geographical proximity to Russian territory has caused Kazakh officials to display such an attitude, because of the perception of Russia as a threat to territorial unity. Besides its geographical position, another factor that might have made Kazakhstan willing to cooperate with Russia is the transport problem. Despite its huge hydrocarbon reserves, Kazakhstan has faced several difficulties in attracting foreign capital and investment to date. There are two main reasons why transporting Kazakh gas and oil from its reserves to the markets is problematic: the first is Russia’s desire to maintain control over the regional resources, while the second is the inability of Western oil companies and state officials to reach an agreement. Furthermore, the lack of legal guarantees, such as the right to seek international arbitration, constitutes another obstacle for foreign investment in Kazakhstan.198 On the other side of the coin, Russia and Iran, in a common manner, rejected the expansion of NATO and any other foreign expansion in the Caspian Sea region. The two countries signed the Caspian Declaration on 12 March 2001, and agreed to act together to prevent the influence of external powers on the Caspian Sea.199 In this declaration, they stated that all agreements and arrangements about the legal status of the Caspian Sea would come into force only with the consent of all five Caspian littoral states.200 In other words, the hydrocarbon resources of the Caspian Sea cannot be used by Azerbaijan and Kazakhstan as leverage in their foreign policymaking, until Russia and Iran approve it. Consequently, the littoral states of the Caspian Sea region have so far been unable to come to a conclusion on the legal status of the sea. They have organized a number of conferences, the first of which was held in

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2002 in Turkmenistan, and the second in Iran in 2007.201 Unless all the riparian states agree on the legal status of the sea, it will remain as one of the key constraints preventing Azerbaijan and Kazakhstan from using their Caspian energy resources efficiently. In January 2010, to explain Azerbaijan’s ongoing efforts for an agreement on the issue, the deputy foreign minister declared that “negotiations on division of the Caspian Sea shelf will continue in March 2010,” and added that: We’ll keep on negotiations based on five-sided format on drawing up the conventions. Our next meeting will be held in the first quarter of the current year. We still continue the negotiations on some features. So, in 2007, during the Teheran summit, the heads of the states initiated a safety issue and made decision to appeal to Azerbaijan for the purpose of establishing the security-related mechanisms with attraction of boundary, customs, law-enforcement, and other state bodies. It’s possible to conclude the corresponding treaty for establishment of such mechanisms. Azerbaijan has already drawn up the draft of the project. Last year we held the first stage of the negotiations and the next stage of the negotiations is intended to be held in Baku. We have already notified our Caspian colleagues about the date of the meeting. If the meeting takes place on that date, we’ll continue our negotiations then.202

Geographical Factors and the Transportation of Caspian Oil and Gas The transportation of Caspian oil and gas has always been a component of the region’s geopolitical situation. Therefore, the development of the oil and gas potential of the Caspian region has been hostage to pipeline politics.203 One of the most significant factors affecting the oil politics is geography.204 Ehteshami argues that the Caspian states, particularly Azerbaijan and Kazakhstan, are not as lucky as the oil producers in the North Sea or the Gulf region in benefitting from their energy reserves. First, despite the volatility in the oil prices, which have peaked at 140 dollars, prices are likely to remain at low levels in the foreseeable future. This will lower the region’s commercial attractiveness due to its production costs, which are higher than those of the OPEC members or the North Sea. Second, the high taxation of fossil fuels in the Western countries has begun to lower the demand for these fuels. This has also triggered the search for alternative energy sources, such as renewable energy. Within this changing energy environment, the Caspian oil exporters may lose their significance due their relatively high production costs. Third, OPEC producers (including Kuwait, Qatar, Iraq, and also Iran) have begun to open their economies to foreign investors, thanks to

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the increasing competition in the market. This would cause transnational oil companies to prefer these regions, which have richer oil reserves than the Caspian Sea. Fourth, increasing investment on the part of Western corporations in the Gulf region has, once more, decreased the production costs, which is against the interests of the Caspian producers. Finally, in recent years, the non-OPEC producers in the Middle East, Africa, and Latin America have begun to supply the oil demand of both the global markets and their domestic markets. Geography has become a key variable in a situation where the number of players has risen and the production and transport costs have decreased, thanks to increasing competition in the market. The landlocked position of Azerbaijan and Kazakhstan emerges as one of the key obstacles to their efficient and independent use of the energy card. Instead, they have remained dependent on transit states in order to supply the global energy demand. The geopolitics of the region has complicated the transportation of oil and gas from the Caspian basin to the markets in Europe, Asia, and elsewhere. Determining the routes along which resources should flow has become an issue of foreign policy among local and also extra-regional actors. The rivalry over the pipeline routes promises economic and political gains for those who can use their resources effectively, while losers would be marginalized strategically. Azerbaijan and Kazakhstan will depend on Moscow until alternative transport routes are built. Russia prefers northern routes to be used for pipelines in order to maintain its control over the pipeline infrastructure, which was originally constructed during the Soviet era. These routes extend from Baku to Novorossiysk, and from the Tengiz oil field in western Kazakhstan to Novorossiysk. Meanwhile, the United States and the EU support western routes, to contain Russian influence and domination in the region. The primary objective of these actors is to bypass Iran and Russia. In 1997, the United States began to support the Baku–Tibilisi–Ceyhan (BTC) pipeline; according to Olsen, there were two reasons that explain their support.205 First, the United States ignored Iran as an alternative transport route. Second, it intended to minimize the role of Russia in the transport system.206 The southern routes, which are supported by Iran and some major oil corporations, pass through Iranian territory and terminate on the Persian Gulf. They are the shortest and cheapest routes, and would pass through safer territories and carry fewer environmental risks.207 Using purely economic considerations, these routes represent the best options for transporting Caspian oil and gas to the markets. However, the United

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States opposes these routes due to the political and ideological controversies between Washington and Iran.208 There are some favourable factors that make Iran a possible central actor in the transportation of the Caspian reserves. First, the most significant factor is the geostrategic position of the country between the Caucasus, the Caspian Sea, Central Asia, the Persian Gulf, the Gulf of Oman, Turkey, Afghanistan, and Pakistan. It can be the gateway for Caspian oil and gas to the open seas. Further, Iran can take oil through swap agreements from Azerbaijan, Kazakhstan, and Turkmenistan to the global markets. This would enrich the transport options of Azerbaijan and Kazakhstan: rather than depending only on Russia or alternative USsupported pipeline projects, there would be a third option to counterbalance the influence of Russia and the United States. Under these circumstances, it becomes very difficult for Azerbaijan and Kazakhstan to choose the most suitable option for exporting their reserves and getting the maximum utility. Hence, these countries, in terms of their exploration and extraction of oil and gas, depend on the Russian and Western oil firms, the latter mostly represented by American oil corporations. They have to consider the priorities of Russia and the United States. As mentioned above, commercially, the Iran route would offer Caspian states an alternative, allowing them to lower their dependence both on Russian and Western routes. The United States, however, would not allow Iran to increase its influence in the region: this has been the driving force behind US policy towards the Caspian region.

Conclusion This study has given an overview of the role of energy resources as a foreign policy tool in the cases of Azerbaijan and Kazakhstan. It has tried to offer a new perspective, reconciling oil politics with the mainstream IR theories. To aid a better understanding, it explained the historical background of the wider Black Sea region. It aimed to examine the factors that lead to a rising interest in the region on the part of the Euro–Atlantic community. This community has been largely motivated by concerns about “energy security” and efforts to achieve diverse energy suppliers through alternative resources in the wider Black Sea–Caspian region. Another drive has been the effort to provide political stability and security in the region, which became critical after the 9/11 terrorist attacks. In order to lessen their dependence on Russia, both Azerbaijan and Kazakhstan can conduct bilateral relations with Western multinational oil corporations and international institutions, such as the IMF and the World

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Bank. However, which actors these states will prefer to cooperate and trade with are also defined by their dependence on Russia. The activities of multinationals and foreign firms in the newly independent Caspian states enable them to have closer relations with the aforementioned international institutions. The increasing level of interaction between these actors has resulted in economic reforms and a relative liberalization of their economic structure, which can be easily observed in the divergent attitudes of the region’s three oil- and gas-producing countries. For instance, due to their liberal economic environment, which is attractive to foreign firms, Azerbaijan and Kazakhstan, but not Turkmenistan, became capable of having closer relations with the Western international institutions. However, Turkmenistan, a country whose economy is based on natural gas rather than oil, has no other choice but to carry its gas through the Russian pipelines, which are the only available route. In addition, the former leader of this country, Turkmenbasy Saparmurat Atayevich Niyazov, played a significant role in the country’s sceptical attitude towards Western oil corporations. As a result, unlike Azerbaijan and Kazakhstan, Turkmenistan’s economy has remained untransformed, and the political structure has consequently become more autocratic.209 These developments suggest that oil and gas are not the sole variables in the foreign policymaking of Baku and Astana. The future of the foreign policy steps for Azerbaijan and Kazakhstan depend not only on the amount of hydrocarbon reserves they possess, but also on their choices regarding whom they cooperate or ally themselves with. Despite their considerable reserves, these countries still depend on Western capital, technology, and investment. Hence, the energy card has smaller leverage than the current literature estimates for the future of the region. When compared with Azerbaijan, Kazakhstan has a limited and constrained foreign policy agenda. The integration of Kazakhstan into the global economy has been limited. One reason for this has been the Russian factor: Kazakhstan is severely restrained by Moscow in its foreign policy choices. For the most part, this pressure has been economic.210 The situation has been usually explained with the maintenance of the Soviet nomenklatura, which has been influential in preserving the economic, financial, institutional, and political relations between the two states.211 The ability of the Russian government and business people to manipulate the Kazakh economy has been one of the country’s major vulnerabilities. This manipulation ranges from the control of the energy infrastructure, to the existence of a considerable and efficient Russian population in Kazakhstan.212 The demographic composition of Kazakhstan has been

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another factor behind its policy towards Russia. Nearly 50 percent of the population is composed of ethnic Russians in Kazakhstan. Thus, this group exerts heavy pressure on the foreign policymaking of the country when Russian interests are at stake.213 These issues indicate that certain critical factors play a role in energy politics. In Azerbaijan and Kazakhstan, security concerns weigh heavier than other foreign policy priorities. In the case of Azerbaijan, since the early years of independence, the Nagorno-Karabakh issue has been the most decisive element on the foreign policy agenda. On the other hand, the legal status of the Caspian Sea outweighs the other foreign policy issues. In Kazakhstan, the geographic location and demographic structure come before energy considerations. Alongside these critical political factors, energy politics emerges for Azerbaijan and Kazakhstan as a tool or leverage to allow them to achieve objectives regarding security and other concerns. For instance, the routes of oil and gas pipelines are predominated by these political facts. Sometimes, despite the existence of a cheaper and easier transport route, other options that are more costly are preferred due to the subordination of energy policies to the political facts.

Notes 1

Daniel Yergin, The Prize: The Epic Quest for Oil, Money and Power (New York: Free Press, 1992), 787–788. 2 See Michael Wesley, “The Geopolitics of Energy Security in Asia,” in Energy Security in Asia, ed. Michael Wesley (London: Routledge, 2007): 1–12; Pami Aalto, “The EU–Russia Energy Dialogue and the Future of European Integration: From Economic to Politico-Normative Narratives,” The EU–Russian Energy Dialogue: Europe’s Future Energy Security, ed. Pami Aalto (Aldershot: Ashgate, 2008), 23–42. 3 The term “Chindia effect” has been used to explain the growing energy demand from China and India; Emre øúeri, “Fosil Yenilenebilir vet Nükleer YakÕtlarÕn Neopolitik AnlamÕ,” Uø Dergisi 5, no. 20 (2009): 58. 4 EIA: International Energy Outlook 2009, 1. 5 See Paul J. Sanders, Russian Energy and European Security: A Transatlantic Dialogue (Washington: The Nixon Center, 2008). 6 Wesley, Energy Security in Asia. 7 See Ronald D. Asmus, ed., Next Steps in Forging a Euroatlantic Strategy for the Wider Black Sea (The German Marshall Fund of the US, Washington, 2006). 8 Aalto, “The EU–Russia Energy Dialogue.” 9 “AB’den Gaza 2,3 Milyar Euro,” Milliyet, 5 March 2010. 10 See Anja Franke, Andrea Gawrich, and Gurban Alakbarov, “Kazakhstan and Azerbaijan as Post-Soviet Rentier States: Resource Incomes and Autocracy as a

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Double ‘Curse’ in Post-Soviet Regimes,” Europe-Asia Studies 61, no. 1 (2009): 109–140. 11 Franke, Gawrich, and Alakbarov, “Kazakhstan and Azerbaijan as Post-Soviet Rentier States,” 109. 12 R. H. Dekmejian and H. Hovann Simonian, Troubled Waters: The Geopolitics of the Caspian Region (London: I. B. Tauris, 2003), 3. 13 See Barry Buzan, Ole Wæver, and Jaap de Wilde, Security: A New Framework for Analysis (London: Lynne Rienner, 1998). 14 Buzan, Wæver, and de Wilde, Security, 98. 15 Barry Buzan, “New Patterns of Global Security,” International Affairs 67, no. 3 (1991): 433. 16 Buzan, “New Patterns.” 17 Gareth M Winrow, “Energy Security in the Black Sea–Caspian Region,” Perceptions (Autumn 2005): 87. 18 John Roberts, “Dossier Energy: The Cut Throat Energy Politics of Russia and Turkey,” Europe’s World (Spring 2007), http://europesworld.link.be/EWSettings /Article/tabid/191/articleType/articleview/ArticleID/20784/. 19 Ian Lesser, “Global Trends, Regional Consequences: Wider Strategic Influences on the Black Sea,” Xenophon Papers No. 4 (Athens: International Centre for Black Sea Studies, 2007), 33–35. 20 Ronald D. Asmus, “Next Steps in Forging a Euroatlantic Strategy for the Wider Black Sea,” in Next Steps in Forging a Euroatlantic Strategy for the Wider Black Sea, ed. Ronald D. Asmus (Washington: German Marshall Fund for the United States, 2006), 15. 21 Erhan Türbedar, “Karadeniz’de De÷iúen Dinamikler: Bulgaristan ve Romanya’nÕn Rolleri,” Avrasya DosyasÕ: Karadeniz’in Yeni Jeopoliti÷i (Ankara: ASAM) 13, no. 1 (2007): 227. 22 Lesser, “Global Trends,” 9. 23 Dimitrios Triantaphyllou, “Energy Security and Common Foreign and Security Policy (CFSP): The Wider Black Sea Area Context,” Southeast European and Black Sea Studies 7, no. 2 (2007): 297–298. 24 Kamil A÷acan, “Karadeniz’e Kafkasya’dan Bakmak,” Avrasya DosyasÕ: Karadeniz,” Yeni Jeopoliti÷i (ASAM) 13, no. 1 (2007): 192. 25 Asmus, “Next Steps,” 19. 26 Asmus, “Next Steps,” 17–18. 27 Asmus, “Next Steps,” 12. 28 For detailed information, see http://www.traceca-org.org/. 29 Yelda Demira÷, “EU Policy towards South Caucasus and Turkey,” Perceptions (Winter 2004–2005): 92. 30 “Doing More with Less: Green Paper on Energy Efficiency” (Brussels: European Commission, 2005), 8. 31 “Green Paper: European Strategy for Sustainable, Competitive and Secure Energy” (Brussels: European Commission, 8 March 2006), 4. 32 Ian Lesser, “Global Trends,” 13. 33 John Roberts, “The Black Sea and European Energy Security,” Southeast European and Black Sea Studies 6, no. 2 (2006): 207.

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34 Svante E. Cornell and Niklas Nilsson, “Daha YakÕn Bir Güneydo÷u Komúulu÷u: Geniú Karadeniz Bölgesi ve Avrupa Güvenli÷i,” Avrasya DosyasÕ: Karadeniz’in Yeni Jeopoliti÷i (ASAM) 13, no. 1 (2007): 141–142. 35 Cornell and Nilsson, “Daha YakÕn Bir Güneydo÷u Komúulu÷u,” 159–160. 36 Asmus, “Next Steps,” 28. 37 Burcu Gültekin-Punsmann, “Black Sea Regional Policy Approach: A Potential Contributor to European Energy Security,” ICBSS Policy Brief No. 7 (Athens: International Centre for Black Sea Studies, 2008), 1. 38 Gültekin-Punsmann, “Black Sea Regional Policy Approach,” 1–2. 39 Gerhard Mangott and Kirsten Westphal, “The Relevance of the Wider Black Sea Region to the EU and Russian Energy Issues,” in The Wider Black Sea Region in the 21st Century: Strategic, Economic and Energy Perspectives (Washington DC: Center for Transatlantic Relations, 2008), 157. 40 “Black Sea Synergy: A New Regional Cooperation Initiative,” Commission of the European Communities COM (2007) 160 final (Brussels), April 11, 2007. 41 Commission of the European Communities, “Black Sea Synergy,” 1–4. 42 The official website of INOGATE, http://www.inogate.org/inogate/en/bakuinitiative. 43 The official website of INOGATE. 44 Daniel Hamilton, “A Transatlantic Strategy for the Wider Black Sea?” in The Wider Black Sea Region in the Twenty-first Century: Strategic, Economic, and Energy Perspectives, ed. Daniel Hamilton and Gerhard Mangott (Washington, DC: Center for Transatlantic Relations, 2008), 321–323. 45 Hamilton, “A Transatlantic Strategy,” 322–323. 46 Matthew Bryza, “The Policy of the United States toward the Black Sea Region,” in Asmus, ed., Next Steps, 38. 47 Bryza, “The Policy of the United States toward the Black Sea Region,” 41. 48 F. Stephen Larrabee, “A Western Strategy toward Russia in Black Sea Region,” in Asmus, ed., Next Steps, 117. 49 Himmelreich, 2006, pp.48–49. 50 Jeffrey Simon, “Black Sea Regional Security Cooperation: Building Bridges and Barriers,” in Asmus, ed., Next Steps, 95. 51 Simon, “Black Sea Regional Security Cooperation,” 96. 52 Kamer KasÕm, “ABD’nin Karadeniz PolitikasÕ,” Global Strateji [Global Strategy Institute], no. 12 (2008): 111. 53 Article 5 of the North Atlantic Charter identifies an attack on one member as an attack on all. The North Atlantic Treaty. http://www.nato.int/docu/basictxt/ treaty.htm. 54 Nadia Alexandrova-Arbatova, “Troubled Strategic Partnership: The Black Sea Dimension of Russia’s Relations with the West,” in Asmus, ed., Next Steps, 315– 316. 55 Jamie Shea,“Energy Security: NATO’s Potential Role,” NATO Review, Autumn 2006, http://www.nato.int/docu/review/2006/issue3/english/special1.html. 56 “NATO Topics: NATO’s Role in Energy Security,” NATO, http://www.nato .int/issues/energy_security/index.html.

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57 Paul Gallis, “NATO and Energy Security,” Congressional Research Service: Report for Congress, RS22409, 2007, http://www.italy.usembassy.gov/pdf/other/ RS22409.pdf. 58 Sami Kohen, “Kafkas Krizi BatÕ’yÕ Bölüyor,” Milliyet, September 17, 2008. 59 Mert Bilgin, Hazar’da Son Darbe (Ankara: IQ, 2005), 14–15. 60 Bilgin, Hazar’da Son Darbe, 17. 61 Bilgin, Hazar’da Son Darbe, 21. 62 Dekmejian and Simonian, Troubled Waters, 3. 63 Dekmejian and Simonian, Troubled Waters, 5. 64 Houman Sadri, “Elements of Azerbaijan Foreign Policy,” Journal of Third World Studies 20, no. 1 (2003): 179. 65 Sadri, “Elements of Azerbaijan Foreign Policy,” 180. 66 Sadri, “Elements of Azerbaijan Foreign Policy,” 180–181. 67 Sadri, “Elements of Azerbaijan Foreign Policy,” 182–183. 68 Sadri, “Elements of Azerbaijan Foreign Policy,” 184. 69 Sadri, “Elements of Azerbaijan Foreign Policy,” 185. 70 Emil Souleimanov and Ondrej Ditrych, “Iran and Azerbaijan: A Contested Neighborhood,” Middle East Policy 14, no. 2 (2007): 112–113. 71 Sadri, “Elements of Azerbaijan Foreign Policy,” 187. 72 Kenneth Waltz, Theory of International Politics (Boston, MA: McGraw-Hill, 1979), 60–67. 73 Geoffrey Gresh, “Coddling the Caucasus: Iran’s Strategic Relationship with Azerbaijan and Armenia,” Caucasian Review of International Affairs 1, no. 1 (2006): 2. 74 Rajan Menon and Hendrik Spruyt, “The Limits of Neorealism: Understanding Security in Central Asia,” Review of International Studies 25 (1999): 89. 75 Menon and Spruyt, “The Limits of Neorealism,” 90. 76 Menon and Spruyt, “The Limits of Neorealism,” 91. 77 According to NATO, “The Partnership for Peace (PfP) is a program of practical bilateral cooperation between individual Partner countries and NATO. It allows Partner countries to build up an individual relationship with NATO, choosing their own priorities for cooperation. Based on a commitment to the democratic principles that underpin the Alliance itself, the purpose of the Partnership for Peace is to increase stability, diminish threats to peace and build strengthened security relationships between individual partner countries and NATO, as well as among partner countries,” http://www.nato.int/cps/en/natolive /topics_50349.htm. 78 Gresh, “Coddling the Caucasus,” 1. 79 Gresh, “Coddling the Caucasus,” 6. 80 Gresh, “Coddling the Caucasus,” 6–7. 81 Oksana Antonenko, “Russia’s Policy in the Caspian Sea Region: Reconciling Economic and Security Agendas,” in The Caspian: Politics, Energy and Security, ed. Shirin Akiner (London: RoutledgeCurzon, 2004), 247–248. 82 Gresh, “Coddling the Caucasus,” 13. 83 Gresh, “Coddling the Caucasus,” 10. 84 Pinar øpek, “Azerbaijan’s Foreign Policy and Challenges for Energy Security,” The Middle East Journal 63, no. 2 (2009): 227–239.

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øpek, “Azerbaijan’s Foreign Policy,” 227. øpek, “Azerbaijan’s Foreign Policy,” 228. 87 Nasib Nassibli, “Azerbaijan: Policy Priorities towards the Caspian Sea,” in The Caspian: Politics, Energy and Security, ed. Shirin Akiner (London: RoutledgeCurzon, 2004), 144–145. 88 The members of the OSCE (the conference was later renamed the Organization for Security and Co-operation in Europe) Minsk Group are France, Russia, the US (co-chairmanship), and also Belarus, Germany, Italy, Portugal, Netherlands, Sweden, Finland, and Turkey, as well as Azerbaijan and Armenia, http://www.osce .org/ item/21979.html. 89 For the original document, see http://www.un.int/azerbaijan/documents/ scresolutions/822.pdf. 90 “Karaba÷ Sorununun Perde ArkasÕ,” Milliyet, 3 September 2009. 91 Kamer Kasim, “The Nagorno-Karabakh Conflict, Caspian Oil and Regional Powers,” in The Politics of the Caspian, ed. Bülent Gökay (New York: Palgavre Macmillan, 2001), 187. 92 FÕrat Karabayram, Rusya Federasyonu’nun Güney Kafkasya PolitikasÕ (Ankara: Lalezar Kitabevi, 2007), 312. 93 Kasim, “The Nagorno-Karabakh Conflict,” 187. 94 Kasim, “The Nagorno-Karabakh Conflict,” 186. 95 øpek, “Azerbaijan’s Foreign Policy,” 227. 96 øpek, “Azerbaijan’s Foreign Policy,” 228. 97 øpek, “Azerbaijan’s Foreign Policy,” 229. 98 Kasim, “The Nagorno-Karabakh Conflict,” 188. 99 Yunus ùen, Hazar’Õn KanÕ: Orta Asya’nÕn Petrolle YazÕlan Tarihi (Istanbul: Do÷an Kitap, 2009), 32–34. 100 øpek, “Azerbaijan’s Foreign Policy,” 233. 101 Araz AslanlÕ and Ilham Hesenov, Haydar Aliyev Dönemi Azerbaycan DÕú PolitikasÕ (Ankara: Platin, 2005), 25. 102 AslanlÕ and Hesenov, Haydar, 26. 103 ùen, Hazar’Õn KanÕ, 56. 104 ùen, Hazar’Õn KanÕ, 57. 105 øpek, “Azerbaijan’s Foreign Policy,” 231. 106 øpek, “Azerbaijan’s Foreign Policy,” 232. 107 For details of the Freedom Support Act, http://www.fas.org/nuke/control/ ctr/docs/s2532.html. 108 øpek, “Azerbaijan’s Foreign Policy,” 232. 109 Nassibli, “Azerbaijan,” 153. 110 Nassibli, “Azerbaijan,” 153–154. 111 Nassibli, “Azerbaijan,” 154. 112 Semih ødiz, “Aliyev HaklÕ, Ama … ,” Milliyet, 19 October 2009. 113 ødiz, “Aliyev HaklÕ.” 114 Sadri, “Elements of Azerbaijan Foreign Policy,” 188. 115 “Azerbaijan in the International Arena,” Administrative Department of the President of the Republic of Azerbaijan, Presidential Library, p. 2, http://www .elibrary.az/docs/azerbaijan/eng/gl8.pdf. 86

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PÕnar øpek, “The Role of Oil and Gas in Kazakhstan’s Foreign Policy: Looking East or West?” Europe-Asia Studies 59, no. 7 (2007): 1179. 117 øpek, “The Role of Oil and Gas,” 1180–1181. 118 S. N. Cummings, “Eurasian Bridges or Murky Waters between East and West? Ideas, Identity and Output in Kazakhstan's Foreign Policy,” Journal of Communist Studies and Transition Politics 19, no. 3 (2003): 145. 119 CIA World Factbook: Kazakhstan, https://www.cia.gov/library/publications/ the-world-factbook/geos/kz.html. 120 Cummings, “Eurasian Bridges,” 149–151. 121 Cummings, “Eurasian Bridges,” 151. 122 øpek, “The Role of Oil and Gas,” 1194–1195. 123 øpek, “The Role of Oil and Gas,” 1195–1197. 124 Dekmejian and Simonian, Troubled Waters, 83–85. 125 This policy includes encouraging the immigration of ethnic Kazakhs from China and Mongolia, replacing Russian officials with Kazakhs, and making the Kazakh language obligatory for higher education and employment. Dekmejian and Simonian, Troubled Waters, 53. 126 Dekmejian and Simonian, Troubled Waters, 85. 127 Dekmejian and Simonian, Troubled Waters, 84. 128 V. Zhavoronkova, “President of Kazakhstan Achieves Most Succeses in Foreign Policy,” Trend News, Baku, http://en.trend.az/news/politics/foreign/1543166.html. 129 øpek, “The Role of Oil and Gas,” 1192. 130 øpek, “The Role of Oil and Gas,” 1193. 131 øpek, “The Role of Oil and Gas,” 1194. 132 Franke, Gawrich, and Alakbarov, “Kazakhstan and Azerbaijan as Post-Soviet Rentier States,” 109–114. 133 Lutz Kleveman, Yeni Büyük Oyun: Orta Asya’da Kan ve Petrol (Istanbul: Everest, 2004), 100. 134 Kleveman, Yeni Büyük Oyun, 101. 135 Kleveman, Yeni Büyük Oyun, 101–102. 136 “Kazakhstan: Multi-Vector Foreign Policy under Pressure,” Oxford Analytica Daily Brief Service, 10 December 2003, p. 1. 137 “Kazakhstan,” Oxford Analytica Daily Brief. 138 Janusz Bugajski and Margarita Assenova, “Kazakhstan’s OSCE Chairmanship,” Center for Strategic and International Studies (CSIS), http://csis.org/publication/kazakhstans-osce-chairmanship. 139 “Kazakhstan Raises Questions over OSCE’s Direction,” BBC News Online, Russian Service, 15 January 2010, http://news.bbc.co.uk/2/hi/asia-pacific/8459600.stm. 140 øpek, “The Role of Oil and Gas,” 1195. 141 “Kazakhstan,” Oxford Analytica Daily Brief, 1. 142 “Kazakhstan,” Oxford Analytica Daily Brief, 1. 143 øúeri, “Geo-strategic Dimensions,” 148. 144 Robert A. Manning, “The Myth of the Caspian Great Game and the New Persian Gulf,” The Brown Journal of World Affairs 7, no. 2 (2000): 29–30.

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Majid Jafar, “Kazakhstan: Oil, Politics and the New Great Game” in The Caspian: Politics, Energy and Security, ed. Shirin Akiner (London: RoutledgeCurzon, 2004), 191. 146 Jafar, “Kazakhstan,” 191. 147 Olga Oliker, “Kazakhstan’s Security Interests and their Implications for the US–Kazakh Relationship,” China and Eurasia Forum Quarterly 5, no. 2 (2007): 64. 148 Oliker, “Kazakhstan’s Security Interests,” 65. 149 Oliker, “Kazakhstan’s Security Interests,” 67. 150 Dekmejian and Simonian, Troubled Waters, 80. 151 Dekmejian and Simonian, Troubled Waters, 81. 152 Kleveman, Yeni Büyük Oyun, 107. 153 Emre øúeri, “Geo-strategic Dimensions of Kazakhstan at the Eve of Global Peak Oil,” Journal of Central Asian and Caucasian Studies 2, no. 4 (2007): 143. 154 øúeri, “Geo-strategic Dimensions,” 144. 155 øúeri, “Geo-strategic Dimensions,” 145. 156 øúeri, “Geo-strategic Dimensions,” 151. 157 Jafar, “Kazakhstan,” 192. 158 Jafar, “Kazakhstan,” 193. 159 “At Least 140 Killed in Uighur Riots in China,” ABC News International, 6 July 2009, http://abcnews.go.com/International/story?id=8010018&page=1. 160 “Russia, China, US Occupy Special Place in Kazakh Foreign Policy: Nazarbayev,” Asian News International—ANI, 28 December 2009, http://www.aniin.com/. 161 ANI, “Russia, China, US.” 162 ANI, “Russia, China, US.” 163 ANI, “Russia, China, US.” 164 “Minister of Foreign Affairs of Kazakhstan Visits NATO,” NATO, http://www.nato.int/cps/en/SID-40DE51D6-5277BF51/natolive/news_61025.htm. 165 NATO, ““Minister of Foreign Affairs of Kazakhstan Visits NATO.” 166 “Belgium Welcomes Kazakhstan’s Multi-vector Foreign Policy,” Kazinform, http://www.inform.kz/eng/article/2232146. 167 øúeri, “Geo-strategic Dimensions,” 145. 168 øúeri, “Geo-strategic Dimensions,” 145–146. 169 Oliker, “Kazakhstan’s Security Interests,” 71. 170 Dekmejian and Simonian, Troubled Waters, 90. 171 øpek, “The Role of Oil and Gas,” 1179. 172 Sheila N. Heslin, “Key Constraints to Caspian Pipeline Development: Status, Significance and Outlook,” Unlocking The Assets: Energy and the Future of Central Asia and the Caucasus: Working Papers, James A. Baker III Institute for Public Policy, Rice University, April 1998, pp. 2–3. 173 Roland Sinker, “The Management of a Transboundary Energy Resource: The Oil and Gas of the Caspian,” in The Politics of the Caspian, ed. Bülent Gökay (New York: Palgrave Macmillan, 2001), 51. 174 The absence of an efficient legal infrastructure to manage the oil fields located on the Iraq–Kuwait border enabled Kuwait to extract more oil than Iraq, and

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ultimately led to the latter’s 1990 invasion. Sinker, “The Management of a Transboundary Energy Resource,” 51–109. 175 Sinker, “The Management of a Transboundary Energy Resource,” 51–52. 176 Sinker, “The Management of a Transboundary Energy Resource,” 52–53. 177 Ali Granmayeh, “Legal History of the Caspian Sea,” in The Caspian: Politics, Energy and Security, ed. Shirin Akiner (New York: Routledge Curzon, 2004), 15. 178 Here meaning “the joint control of a state’s affairs by other states” (Oxford Online Dictionary). 179 Sinker, “The Management of a Transboundary Energy Resource,” 53. 180 Souleimanov and Ditrych, “Iran and Azerbaijan,” 103. 181 Ariel Cohen, “Iran’s Claims Over Caspian Sea Resources Threaten Energy Security,” Backgrounder: Executive Summary; The Heritage Foundation No. 1582, September 4, 2002. 182 Sinker, “The Management of a Transboundary Energy Resource,” 53–54. 183 Granmayeh, “Legal History of the Caspian Sea,” 16. 184 Rustam Mamedov, “International Legal Status of the Caspian Sea: Issues of Theory and Practice,” The Turkish Yearbook of International Relations Vol. 32 (Ankara: Ankara University, 2001), 219. 185 Yolbars Kepbanov, “The New Legal Status of the Caspian Sea is the Basis of Regional Co-operation and Stability,” Perceptions: Journal of International Relations 2, no. 4 (December 1997–February 1998): 1–2. 186 Mahmoud Ghafouri, “The Caspian Sea: Rivalry and Cooperation,” Middle East Policy 15, no. 2 (2008): 87. 187 øpek, “Azerbaijan’s Foreign Policy,” 234. 188 øpek, “Azerbaijan’s Foreign Policy,” 235. 189 Granmayeh, “Legal History of the Caspian Sea,” 19–30. 190 Granmayeh, “Legal History of the Caspian Sea,” 32. 191 øpek, “Azerbaijan’s Foreign Policy,” 235. 192 Granmayeh, “Legal History of the Caspian Sea,” 28–32. 193 Bahman Aghai Diba, The Law and Politics of the Caspian Sea in the TwentyFirst Century: The Positions and Views of Russia, Kazakhstan, Azerbaijan, Turkmenistan, with Special Reference to Iran (Bethesda, MD: IBEX Publishers, 2003), 51. 194 US Department of Energy, “Country Analysis Briefs, Caspian Sea,” EIA, http://www.eia.doe.gov/emeu/cabs/Caspian/Background.html. 195 “Azerbaycan ile Türkmenistan ArasÕnda ‘Hazar’ TartÕúmasÕ,” USAK Gündem, 25 July 2009, http://www.usakgundem.com/haber/39303/azerbaycan-ile-türkmenistan -arasÕnda-39-hazar-39-tartÕúmasÕ.html. 196 Fiona Hill, “Russia’s International Integration and Caspian Sea Oil,” Program on New Approaches to Russian Security Policy Memo 9 (1997): 4, http://csis.org/ files/media/csis/pubs/pm_0009.pdf. 197 Sinker, “The Management of a Transboundary Energy Resource,” 65. 198 Sinker, “The Management of a Transboundary Energy Resource,” 87–88. 199 Souleimanov and Ditrych, “Iran and Azerbaijan,” 111–112. 200 Souleimanov and Ditrych, “Iran and Azerbaijan,” 114.

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Bahman Agai Diba, “National Interests of Iran in the Caspian Sea,” Pavyand News, 10 September 2009, http://payvand.com/news/09/sep/1102.html. 202 “Negotiations on Division of the Caspian Sea Shelf will Continue in March,” NewsAZ, http://www.news.az/articles/7916. 203 Willy Olsen, “The Role of Oil in the Development of Azerbaijan,” in The Caspian: Politics, Energy and Security, ed. Shirin Akiner (London: RoutledgeCurzon, 2004), 120. 204 Michael T. Klare, “Oil Moves the War Machine,” The Progressive, June 2002, p. 19. 205 Olsen, “The Role of Oil,” 121. 206 Olsen, “The Role of Oil,” 121. 207 Enayatollah Yazdani, “Competition over the Caspian Oil Routes: Oilers and Gamers Perspective,” Alternatives: Turkish Journal of International Relations 5, no. 1–2 (2006): 51–53. 208 Yazdani, “Competition over the Caspian Oil Routes,” 57. 209 Bilgin, Hazar’da Son Darbe, 33. 210 Michael Rywkin, “Stability and Security in Central Asia: Engaging Kazakhstan,” American Foreign Policy Interests 28, no. 6 (2006): 454. 211 The nomenklatura were a small, elite subset of the general population in the Soviet Union and other Eastern Bloc countries who held various key administrative positions in all spheres of those countries’ activity—government, industry, agriculture, and education. Mikhail Voslenskii, Nomenklatura: Anatomy of the Soviet Ruling Class (London: Bodley, 1984). 212 Voslenskii, Nomenklatura, 454. 213 Bilgin, Hazar’da Son Darbe, 36.

CHAPTER TWENTY-FIVE THE ROLE OF AZERBAIJAN IN EU ENERGY SECURITY AGSHIN UMUDOV*

Introduction Access to secure energy supplies is a crucial determinant of power relations in world politics.1 Given the EU’s manifest ambition to become one of the leading powers in global politics, one can therefore assume that safe energy supplies must play a core role in its foreign policy. As one of the cornerstones of the EU’s foreign policy, energy security holds a central place in its agenda. The EU’s energy policy is determined by objectives of energy sustainability, security of supply, and competitiveness.2 As with other powers, energy is the backbone of the EU’s economic performance. Energy security does not relate solely to the field of industry and economy; it has also been used to assert political leverage as a foreign policy tool. It is therefore part of and central to the EU’s Common Foreign and Security Policy (CFSP). Though the EU does not have a formalized common energy policy at the moment, it has a common vision. This common vision is based around sustainable energy, and pursues the goal of decreasing dependency on fossil fuels, and seeking ways of increasing the share of renewable resources in the EU energy supply. However, this seems to be a distant objective, since at present 80 percent of the EU’s energy demand is covered by non-renewable sources such as oil, gas, and coal. The EU imports 50 percent of these resources, and according to recent estimates, this will rise to 70 percent by the year 2030.3 The EU common energy policy seeks to deal with its increased energy demands by diversifying sources of energy supply, and thereby to decrease *

Currently enrolled as an MA student at the Department of Peace and Conflict Research, Uppsala University, Sweden. He holds an MA in Global Studies from the University of Leipzig, Germany.

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its dependence on the Middle East and Russia. Here, the key questions are where the energy supplies will come from, and how they will be transferred to Europe. This concern is understandable, as the EU’s energy is mostly supplied by Russian and Middle Eastern reserves which are politically potentially vulnerable. For this reason it seeks other secure energy resources, with the Caspian region offering a comparatively safe alternative. Aside from the importance of the Caspian reserves themselves, the region’s geopolitical position also makes a crucial contribution to the EU’s energy security. Azerbaijan, as one of the important Caspian coastal states, acts as a major ally of the EU with regard to energy supply, and forms a crucial corridor between Central Asia and Europe. The countries of the Caucasus, especially Azerbaijan, have a pivotal role to play in the opening up of alternative transportation routes for trade, and oil and gas, from the Caspian and Central Asia to Europe. In turn, the EU represents a very attractive energy market for Azerbaijan’s energy resources. In this sense, Azerbaijan, along with other Caspian Basin energy suppliers, is very interested in transactions with this market.

EU Energy Policy: Security of Energy Supplies as a Central Challenge Ensuring the flow of safe energy supplies holds a core place in the EU’s external relations, as this forms the backbone of its economic performance. Given the growing tendency towards dependence on foreign energy sources, EU energy policy is determined by the objectives of energy sustainability, security of supply, and competitiveness.4 The main scope of this paper is to assess one of the cornerstones of EU energy policy, namely security of supply. Security of supply is defined as the “existence of a variety of approaches aimed at insuring against supply risks,” and is broadly interpreted as a “guarantee that all the energy volumes demanded will be available at a reasonable price.”5 The European Commission has adopted this interpretation. The definition of energy security provided by the International Energy Agency overlaps with the above definition: “the availability of a regular supply of energy at an affordable price.”6 The principle of security of supply has come to the forefront of EU energy policy, with the increase in dependence on foreign energy sources. In order to take measures to counter the possible impact of this dependence, the EU has developed crisis management mechanisms such as the maintenance of security stocks of crude oil and petroleum products at the national level.7

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With regard to growing oil and gas imports, the EU has explored ways out, and has given priority to alternative import sources and routes.8 More specifically, to ensure security of supply, the EU aims to diversify its supply sources. This policy is understandable, as EU energy is supplied mostly from Russian and Middle Eastern reserves (see table 25-1), which are shaky regarding their political environment. The Middle East is a politically unstable region which makes it unreliable in terms of energy infrastructure safety. As far as Russia is concerned, it has proven that it can cut off gas supplies to Europe whenever it sees a need to use energy for political leverage.9 Table 25-1 EU energy suppliers

Russia Norway Libya Saudi Arabia Iran Kazakhstan Nigeria Iraq Algeria Azerbaijan Venezuela Others Russia Norway Algeria Nigeria Libya Egypt Qatar Trinidad and Tobago Uzbekistan Croatia Turkmenistan Others Source: Eurostat 2008

2000 20.3 21.0 8.2 11.8 6.4 1.8 4.1 5.7 3.9 0.7 1.3 15.0 2000 49.6 21.7 24.1 1.9 0.4 0.0 0.1 0.4 0.4 0.0 0.0 1.5

Crude oil 2001 2002 24.8 29.0 19.6 19.3 7.9 7.3 10.4 10.0 5.7 4.9 1.6 2.5 4.7 3.5 3.7 3.0 3.5 3.4 0.8 1.0 1.6 1.7 15.5 14.4 Natural Gas 2001 2002 48.8 46.1 23.6 26.3 21.6 21.6 2.4 2.2 0.4 0.3 0.0 0.0 0.3 0.9 0.3 0.2 0.3 0.0 0.0 0.0 0.0 0.0 2.0 2.0

2003 30.9 19.2 8.3 11.1 6.3 2.9 4.2 1.5 3.4 1.0 0.9 10.2

2004 32.8 18.9 8.7 11.2 6.2 3.9 2.6 2.2 3.8 0.9 0.8 8.1

2005 32.4 16.8 8.7 10.5 6.1 4.5 3.2 2.1 3.9 1.2 1.2 9.4

2006 32.9 15.5 9.3 8.9 6.3 4.7 3.5 2.9 2.9 2.1 1.9 9.2

2003 46.1 25.4 20.3 3.2 0.3 0.0 0.8 0.0 0.3 0.0 0.1 3.3

2004 44.5 25.2 18.4 3.7 0.4 0.0 1.4 0.0 0.2 0.0 0.1 5.6

2005 41.8 22.5 19.0 3.7 1.8 1.7 1.7 0.3 0.5 0.0 0.7 5.7

2006 40.4 23.3 17.5 4.6 2.6 2.6 2.0 1.3 1.0 0.4 0.3 3.7

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Table 25-1a EU imports of crude oil, by country of origin (megatonnes) Russia Norway Saudi Arabia Libya Kazakhstan Iran Others Total

2000 118 115 65 46 10 35 145 533

2001 136 107 57 44 9 31 148 532

2002 153 102 53 39 13 26 138 524

2003 169 105 62 46 15 35 115 545

2004 183 107 64 50 19 36 109 568

2005 186 97 61 50 26 35 118 573

2006 188 87 51 52 26 35 124 564

2007 185 84 40 54 26 35 133 557

2008 178 86 39 56 27 30 151 568

2009 173 79 30 47 28 25 140 522

Source: Eurostat

Table 25-1b EU imports of natural gas, by country of origin (Petajoule = 1015 Joule) Russia Norway Algeria Nigeria Qatar Libya Others Total

2000 4,540 1,921 2,203 172 12 33 398

2001 4,396 2,104 1,957 216 27 33 488

2002 4,534 2,644 2,132 218 88 26 433

2003 4,872 2,758 2,159 336 80 30 571

2004 4,922 2,802 2,042 410 160 48 842

2005 5,100 3,064 2,257 436 196 209 1,288

2006 5,097 3,307 2,132 564 233 321 1,316

2007 4,856 3,566 1,946 588 281 384 1,018

2008 5,108 3,924 2,000 540 304 398 1,308

2009 4,520 4,052 1,867 313 609 380 1,461

9,280

9,222

10,075

10,807

11,226

12,550

12,971

12,639

13,582

13,201

Source: Eurostat

This fact dismays the EU, which therefore seeks alternative safe energy resources.10 The Caspian region partially fulfils this requirement with its potential fossil fuel reserves. The geopolitical position of the region is another crucial contribution to EU energy security. Azerbaijan stands out in this regard, acting as one of the EU’s major allies in the supply of its own energy resources, and is a crucial corridor between Central Asia and Europe.11 Beginning with the Single European Act, the EU (then the EC) started discussions and proposals to form a Common Energy Policy (CEP), and as a result the Internal Energy Market and CEP were developed, though at a very slow pace. Most important infrastructure projects have been included in this development. The adoption of the European Energy Charter was a crucial step towards the EU’s CEP. This charter envisaged cooperation with the Eastern European and former Soviet Union countries in the energy sector, with the aim of stimulating economic growth and improving the EU’s security of supply.12

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Resource Capacity of Azerbaijan: Proven and Possible Oil and Gas Reserves Before looking at Azerbaijan’s oil and gas resources, the overall resources of Caspian Basin should be reviewed. The Caspian Basin is endowed with large “proven and possible” oil and gas reserves that can meet Europe’s growing energy demands. (Proven reserves are oil and natural gas resources that are regarded as 90 percent probable, and possible reserves are resources that are regarded as 50 percent probable.) Most estimates agree that the Caspian Basin holds between 10 and 32 billion barrels of proven and 233 billion barrels of possible oil reserves. The proven natural gas reserves of the Caspian Basin are estimated at 243 to 248 trillion cubic feet, while its possible natural gas reserves are estimated at 293 trillion cubic feet.13 The littoral states of the Caspian are Azerbaijan, Iran, Kazakhstan, Turkmenistan, and Russia.14 Some scholars also include Uzbekistan, Tajikistan, Kyrgyzstan, and Georgia in the list of Caspian Basin countries, although they do not have access to the Caspian Sea.15 Azerbaijan and Kazakhstan are the main oil-producing states of the Caspian Basin, whereas Turkmenistan is richer in natural gas resources.16 Many geologists and energy analysts claim that oil-producing countries generally exaggerate the size of their energy reserves in order to attract more foreign direct investment (FDI) to their energy industry.17 Taking into consideration such general trends of exaggeration, one might not believe in the accuracy of official estimates of the size of proven and possible oil and gas reserves. However, given the soaring global energy demands, the importance of the Caspian Basin reserves is unquestionable. As noted above, the Caspian oil resources are mostly concentrated in Kazakhstan and Azerbaijan. Kazakhstan, whose reserves are mainly located on-shore, is the largest oil producer in the region, while Azerbaijan, with mainly off-shore reserves, is the second.18 Azerbaijan’s main oil production comes from three off-shore fields of the Azeri– Chirag–Guneshli (ACG).19 As shown in Table 2, oil production in Azerbaijan has increased year by year since 2004, and is expected to peak between 2012 and 2014, at 1.4 million barrels per day.20

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Table 25-2 Azerbaijan: Energy and the economy Oil Production (1) Oil Exports (1) FDI /2 Oil Sector FDI (2) as share of total revenue (%) as share of GDP (%) Oil Fund Assets

2003 320 215 3,285 3,246 42%

2004 319 204 3,556 3,461 38%

2005 441 314 1,680 1,459 39%

2005 648 521 -219 -573 51%

2007 860 721 -4,750 -5,198 59%

2010 1,300

816

972

9.8% 1,394

15.0% 1,936

19.7% 3,093

43.3% 36,387

476 366 -

In million $US unless otherwise indicated. 1. Thousand barrels per day. 2. Foreign Direct investment. Oil production source: US Energy Information Administration, Short-Term Energy Outlook. Other indicators from IMF, Article IV Consulation—Staff Report no. 07/191, June 2007. Source: U.S. Energy Information Adminstration, “Independent Statistics and Analysis: Azerbaijan,” 200921

In the coming years, Azerbaijan is expected to contribute substantially to non-OPEC oil production. Taking into consideration the scheduled oil projects, the US Energy Information Administration (EIA) has made estimates concerning the oil supply growth of the non-OPEC producers, in which Azerbaijan comes third, following Brazil and the United States, for its contribution to non-OPEC oil supply growth.22 Table 25-3 Projected petroleum supply growth 2008–2009 Million barrels per day Brazil 0.72 United States 0.50 Azerbaijan 0.48 Russia 0.39 Canada 0.30 Kazakhstan 0.26 Sudan 0.17 Vietnam 0.10 China 0.09 Egypt 0.07 Source: U.S. Energy Information Administration, short-term energy outlook.

This fact makes Azerbaijani oil resources more valuable in terms of placing them outside of the group of producers that keep prices artificially high. In 2007, Azerbaijan’s oil production showed a remarkable increase,

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rising to 860,000 barrels per day (bbl/d), of which 730,000 bbl/d was exported via the Baku–Tbilisi–Ceyhan (BTC) pipeline, whereby it bypassed Russia.23 Besides Azerbaijan, Kazakhstan is the other important oil producer of the region, also showing promising potential growth, as seen from table 23-3. With its oil output of 2.8 million bbl/d, Kazakhstan produces more than half of the Caspian Basin’s total oil output.24 But only a small portion of its exports bypass Russia. In 2007, Azerbaijan and Kazakhstan provided nearly 7 percent of EU oil imports.25 It should be noted that the EU’s oil consumption for 2007 was 14,680,000 bbl/d.26 At the current levels of oil export, Azerbaijan alone could cover the consumption of some EU member states, such as Greece (oil consumption was 415,000 bbl/d in 2007), the Czech Republic (213,000 bbl/d in 2007), and Bulgaria (108,000 bbl/d in 2007).27 It is very striking that in 2003, just before the “big bang” enlargement, the total oil consumption of the EU was 11.4 million bbl/d, while currently, quite some time after the integration of ten more members, the EU consumes 14.5 million bbl/d.28 Based on this data, we can argue that oil consumption in the EU has been stable in recent years. To a certain extent this is also because of the increasing share of renewable energy; apart from this, rising oil prices have forced states to take serious measures to use energy more efficiently. Regarding natural gas, as seen in figure 25-1, Azerbaijan and Kazakhstan both were importer countries in 2006. Azerbaijan’s gas sales boom came in 2007, when intensive production started in the promising Shah Deniz (literally, the “king’s sea”) field. Average gas production from Shah Deniz is supposed to be around 304 billion cubic feet per year, and 45,000 barrels of condensate per day.29

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Fig. 25-1 Central Asia natural gas balances, in billion cubic feet (2006)

Source: http://www.eia.gov/cfapps/ipdbproject/iedindex3.cfm?tid=3&pid=26&aid=24&cid =AJ,KZ,TX,UZ,&syid=2006&eyid=2006&unit=BCF.30

For 2008, Azerbaijan could produce over 500 billion cubic feet of natural gas per year. But the problem has been increasing domestic consumption, which was 400 billion cubic feet during 2006.31 The Azerbaijani government claims that by reaching full capacity in Shah Deniz, production will rise up to 1.1 trillion cubic feet, which is far beyond the domestic consumption, by 2011.32 In 2007, Azerbaijan began to export natural gas to Turkey, Georgia, and Greece, changing it from being a net importer of gas to a net exporter.33 For the EU, Azerbaijan’s role is more than as an oil source: it sees Azerbaijan as a hub for the transmission of the natural gas of Turkmenistan and Uzbekistan, as well as Kazakhstan, to the European market. As is clear from figure 25-1 above, Turkmenistan and Uzbekistan’s gas reserves are more promising than those of Azerbaijan and Kazakhstan. The question for the future is how far it will be possible to bypass Russia in the transit of Central Asian oil and gas resources. This challenge will be explored in the next sections. Acting as a hub between Central Asia and Europe offers the prospect of long-term wealth to Azerbaijan, in terms of revenues from transit fees. Most importantly, at close to $400 per 1,000 cubic metres, the EU pays more than what Turkey, (currently $120), Iran (as of 2008, $300), and Georgia ($120)34 pay for Azeri gas.35

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Attracting Foreign Direct Investment to Azerbaijan The Armenia–Azerbaijan conflict assumes a central position when analyzing the oil policies pursued by the state of Azerbaijan. As a result of the war waged with Armenian separatists, Azerbaijan was left in a serious fiscal crisis arising from the huge cost of the conflict. Not surprisingly, the Azerbaijani government pursued the policy of attracting significant FDI to the oil sector as a way of resolving its financial problems. The oil industry, as the key to national wealth, was a special concern of the Elchibey government (1992–1993).36 Referring to this government’s oil policy, T. Swietochowski, a well-known expert on Azerbaijan, states that: As had been the case in 1918, it appeared that, under the proper supervision of the national government, the oil industry could potentially be a solid foundation for the country's independence ... as an influx of foreign capital appeared vital for the very survival of Azerbaijan`s oil industry, the new regime acted quickly—some critics on the right and left said quickly—to secure funds from Western sources.37

Even though the policy to attract FDI into the country was more or less pursued since independence in 1991, negotiations with Western transnational oil companies (TNOCs), however, did not yield the expected result, namely production-sharing agreements.38 The ceasefire with Armenia in May of 1994 led to a relative stabilization of the country’s ruined socio-economic situation. After achieving this stability, immediate negotiations began with several governments and government-backed TNOCs regarding the exploration and production of oil fields in Azerbaijan. As a result of these negotiations, a thirty-year contract was signed between the State Oil Company of the Azerbaijan Republic (SOCAR) and the Western Consortium on 20 September 1994.39 This contract is famously known as the “contract of the century” or the “deal of the century,” and is worth nearly $8 billion. Immediately after the signing of the contract, Russian higher officials threatened the legitimacy of the contract, on the grounds that it was a unilateral action taken by Azerbaijan and violated the legal regulations of the Caspian Sea.40 In addition, it was claimed that Russia’s interests had been ignored.41

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Table 25-4 BTC/AIOC Project Shareholders Company AIOC Share BTC Share BP 34.1% 30.1% SOCAR 10.0% 25.0% ChevronTexaco* 10.3% 8.9% Statoil 8.6% 8.7% TPAO 6.8% 6.5% Total 0.0% 5.0% Eni/Agip 0.0% 5.0% Itochu 3.9% 3.4% ConocoPhillips 0.0% 2.5% Inpex 10.0% 2.5% Amerada Hess/Delta 2.8% 2.4% Exxon Mobil 8.0% 0.0% Devon Energy 5.6% 0.0% *formerly Unocal shares. (Source: Company websites) Source: Langdon Clough, “Energy profile of Azerbaijan,” The Encyclopedia of 42 Earth, 2007.

The striking point here was that while Russia’s Foreign Ministry condemned the contract as illegitimate, Russia’s prominent oil company LUKoil was one of the signatories.43 Following the signing of this contract, the Azerbaijan International Operating Company (AIOC) was established to execute the consortium’s day-to-day policy and operations. Participants of the AIOC and their shares are shown in table 25-4. According to the initial proposal as laid down by the Elchibey regime, SOCAR was supposed to get the highest share, and also have the final say in any problems of operation.44 However, due to a number of political and economic reasons, such as change of government, pressure from Russia, and lack of finances to undertake the costs of its shares, SOCAR gave some of its shares to TPAO (the Turkish national oil company), LUKoil, and Exxon.45 The AIOC has rights to explore and exploit the oil from the offshore ACG fields. Beginning in 1997, oil exploration in these fields increased overall oil production in Azerbaijan. The AIOC accounts for more than 70 percent of Azerbaijan’s oil exports. As of September 2009, 164.2 million tonnes of oil and 37 billion cubic metres of associated gas have been produced, and 80.3 million cubic metres of water and 13 billion cubic metres of gas have been injected into layers, since the beginning of

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production in ACG fields in 1997. The main concern during the negotiations regarding the operation of the consortium was the problem of defining transportation routes.

The Baku–Tbilisi–Ceyhan Oil Pipeline: A Breakthrough in Caspian Basin Energy Transmission After discussing several alternatives, the partners of the international consortium finally decided to construct a pipeline from Baku through Tbilisi to Ceyhan, which is a Turkish town on the Mediterranean coast. Pending the completion of the construction of this pipeline, the consortium decided to direct the oil from the Baku–Supsa and Baku–Novorassyski pipelines to the Black Sea, and then transport it with shipments to Europe through the Bosporus straits. The temporary transportation of oil from the offshore ACG fields— until the construction of the BTC pipeline—was called “early oil” by partners, and was planned to start in 1996.46 The main preoccupation during the discussions concerning transportation routes was the exclusion of any route that would be dependent on either Iran or Russia. However, the Baku–Novorossiysk pipeline passes through the Russian Federation. Besides, this transportation route was regarded as a temporary remedy, due to the fact that it is so close to Chechnya, and because the transportation of additional oil from Kazakhstan would not have been possible as the capacity of the Baku–Novorossiysk pipeline is very limited.47 Additionally, Azerbaijan was losing money in allowing its high-quality oil flow through the Baku–Novorossiysk pipeline, where it mixed with lowquality Ural oil, leading to low-quality oil being exported on Azerbaijan’s behalf at Novorossiysk port.48 Given that a route through Russia could not be a long-term remedy, full support was given to the BTC mega-project by the Western oil companies, as well as states led primarily by the United States. Finally, with the successful conclusion of the “deal of the century” and the BTC project, the West managed to reduce Russia’s influence over Azerbaijan’s energy resources significantly. Iran was also largely kept out of the game. Furthermore, despite Iran’s interest in taking part, US companies successfully blocked its participation in the consortium, although it had been given a 10 percent share in the Shah Deniz oilfield in late 1995.49 As already noted, the BTC oil pipeline, which extends from Azerbaijan’s ACG offshore oil fields through Azerbaijan and Georgia to a terminal at Ceyhan in Turkey, is regarded as a perfect remedy to the transportation of Azerbaijani oil to the European market while bypassing

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Russia. This 1,770 kilometre pipeline, with its $4 billion construction cost, can transport up to one million barrels per day.50 The shareholders of the BTC project are shown in table 25-4 above. The first stage of the BTC oil export pipeline was officially inaugurated on 25 May 2005 at the Sangachal shore terminal, south of Baku, where top level politicians, including the US president George W. Bush, the UK prime minister Tony Blair, and the EU energy commissioner Andris Piebalgs, were present to witness the event. A year later, the pipeline became fully operational.51 With the construction of the BTC pipeline, Azerbaijan, one of the former Soviet republics, succeeded in freeing itself from Russian manipulation of its energy transportation routes. The realization of the project also represents a great achievement for the EU in terms of its energy policy, which pursues diversification of sources and transportation routes. The capacity of the BTC pipeline as it currently operates also offers Kazakhstan the chance to transport some of its oil through to the European market. Kazakhstan officially joined the BTC project in the summer of 2006.52 Besides this route, Kazakh oil has been transported from Aktau port to Baku, then passed to Georgia’s Poti port on the Black Sea coast by railway, finally reaching the European Market through the Mediterranean Sea.53 In order to transfer large amounts of Kazakh oil to the European market via the BTC route, it is planned to lay a trans-Caspian Aktau–Baku oil pipeline under the Caspian Sea, connecting Kazakhstan with Azerbaijan. This pipeline is projected to transfer oil from the core Kazakh oil field of Kashagan54 to the European market.55 Once realized, this pipeline would allow Kazakhstan to transfer 25 million tons of oil to the European markets in its initial stage, later reaching up to 38 million tons.56 It is planned to be completed in 2011. Russia opposes this pipeline project, ostensibly on environmental grounds, but in fact its intention is to keep its monopoly on the transportation of Central Asian energy resources to the European market.57 The full transfer capacity of the BTC is 50 million tons per year, thus it cannot transfer all of Kazakhstan’s oil output to the West, but in the long run it will be able to transfer much more once Azerbaijan’s own production declines. However, a substantial amount of Kazakh oil is currently sent to Russia through the Atyrau–Samara and Tengiz–Novorossiisk pipelines.58 The Tengiz–Novorossiisk pipeline is a project of the multinational Caspian Pipeline Consortium (CPC), which is led by the American corporation ExxonMobil. The CPC project overshadowed the positive impact of the BTC pipeline on Kazakhstan’s energy independence: the

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CPC led Kazakhstan to export its oil via the Russian transportation route for years. Some experts, however, argue that Kazakhstan has enough oil resources to provide for both the BTC and Tengiz–Novorossiisk pipelines.59 The BTC pipeline offers several economic and political advantages to the countries of the region. First of all, it brings a huge amount of money for Azerbaijan (at 2005 prices, $29 billion per year in oil revenues), as well as for Georgia ($600 million per year from transit fees) and Turkey ($300 million per year from transit fees). Moreover, the BTC avoids the risk of shipment through the Bosporus and Dardanelles straits in Turkey, which hold daily transportation quotas.60 Furthermore, generally speaking the BTC has contributed to world energy security, though not to a very large extent. As stated by the US energy secretary Spencer Abraham, the “BTC would strengthen the sovereignty and independence of the nations involved.”61 President Saakashvili of Georgia called the completion of the BTC a “geopolitical victory,” apparently implying a victory over Russia.62 The BTC has created solid ties between Azerbaijan and Georgia in terms of supporting one another on regional issues, including maintaining their territorial integrity and their fight against separatism. Most importantly, the BTC pipeline has played a key role in orienting Azerbaijan and Georgia towards Europe.63 With the construction of the BTC, Azerbaijan has been completely freed from dependence on Russia’s oil transportation routes and has become a transit country, a gateway, for the transfer of energy resources from Central Asia to the European markets. Finally, it should be stated that the BTC has given the West more confidence in realizing other important East–West energy corridor projects, such as the South Caucasus Pipeline (SCP) and Nabucco.64

The South Caucasus Pipeline The SCP is also known as the Baku–Tbilisi–Erzurum or Shah Deniz pipeline. The SCP was developed to transport Azerbaijani gas from the Shah Deniz reserve to Turkey. It follows the same route as the BTC. The construction of the pipeline was completed in 2006, and has a throughput capacity of 20 billion cubic metres per year.65 However, in the initial stage, only 7 billion cubic metres per year is planned to be piped.66 The SCP is operated by its largest shareholders, namely BP and Statoil (each has a 25.5 percent shareholding, while SOCAR, Russia’s Lukoil, Turkey’s TPAO, France’s Total, and the UAE’s NICO hold around 10 percent each).

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The pipeline is initially intended to supply the Turkish and Georgian markets, while in its following stages it is planned to carry gas to Greece and Italy as well.67 Fig. 25-2 Map of the South Stream and Nabucco natural gas transportation pipelines

Source: Samuel Bailey.68

Furthermore, gas from the SCP will also be piped into the proposed Nabucco gas pipeline in order to be sent on to Central Europe.69 The SCP is the first mega gas pipeline to be laid outside of the Gazprom gas system. The Gazprom gas system is the Soviet-era core gas pipeline network which connects Turkmenistan, Uzbekistan, Kazakhstan, and the Caucasus with the Russian Federation. Beyond that, this connection stretches to Ukraine and Central Europe.70 The SCP represents a big blow to the Gazprom gas system, since it does not have any dependence on this system. The realization of the SCP project, which is one of the major steps in building the South Caucasus Energy Corridor, also helps Europe to diversify its energy supply sources to a certain extent. The realization of the planned Nabucco gas pipeline would contribute further to the energy independence of the Caspian Basin countries, if Turkmenistan were to show willingness to join the venture.

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Nabucco Gas Pipeline Project: A Further Step in the South Caucasus Energy Corridor The planned Nabucco gas pipeline project is expected to decrease the EU’s energy dependence on Russian sources to a considerable degree. Once realized, the Nabucco gas pipeline, which is attached to the planned trans-Caspian gas pipeline in Turkey, will transfer a large amount of Caspian Basin and Middle Eastern gas resources to the European market.71 Nabucco will play the role of the “missing link” in the transportation of Caspian Basin gas resources to continental Europe. More to the point, the construction of the SCP pipeline enables the transportation of gas resources from the Caspian Basin to Turkey, and Nabucco will fulfil the task of transporting these resources further into continental Europe.72 The Nabucco project is one of the most important energy infrastructure projects in strengthening Europe’s security of supply for natural gas, as it contributes substantially to diversifying existing supply routes. The pipeline will connect large gas deposits in the Caspian region, the Middle East, and Egypt with Europe. The investment costs will amount to approximately €5 billion. When completed, the pipeline’s annual capacity will be 31 billion cubic metres. The Nabucco consortium consists of six partners (one from each of the participating countries): Austria’s OMV, Hungary’s MOL, Turkey’s BOTAù, Bulgaria’s Bulgargaz, Romania’s Transgaz, and Germany’s RWE.73 The managing director of Nabucco Gas Pipeline International Ltd., Reinhard Mitschek, stated that “in the future, Europe will need far more energy than it has until now. The Nabucco project is our solution.” With its international route, the Nabucco pipeline is an important European infrastructure project, connecting Turkey, Bulgaria, Romania, Hungary, and Austria.74 It should be stressed that many important issues in realizing the Nabucco project have not yet been resolved. One of them is uncertainty about the willingness of Turkmenistan, a country that seems very promising as a supplier for the European market, to join the venture. Turkmenistan agreed with Russia to continue transporting gas via Russia, since Russia has declared its readiness to pay European market prices for the Turkmen gas. Additionally, Turkmenistan has signed agreements with China and Iran concerning gas delivery to these countries. Turkmenistan is also eager to transfer gas to the European market via the planned connection of the trans-Caspian and Nabucco gas pipelines. This begs the question of whether Turkmenistan will be able to fulfil all its agreements concerning gas delivery, since its current gas capacity is 60 billion cubic metres, of

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which almost 50 billion cubic metres is supposed to be transported through Russia.75 On 12 May 2007, the presidents of Russia, Turkmenistan, and Kazakhstan signed an agreement concerning the building of a pipeline not on the Caspian seabed, but along its shore, that will supposedly transport Turkmen and Kazakh gas to the European market via Russia. This would mean that Russia would remain capable of dictating transportation routes from Central Asia to the European market, which would be contrary to the EU’s supply diversification policy.76 However, the ongoing gas conflict between Russia and Turkmenistan that began in March 2009 has changed conditions in favour of the West. Turkmenistan intends to build an internal East–West gas pipeline with the aim of transferring gas resources to the European market in the near future. Russia wants to control this route, whereas Turkmenistan sees the construction of this pipeline as a strategic project that would contribute to Turkmenistan’s policy of diversification of transportation routes.77 In March 2009, Russia stopped the flow of Turkmen gas through its territory, leading to considerable losses to the Turkmen government (nearly 2 billion for April and May).78 Such blackmail has convinced Turkmenistan to pursue an open policy of finding alternatives to the Gazprom gas transportation system. In this context, the trans-Caspian pipeline project was revived. In addition, in July 2009, the Turkmen president Gurbangulu Berdimuhamedow for the first time openly declared his intention to cooperate with the West on transporting gas to Europe through the planned Nabucco route (either using the planned trans-Caspian pipeline or the Turkmenistan–Iran–Turkey pipeline).79 Grasping the opportunity, the German company RWE signed a contract with Turkmenistan to develop its gas deposits and also to deal with transportation through the South Caucasus Energy Corridor.80 Another problem that might make the project unrealistic is its direct competition with the Russian South Stream gas pipeline,81 in which Bulgaria agreed to participate during the Russian president Vladimir Putin’s recent visit to Sofia.82 The South Stream directly competes with Nabucco, since both are intended to convey Central Asian gas sources.83 Three partners of the Nabucco consortium (OMV84, MOL, and Bulgargaz) joined the South Stream, substantially undermining their commitment to the Nabucco project. In this way, Russia has been able to break down the political consensus on Nabucco.85 In addition, this would also have a negative impact on the investment required to undertake the costs of the project. Aside from that, Germany, France, and Italy signed bilateral agreements with Gazprom in order to satisfy their own energy demands.86 Hence, in

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practice it is not possible to talk about a common energy policy in the EU. However, at the EU policy level, it has been recognized that the coexistence of the two projects (Nabucco and South Stream) is possible, though priority is given to Nabucco.87 Another problem that should be emphasized is related to Iran. The Nabucco project proposes to add Iranian gas into the pipeline as well; however, there is no clarification on how to deal with the US extraterritorial sanctions that prevent Iran from engaging in such regional cooperations.88 Russian President Medvedev’s first visit to Azerbaijan and Kazakhstan in early July 2008 introduced further uncertainty into the Nabucco project. During his visit, Medvedev stressed Russia’s interest in importing Azerbaijani gas, and this move was interpreted as a policy to thwart the hopes for realization of the Nabucco project: “Russia is interested in importing Azeri gas for several reasons, first and foremost to prevent the possibility of pursuing the pro-Western Nabucco pipeline, which is clearly of an anti-Russian direction. If the Azerbaijani gas will go to the north, Nabucco will simply have nothing to fill.”89 In March 2009, Azerbaijan and Russia signed a memorandum on possible gas export from Azerbaijan to Russia.90 On 29 June 2009, President Medvedev paid his second visit to Azerbaijan, where a contract was signed on exporting 500 million cubic metres of gas to Russia as part of the first phase of the Shah Deniz project.91 This deal has been widely interpreted as a victory for Russia, since it has allowed Azerbaijan to transport to Russia a substantial amount of Shah Deniz gas which was supposed to be sent through Nabucco. In order to procure sufficient gas to fill the Nabucco pipeline, resources from Turkmenistan (which holds 4.3 percent of global gas deposits, the world’s fourth largest) and Iran (which holds 16 percent, the second largest after Russia) are vital. Gas resources of the other would-be Nabucco suppliers, namely Azerbaijan (which holds 0.6 percent of world gas deposits), Egypt (1.2 percent), and Iraq (1.7 percent), cannot be compared with the gas deposits of Iran. It could be argued that in the case of Iranian gas being piped into Nabucco, this would lessen tensions between Russia and Europe, in the sense that supplies from Turkmenistan would be replaced by Iranian supplies, and this in turn would leave Turkmenistan dependent on Gazprom’s transportation monopoly in the future. On top of the stumbling blocks mentioned above stands the lack of political and economic leadership. Nabucco suffers from unclear commercial coordination; that is to say that all potential investors have been undermined in one way or another by the launch of Gazprom’s South Stream.92 Moreover, Nabucco clearly needs the well-coordinated support

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of the United States and the EU in order to be realized. The EU members have to consolidate their energy policies; otherwise Gazprom will benefit from the inner divisions regarding the EU energy policy. As demonstrated with the successful realization of the BTC and SCP pipelines, the EU’s willingness, encouraged by the support of the United States, can overcome the obstacles to the Nabucco project. Despite all of the above-mentioned problems, on 13 July 2009 an intergovernmental agreement on the Nabucco project was signed in Ankara by the prime ministers of Austria, Bulgaria, Hungary, and Turkey, and the president of Romania. According to the agreement, construction works will be undertaken through to 2014. Nabucco is a very strategic project in terms of its contribution to EU energy policy on the diversification of supply sources. It has also been declared as one of the key infrastructure projects of the EU’s Trans-European Networks programme.93 The transfer of Caspian gas to Europe through Turkey will reduce the EU’s dependence on Gazprom’s monopoly.94 So far, only Azerbaijan is ready to supply gas to the Nabucco pipeline from its promising Shah Deniz field. Should the trans-Caspian project be realized, Azerbaijan’s importance will be boosted as the key transit country. As soon as Turkmenistan’s verbal commitment regarding the Nabucco project is reflected on any contract, attempts to implement the project will be accelerated. If fully realized, the trans-Caspian–Nabucco pipeline (it can also be called the Turkmen–Azerbaijan–Georgian– Turkish–EU pipeline) could be a breakthrough in the development of the South Caucasus Energy Corridor.

EU Cooperation with the Wider Black Sea: Future Perspectives for the Energy Partnership With the accession of Romania and Bulgaria to the EU in 2007, the EU has come closer to the Black Sea region. The EU is currently one of the main actors in the region, and thus must engage in close cooperation with the Black Sea countries. In fact, the EU’s perception of the Black Sea region encompasses more that just the littoral countries of the Black Sea, including Greece, Bulgaria, Romania, Moldova, Ukraine, Russia, and Turkey, as well as the Caucasian countries of Georgia, Armenia, and Azerbaijan.95 The main motivation behind the EU in taking a wider Black Sea approach, also including the states that are not on the Black Sea coast, is their importance either as a source of hydrocarbon resources or as a corridor between Europe and Central Asia. The EU has launched the Baku

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Initiative as a forum to consolidate its energy policy towards the wider Black Sea region. The EU–Black Sea–Caspian Basin Ministerial Conference held in Baku in November 2004 was an important base for the development of relations between the EU and the Caspian Basin countries in the field of energy. It should be noted that this cooperation, including all the Black Sea basin countries, is also based on the safe transit routes that these countries provide for the European markets. As a result of the conference, the Baku Initiative began as a multilateral policy dialogue to advance energy cooperation between the EU and countries of the Black Sea, also including the Caspian Basin and its neighbours (Uzbekistan, Tajikistan, and Kyrgyzstan). The purpose of the Baku Initiative is the progressive integration of the Black Sea and Caspian Sea region energy markets with EU markets, combining the interests of both suppliers and customers. The grounds for the Baku Initiative and its main objectives are listed below: x Harmonizing the legal and technical standards with the objective of creating a functioning integrated energy market in accordance with the EU and international legal and regulatory framework; x Enhancing the safety and security of energy supplies, extending and modernizing the existing infrastructure, substituting the old and dangerous power generation infrastructures with environmentally friendly power generation infrastructures, developing of new infrastructures and implementing a modern monitoring system of their operation; x Improving energy supply and demand management through the integration of efficient and sustainable energy systems; x Promoting the financing of commercially and environmentally viable energy projects of common interest, which will be identified according to pre-defined criteria. The Baku Initiative can be seen as the consolidated form of the EU’s energy policy in the Black Sea and Caspian region. Two years later, on 30 November 2006, the second Energy Ministerial Conference was held in Astana, Kazakhstan, as a follow-up to the Baku conference. The road map agreed by the European Commission and the governments of Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Turkey, Ukraine, Uzbekistan, and the Russian Federation (as an observer), set out a plan of action to bridge the gap between the current situation in the energy sector of these countries and the long-term vision for a common energy strategy. All parties agreed to make every effort to facilitate and mobilize private and public financial resources and

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assistance from partner countries, the EU, and international financial institutions to support this process. The participants of the second Ministerial Conference reviewed the work carried out by the expert working groups that was formulated during the first Ministerial Conference of Baku, and agreed on this basis on the four following priority areas for future energy cooperation: converging of energy markets; enhancing energy security; supporting sustainable energy development, including energy efficiency, renewable energy sources and demand side management; and attracting investment towards energy projects of common interest. Without granting EU membership promises to the partners of the Baku Initiative, the EU plans to integrate them into its Internal Energy Market (IEM), where both sides would benefit from efficient energy use and a free market. Aside from that, effective regional cooperation would create a secure alternative energy transit route from Central Asia to Europe.

Increasing Cooperation between the EU and BSEC In order to become an active player in the Black Sea region, the EU strives to benefit from the institutional frameworks of the existing regional organizations, such as Black Sea Economic Cooperation (BSEC) and GUAM (Georgia, Ukraine, Azerbaijan, and Moldova) Organization for Democracy and Economic Development. In fact, generally speaking, most of the BSEC member states want to see the EU as an active promoter of economic cooperation and development in the wider Black Sea region.96 BSEC came to existence in 1992 with the Istanbul Summit, where eleven countries, Albania, Armenia, Azerbaijan, Bulgaria, Georgia, Greece, Moldova, Romania, Russia, Turkey, and Ukraine, signed the founding treaty of the organization. Being the second-largest source of oil and natural gas, the wider Black Sea region, which is covered by BSEC, is becoming the core energy transit corridor for Europe.97 Since its inception, BSEC has given particular importance to regional cooperation in the energy sector, and to the development of better understanding between energy consumer and producer countries.98 BSEC’s energy cooperation overlaps with the main principles of the EU’s common energy policy. Specifically, the BSEC energy agenda pursues the goals of diversification of energy sources and transportation routes, and becoming a safe transit zone for transportation of resources to Europe, as well as being integrated into the EU IEM.99 Actually, EU–BSEC cooperation in the energy sector dates back to 1999, when the platform for

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cooperation with the EU was formed. One of the key elements of this platform is to ensure the energy security of the European continent. In addition, taking into consideration the fact that the Black Sea is a core energy transit zone for Europe, the EU has launched the Black Sea Synergy proposal to assert its increasing interest in the Black Sea region. Cooperation in energy matters is the focal point of this Black Sea synergy initiative.100 In April 2007, the European Commission adopted a communication entitled Black Sea Synergy: A New Regional Cooperation Initiative, which defines the Black Sea region as a “production and transmission area of strategic importance for the EU energy supply security.”101 Black Sea Synergy is designed to add value to the already established policy of regional cooperation and partnership, particularly on energy issues.102 The EU intends to develop and support close cooperation between energy consumers and producers of the wider Black Sea region. One can discern that such a close relationship between Azerbaijan, Georgia, and Turkey, and their increasing partnership with Ukraine and Greece, is very natural. Without a doubt, the increasing cooperation among the regional states of the wider Black Sea region increases the interdependence among them as well. In the case of Azerbaijan, such mutual interdependence has grown after the realization of the BTC and SCP projects.103 Azerbaijan is in favour of regional cooperation in the wider Black Sea area, since it will bring more revenues to the country in terms of transit fees and mutual economic interdependence, if the planned projects are materialized. Although it remains quite passive, the GUAM Organization for Democracy and Economic Development is another prominent regional institution which affects the interaction among players in the wider Black Sea region.104 It can be argued that the GUAM is an appendage of NATO which pursues the policy of extending Euro–Atlantic influence into the area covered by of the former Soviet Union. Chossudovsky argues that the United States has recruited GUAM in order to protect the energy transportation routes in the Black Sea region on behalf of the TNOCs.105 However, this gives rise to the question of how viable it would be to militarize such a weak organization. Aside from that, the foreign policies of the GUAM members are not all the same. For instance, in order to guarantee its national security and economic development, Azerbaijan is following a balanced foreign policy which takes the power and interests of all influential regional and global actors into consideration.106 On the other hand, since Saakashvili has come to power, Georgia is pursuing full integration into the Euro–Atlantic area, even though it might cost the country its territorial integrity.

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Close cooperation brings benefits for all sides. On the one hand, the cooperation between the EU and the wider Black Sea countries demonstrates how the EU is diversifying its sources of oil and natural gas through safe transit routes. On the other hand, for the countries of the wider Black Sea region this means a path to greater economic development, either via becoming a supplier of hydrocarbon resources, or merely forming a part of the South Caucasus Energy Corridor.

Conclusion From the early 1990s, the EU has concerned itself with the matter of energy security. Its energy security can be delivered at an internal level with the development of renewable energy sources, while at the external level, the focus is on increasing regional cooperation involving the wider Black Sea region and its neighbourhood. In this respect, internally the EU has initiated and nearly completed the IEM, which is one of the cornerstones of the EU’s common energy policy. At the external level, the diversification of energy supply sources is one of the most important means of ensuring its energy security. Considering the importance of the diversification of energy supply, the EU has launched many bilateral and multilateral programmes targeting countries in its wider neighbourhood, particularly those which have rich hydrocarbon resources and a crucial geostrategic location. In this context, Azerbaijan holds a core position within the EU’s policy of diversification of oil and natural gas supply sources. Azerbaijan is becoming an important oil and gas producer, as well as a crucial transit country to Europe from the Caspian Basin and Central Asia. In order to maximize and solidify its energy imports from the Caspian Basin and Central Asia, the EU has initiated a number of mostly energy-specific programmes, such as TRACECA, INOGATE, the Baku Initiative, and Black Sea Synergy. The EU attempts to increase cooperation with BSEC and enable it to become actively involved in energy partnership. However, BSEC lacks an effective decision-making process and the power to react to emerging challenges, and the diverging interests of some members of the BSEC make decision-making even more problematic. Furthermore, the existence of frozen conflicts among BSEC members in the Black Sea region renders the deepening of multilateral cooperation unrealistic. Nevertheless, the EU and BSEC members have recently shown greater interest in regional cooperation regarding energy issues. Such cooperation aims at deepening energy market reforms, securing energy supplies, and constructing and modernizing energy infrastructure.

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The EU is not the only actor seeking input into energy policy in the Caspian Basin. The United States, Russia, Iran, Turkey, and, last but not least, China, are other players that are involved in the scramble for the Caspian Basin’s hydrocarbon reserves. In the particular case of Azerbaijan, China has not involved itself so far. Given the interference of many important actors in the Caspian Basin, relations among these actors have become very complicated. One can draw the lines of competition, as well as cooperation, among these actors. Cooperation and competition among interested actors over Caspian resources have also been reflected in the main pipeline projects of the region, such as BTC, SCP, and most importantly, the would-be Nabucco. The future prospects of the EU’s energy cooperation with the wider Black Sea countries are promising, but are not exempt from risks and challenges.

Notes 1

Van der Linde Coby, “Turning a Weakness into a Strength: A Smart External Energy Policy for Europe,” The Institut Francais des Relations Internationales, 2008, p. 28, http://www.ifri.org/files/Energie/vanderLindeok.pdf. 2 Coby, “Turning a Weakness into a Strength,” 2. 3 EU Commission, “Towards a European Strategy for the Security of Energy Supply,” Green Paper, EURlex, 2000, http://eurl1ex.europa.eu/LexUriServ/ LexUriServ.do?uri=CELEX:52000DC0769:EN:HTML. 4 Commission of the European Communities, “An Energy Policy for Europe,” Communication from the Commission to the European Council and the European Parliament, Brussels, 2007, 3–4; Jean-Michel Glachant, “Towards a Smart European Energy Policy,” European University Institute, 2009, http://www.energypolicyblog.com/?p=592#more-59. 5 “Supply risk” is the risk of an event affecting supply, particularly disruption risk. C. Le Coq and E. Paltseva, Common Energy Policy in the EU: The Moral Hazard of the Security of External Supply, Report No. 1, February 2008, Stockholm, Swedish Institute for European Policy Studies, 19–20. 6 International Energy Agency, “Toward a Sustainable Energy Future,” OECD, Paris, 2001, 76. 7 Pami Aalto, ed., The EU–Russian Energy Dialogue: Europe’s Future Energy Security (Aldershot: Ashgate, 2008), 10. 8 European Commission, “Towards a European strategy for the security of energy supply,” Green Paper: COM (2000)769, 2000, available from http://europa.eu/legislation_summaries/energy/external_dimension_enlargement/l2 7037_en.htm. 9 Aglika Ganova, “European Union Energy Supply Policy: Diversification in Unity?,” Institut Européen des Hautes Études Internationales, 2007, http://www .iehei.org/bibliotheque/memoires/MemoireGANOVA.pdf.

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Pierre Noël, “How Dependent is Europe on Russian Gas,” EU Energy Policy Blog, University of Cambridge, 2008, http://www.energypolicyblog.com/?p=293. 11 “Memorandum of Understanding on a Strategic Partnership between the European Union and the Republic of Azerbaijan in the Field of Energy,” 2006, pp. 3–8, http://ec.europa.eu/energy/international/international_cooperation/doc/ mou_azerbaijan_en.pdf. 12 Giacomo Luciani, “Energy Policies in the European Union,” paper submitted to the Conference on Risk and Uncertainty in the Changing Global Energy Market: Implications for the Gulf, Emirates Centre for Strategic Studies and Research, 2003, 5–6. 13 Fiona Hill and Spector Regine, “The Caspian Basin and Asian Energy Markets,” The Brookings Institution, Conference Report 2001, p. 1, http://www .brookings.edu/~/media/Files/rc/papers/2001/09globaleconomics_hill/cr08.pdf; Hassan-Yari Houchang, “Analysis: Energy Geopolitics in the Caspian,” 18 October 2004, http://www.eurasianet.org/departments/business/articles/pp101904.shtml. 14 Houchang, “Analysis.” 15 Michael Klare, “Bush–Cheney Energy Strategy: Procuring the Rest of the World’s Oil,” Commondreams.org, 2004, http://www.commondreams.org/ views04/0113-01.htm. 16 Bulent Gökay, ed., The Politics of Caspian Oil (New York: Palgrave, 2001), 13. 17 Blanche Ed, “Shell Scandal Points to Exaggerated Estimates of Oil Reserves,” The Daily Star, 17 April 2004, http://www.countercurrents.org/peakoil-blance170404.htm. 18 Off-shore oil exploration in Azerbaijan dates back as early as 1904, when oil was produced on the Artem islands on the Apsheron Sill; the first Soviet Union off-shore oil exploration was launched in the Caspian Sea. See Stephen Lewarne, Soviet Oil: The Move Offshore (London: Westview Press, 1988), 56–63. 19 U.S. Energy Information Adminstration, “Azerbaijan Energy Profile,” 2009, http://tonto.eia.doe.gov/country/country_energy_data.cfm?fips=AJ. 20 Business Monitor International 2009. 21 Available from http://www.eia.doe.gov/cabs/Azerbaijan/Background.html. 22 U.S. Energy Information Adminstration, “Short-Term Energy Outlook Supplement: Outlook for Non-OPEC Oil Supply Growth in 2008–2009,” http://www.eia.doe.gov/emeu/steo/pub/special/2008-non-opec-oil-supply.pdf. 23 ENEPO, Working Paper on “Institutional Convergence of CIS towards European Benchmarks,” Second Draft, 2008, p.168, http://enepo.case.com.pl/plik--21710950.pdf?nlang=710. 24 U.S. Energy Information Administration, Kazakhstan, 2008b, http://www.eia .doe.gov/emeu/cabs/Kazakhstan/Background.html. 25 Elena Rakova, “CIS Role for the EU Energy Supply,” IPM Research Center, http://ec.europa.eu/economy_finance/publications/publication12957_en.pdf. 26 IndexMundi, “European Union Oil-consumption,” 2008, http://www.indexmundi.com/european_union/oil_consumption.html. 27 IndexMundi, “Oil Consumption: Country Comparison,” 2009, http://www .indexmundi.com/g/r.aspx?c=ee&v=91. If we calculate the sum of oil consumption

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of these three EU members it comes to 736,000 bbl/d, which is about 6,000 bbl/d more than Azerbaijan’s 2007 oil exports. 28 Sara Nunnally and Bryan Bottarelli, “Oil Consumption Statistics: The European Union`s Oil Consumption Growth,” Wave Strength, 2007, http://www.wavestrength.com/wavestrength/marketreport/20070307_Oil_Consum ption_Statistics_and_Global_Markets_Market_Report.html#. 29 SPG Media Ltd, “Shah Deniz South Caspian, Azerbaijan,” 2009, http://www.offshore-technology.com/projects/shah_deniz/. 30 U.S. Energy Information Administration, “Independent Statistics and Analysis: Kazakhstan,” 2009, http://www.eia.doe.gov/emeu/cabs/Kazakhstan/NaturalGas.html. 31 ENEPO, “Institutional Convergence,” 168. 32 ENEPO, “Institutional Convergence,” 168. 33 Vladimir Mishin, “Azerbaijan Wants Its Gas to Flow to Nabucco,” Nezavishimaya gazeta, 2008, http://en.ng.ru/energy/2008-03-11/6_nabucco.html. 34 Georgia purchased 0.3 billion cubic meters of Shah Deniz gas at $63 in 2008. However, 0.5 billion cubic metres of SOCAR gas was sold for $180–$200 per 1,000 cubic metres in 2008: see http://en.ng.ru/energy/2008-03-11/6_nabucco.html 35 Mishin, “Azerbaijan Wants Its Gas to Flow to Nabucco.” 36 Abulfez Elchibey was the first elected President of Azerbaijan, in power from June 1992 to June 1993. 37 Tadeusz Swietochowski, Russia and Azerbaijan: A Borderland in Transition (New York: Columbia University Press, 1995), 223. 38 Angeliki Spatharou, “Geopolitics of Caspian Oil: The Role of the Integration of the Caspian Region into World Economy in Maintaining Stability in the Caucasus,” in The Politics of Caspian Oil, ed. Gökay Bulent (Basingstoke: Palgrave, 2001), 25–26. 39 Sabit Bagirov, “Azerbaijani Oil: Glimpses of a Long History,” Perceptions l, no. 2 (June–August 1996): 6, http://www.sam.gov.tr/perceptions/Volume1/June August1996/azerbaijanioilglimpsesofalonghistory.pdf. 40 Bagirov, “Azerbaijani Oil.” 41 In the beginning LUKoil was given no shares in the consortium; however, in order to persuade Russia not to threaten the contract, SOCAR granted 10% of its own shares to LUKoil. 42 Taken from http://www.eoearth.org/article/Energy_profile_of_Azerbaijan. 43 Parvizi Mehdi Amineh, Towards the Control of Oil Resources in the Caspian Region (New York: St. Martin’s Press, 1999), 88. 44 Nasib Nassibli, “Azerbaijan: Oil and Politics in the Country’s Future,” in Oil and Geopolitics in the Caspian Sea Region, ed. Michael P. Croissant and Bülent Aras (Westport, Praeger Publishers, 1999), 106. 45 Bagirov, “Azerbaijani Oil,” 11. 46 Natig Aliyev, “Choosing the Route for Early Oil,” Azerbaijan International 3, no. 3 (1995), http://www.azer.com/aiweb/categories/magazine/33_folder/33_ articles/33_socar.html. 47 Bagirov, “Azerbaijani Oil,” 12–15.

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Svante E. Cornell, Mamuka Tsereteli, and Vladimir Socor, “Geostrategic Implications of the Baku–Tbilisi–Ceyhan Pipeline,” in The Baku–Tbilisi–Ceyhan Pipeline: Oil Window to the West, ed. Svante E. Cornell and S. Frederick Starr (Washington, DC: Central Asia–Caucasus Institute & Silk Road Studies Program—Joint Transatlantic Research and Policy Center, Johns Hopkins University—SAIS, 2005), 19. 49 Svante E. Cornell, “The Nagorno-Karabakh Conflict,” Report no. 46. Department of East European Studies, Uppsala University, 1999, pp. 90–91, http://www.silkroadstudies.org/new/inside/publications/1999_NK_Book.pdf. 50 Peter Symonds, “Oil Pipeline Completed: A Sign of Rising Great Power Rivalry in Central Asia,” International Committee of the Fouth International, 2005, http://www.wsws.org/articles/2005/may2005/oil-m31.shtml. 51 Vladimir Socor, “Baku–Tbilisi–Ceyhan Pipeline Inaugurated,” Eurasia Daily Monitor 2, no. 105 (2005), http://www.jamestown.org/single/?no_cache=1&tx_ ttnews[tt_news]=30462. 52 APS Review of Oil Market Trends, “AZERBAIJAN-Kazakhstan Joins BTC Pipeline Venture,” 2006, http://www.allbusiness.com/sector-21-mining/oil-gasextraction-crude/1185753-1.html. 53 Sergei Blagov, “Georgia: A Small Pawn in the Great Game,” Asia Times Online, 2004, http://www.atimes.com/atimes/Central_Asia/FA07Ag03.html. 54 Kashagan is the richest oilfield discovered worldwide in the last thirty years, and reportedly has 5.3 billion tons of proven crude oil reserves. See Socor, “Baku– Tbilisi–Ceyhan Pipeline Inaugurated.” 55 Vladimir Socor, “Trans-Caspian Oil Pipeline Planned in Kazakhstan,” Eurasia Daily Monitor 2, no. 95, http://www.jamestown.org/single/?no_cache=1&tx_ ttnews[tt_news]=30404; The Thirtieth Plenary Session of the PABSEC General Assembly, “The Priorities of Cooperation between BSEC Member States in the Field of Energy: Oil and Gas Sector,” Meeting of the Economic, Commercial, Technological, and Environmental Affairs Committee, Draft Report on Doc: GA30/EC29/REP/, 2007. 56 Today.az, “First signatures for Baku–Tbilisi–Ceyhan Oil Pipeline,” 2007, http://www.today.az/news/business/39349.html. 57 Socor, “Trans-Caspian Oil Pipeline Planned in Kazakhstan.” 58 Vladimir Socor, “The West Defaults on a Big Pipeline Match,” The Institute for Advanced Strategic & Political Studies, Weekly Essays, 2003, http://www.iasps .org/opeds/show_article.php?lang=2&main=&type=4&article_id=223. 59 Socor, “The West Defaults.” 60 Tuncay Babali, “Implications of the Baku–Tbilisi–Ceyhan Main Oil Pipeline Project,” Perceptions 10, no. 4 (Winter 2005): 29–50, http://www.sam.gov.tr/ perceptions/Volume10/winter2005/TuncayBabali.pdf. 61 Babali, “Implications,” 45. 62 Peter Symonds, “Oil Pipeline Completed.” 63 Cornell, Tsereteli, and Socor, “The Baku–Tbilisi–Ceyhan Pipeline,” 24. 64 Cornell, Tsereteli, and Socor, “The Baku–Tbilisi–Ceyhan Pipeline,” 24. 65 BP, “SCP Commissioning Commences,” press release, 2006, http://www.bp.com/genericarticle.do?categoryId=9006615&contentId=7018471.

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66 Petroleum Economist, “Caspian: South Caucasus Pipeline Ready,” 2006, http://www.petroleum-economist.com/default.asp?page=14&PubID=46&ISS= 23039&SID=665207. 67 Vagif Sharifov, “Passion for ‘Shah-Deniz,’” Caspian Energy Website, http://www.caspenergy.co-az.net/15/shahdenizeng.html. 68 Map of the South Stream and Nabucco natural gas transportation pipelines" Samuel Bailey (own work), http://en.wikipedia.org/wiki/File:Nabuccostream.png, 15 November 2009(2009-11-15). 69 “Caspian/Iraq Export Pipeline,” Middle East Economic Survey 49. no. 52 (2006), http://www.mees.com/postedarticles/oped/v49n52-5OD02.htm. 70 Gennady Chufrin, The Security of the Caspian Sea Region (Oxford: Oxford University Press, 2002), 61. 71 The projected trans-Caspian gas pipeline is expected to carry Central Asian gas sources through Azerbaijan and Georgia to Turkey and then to join the Nabucco pipeline. 72 Nicklas Norling, “Gazprom’s Monopoly and Nabucco’s Potentials: Strategic Decisions for Europe,” Central Asia–Caucasus Institute and Silk Road Studies Program, Silk Road Paper, November 2007, pp. 27–30. 73 Sofia Novinite News Agency, “Sixth Company Joins Nabucco Consortium,” 2008, http://www.novinite.com/view_news.php?id=90070. 74 Nicklas Norling, “The Nabucco Pipeline: Reemerging Momentum in Europe’s Front Yard,” in Europe’s Energy Security: Gazprom’s Dominance and Caspian Supply Alternatives, ed. Sevante Cornell and Niklas Nilsson (Washington, DC: Central Asia–Caucasus Institute, 2008), 128. 75 Rovshan Ibrahimov, “Trans-Afghan Pipeline: Will Ambitions Convert into Reality?” The Journal of Turkish Weekly, 15 May 2008, http://www.turkishweekly .net/comments.php?id=2903. 76 Kulpash Konyrova, “Putin Deal Torpedoes Trans-Caspian Gas Pipeline Plans,” European Weekly, no. 730 (2007), http://www.neurope.eu/view_news.php?id=73862. 77 Aleksandra Jarosiewicz, “The Russian–Turkmen Gas War,” East Week Analytical Newsletter 21, no. 171 (2009), http://osw.waw.pl/en/epub/EW/2009/090603/01.htm. 78 Jarosiewicz, “The Russian–Turkmen Gas War.” 79 The Turkmenistan–Iran–Turkey pipeline is the second trans-Caspian option; however, this option is not as realistic, since the US would use the Iran-Libya Sanctions Act to prevent Iran from gaining any benefits from regional projects, and also because Iran’s own gas consumption keeps increasing in northern Iran, where the existing gas pipeline from Turkmenistan to Iran (the Korpeje–Kurt Kui) will be used to meet growing domestic demands for gas. See Norling, “The Nabucco Pipeline”: 32–33. 80 Aleksandra Jarosiewicz and Justyna Gotkowska, “Germany’s RWE to Invest in the Gas Sector of Turkmenistan,” East Week Analytical Newsletter (2009), http://osw.waw.pl/en/epub/EW/2009/090729/02.htm. 81 The South Stream pipeline is planned to run from Russia’s Novorossiysk port across the Black Sea to Bulgaria.

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Sofia Novinite News Agency, “Sixth Company Joins Nabucco Consortium.” Muharrem Ekshi,“First Pipeline Built Will Block the Other: Nabucco Versus South Stream,” Today’s Zaman, 15 July 2009, http://www.todayszaman.com/tzweb/detaylar.do?load=detay&link=180948. 84 On 25 January 2008, Gazprom acquired a 50 percent stake in OMV’s natural gas hub in Baumgarten, Austria, which was supposed to be a distribution centre for Nabucco; this was a blow to the Nabucco project. See Norling, “The Nabucco Pipeline,” 131. 85 Norling, “The Nabucco Pipeline”; Niklas Nilsson et al., Transatlantic Energy Security Dialogue, Conference Report, 11–12 September, 2008, p. 131, Stockholm, Institute for Security and Development Policy. 86 Norling, “The Nabucco Pipeline,” 132. 87 àoskot-Strachota, Agata, “Nabucco vs. South Stream: Rivalry over Balkan Gas Pipe-lines,” Policy Documentation Centre, Central European University, 2008, http://pdc.ceu.hu/archive/00004402/. 88 Ekshi,“First Pipeline Built Will Block the Other.” 89 Rovshan Ibrahimov, “Medvedev’s Visit to Azerbaijan: Possible Scenarios in Energy Cooperation,” The Journal of Turkish Weekly, 2008, http://usakyayinlari .com/news.php?id=56969. 90 Aleksandra Jarosiewicz, “Azerbaijan’s Gas Export Policy,” East Week Analytical Newsletter 13, no. 163 (2009), http://osw.waw.pl/en/epub/EW/2009/ 090401/02.htm. 91 Aleksandra Jarosiewicz, “China Joins the Turkmen-Russian Gas Conflict,” East Week Analytical Newsletter 24, no. 174 (2009), http://osw.waw.pl/en/epub/EW/ 2009/090701/01.htm. 92 Niklas Nilsson et al., Transatlantic Energy Security Dialogue, 8–16. 93 àoskot-Strachota, “Nabucco vs. South Stream.” 94 Cornell, Tsereteli, and Socor, “The Baku–Tbilisi–Ceyhan Pipeline,” 28. 95 “Black Sea Synergy: A New Regional Cooperation Initiative,” Commission of the European Communities COM (2007) 160 final (Brussels), 11 April 2007. 96 Panagiota Manoli, “Unfolding the Black Sea Economic Cooperation: Views from the Region,” Xenophon Paper No. 2 (Athens: International Centre for Black Sea Studies, 2007), http://www.bsec-organization.org. 97 Organization for the Black Sea Economic Cooperation 2009. 98 The Thirtieth Plenary Session, “The Priorities of Cooperation,” 3. 99 The Thirtieth Plenary Session, “The Priorities of Cooperation,” 3–5. 100 Di Lili Puppo, “The European Union Begins to Think Strategically about the Black Sea,” Caucaz Europenews, 2007, http://www.caucaz.com/home_eng/breve _contenu.php?id=312. 101 The Thirtieth Plenary Session, “The Priorities of Cooperation,” 11. 102 Commission of the European Communities, “An Energy Policy for Europe,” Communication from the Commission to the European Council and the European Parliament, Brussels, 2007. 103 Panagiota Manoli, “Unfolding the Black Sea Economic Cooperation.” 104 The former name of the organization was GU(U)AM which stands for the first letter of the member countries: Georgia, Ukraine, Uzbekistan, Azerbaijan, and 83

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Moldova. Uzbekistan withdrew in 2005 and in 2006 the organization renamed itself GUAM: Organization for Democracy and Economic Development. For details see GUAM’s official webpage, http://guam-organization.org/node/242. 105 Michel Chossudovsky, “The Eurasian Corridor: Pipeline Geopolitics and the New Cold War,” Global Research, 22 August 2008, http://www.globalresearch .ca/index.php?context=va&aid=9907. 106 Manoli, “Unfolding the Black Sea Economic Cooperation,” 31–32.

CHAPTER TWENTY-SIX THE NEXUS BETWEEN THE ENERGY PIPELINE CONTEST AND SECURITY IN THE BLACK SEA REGION: RUSSIA VERSUS THE REST GÜNER ÖZKAN*

Introduction Competition over scarce resources, including safe access to them, is one of the main, if not the most important, issues amongst states around the globe. The exploitation of energy resources—oil and gas—and their transportation to markets have been hot topics in the context of energy security, especially in the Eurasian region, since the collapse of the USSR, and the Black Sea region in particular has sat at the very centre of those discussions. There is a strong link between energy, pipelines, power, and security. This is because “energy security is assurance of ability to access the energy resources required for the continued development of national power … it is the provision of affordable, reliable, diverse, and ample supplies of oil and gas … and adequate infrastructure to deliver these supplies to markets.”1 European states and Russia have displayed both cooperation and rivalry for such energy resources and their transportation to consumers via pipelines. High regional security risks in the Persian Gulf, where much of the world’s energy is located, and the natural inclination of states towards cheap and easily accessible resources, have directed much attention to the rich energy resources of Russia and the Caspian region. Russia’s energy exports to prosperous European markets have provided Moscow with the opportunity not only to revive its post-Soviet economic infrastructure, but also to give it the chance to become once again a great, *

Mugla University, Faculty of Economics and Administrative Sciences, Department of International Relations, Turkey.

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if not a super, power. The same markets in Europe have also been attracted by other energy-rich states in the Caspian region for economic and geopolitical reasons. For the states that are wealthy in energy reserves— Russia and others in the Caspian—the Black Sea area and the South Caucasus have turned into a critical corridor for the transportation of goods, including energy, in all directions. Excluding Russia, the countries surrounding the Black Sea do not have significant oil and natural gas reserves. What makes this region important is that it can act as a bridge for energy pipelines between producer and consumer states in and around the wider Black Sea area. Russia’s foreign and military policies have been mainly preoccupied with exerting as much control as possible over the oil and natural gas pipelines in the former Soviet territories of the Black Sea region, and building new pipelines to lucrative European markets. It is therefore no coincidence that Russia has long opposed the enlargement of NATO and the further eastern expansion of the EU, as well as the increased involvement of international organizations, such as the OSCE, in resolving conflicts in the “near abroad” and the Black Sea areas which have been seen by Russia as falling within its traditional sphere of influence. Rather, Russia has considered that such “intrusions,” which help to resolve the ethno-territorial conflicts, increase prosperity, aid the development of democratic structures, and build regional and bilateral security relationships, are hostile efforts that aim to reduce Russian influence in the “near abroad” and the Black Sea region. Russia has largely seen such outcomes, instigated by external influences in the 1990s, as increasingly alarming developments. These developments, perceived by Moscow as anti-Russian, paved the way for the ascent to the presidency in 2000 of Vladimir Putin, who has since adopted a much tougher approach towards the “near abroad” and wider world. This paper tries to delve into the link between the energy pipeline contest, including the issue of transporting oil and gas resources from Russia and the Caspian region to Europe, and security in the Black Sea region. Ostensibly, there is competition between Russia on the one hand, one of the major energy exporters, and the energy-dependent states in Europe and the transporting countries in the Black Sea region on the other; it is not often played out through military means, but usually through economic, political, and other strategic instruments. How realistic is it to view this competition in terms of Russia versus the rest? What security responses will this rivalry continue to bring about in the Black Sea region? The paper argues that, as competition over scarce resources is a neverending phenomenon among the states, Russia, using its advantageous

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position in the Black Sea region and the neighbouring areas, will continue to exert its influence over the territories where energy resources are transported. This Russian influence is likely to keep a number of states in the Black Sea region unstable, and their hands weak on the issue of energy pipelines, so long as the EU and European states as a whole fail to develop better strategies to curb or accommodate Russia. For that reason, if Russia manages to build more energy pipelines from its coast (Novorossiysk or elsewhere) to any European country, such as Bulgaria or Turkey, via the Black Sea, it is almost impossible to imagine the establishment of security and stability in the wider Black Sea region for years to come. There will, in fact, be a kind of stability and security in the region, but it will mainly resemble no more than what Russia would like to see and allow. Only the EU, or the European states together, have enough economic and political leverage to prevent Russia from continuing with such occurrences. However, what the EU and European states most lack, as was clear throughout the 1990s because of the presence of so many divergent interests amongst themselves, is the strong will for a common and determined strategy against Russian energy and military policies. So long as the European states, individually or together in the EU, continue to show ineptitude and act slowly in the energy pipeline competition with Russia, they will not only worsen their own energy situation (and other security problems), but will also diminish the hope of many states, in the Black Sea region and beyond, of becoming stable and secure. This paper will discuss the above arguments under the following headings: competition over scarce sources as a form of power politics; the importance of the Black Sea region for energy transportation; Russia, energy pipelines, and the Black Sea; and European dependence on Russian energy and major challenges.

Competition over Scarce Resources as a Form of Power Politics There is no single definition for power in international relations. Nevertheless, the material aspect of power, or a state’s physical capacity, capability, and ability to use it effectively, is central to many who deal with this subject. Therefore, control over scarce resources is a central theme in this material-based power calculation. One of the pioneers of international relations, E. H. Carr, suggested there was not just one, but three types of power: military, economic, and psychological. As a thinker from the inter-war period in the 1930s, Carr placed great emphasis on military power because war was not a remote

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possibility at the time. Economic capacity was viewed not just in its significance for military power, but in its potential for achieving certain goals in the international arena. Psychological power, or the ability to change the opinions of others, was also important, again for political purposes, alongside military and economic strength.2 Another influential international relations thinker, Hans J. Morgenthau (this time in the post– Second World War era), saw it as the final goal of every state to strive for the maximization of power all the time, in an anarchic international arena.3 At the time when the USSR still existed, according to Realist views (which always gave great importance to power), there was not a single form of power but many, ranging from economic and military strength to technological ability, geographical location to natural sources, population to national morale, and so on.4 Did states’ views on power maximization change when the bipolar world came to an end, after the USSR withdrew from Eastern Europe and finally collapsed in 1991? Hardly so, if one agrees with what the contemporary thinkers have said about state power. One such intellectual, J. Stoessinger, stressed in 1994 that the main objective of a state was to influence and/or change the behaviour of other states by using physical and non-physical resources.5 A similar definition had been expressed by Carr and many others during the Cold War, and even before it began. Since a new global war among great powers is no longer an option, due to their capacity for mutual annihilation, as many thinkers in the Realist school of thought express, states have now further concentrated on the maximization of their economic powers. This new push for increasing economic and technological power in the post–Cold War period has defined an international environment in which state rivalries and alliances have emerged over physical (e.g., raw materials) and social (e.g., influence) scarcities. Great powers, in cooperation with many other strategically important but weaker states in the periphery, have still been very much involved in a “positional competition” for rare resources, such as natural materials, market shares, and political influence. Surely, “positional competition” for power, as many argue, carries the risk of producing relationships which may take various forms, from relatively benevolent ones to more traditional military and territorial rivalries among smaller as well as major states.6 In observing the current conduct of states, in some cases it appears that power maximization, security, and relative gains remain their main objectives in the international arena. As stated above, it is now less likely, if not impossible, that we will witness a global war similar to the previous ones, as there can be no real winner of such an upheaval under the shadow

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of nuclear weapons. Nevertheless, this does not stop states searching for better military technology, such as anti-missile defence systems, nextgeneration assault missiles, and weapons, along with their economic benefits. It can even be said that under the protection of nuclear weapons, states have felt much freer to pursue more economic resources and greater market shares. For instance, the US effort to establish anti-missile defence systems in Poland and the Czech Republic is explained as prevention against missile attacks targeted by Iran towards Europe. Yet, as many may also argue, these systems can just as easily be used against Russian missiles, and so have the ability to undermine Russia’s influence in Eastern Europe and at the global level in general.7 In either case, the US strategic missile defence system in those states can be thought of as a means of curbing increasing regional influences and the rising power of Iran and Russia. In the example of Iran, neither the United States nor its allies in the Middle East want to see it become powerful enough to shape regional economic (mainly energy resources) and military dynamics. In the Russian case, not reacting to the US attempts to build anti-missile defence systems means that Russia would lose significant strategic ground against external powers on its doorstep. Most importantly, Russia may think that failing to respond strongly to US efforts to build an anti-missile system in Europe would open the gate for further NATO expansion into other post-Soviet areas such as the South Caucasus and Caspian regions. In such an eventuality, Russia would lose its control over both regions, which are of vital importance for the transportation of its energy resources, bringing in much-needed currency to support its economic and military recovery. To give another example, China’s fast economic growth results from flooding markets in the West and East with much cheaper goods. In order to maintain and even further increase its economic growth and export benefits, the Chinese government has been in search of additional vital and scarce resources, including oil and gas, in Central Asia, Africa, and elsewhere. It has already been predicted that China may be consuming significantly more oil than the United States by 2020. China has been in a competition with its powerful neighbours, Japan and India, over energy resources, as the latter two have also needed to meet their growing energy demands. Whether China is going to follow an aggressive geopolitical course in order to meet its future energy requirements is not yet clear; however, such a policy direction still remains an option, for a China that is sufficiently militarily strong.8 The Chinese government’s relatively soft policy over the Iranian nuclear issue can already be explained by its demand for Iran’s energy resources. A similar Chinese policy is also in

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place regarding Sudan: Beijing’s interest in Sudanese energy reserves is the main reason behind its provision of arms to the Khartoum government and its less critical stance towards Sudan’s policy in the Darfur crisis. As elsewhere, a similar situation regarding the link between scarce resources and power, in both conceptual and practical terms, is also very relevant to the Black Sea region, especially with the inclusion of the energy-rich Caspian region. This region offers one of the most important scarce resources, energy (in the form of oil and gas), to larger and smaller countries for their economic sustenance, growth, and well-being. Thus, energy resources from the Caspian region, and the pipelines that carry them to markets, are currently major components of the security and power backdrop, and have been increasingly sought-after by a number of regional and extra-regional states. Russia, Georgia, Ukraine, and Azerbaijan are just a few among many states which need and provide either energy itself, or a safe transport corridor for energy resources. Obviously, the importance of the Black Sea region as a key land and water corridor for energy transportation and security has therefore risen substantially.

Importance of the Black Sea Region for Energy Transportation The Black Sea region is important for many reasons, both for the six riparian countries, and for various adjoining and faraway states. These states have varied cultural, political, and economic characteristics and interests. Since the collapse of the USSR, the means of transportation of energy resources—pipelines from Russia and the Caspian region to the markets to the West—have become increasingly important commodities for the states in the wider Black Sea area, in economic, political, and security terms. The Black Sea itself, as a body of water and its surrounding areas, is one of the most important regions in the world, where significant amounts of oil and gas have been transported for decades by ship and pipelines. The ports of Supsa and Poti in Georgia, Novorossiysk in Russia, Odessa in Ukraine, Constanta in Romania, Burgas in Bulgaria, as well as the Turkish Straits, have been major transportation outlets for the energy produced in Russia and the Caspian region. The two larger states in the wider Black sea region, Russia and Turkey, have been especially eager to host further energy pipelines in their own territories from various regions, including the Caspian, the Middle East, and deep inside Russia, to profitable markets such as Europe. Russia in particular, having taken over most of the Soviet-

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era oil and gas transportation infrastructure (stretching from the Ukrainian border in the south to the Gulf of Finland in the north), now provides a significant proportion of the energy needs of European countries, and is seeking additional export options to Europe. On the other hand, Turkey, which successfully hosts the Baku–Tbilisi– Ceyhan (BTC) and Baku–Tbilisi–Erzurum (BTE) energy lines, is also looking forward to additional similar lines through its territory from both Russia and the Caspian region. Turkey is doing this not just in order to reduce its dependence on Russian gas, but also to get the financial and geopolitical benefits of being an important energy corridor to Europe. Similar concerns about being heavily dependent on Russian energy have been observed in a number of Eastern European countries as well. In addition, like Turkey, Eastern European countries are also seeking economic and geopolitical gains from already functioning energy lines, as well as possible future lines, to Europe from Russia and the Caspian region through the Black Sea region. Russia’s energy resources aside, the Caspian region has accordingly been the focal point for the countries surrounding the Black Sea region. The reason for this is clear: Kazakhstan, Azerbaijan, Turkmenistan, and Uzbekistan have proven reserves of 1.90, 1.28, 2.67, and 1.74 trillion cubic metres of natural gas, and 40, 7, 0.6, and 0.6 billion barrels of oil, respectively. It is even estimated that these four states’ oil reserves may exceed over 150 billion barrels.9 Transportation of these energy resources with additional pipelines to Europe requires billions of dollars of investment, and requires them to cross politically and ethnically troubled territories all the way from the shores of the Caspian to the coasts of the Black Sea. Though this is the real puzzle to be resolved, Russia has continued to take advantage of its huge proven energy reserves (around 45 trillion cubic metres of natural gas and 80 billion barrels of oil) and transportation infrastructure in the European market, and used these as geopolitical and economic leverage throughout the wider Black Sea region. In many respects, energy resources in the Caspian region, as well as in Russia, together with their means of transportation, are all scarce resources, which countries throughout the wider Black Sea region strive to control or take their own share of as much as possible. Regarding the pipeline issues, Russia obviously holds an advantageous position in comparison to states which either have their own energy resources or are transport corridors in the Black Sea, Caspian, and Central Asian regions. On the other hand, the end of the communist regime in Eastern Europe and the dissolution of the USSR gave way to the birth of new states which are no longer bound by the constraints of the old

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ideological and geopolitical realities. Since 1991, most of the Eastern and Central European states have become members of both the EU and NATO, providing them with new economic, political, and military orientations away from the new Russia. Further, Ukraine and the Baltic States are either fully integrated into the Western institutions, or have been in close economic, political, and military cooperation with them. Since the early 1990s, taking advantage of the former Soviet oil and gas pipeline networks that stretch to Eastern Europe and further afield, Russian governments have pushed hard to convince, and if necessary force, the states situated on its western frontiers to act as an energy corridor, so as to obtain greater political and economic gains. As the political directions of these states have changed, for example in coming closer to membership of the EU and NATO, Russia has not hesitated to leave them in the cold or increase gas prices to a level that they find difficult to pay. Thus, it appears logical that all these Black Sea coastal states, such as Ukraine, Bulgaria, and Romania, could benefit from energy pipelines by acting as outlets and markets for the Caspian. This is likely to be beneficial to them not only because of the energy transportation fees and access to extra resources that avoid Russia or Turkey, but also because of removing, or reducing, the probable repercussions of aggressive Russian policies. Although it may be argued that pipelines from Russia to Europe provide Eastern and Central European states with transit fees and badly needed energy resources, this situation also creates security risks for those same states, especially in political and economic terms. In fact, Eastern and Central European states such as Bulgaria, Romania, Slovakia, Hungary, and even Greece have been enthusiastic about hosting as many energy pipelines as possible, either from Russia or from the Black Sea region, because they are already politically, economically, and militarily aligned in a Western European and Euro–Atlantic direction, and have received financial benefits from existing and future energy ventures. Perhaps the only problem for these states is their heavy reliance on a single country, Russia, for their energy needs. Therefore, energy pipelines are connected to security in the Black Sea region, whose wider domain is made up of closely related states which have not established their foreign and security policy orientations, or have been unable to set them, without external influence. In the western part of the Black Sea, Ukraine and Belarus are two important countries that in recent years have faced this challenge more than other states in the region, owing mainly to the ongoing Russian influence over their economic and political lives. Apart from Belarus, which mainly pursues a pro-Russian foreign policy under Alexander Lukashenko, in the example of Ukraine, the political and

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strategic significance of energy pipelines in the region is very clear. With the “Orange Revolution” in Ukraine during the autumn of 2004, Kiev entered a new era of democratization, beginning a pro-Western policy course which included membership of NATO. It is primarily for this reason that Russia sought to punish the pro-Western Ukrainian leadership by forcing Kiev to pay European prices for its gas sales, subsequently cutting its gas supply briefly in January 2006.10 On the other side of the Black Sea, in the South Caucasus, pipeline security issues are much more complex, and often create trouble for the small states there. What direction energy pipelines in the Caspian should follow have been fiercely discussed since (and even shortly before) the break-up of the USSR. Georgia, which does not have its own oil or gas resources to sell for hard currency, occupies a pivotal position in the export of energy from the Caspian to the West. As the only country in the South Caucasus with an outlet to the Black Sea, Georgia is totally dependent on other states and actors, either for their energy resources, such as Azerbaijan and Kazakhstan, or for their influence, like the US government and oil companies. Hence, when the issue of energy pipelines passing through Georgian territory comes up for discussion, either to its Black Sea ports or to Turkey, many actors seek their own interests through various methods. Thus far, in the examples of the Baku–Supsa and BTC oil pipelines, and the BTE gas pipeline, Georgian governments have sided with the Western states and financial actors, at the expense of upsetting Russia. It was only after long discussions and negotiations among state and financial actors that these energy lines were either refurbished or constructed fully via Georgia. There were even reports that Russia, which was against any major oil pipeline from Azerbaijan that avoided Russian territory, did not hesitate to resort to extraordinary measures, such as using ethnic disputes in Georgia and assassination attempts on the former Georgian president Edward Shevardnadze in order to disqualify the BTC line.11 On the other hand, as the Caspian pipeline issue is part of a geopolitical and geo-economic power game among many actors, Georgia has also tried to take advantage of it. Firstly, for Georgia the most important matter is the energy pipelines that pass through its territory, but not the direction they follow, whether via its Black Sea coast or Turkey. Georgia, a small and poor country, badly needs not only the transit fees, but also the energy for its own use at a discount price. Secondly, energy pipelines are of great political value in order to balance Russian military, political, and economic influence over the region, and over Georgia in particular. The interruption of the gas supply from Russia to Georgia in

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January 2006 emphasized Georgia’s needs in this context: the Mozdok– Tbilisi pipeline, providing gas to Georgia and Armenia from Russia, was damaged by two nearby explosions on January 22, stopping the flow of gas to these countries in the middle of a cold winter. The Georgian government blamed Russia for the explosions.12 The Russian government has always denied its involvement in such actions against Georgia. Nevertheless, that incident displayed Georgia’s vulnerability to Russian influence in geopolitical and energy-security terms, as Tbilisi and Moscow were at loggerheads over the questions of the withdrawal of Russian military bases, the disputes in Abkhazia and South Ossetia, Georgia’s NATO membership, and most importantly, the “Rose Revolution” itself. For Georgia, therefore, its energy diversification is of vital importance, either through the Black Sea or via other regions outside of Russia. To differing degrees, similar geopolitical and geo-economic benefits and concerns in relation to Black Sea energy pipelines can also be discussed for Armenia, Azerbaijan, and some states beyond the region, such as Kazakhstan, Turkmenistan, and Uzbekistan. Countries like Azerbaijan, Kazakhstan and Turkmenistan, which have an abundance of energy resources for export, have long sought safe and profitable access to international markets. While the importance of the Black Sea to Georgia and Azerbaijan is apparent due to their political and market orientations towards Europe, for others, such as Kazakhstan and Turkmenistan, the same region carries less importance, as they have other market and geopolitical alternatives towards the east, including China, India, and others. Nevertheless, in Kazakhstan at present, and possibly Turkmenistan in the future, there is interest in exporting some of their energy yields through the wider Black Sea region. Kazakhstan has already exported some of its oil to Western markets using Azerbaijani and Georgian railways and Georgia’s Black Sea ports, and is searching for ways to supply additional oil via the BTC pipeline in the near future, especially with the development of huge Kashagan offshore oil fields. Similarly, Turkmenistan has long been on the agenda not only of Europe and Turkey, but also of Russia and other states (China, India, Pakistan) that wish to import its natural gas via pipelines.13 In the west, despite long discussions since the mid 1990s, there has been no successfully completed pipeline from Turkmenistan or Kazakhstan, via the Caspian Sea bed or Iran, to the Black Sea region and then to Europe. At present, the increasing importance of the Black Sea area stems from the discussion over additional energy pipelines from the Caspian and the directions they might follow. At this point, the thinking and strategies of Russia, as the most

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influential regional actor, remains of great importance regarding possible energy lines in the Black Sea region and their links to security.

Russia, Energy Pipelines, and the Black Sea: Many Projects for One Objective Like the United States in the Middle East, where oil plays one of the major roles in Washington’s foreign policy and security calculations, Russia, too, tries to maximize its economic and political interests by using its advantageous position in the Eurasian area over energy pipelines. Russia’s big energy resources, the pipelines that carry them, and its proximity to the energy-rich Caspian region, are invaluable scarce resources that are useful in promoting its national interests and strengthening its security in various respects in and around the Black Sea. Russia’s abundant energy yields and the energy pipelines that connect them to markets in Europe and Asia are vital sources of hard currency, allowing it to bolster its tarnished economic structure. It is true that Russia has not yet been able to catch up to the annual oil production level of 570 million tonnes achieved under the Soviet system in 1987. Nevertheless, it still managed to increase its oil production significantly on a yearly basis, from around 300–324 million tonnes in the second half of the 1990s to over 490 million tonnes at the end of 2007. During this period, Russia produced 9.9 million barrels of oil per day, making it the second biggest oil producer in the world after Saudi Arabia (10.4 million).14 The current annual natural gas production level in Russia has also remained lower than the output reached in 1991. Just before the disintegration of the USSR, 643 billion cubic metres (bcm) of natural gas was being produced annually, before output declined steadily during the 1990s. It was only as of 2006 and 2007 that Russia managed to produce just over 600 bcm of natural gas on yearly basis, making it the biggest natural gas producer in the world, ahead of the United States (546 bcm).15 Overall, the oil, fuel, and natural gas exports of Russia have always made up the biggest proportion (currently over 60 percent) of its total export goods.16 Mainly due to its increased energy export earnings and investment, Russia’s international currency reserves leaped from $12 billion in 1998 to $476 billion in 2007.17 Unlike in the Yeltsin era, during which Russia faced a serious economic downturn, Russia did not experience such economic upheaval under Putin. Thanks mainly to the rise of oil prices in the latter period, real wages increased to 28 percent above pre-1998 levels, and the number of people living in poverty was reduced by a third.18

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In 2007, Russia exported around 4.4 million barrels of crude oil and over 2 million barrels of oil products per day. During the same year, Russia sold approximately 1.3 million barrels of its crude oil per day via the Druzhba pipeline to Belarus, Ukraine, Germany, Poland, and other markets in Central and Eastern Europe such as Hungary, Slovakia, and the Czech Republic. It also used the new Primorsk port to export about 1.3 million barrels of oil per day, and the Black Sea for 900,000 barrels. Most of Russia’s oil is exported via Transneft-controlled oil pipelines, the rest using waterways and railways.19 There are, however, some problems for Russia in exporting oil via these pipelines, since Transneft, the stateowned pipeline monopoly, is unable to meet oil producers’ export capacity due to bottlenecks in the pipeline systems. It is because of this that Russia managed to export just over 4 million barrels of oil per day via pipelines in 2007, and also had to use the more expensive transport options of railways and river channels. When oil prices fall and remain at lower levels, exporting via rail and river becomes economically less viable. A large amount of Russian oil is now also being exported from the Black Sea port of Novorossiysk (around 1 million barrels per day) by tankers via the Turkish straits, which Turkey has already limited for environmental and safety reasons.20 Thus, Russia needs more oil transportation options and investment, not just to efficiently and inexpensively increase its export capacity to Europe and Asia, but also to compete for shares in oil markets that are already being sought by other regional oil producers like Kazakhstan. Russia’s energy assets and their means of delivery represent a significant source of income and a useful political instrument, regardless of the fact that such heavy dependence on energy returns leaves the country vulnerable to the fluctuation of global energy prices.21 Putting aside the downsides of energy price shocks in the international market, Russian president and then prime minister Vladimir Putin was well aware of the importance of the energy sector for Russia in economic and geopolitical terms. The foreign and economic policies of postindependence Russia have encountered a number of difficulties in terms of their definitions and responses. Loss of an empire and superpower status, a slumped economic structure, and military and political challenges from inside and outside have been constant factors behind the formation of Russian foreign policy since 1991. While these did and, to a certain extent, still exist, as Light notes, what Russia most fundamentally lacked was economic strength, one of the important qualities of power.22 Indeed, Russia could not be seen as a great power at the same time as seeking economic and financial assistance

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from rich states that were normally Russia’s competitors in the international arena. Without economic power, therefore, no matter what Russia had in its hands—a huge nuclear arsenal, abundant but old conventional weapons, and vast territory—it could not even be considered a great power, let alone regain its superpower status. It was for this reason that the national security concept of Russia in 2000 under Putin, a strong personality and a former KGB chief, gave critical importance to the economy, linking it directly to Russian national security. This conceptual link of the economy with security included the idea that the poor economic situation could potentially give rise to further separatist demands from ethnic republics. Such demands would represent a serious national security problem, potentially endangering the integrity of the Russian Federation.23 Further, Putin, in his annual address to the Federal Assembly of the Russian Federation in May 2003, said that Russia faced a serious threat rooted in the unstable and weak economic performance, stressing that in order for Russia to maintain its position among the greatest powers in the world, it was an absolute necessity to possess significant economic, intellectual, and military advantages. To achieve this, Putin asserted that by 2010, Russia must see a two-fold increase in GDP, defeat poverty, and modernize the armed forces.24 In the military area, for example, Russia is preparing to allocate a significant amount of capital in order to revive the “glorious” days of the Red Army during the former Soviet era. Sergei Ivanov, then deputy prime minister in charge of the military-industrial complex, revealed in October 2008 that they would spend $50 billion on the modernization of the Russian army in 2009, concentrating in particular on the development of new strategic nuclear forces and the navy, to include new nuclear submarines and aircraft carriers.25 As president, Dimitry Medvedev reiterated the determination to realize this defence scheme, regardless of the severe impact of the global financial crisis on Russia. If it materialized, the amount of capital planned to be invested in the modernization of the Russian army could indeed be a successful move for the Russian leadership, since Russia has only managed to increase its military budget by limited amounts in recent years.26 It is clear that Russia’s energy and pipeline policies in and around the Black Sea region have contributed greatly not only to economic growth, but also to a possible military recovery. Russian policymakers, especially under Putin and then under his successor Medvedev, have strongly believed that economic development, for which energy export and control over energy pipelines play vital roles, is directly related to, and complementary with,

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strengthening security and Russia’s geopolitical interests in the “near abroad” and farther afield in the international arena. If one considers the “near abroad,” Russia has always seen the Caspian region’s energy-rich states as important energy targets in which Russia would like to hold large shares. However, both the Caspian states and others outside of the region, such as the United States and Turkey, have been equally adamant about either diversifying the routes for energy pipelines, or participating in energy projects. This leads to ongoing competition in the Caspian between many actors (Russia, the United States, China, Turkey, European States, and oil companies) on energy projects and pipeline directions. Russia fiercely opposed the BTC pipeline that commenced carrying crude oil in 2006 from Azerbaijan to Turkey via Georgia. Many security issues (Abkhazia, South Ossetia, NagornoKarabakh, Chechnya, and the Kurdish issue) in areas crossed by or in close proximity to the BTC continue to be related to the ongoing energy and pipeline competition in the Caspian and Black Sea regions. Despite Russia’s opposition, the BTC and BTE pipelines were accomplished with the support of the United States and various West European countries. However, the trans-Caspian natural gas pipeline, that was to lead from Turkmenistan to Azerbaijan via the Caspian Sea bed, and then to Georgia and Turkey, could not be realized, largely due to Russia’s role in the problem of the Caspian delimitation issue, and its strong influence over the region’s political elites. Russia has also now tried to discredit the planned Nabucco gas pipeline, which is planned to carry around 30 bcm of natural gas annually from Turkmenistan, Azerbaijan, Iraq, Egypt, and if possible Iran, to Central Europe via Turkey. Under the rule of Putin and Medvedev, like that of Yeltsin in the 1990s, Russia believes that if new energy pipelines from the Caspian region were to be built avoiding its territory, it would lose not only lucrative transportation fees and natural gas at cheap prices from Central Asian states, but also important political leverage over the states in the region stretching from Asia to the Black Sea. As global energy prices and energy export to the profitable European market have risen in recent years, Russia has been unwilling to drop its monopoly over the Caspian energy supplies. It has not, for instance, allowed Kazakhstan to export oil to the Baltic States. Also, by the early 2000s Russia was paying $57 per thousand cubic metres for Turkmen gas for domestic use, while it continued selling its own gas to Europe at around $250 for the same amount.27 Similarly, following the rise in political tension between Georgia and Russia after January 2006, Russia demanded that Tbilisi increase its payment for natural gas to $230 per thousand cubic metres

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while it continued to export gas to Armenia, flowing through Georgian territory, at $110 per thousand cubic metres. Russia did not stop at overtly pressurizing Georgia; it also pushed Azerbaijan to back its policy of strangling Tbilisi by using the energy card. When Azerbaijan did not give in to that pressure, Russia threatened to raise gas prices for Azerbaijan to the level that it asked from Georgia, or Russia would reduce the amounts of gas and electricity it was supplying.28 Russia’s energy pipeline policy is not limited to the “near abroad”: It has also pursued a successful pipeline policy towards the markets situated around and further beyond its near neighbours. For instance, it has supplied 65 percent of Turkey’s annual natural gas needs, which are around 35 bcm, via a Soviet-era pipeline and the newly built Blue Stream pipeline under the Black Sea. It is often commented that the Blue Stream pipeline was a strategic project for Russia because it helped prevent possible Azerbaijani and Central Asian natural gas from reaching Europe via other projected pipelines falling outside Russian territory. Another example of a strategic natural gas pipeline aimed at supplying the European market with more Russian gas with minimal hindrance is the North European Gas Pipeline, which is planned to stretch from the Baltic coast of Russia along the seabed to Germany at an estimated cost of $10.5 billion. As the cost of this pipeline indicates, Russia, together with its European partner, Germany, prefers not to build along the shortest line through Ukraine and Belarus, which suggests that they do not want to be dependent on those transporting states. The initiation of this line also implies that Russia will be in a stronger position to squeeze Kiev and Minsk politically and economically, so as to bring them back, when necessary, into the “near abroad” policy orbit. Ukraine’s failure to pay its gas debt to Russia, and the subsequent disagreement over the price of natural gas export and transportation fees between the two states in January 2009, caused the shutdown of many factories and heating problems in Ukraine and other energy-dependant countries in Eastern Europe.29 Among other things, this latest divergence between Ukraine and Russia played a significant role in the Ukrainian presidential election in January–February 2010, which the pro-Russian Viktor Yanukovych won against the leaders of the Orange Revolution, the pro-Western incumbent president, Viktor Yushchenko, and prime minister, Yulia Tymoshenko. There are a number of other Russian energy pipeline enlargement and construction projects that surely have the objective of further boosting Russian economic and geopolitical power.30

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European Dependence on Russian Energy and Major Challenges European states, like all countries, prefer their energy sources to be as cheap and diverse as possible. Although Europe, which itself has a large and diverse geography, divided into a number of states with different national interests, does not have a single energy pipeline policy in and around the Black Sea region, it still cannot disregard Russia’s impact on energy issues. The discussion about energy security, as stated at the beginning of this work, has largely turned on the safe and stable flow of energy resources to consumer countries. Obviously, the expectations and preferences are that these resources should be supplied via various sources that are independent from one another, in order to avoid depending too heavily on one or two producers or transporting countries. For Europe, the Black Sea region’s importance regarding energy pipelines is overwhelmingly linked to the matter of how and from where European states would import additional energy resources without depending heavily on a single country’s resources, such as those of Russia, as well as various transporting countries that often experience political, economic, and social instability. Europe currently imports much of its energy resources from four places: the North Sea, Russia, the Middle East, and North Africa. Of these sources, Russia, at nearly 40 percent, is the leading supplier of Europe’s natural gas. Some European states’ gas import figures show them to be either totally or largely dependent on Russia. As the BP Statistical Review of World Energy of 2008 indicates, while Bulgaria, Finland, Latvia, Lithuania, Serbia, and Slovakia import all of their natural gas from Russia, the proportions of the bigger states’ Russian imports range from 22 percent to 42 percent. A number of other European states, such as the Czech Republic, Hungary, Poland, and Turkey, now rely on Russia’s natural gas in much higher quantities, between 65 percent and 75 percent.31 As a whole, Russia currently supplies 30 percent of European oil imports and, most importantly, 42 percent of the EU’s 61 percent gross inland consumption of natural gas. It is estimated that the EU’s natural gas import will increase to 73 percent by 2020, and there is a fear that the EU will become further dependent on Russia.32 It can be seen from these figures that Russia is in a significantly advantageous position not only in terms of dictating gas prices whenever and however it likes, but also by using its commercial power as geopolitical leverage in the Black Sea region and beyond. Great quantities of natural gas are carried from Russia to Europe by Soviet-era pipeline

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systems through Ukraine and Belarus. As stated earlier, since the early 1990s, any political, economic, or strategic disagreements between these states and Moscow have been reflected either in the increase of prices of natural gas or in its partial or total disruption. Many examples of this can be given, notable cases being those of the Baltic States (1992), Ukraine (1993, 1994, 2006, and 2009), Belarus (2003), and Georgia (2001 and 2006). Evidently, the security risk of being heavily dependent on Russian energy resources is not confined just to the amount of natural gas purchased by Europe from Russia, but also affects the ability of European states to challenge the increasing weight of Gazprom in the gas market. For Russia, Gazprom is now the biggest source of hard currency, and one of its most important foreign policy tools, as it is Europe’s main natural gas supplier and has the ability to set supply amounts and prices. The increasing influence of this state monopoly creates greater European dependence on both Russian gas and delivery systems. While Europe has tried to avoid relying on Russian gas, Gazprom has successfully prevented its potential competitors from supporting the European policy of supply diversification through the integration of some European energy companies into the development of various new natural gas infrastructure projects. In this way, Gazprom has managed to make its position in the European gas markets stronger with respect to energy supply and price determination.33 Gazprom’s further boosting of its influence on Europe’s natural gas market occurred through its acquisition of some domestic transportation and delivery systems there, including facilities in Germany, France, and Italy, and thus has limited potential suppliers and European states from making long-term gas deals for lucrative European markets.34 Because of Russia’s dominance over European natural gas imports, and the continuing disputes between Russia and transporting countries, European states have begun pursuing a much more determined policy of pressuring Russia to open more of its pipeline system up to Central Asian states. To support this policy, in January 2007, the European Commission produced a document, entitled “An Energy Policy for Europe,” which outlines a common energy policy as a central element of the EU’s foreign relations and energy security, and as one of the most important factors for its geopolitical security.35 Yet Russia did not accept this, and even threatened that it would redirect the flow of its natural gas towards Asia so long as European states prevent Russian companies from purchasing energy supply companies in Europe.36 Despite the fact that Europe is now considerably more aware of Russia’s increased dominance over energy security, and that it is trying to

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develop policies aimed at reducing its energy dependence, there are some serious intrinsic problems for European states, particularly the EU, to overcome as a whole in order to be successful on this issue. Regarding Russian energy resources, the EU needs to pursue an energy policy that is shaped and executed jointly amongst the member states, possibly including non-EU states. Otherwise, if certain EU members continue to follow individual policies with Russia, it will be very difficult to put pressure on Russia regarding its energy policies in the region. To give an example, many observers agree that it is very difficult to understand Germany’s participation in building the very expensive North European Gas Pipeline from Russia via the Baltic Sea bed, while the EU tries to reduce its dependence on Russia’s energy. An even more puzzling question regarding this project is why former German Chancellor Gerhard Schroeder took up a senior management post at Gazprom, while many experts, academics, and political figures continued to stress the necessity of increasing European energy independence. In various respects, this project is similar to the Blue Stream gas pipeline project, through which Turkey has become heavily dependent on Russian natural gas. Most importantly, however, the project played a key role in the postponement, if not yet the total abandonment, of a Trans-Caspian gas pipeline from Turkmenistan to Europe.37 Looking at the bigger picture, it can be said that the inability of Europe or the EU to challenge Russia’s dominance stems mainly from the failure to develop a common foreign and security policy and related functioning structures. Major EU states, now including the new members in Eastern and Central Europe, have continued to reflect differing and changing geopolitical perspectives among themselves and towards the outside world. It is a historical fact that there has been, to a changing degree over time, a geopolitical division between Britain and France, Germany and France, and Britain and Germany. Currently, such a division can also be observed between Britain and the Eastern European EU members on the one hand, and France and Germany on the other. A number of older and more recent developments have shown such divisions within the EU: British opposition to French and German domination in the EU; Germany and France’s opposition to the US war in Iraq, which was supported by Britain and Eastern European states; Germany and France’s courtship of Russia and their view of its legitimate role in the former Soviet-bloc countries. Additionally, there is a deep division among the major EU members about whether Turkey, a transit country in the Black Sea region, will become a full member of the Union. Although the EU has reiterated a number of times that Turkey is a strategically important country that links

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Europe, the Caucasus, and the Middle East, its accession to full EU membership has been delayed by some key members, such as Germany and France, for many different reasons. This has therefore pushed Turkey to seek alternative economic and strategic partners in the region, where Russia appears to have been the most important candidate so far.38 While Russia has linked energy resources with political and military developments in the “near abroad” as part of its vital national interest, and has not hesitated to use military force to this end, the EU, as a divided actor on these high matters, cannot be successful in its policy of diversifying its energy demand throughout wider Black Bea region. One should remember that the deposition of the democratically elected Azerbaijani government in 1993, and the construction of military bases in Georgia in the early 1990s, were closely connected to the development of Caspian energy resources and future energy pipelines bypassing Russia. All these military developments, largely instigated by Russia in the 1990s, were among the key factors which led to the delay in the construction of the BTC in the 2000s. Apart from the US invasion of Iraq, no other recent development has so starkly revealed the division within the EU on the formation of a joint strong policy stance by member states, as its position towards Russia in the conflict with Georgia in early August 2008. Despite their condemnations, neither Germany, France, nor Italy pressed for tougher actions and sanctions against Russia, mainly due to their better economic and political relationships with Moscow, while, on the other hand, Britain and Eastern European states such as the Baltic States, Poland, and Ukraine, tried to do otherwise.39 Though Russia did not attack energy lines in the region when the war broke out between Tbilisi and Moscow over South Ossetia in August 2008, Russian did, for a while, occupy significant parts of Georgia, including its strategic Black Sea coasts. This raised serious concern for various states and companies in Europe which had already either participated in the BTC, BTE, and Baku–Supsa energy lines or were working on the realization of the Nabucco project.40 Thus, no matter how difficult it is, the EU has to find ways of giving solid security guarantees for the states that hold energy resources, and of providing passage for those resources in the Black Sea region. If not, building new pipelines to Europe from the Caspian via the Black Sea region will take a long time, and European security will always be a subject of Caspian and Black Sea regional security developments, in which Russia has played the most important role. This was clearly proven in the latest conflict in the South Caucasus.

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While European states have continued to be divided among themselves in dealing with Russia, the difficulty of reducing their energy dependence on Russian resources has further increased. This is directly reflected in the economic and geopolitical views and decisions of the potential energy suppliers to Europe, the Caspian States. The three states in the Caspian which are potential energy suppliers to Europe—Azerbaijan, Kazakhstan, and Turkmenistan—have had to accommodate their positions in line with regional geopolitical and economic developments. Already, having taken advantage of the turmoil in Georgia, on 2 September 2008 Russia formed a verbal contract with Islam Karimov, the Uzbek president, for another pipeline in the region, to carry around 30 bcm of natural gas per year from Uzbekistan to Russia with a link to Turkmenistan.41 This latest deal, whether it materializes or not, which is debatable, seems to have further solidified Russia’s dominance over the pipelines throughout the Black Sea and Caspian regions. Russia had already succeeded in making another gas transportation agreement with Turkmenistan in 2007 to supply around 50 bcm of gas annually to Russia, which they agreed would be gradually increased to around 90 bcm per annum, as part of a twenty-five year bilateral gas deal made in 2003.42 In the final analysis, it appears that Europe in general and the EU in particular still have to spend huge amounts of capital and effort in order to reduce energy dependence on Russia, by supporting energy pipelines that skirt Russian territory.

Conclusion The ongoing contest over the energy pipelines in the Black Sea region is a sort of power and security struggle which is, to a great extent, sought by some states individually, and presented as a kind of rivalry between one group of states against another; or in the case of this work, Russia against the rest. The concept of security is generally accepted to have many different meanings; in this work, security is considered in the context of energy, whose means of transportation represent scarce resources to states, and are linked to their continuing economic and social development. This work also shows that so long as states exercise strong control over energy resources and pipelines, they gain economic, strategic-geopolitical, and security benefits, and consequently become more powerful. This power provides states with great opportunities to improve their internal and international deficiencies. Over the years, such a link between security and power is increasingly being observed in the Black Sea region among a number of regional and extra-regional states, around the competition for

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energy pipelines. In this pipeline power game, a number of cooperative policy attempts can also be seen, despite the opposition of Russia to the region’s other states. Competition, as well as cooperation, in the Black Sea region over the energy pipelines is a natural development, since this very region has to play the role of a bridge between demand and supply markets in Europe and the Caspian. Also, since the region is not an isolated area, with the states there having different—and often clashing—security, economic, and geopolitical concerns, as well as development levels, the issues about pipelines have gained further sensitivity and importance in state strategies. Ukraine, Georgia, and Turkey in particular, as coastal states, have tried to take advantage of their geographical positions and have sought to host as many energy pipelines from the Caspian region as possible; they believe that if energy pipelines continue to be built via Russian territory from the Caspian region, this situation will make Ukraine and Georgia in particular further dependent on Russia in terms of their economic, foreign, and security policy options. This worry has, in fact, been confirmed on many occasions when the interests of Ukraine and Georgia clashed with those of Russia, such as the question of their possible NATO membership. Russia cut off the flow of gas a number of times to Ukraine and Georgia, and increased the price to an unaffordable level. In contrast, Russia has sold the gas much more cheaply to states like Armenia and Belarus, as they have acted in line with Russian wishes in regional and international relations. Accordingly, the Black Sea region is of great strategic and economic value not only for states like Ukraine and Georgia, but also for Azerbaijan and Turkey, as well as Kazakhstan and Turkmenistan, as a means of reducing their dependence on Russia. It is clear that these states could not turn the tide much in their own favour in the energy pipeline rivalry, if the BTC and BTE were left aside. Nevertheless, the Black Sea region has offered them the chance to take further advantage by developing further alternatives for cooperation with other states, particularly with European projects in the coming years, for instance the Nabucco pipeline. From the energy pipeline contest (and cooperation in some cases) in the Black Sea region, Russia is the country which has benefited most. There are two main reasons for this success. First, Russia is the most powerful state in the Black Sea and Caspian regions. Second, Russia has strong enough determination to dominate energy pipeline issues, as well as various other affairs, such as military development, while no other state in the region is either capable or resolute enough to make great changes in the region with their policies. This imbalance in power and willingness has

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empowered Russia to continue to dominate energy supplies and pipelines in the Black Sea region and Europe. What Russia wants is quite clear: to recover from the post-Soviet economic, strategic, and psychological collapse, and to be once again a great power, if not a superpower like the USSR. Russia started to reveal its objective in the early 1990s when it developed the “near abroad” policy, enlarged the Commonwealth of Independent States by incorporating the Central Asian and South Caucasus states, and established the Collective Security Organization. It is true that the effectiveness of these Russian-led organizations is open to debate, especially during the Yeltsin era, considering the diverging policy practices of various member states in those entities. Yet, since Putin came into power in 2000, Russia has begun to pursue more stringent and assertive foreign and security policies. This is especially true on the issue of energy pipelines in the Eurasian landmass. The main reason for this, as openly shown by the latest conflict in Georgia, is to resurrect Russia from the deep sleep and complacency believed to be characteristic of Yeltsin’s period. In this sense, Putin’s decision to start his job by attacking Chechnya, a conflict that was seen as a major disgrace for Russia with its defeat in the war between 1994 and 1996, was not coincidental. From the point of view of Putin and Medvedev, for Russia, taking Chechnya fully under its control is important for a recovery of Russian national pride, and for the continuation and increase of its domination over Europe’s energy markets, whose transportation lines, including those in the Black Sea region, are vital to its economic and geo-strategic revival. European states, in particular high-ranking EU officials, have often lamented the disadvantages of their dependence on Russian energy, and have urged one another to reduce it. However, when action is called for, states are either slow, or show policy discrepancies in developing a common energy and pipeline stance towards Russia. As stated in this paper, there are many historical geopolitical divisions among major European states which have prevented them from developing a synchronized position. The recent best example of that failure on the part of Europe was displayed again in the Georgian crisis, during which Britain, the Eastern European members of the EU, and Ukraine urged strong sanctions, while the other big three, Germany, France, and Italy, worked against policy options that aimed to isolate Russia economically and politically in Europe and the international arena. This European ineptitude is also apparent in their slow, or even non-existent, reaction to increasing Russian pipeline projects to supply more energy to Europe, such as the proposed South Stream pipeline (a rival venture to Nabucco),

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which would lead from Russia to Bulgaria via the Black Sea, and then further into Europe. Energy production capacities in the Caspian, and the additional pipelines planned to carry them to Europe, are not enough to reduce the heavy reliance of many European states on Russia. For instance, the proposed Nabucco pipeline can only carry 30 bcm of gas to Europe annually, an amount that falls far short of independence from Russian gas: according to conservative estimates, the EU will import about 400 bcm of gas annually by 2030.43 Such a high amount cannot be easily met by excluding Russia. Thus, if one only views energy pipelines from the Caspian region to Europe via the Black Sea region, away from Russia (like Nabucco), as a way of lessening Europe’s energy dependence on a single source country, this will not happen in the short or mid-term. Nevertheless, any Caspian energy pipelines that are independent from Russia carry increased security benefits for Europe, energy suppliers, and transporting countries. For as long as the energy suppliers of Azerbaijan, Turkmenistan, and Kazakhstan in the Caspian region, and the transporting states of Ukraine and Georgia in the Black Sea area, are unable to gain access to markets relatively freely and host more energy lines, they cannot progress in building prosperous and democratic societies. In the absence of such self-confident societies, they will not only continue to face further bullying and infringement of their sovereignty on the part of Russia, but they are also likely to turn more into places where organized crime, corruption, and international terrorism can find breeding grounds and remain significant factors for state failure, which will provide no security benefits for Europe and the wider Black Sea region. Only Russia can continue to gain from that failure, since it has always seen itself as the only legitimate arbiter and actor in the appeasement or resolution of many problems in the “near abroad,” which includes a significant part of the Black Sea region.

Notes 1

Jan H. Kalicki and David L. Goldwyn, “Introduction: The Need to Integrate Energy and Foreign Policy,” in Energy and Security: Towards a New Foreign Policy Strategy, ed. Jan H. Kalicki and David L. Goldwyn (Washington DC: Woodrow Wilson Center Press, 2005), 9. 2 E. H. Carr, Twenty Years Crisis 1919–1939 (London: Macmillan, 1995), 95–134. 3 Hans J. Morgenthau, Politics Among Nations: Struggle for Power and Peace (New York: Alfred A. Knopf, 1967), 25. 4 For more about various forms of power, see Morgenthau, Politics Among Nations, 7.

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5 John Stoessinger, “The Anatomy of the Nation-State and the Nature of Power,” in Perspectives on World Politics, ed. Richard Little and Michael Smith (London: Routledge, 1991), 34. 6 Randall L. Schweller, “Realism and the Present Great Power System: Growth and Positional Conflict over Scarce Resources,” in Unipolar Politics: Realism and State after the Cold War, ed. Ethan B. Kapstein and Michael Mastanduno (New York: Colombia University Press, 1999), 28–68; see also Charles L. Glaser, “Realists as Optimists: Cooperation as Self Help,” in The Perils of Anarchy: Contemporary Realism and International Security, ed. M. E. Brown (London: The MIT Press, 1995), 377–417; Peter Liberman, “Spoils of Conquest,” in Brown, ed., The Perils of Anarchy, 179–207. 7 Pavel Felgenhauer, “U.S. Proposal to Base Missile Defense Systems in Poland, Czech Republic, Raises Alarm in Moscow,” Jamestown Foundation 4, no. 17 (24 January 24 2007). 8 Roland Dannreuther, International Security: The Contemporary Agenda (Cambridge: Polity Press, 2007), 94. 9 BP Statistical Review of World Energy, June 2008, pp. 6, 22 (http://www .bp.com); Caspian Sea Region: Survey of Key Oil and Gas Statistics and Forecasts, Energy Information Administration, July 2006, http://www.eia.doe.gov/emeu/cabs/ Caspian/images/caspian_balances.xls. 10 Jan Maksymiuk, “Gas Talks to Dominate Ukrainian Premier’s Russia Visit,” Radio Free Europe/Radio Liberty, August 15, 2006, http://www .rferl.org/. 11 Interview with Vahtang Kutateladze, Minister of Georgian State Security, Azadliq, 23 December 1999; “Georgia: Avoiding War in South Ossetia,” International Crisis Group, no. 159, Tbilisi/Brussels, 26 November 2004, pp. 16– 17, unpan1.un.org/intradoc/groups/public/documents/UNTC/UNPAN019224.pdf; Dov Lynch, “Separatist States and post-Soviet Conflicts,” International Affairs 78, no. 4 (2002): 845–846. 12 Richard Giragosian, “Gas Cut off Highlights Flaws in Georgia’s National Security Concept,” Radio Free Europe/Radio Liberty, 31 January 2006, http://www.rferl.org/. 13 “China President Opens Turkmenistan Gas Pipeline,” BBC News Online, 14 December 2009, http://news.bbc.co.uk/2/hi/8411204.stm. 14 Economist Intelligence Unit, Country Profile 2007, Russia, p. 45, http://www.eiu.com/report_dl.asp?issue_id=962078281&mode=pdf; BP Statistical Review, 8–9. 15 Economist Intelligence Unit, Country Profile 1996–1997, Russia, pp. 24, 27. 16 Economist Intelligence Unit, Country Profile 2008, Russia, p. 37. 17 Economist Intelligence Unit, Country Profile 2007, Russia, p. 55; Economist Intelligence Unit, Country Profile 2008, Russia, p. 63. 18 Peter Rutland, “Putin’s Economic Record,” in Developments in Russian Politics, ed. Stephen White, Zvi Gitelman, and Richard Sakwa (Durham: Duke University Press, 2005), 193. 19 Economist Intelligence Unit, Russia Country Analysis Brief, Energy Information Administration, May 2008, p. 4.

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20 Economist Intelligence Unit, Russia Country Analysis Brief, Energy Information Administration, May 2008, p. 7. 21 Thus, for instance, a $1 per barrel change in oil prices brings about a nearly $1.4 billion difference in the amount of revenues Russia receives from its oil exports. See Bernard A. Gelb, CRS Report for Congress, Russian Oil and Gas Challenges, Congressional Research Service, 3 January 2006, p. 3, http://fpc.state.gov/documents/organization/58988.pdf. 22 For the same view, see Margot Light, “Foreign Policy,” in Developments in Russian Politics, ed. Stephen White, Zvi Gitelman, and Richard Sakwa (Durham, Duke University Press, 2005), 225–226. 23 “National Security Concept of the Russian Federation,” Rossiiskaya Gazeta, 18 January 2000, http://www.fas.org/nuke/guide/russia/doctrine/gazeta012400.htm. 24 President of Russia, Annual Address to the Federal Assembly of the Russian Federation, 16 May 2003, http://www.kremlin.ru/eng/speeches/2003/05/16/0000_ type70029type82912_44692.shtml. 25 “Russia to Spend $50 Billion Buying Arms in 2009,” Radio Free Europe/Radio Liberty, 16 October 2008, http://www.rferl.org/content/Russia_To_Spend_50_ Billion_Buying_Arms_In_2009/1330511.html. 26 Economist Intelligence Unit, Country Profile 2008, Russia, p. 43; Economist Intelligence Unit, Country Profile 2007, Russia, p. 17; Chloe Arnold, “Russia: Resignation Signals Trouble within Defence Ministry,” Radio Free Europe/Radio Liberty, 27 March 2008, http://www.rferl.org/content/Article/1079697.html. 27 Vladimir Socor, “Seven Russian Challenges to the West’s Energy Security,” Eurasia Daily Monitor, 6 September 2006, http://www.jamestown.org/single /?no_cache=1&tx_ttnews%5Btt_news%5D=32002; Svante E. Cornell et al., “The Wider Black Sea Region: An Emerging Hub in European Security,” Central AsiaCaucasus Institute and Silk Road Studies Program, 2006, pp. 77–78, www.silkroadstudies.org. 28 “Facing Crunch, UES Could Cut Its Exports to Azerbaijan,” The Moscow Times, 23 November 2006, http://www.moscowtimes.ru/article/852/49/ 200733.htm; Vladimir Socor, “Azerbaijan Keeps Solidarity with Georgia despite Russian Energy Supply Cuts,” Jamestown Foundation, 8 December 2006, www.jamestown.org/single/?no_cache=1&tx_ttnews%5Btt_news%5D=32317. 29 “EU Seeks Gas Supply Return after Deal on Monitors,” Reuters, 8 January 2009, http://www.reuters.com/article/idUSTRE5062Q520090108?feedType= RSS&%3BfeedName=worldNews; “FACTBOX: 18 Countries Affected by Russia-Ukraine Gas Row,” Reuters, 8 January 2009, http://www.reuters.com/ article/idUSTRE5071TT20090108. 30 These oil pipelines include the Druzhba line, the Baltic Pipeline System, and Murmansk or Indiga on the Barent Sea on the European side of Russia, and a pipeline system from the Russian city of Taishet in the east to Nakhodka in northern Japan or Daqing in China. Regarding the natural gas pipelines of Russia, they are the Yamal–Europe I Pipeline, the North Trans-Gas Pipeline (or North European Gas Pipeline) in the west, and a pipeline in the east to China and then to South Korea. See Gelb, CRS Report for Congress, 7–11; Jan H. Kalicki and Jonathan Elkind, “Eurasian Transportation Futures,” in Energy and Security: Towards a New Foreign

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Policy Strategy, ed. Jan H. Kalicki and David L. Goldwyn (Washington, DC: Woodrow Wilson Center Press, 2005), 149–174. In addition to these, there are also various proposed oil and gas pipelines bypassing the Bosporus in the Black Sea region. These are Burgas (Bulgaria)–Alexandropolis (Greece), Burgas–Vlore (Albania), Constanta (Romania)–Trieste (Italy) or Omisalj (Croatia), and Odessa– Brody (Ukraine). See Kalicki and Elkind, “Eurasian Transportation Futures,” 156. 31 BP Statistical Review, 30; see also Economist Intelligence Unit, Russia Country Analysis Brief, May 2008, p. 11. 32 EU Energy Security and Solidarity Action Plan, Second Strategic Energy Review, Commission of the European Communities, 2008, p. 4, http://news.bbc .co.uk/2/shared/bsp/hi/pdfs/14_11_08euenergy.pdf. 33 Mamuka Tsereteli, “Economic and Energy Security: Connecting Europe and the Black Sea-Caspian Region,” Central Asia–Caucasus Institute, Silk Road Studies Program, March 2008, p. 26, http://www.silkroadstudies.org. 34 Tsereteli, “Economic and Energy Security.” 35 Tsereteli, “Economic and Energy Security,” 28; “EU Seeks to Expand Energy Grids,” BBC News Online, 13 November 2008, http://news.bbc.co.uk/2/hi/europe/ 7727028.stm. 36 Tsereteli, “Economic and Energy Security,” 27–28. 37 For these, see Cornell, “The Wider Black Sea Region,” 82. 38 Tsereteli, “Economic and Energy Security,” 30–31. 39 See Presidency Conclusions, The Council of the European Union, Brussels, 1 September 2008, http://www.consilium.europa.eu/ueDocs/cms_Data/docs/press data/en/ec/102545.pdf; “EU Links Russia Talks to Georgia Withdrawal,” Radio Free Europe/Radio Liberty, 1 September 2008, http://www.rferl.org/content/EU _Russia_Talks_Georgia_Withdrawal/1195551.html; Guner Ozkan, “Russia and the Remaking of the Near Abroad,” Today’s Zaman (Istanbul), 22 September 2008, http://www.todayszaman.com/tz-web/detaylar.do?load=detay&link=153884. 40 Bruce Pannier, “Russia–Georgia Conflict Raises Concerns About Caspian Energy Exports,” Radio Free Europe/Radio Liberty, 13 August 2008, http://www.rferl.org/content/Conflict_Raises_Concerns_About_Caspian_Energy_ Exports/1190774.html; Anatoly Medetsky, “War Casts Cloud Over Pipeline Route,” The Moscow Times, 14 August 2008, http://www.themoscowtimes.com/ article/1009/42/369783.htm; Ahto Lobjakas, “EU Fights For Nabucco’s Future,” Radio Free Europe/Radio Liberty, 5 November 2008, http://www.rferl.org/content/ EU_Fights_For_Nabuccos_Future/1338540.html. 41 Farangis Najibullah, “Moscow Seeking Alliances in Energy-Rich Central Asia” Radio Free Europe/Radio Liberty, 4 September 2008, http://www.rferl.org/ content/Moscow_Seeking_Alliances_in_EnergyRich_Central_Asia_/1196365 .html; “Central Asia: Russia and United States Intensify Energy Competition,” Eurasia Insight, 5 September 2008, http://www.eurasianet.org/departments/ insight/articles/eav090508a.shtml. 42 Economist Intelligence Unit, Country Report: Turkmenistan, July 2007, p. 23, http://www.eiu.com/report_dl.asp?issue_id=712384656&mode=pdf. 43 Tsereteli, “Economic and Energy Security,” 23–24.

CHAPTER TWENTY-SEVEN POLICIES AROUND THE BTC PIPELINE HALIL ERDEMIR*

Introduction The disintegration of the Soviet Union in 1991 led to new developments in the former Soviet republics and in and around the Caucasus and the Caspian region. Opportunities as well as rivalries emerged in many parts of the former Soviet Union resulting from these geopolitical changes. In the Caucasus and the Caspian Sea region, competition arose for the natural resources of the area, along with the need to transport them to world markets.1 To consider the strategic energy issue, a regional alliance was formed by Turkey, Azerbaijan, and Israel in the 1990s. This reflected the new geopolitical reality of the post–Cold War era. Such alliances led to greater awareness of how natural energy resources were being shared, who was taking the larger share and how the resources were being transported to world markets. A number of scholars2 have addressed the emergence of alliances and the formation of policies in the region. In a recent publication, Alexander Murinson has discussed the trilateral axis of Azerbaijan, Turkey, and Israel in the post–Cold War era, paying particular attention to the issue of energy security.3 International competition to access secure, cheap, and reliable energy resources has increased dramatically in recent decades. The impact of energy needs has influenced the formation and implementation of foreign policy in the countries of the region. This paper explores the growing importance of energy security and its contribution to the formation of strategic alliances and policies among those states in and around the region that were involved in the creation of the Baku–Tblisi–Ceyhan (BTC) pipeline. To reflect adequately the *

Lecturer in International Relations, School of Applied Sciences, Celal Bayar University, Manisa, Turkey.

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complexity of BTC policies in the post–Cold War environment, the conceptualization of security is extended beyond military security. This new concept includes energy security, transfer networks, the discovery and exploration of natural resources, and related environmental issues.

The Research Problem and its Relevance Energy supply and demand is a matter of international security. How the international market could guarantee to meet energy needs reliably, cheaply, and securely, from general sources and from the Caspian region in particular, has become an important issue for consumers. Western dependence on Russian energy resources and control of the supply networks has also become an important security matter in Europe. In these circumstances the question arose as to how, and to what extent, the BTC pipeline could potentially play a role in the diversifying of energy sources and the securing of sustainable and reliable network routes for the West and for the countries of the region. What kinds of problems did the parties involved in the BTC project face? The policies that have been put in place in the recent past for the BTC pipeline might serve as indicators of the direction of future policies and the planning and implementation of regional projects in the coming years. What kinds of instruments determined the policies of the regional countries? The economic, political, and strategic goals are directly related to the interests of the powers within the region. This chapter examines the importance of the BTC pipeline to foreign policies and security matters both regionally and internationally. Its purpose is to determine the impact of the pipeline and its associated issues on the security and foreign policies of the countries in the region. The research tasks are to identify the players and to define their policies on energy issues in general and the construction of the BTC pipeline in particular. This has three dimensions. Theoretical framework: The energy and security issues of the region are discussed and the policies and economic data relating to oil and gas are analysed. Research methodology: Analysis of scientific literature and collection of data; a comparison of information from various governmental and academic outputs; interpretation of the available materials in relation to the policies implemented. Possible developments and expectations are forecast based on the events of the recent past. Research results: National, bilateral, and multilateral relations were formed to address issues of energy security and economic and political interests. The countries involved in the BTC project worked towards its completion, while Russia and Iran opposed the

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plan. The BTC pipeline was built despite the difficulties created by regional and international players; however, some of the aims of the project are yet to be achieved.

The BTC in its Regional Context Turkey proposed to construct a pipeline that would deliver oil and gas via Azerbaijan and possibly other newly independent Turkish republics from the Caspian region to Western markets. The BTC pipeline would be geopolitically important to Azerbaijan’s, Georgia’s, and Turkey’s economic and political independence of regional influences, particularly those of Russia and Iran.4 The authorities in Israel supported the construction of the pipeline, sympathizing with Turkey’s position on regional security issues in relation to energy needs.5 The BTC pipeline’s construction would reinforce the existing ethnic, linguistic, economical, and political links between Turkey and Azerbaijan.6 Turkey championed the creation of the BTC as an east–west pipeline network from the Caspian region to the Western market in the early 1990s. Necdet Pamir’s7 strategic vision was to make Turkey a chief player in the delivery of Caspian and Iraqi hydrocarbon resources to the West. Turkey had already been exporting around 1.5 to 1.6 million barrels of Iraqi oil a day via its oil terminal in the seaport of Ceyhan.8 The Turkish authorities aimed to turn Ceyhan into a major global oil terminal by transporting oil and gas from the new Central Asian republics via a number of new pipeline projects.9 Turkey sought to secure reliable sources of oil and gas by gaining access to the new Turkish republics in Central Asia, beginning with Azerbaijan as the main gateway to further energy resources. The United States and Israel supported Turkey’s initiative on energy for their own ends in the 1990s. For pragmatic and strategic reasons, Azerbaijan became the focal point of intense diplomatic activity in Turkey, the United States, and Israel.10 The active military-strategic entente between Turkey and Israel was supported by the United States.11 This entente was boosted further by economic cooperation to promote Azerbaijan’s independence and economic viability within the Caucasus and the Caspian region. After 1995, the US government supported the project and removed many of the obstacles that stood in its way. From the outset, one of the United States’s aims was to use Azerbaijan and Turkey in the frontline of the global war against any kind of fundamentalist movement in the region.12 Discussions were instigated among the various partners on the BTC pipeline being extended to Israel and possibly even further towards Eastern markets.13

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The Transformation of Security The post–Cold War era saw changes in the understanding of the concept of security.14 The bipolarity of the world system caused shifts and diversification. Potential for new rivalries arose, and the concept of international security had to be adapted to the changed situation. New security issues included access to secure energy resources; environmental sensitivities and biospheric changes in global climate; new ideological threats; and the threat of the proliferation of weapons of mass destruction and their use against civilian populations in cities. These new threats affected relationships among regional countries, particularly those between Turkey and its immediate and regional neighbours. The Turkish–Israeli axis, the Turkish–Iranian gas contract, the BTC pipeline, and other potential pipeline projects were among the developments that Turkey undertook during the 1990s.15 The traditional concept of security included the preservation both of a state’s territory and of its sovereignty.16 However, there are other definitions of national security, including the capability of a state to deter or counter threats to the three components of territory, society, and regime.17 Comprehensive security includes military capabilities; political legitimacy; ethnic, religious, and cultural tolerance; economic capabilities; and the availability of essential natural resources. Energy security is based on a state’s ability to have continued access to sufficient supplies of environmentally safe, reliable, and affordable energy—especially oil and gas—either from its own sources or from sources abroad. Since globalization has become the dominant force animating the economic reality of the international community, energy security and competition for reliable sources of energy are at the top of the international agenda. Energy security has become integral to national, regional, and international issues.18

Caspian Offerings and Relevant Policies Azerbaijan’s petrochemical resources in the Caspian shelf became an issue of energy security and cooperation in the early 1990s, not only for Turkey, but also for the neighbouring states. Energy security is important to the forming of alliances and to the cooperative development of proposed strategic projects in the region. Azerbaijan’s geographical location is highly significant to world markets, located as it is at the east– west passageway to the land-locked Caspian Sea and its petrochemical resources. It is also an important link to a potential wider network, as it lies on the route to Central Asia and its natural resources.19 Israel plays an

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important role in energy security, not only for itself but also for the region.20 One of the fundamental concerns of Israeli leaders was and is access to secure oil and natural gas sources, since the main oil-producing countries are Arab ones who are not friendly to Israel.21 The fossil-fuel-rich Caspian basin, whose total oil exports were predicted to reach two million barrels per day, is an important source of energy security for Europe and the region.22 European and American energy requirements and strategic considerations have necessitated the establishment of stable, Westernoriented countries and administrations in the region, including in Azerbaijan. A number of transport and communications routes were developed throughout the Caucasus in order to implement Western policy and to anchor Azerbaijan in the Western-dominated global economy. In various ways, these links led to improved political stability despite their falling short of Caspian oil. The American-sponsored East–West Energy Corridor and a transportation corridor known as the TRACECA (the Europe–Caucasus–Asia project, proposed by the European Union) were expected to guarantee the independence and economic viability of Azerbaijan and the Central Asian republics.23 The East–West Energy Corridor was composed of the BTC oil pipeline, the Turkmenistan–Turkey natural gas pipeline, and the Azerbaijan–Turkey South Caucasus gas pipeline.24 The construction of this proposed corridor would allow the West and the Caspian basin countries, as well as Turkey and Israel, to benefit from Caspian energy resources. This corridor aimed to avoid potential obstacles created by countries such as Russia, Iran, and Iraq. The alliance of Israel, Turkey, and the United States was one of the major factors for the selection of the BTC route,25 which could be extended to bring oil directly to energy-deficient Israel and further to world markets.26 Having experienced the dramatic consequences of the politics played for oil in the south-west Asian Countries (SWAC) in the previous decades, Turkey expected to be one of the main beneficiaries of the BTC project. Its industry and infrastructural development had been affected by the 1973 oil embargo and the wars between Israel and its Arab neighbours. Nevertheless Turkey, while keeping to agreements and obeying international rules, had resisted becoming a satellite of either the United States or the Soviet Union during these difficult years. They had followed independent policies on foreign matters, particularly on the Cyprus issue and on the problems of the SWAC.27 Other than in economic matters, Turkey managed to avoid direct interference in its domestic affairs by the outside world. Despite its resistance on matters of foreign policy, Turkey’s energy needs forced it from time to time into difficult situations in its

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relations with Israel and the Arab oil-producing countries.28 In the second half of the 1970s, the Turkish economy came very close to total collapse because of severe and enduring shortages of fuel, power, and necessary imports.29 Turkey had to pay much more for its crude petroleum imports than it received in export earnings from its main oil suppliers, Iraq, Libya, Iran, and Saudi Arabia.30 The Turkish authorities had never forgotten the decades in which they experienced energy shortages, and they attempted to avoid the recurrence of this difficult situation by creating and initiating new energy projects in the region. During the Cold War years, the Americans were eager to secure oil supplies from the Persian Gulf, and they valued the closely cooperative relationship between Turkey and Israel as a stabilizing element in their regional strategy in the SWAC. Turkey began importing natural gas from Russia and became increasingly dependent on Russian gas from 1987 onwards. The Turks tried to meet their economy’s energy needs by the constructing Mavi AkÕm, the Blue Stream project, with the capacity to pump 565 billion cubic feet of oil per year. It is estimated that the Blue Stream project significantly increased Turkey’s dependence on Russia for natural gas, as it was contracted to import 67% of its gas by 2006.31 It has been claimed that this is an attempt by the Turkish authorities to diversify its import sources. Caspian oil and gas resources are a potential cause of conflict among the neighbouring states of the Caspian Sea. Azerbaijan, Iran, Turkmenistan, Kazakhstan, and Russia have all laid claim to the petrochemicals in their prospective sea shelves. Each state has its own intentions for its natural resources and for their transfer to world consumer markets. Russia has pursued a dual goal, with its attention on the networks between Asia and Europe as well as on the Caspian region. The Russians wanted to control the largest production share of hydrocarbons of the regions as well as having total control over transport routes to world markets.32 Azerbaijan tried various ways of breaking its dependence on Russia for the delivery of its natural resources, and of attempting to gain some political leverage. Nevertheless, Russia succeeded to an extent in controlling the pipeline infrastructure that delivered Caspian energy to the market in the mid-1990s. The BTC oil pipeline provided a way for Azerbaijan to overcome the Russian problem. Meanwhile, Azerbaijani leaders tried to optimize economic and political gains from the United States and Turkey through the BTC pipeline, which was an expensive (and therefore not lucrative) overland route for international investors. However, the discovery of the world’s largest natural gas reserve since 1978 in the Shah Deniz field33 helped attract investors to this strategic

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pipeline. The new gas from the Shah Deniz field will be delivered to the world market through Turkey via the South Caucasus Pipeline (SCP), which will be built parallel to the BTC pipeline, extending to the Turkish gas pipeline network near the town of Horasan.34 The pipeline is expected to be some 630 miles long, including 290 miles in Azerbaijan and approximately 170 miles each in Georgia and Turkey. The estimated cost of the line is $900 million.35 With its gas reserve, Azerbaijan has become a major player in the Caspian gas business. British Petroleum (BP) is the largest shareholder in the Azerbaijani International Oil Corporation (AIOC), which decided to use the BTC pipeline in addition to a Russian pipeline for Azerbaijani oil in 1999.36 Turkey sought to strengthen its relationships with its new republics in Central Asia.37 Its leaders expected support from the West, particularly from the United States, in forming these new ties. The aims were to access secure energy supplies and to become the network centre for the transit of energy from its source to Western consumer markets. Turkey hoped that its close ties with Azerbaijan would support the secular and pro-Western leanings of the ruling elite. This was important for the newly independent states while Russia and Iran were working to achieve ends which might not serve the interests of the West. The new direction of Azerbaijan’s regime and its vital natural resources became a major topic of international discussion and cooperation.38 Turkey’s lobbying initiatives for the construction of the BTC pipeline were strengthened by Israel’s lobby, helping to boost relations between Turkey and Israel. The latter needed Turkey’s support not only to take a stand on Israel’s claim to existence but also to stabilize the region to make it attractive to Western interests.39 For various economic, strategic, and political reasons, Azerbaijan could be one of the most reliable partners in the region for Turkey as well as for Israel. Their shared interests lie in the sphere of economics and include agriculture, industrial developments, telecommunications, and geopolitical and strategic aims which might serve Western interests. It seems that the Americans approved the multi-vector foreign policy relations between Azerbaijan and its Western neighbours, namely Turkey and Israel. All of the parties aimed to achieve their individual goals within the agreed frameworks. This would enable the United States to diversify its energy sources and apply its regime change policy to the region. Its ally Israel would be able to share its industrial resources and technical expertise in the areas of medicine, agriculture, and irrigation with the new republics of Central Asia. Turkey, on the other hand, would benefit from American economic, political, and strategic policy as a reliable partner in the Transcaucasus and Central Asia. Azerbaijan expected to cultivate its

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Western ties through an alliance with Turkey and its Western-oriented partners. It seemed that energy was at the core of these multiparty relations, as it was crucial for the Western parties to gain access to Caspian hydrocarbon resources. Nevertheless, some interest groups, such as the American Armenian lobby, opposed the BTC project and US governmental aid to Azerbaijan. The Silk Road Strategy Act in US Congress, which involved the BTC project, was an attempt to link Azerbaijan to the East–West Energy Corridor. The American Armenian lobby conducted a campaign to block this legislation, which passed in June 1999.40 The United States found itself with a dilemma on this energy issue. The Armenian lobby had to be considered in Congress, and Armenia itself was not to be brushed aside to fall into Russian hands; on the other hand, Azerbaijan and the US allies, Turkey and Israel, had to be considered carefully. The counteractions of the Turkish and Azerbaijani lobby were supported by the American Israel lobby, and this coincided with the improvement of Turkish–Israeli relations.41 The Turkish authorities were grateful to the lobby, and in particular to the B’nai Brith, the international Jewish service organization, which played a prominent role in the lobbying effort. Moreover, to reduce future dependence on Persian Gulf oil following the events of 11 September 2001, the United States revived its policy of securing energy through the diversification of world hydrocarbon fuel supplies. The US aim was fulfilled by request of Azeri, Turkish, and Israelis in the Caucasus.

Regional Energy and the Requirement for International Cooperation Its rapidly growing economy has made Turkey a significant regional consumer of secure and sustainable energy which is almost totally dependent on importation. Almost ninety percent of Turkey’s oil requirements were met by Russia and the SWAC, with Russia supplying almost half of Turkey’s energy. The projections for Turkey’s energy needs by 2010 grew from 200 to 300 percent, seventy-five percent of which were from imported sources.42 Israel, on the other hand, does not possess significant oil resources and is completely reliant on oil imports. Economic figures indicate that Turkey and Israel need to source their energy from the Caucasus and the Caspian region.43

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Fig. 27-1 Bosporus Bypass Options

Source: US Government (http://www.eia.gov/countries/).

Western and European demands for sustainable and cheap oil and natural gas supplies have grown rapidly in recent years. These demands, along with the potential threats to oil resources and their transportation, led to two Gulf Wars in within a decade or so. Like Western countries, Israel met its petrochemical needs by exporting oil from Egypt, the North Sea, West Africa, and Mexico. However, it still sought alternatives and changed from its traditional suppliers to the new exporters like Russia, Azerbaijan, Kazakhstan, and Turkmenistan.44 Regional relations were affected by concerns about energy security, and this played a prominent role in the formation of regional alliances. The construction of pipelines and seaport terminals for the delivery of oil and gas to their markets were economically and politically important for the transit through central network countries. The availability of multiple transportation routes for oil and gas can contribute to energy security for both exporters and importers. It may also help to decrease dependence on

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any one pipeline in case of conflict in the region, either from terrorist attacks or inter-state clashes. The Israeli lobby in the United States supported the construction of the BTC pipeline, which might benefit the Jewish state in the SWAC. The pipeline would be important for Israel and Turkey, lessening both countries’ dependence on the Arabs. This would mean the creation of a freer foreign policy in energy matters for Turkey, particularly towards those affiliated with the Arab states. The resultant boost to the relations between Turkey and Israel would be welcomed by the American Israel lobby. The then president of Azerbaijan, Haydar Aliyev, met with American Jewish leaders in August 1997, seeking their support for an active campaign to promote the BTC project on Capitol Hill. The concerted lobbying campaign reflected the confluence of interests of Turkey, Israel, and Azerbaijan. The BTC pipeline, despite its limited capacity to carry gas and oil, allowed some flexibility for the foreign policy of Azerbaijan, who had largely followed Iranian policy with regard to the United States and Israel during the 1990s. The pipeline, as well as providing links from Azerbaijan to Turkey, Georgia, and Israel, also facilitated the quick and reliable delivery of Azerbaijani oil to Western markets by avoiding Iranian and Russian territories. For Turkey, the port of Ceyhan has become an important oil terminal in the Mediterranean Sea. It is expected that the BTC will transfer fifteen million tons of Azerbaijani oil to the Mediterranean Sea. Azerbaijan sought reassurance from Turkey and the United States that it would be protected from Iranian interference in oil exploration in its Caspian continental shelf. Iran did not like what was happening with the BTC project in Azerbaijan, and disputed the maritime and seabed boundaries that demarcated its sector and determined the legal status of the Caspian Sea.45 According to Azerbaijani officials, since the collapse of the Soviet Union Iran has supported Armenia in the Nagorno-Karabakh conflict; opposed Azerbaijani policy on the Caspian Sea; and worked against the BTC project and Azerbaijanii integration with the West.46 Iran opposed the project because it would deprive them of potential oil transportation revenues. Iranian gunboats have made several incursions into Azerbaijani territorial waters. The last violation occurred on 23 July 2001, when an Iranian warship ordered an Azerbaijani exploration ship, hired from British Petroleum, to withdraw from exploration operations in a disputed zone. In a show of force and to express support for Azerbaijan, Turkey sent its Chief of General Staff, Hüseyin KÕvrÕko÷lu, with an Air Force squadron, to Baku to participate in an air show in the Azerbaijani capital.47 Israel has shadowed this operation, indicating that Azerbaijan

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would be supported in the event of a conflict with Turkey and its Western allies. Overall trade between Israel and Azerbaijan constituted a small amount ($23 million in 1996–1998) of its potential of $1 billion.48 Moreover, Israel has been importing oil from Azerbaijan since 1991. The Azerbaijani–Turkish trade volume for the same period constituted $832 million.49 This might seem a greater volume in comparison; however, the potential similarities of the economies of Azerbaijan and Turkey is far greater than those of Azerbaijan and Israel. Oil is the main commodity in trade relations between these countries. The Israeli prime minister, Benjamin Netanyahu, expressed his country’s interest in importing Azerbaijani oil through the BTC pipeline on his visit to Azerbaijan in 1997. Russia, on the other hand, proposed two alternative oil pipelines, one beneath the Black Sea to Samsun and the other through Armenia to Turkey, with plans for an extension to Israel.50 The BTC pipeline began to deliver Azerbaijani oil to the markets in July 2006.51 However, the volume of oil was not enough to make the pipeline project economically viable. On the other hand, Kazakhstan, as the largest regional oil producer in the region, committed to supplying additional oil to make the BTC pipeline commercially viable for investors and for consumer markets. The pipeline’s capacity is projected at one million barrels per day. There was a general expectation for Kazakhstan to pump oil through an underwater cross-Caspian pipeline, which would necessitate the construction of a new pipeline from Aktau to Baku. This Kazakh oil would make the BTC pipeline profitable for all parties.52 Turkey’s geo-strategic location at the junction of the two continents makes it an ideal location for an energy network corridor linking Caspian oil and gas producers with Western consumer markets. Energy security was the main focus of Turkish internal and foreign policy in the post–Cold War years.53 The seaport terminal of Ceyhan will be an important outlet, both for the already existing Kirkuk-Ceyhan pipeline for Iraqi oil exports and for potential Caspian oil exports through the BTC pipeline.54 Turkey has proved a reliable ally to the West as a stable and reliable democratic country in the region. This gave it a competitive advantage in building and maintaining pipeline and infrastructure projects to serve world markets from the region.

Gas Synergy in the SWAC: Israel in Focus Seeing the BTC pipeline and its extension to Israel as a way to end its isolation in the region, Israel seized the opportunity for political and economic gain. It would thereby be guaranteed a reliable source of oil and

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gas to meet its ever-expanding demand for industrial growth without disturbing the Persian Gulf states. The demand for natural gas in Israel had grown exponentially since the 1980s and had reached about 282.5 billion cubic feet (bcf) annually by 2010.55 The Israel Electric Company planned to invest $1.5 billion in the construction of eight additional natural gas power plants in Israel. Turkish policymakers wanted to become involved in the supply of natural gas and oil to Israel through Turkey as a means of participation in the Israeli power network project, hence encouraging cooperation in other areas. In October 2005, Zorlu Holding signed a contract for a twenty percent share of the construction of the Ashdod gas-based power plant in Israel, which was expected to produce the significant amount of 100 megawatts of energy per year.56 To meet its energy requirements securely and reliably, Israel was forced to consider diversifying its gas supply sources. With its potential to transport gas and oil to Kazakhstan and Turkmenistan as well, the BTC pipeline represents a real alternative for Israel. The Israeli company Merhav invested in Turkmenistan, becoming the largest foreign contractor working to reconstruct and upgrade Turkmen refineries. Merhav controlled $1.4 billion worth of contracts in Turkmenistan’s energy industry.57 Prior to 1997, natural gas from the Caspian region was delivered via the Russian natural gas pipeline system through the re-export route from Turkmenistan. Russia had originally intended to deliver gas to the Turkish market by extending its Central Asian pipeline, connecting it to the existing Russian natural gas pipeline to Georgia and then, via a new pipeline, to Turkey. In October 1998, Merhav negotiated with the Turkmenbashi government a three billion USD deal to build a transCaspian gas pipeline (TCGP) that would bypass Russian territory. Earlier that month, the Turkish President Süleyman Demirel and Saparmurat Niyazov had signed a long-term agreement for the supply of Turkmen gas to Turkey via the Merhav-backed Israeli pipeline.58 This pipeline was expected to be a substantial component of the US-sponsored East–West corridor and would run alongside the BTC pipeline. The BTC project was approved by the Turkish, American, Azerbaijani, Georgian, Kazakhi, and Turkmen governments in October 1998. The project was not financially viable as the costs were expected to be high. Nevertheless, it was an important step forward for long-term diplomatic, strategic, and political purposes. The American government hoped that the project would satisfy Turkey’s energy needs and possibly be a future power source for Israel as its main partner in the region.

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As the world’s largest producer of natural gas, Russia has vigorously competed for the delivery of natural gas to Turkey since the mid-1990s. Ultimately, Gazprom, holding the Russian gas monopoly, was able to harness its influence among Turkish and Israeli business lobbies and thus to secure discussions on the controversial Blue Stream project. Negotiations are now under way to extend the Russian pipeline through Turkish territory from the Mediterranean to Israel.

Turkish Gas Supply and Demand Turkey is heavily dependent on imports for its energy production and industrial needs, and has begun a shift from oil to natural gas. Turkish consumption of natural gas has increased dramatically within a decade, from 150 bcf in 1991 to 748 bcf in 2003, and Turkey has signed gas import contracts for a total of around 1.8 trillion cubic feet (tcf) per year.59 The contracted amount was far above the country’s actual needs, and BOTAù, the state natural gas and pipeline company, reduced the estimation by forty-five percent, from about 1.6 tcf to under 0.9 tcf, in 2005.60 In August 1996, the Erbakan government signed a natural gas contract with Iran. This was opposed by various internal and external interest groups:61 some writers described the deal as a representation of a broader Erbakan campaign to improve its relations with the predominantly Muslim world as part of the D8 project.62 The gas supplied by Iran to Turkey was expected to meet around nineteen percent of Turkey’s needs by 2010.63 Despite the suspension of the planned Trans-Caspian Pipeline in 2002, the new discovery in the Shah Deniz reduced Turkmenistan’s leverage in negotiations over the pipeline’s delivery capacity. On the other hand, Turkey was ambitious in signing an agreement with Azerbaijan, having already over-committed itself to the gas importation agreements it had made with Iran and Russia. Russia and Iran had imposed strict “take or pay” conditions on Turkey. In the event of the Turkish government’s failure to fulfil its contract to purchase gas, it would nonetheless be obliged to pay for gas which it had not received. Penalties of up to $1 billion per year were to be imposed on Turkey for failure to fulfil the contract to the letter.64 In addition, Turkey was not allowed to re-export Russian gas, either to third parties or to importers. Nevertheless, in late 2003 the parties managed to reach a settlement that reduced both the price and the take or pay percentage.65 Further discussion took place and some of the contract’s clauses were renegotiated, but discretion remained in the hands of Russia. Meanwhile, Turkey continued to cooperate with

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Azerbaijan on gas transportation and energy security, signing an agreement on the gas export deal from the Shah Deniz field. This agreement had Azerbaijan deliver 70 bcf of natural gas to Turkey in 2006, 177 bcf in 2007, and around 223 bcf per year from 2009 to 2020.66 By 2010, Azerbaijan was expected to supply about 13 percent of Turkey’s total gas imports. Moreover, Turkey and Azerbaijan were constructing the Baku–Tbilisi–Erzurum (South Caucasus Gas) pipeline to run parallel to the BTC. These projects were expected to improve the East–West energy corridor in the coming years. With Turkey supporting the transfer of Azerbaijani gas to the Euro-Atlantic community, Azerbaijan’s economic self-sufficiency and geopolitical standing will be increased.

The Impact of the Blue Stream Pipeline on BTC Gas Usage The Blue Stream gas pipeline beneath the Black Sea was completed in October 2002 and officially opened in November 2005. It runs from the Russian port of Dzhugba to Samsun in Turkey and was projected to carry 275,700 billion barrels per day.67 Dependence on any one foreign supplier weakens a country’s energy security. Russia formed a strategic goal to reestablish itself as the great energy power in the region, aiming to be the dominant power in the energy business as an exporter and to own a network of gas and oil transfer routes. Energy is considered key to Russia’s new foreign policy, with its focus on oil and gas distribution networks and control of energy resources and electricity grids in neighbouring countries, and its aim to be the dominant player in the supply of oil and gas to Europe.68 The Turkish government’s decision to go ahead with the Blue Stream project was the result of intense lobbying, particularly from GAMA, ENKA, and Tekfen who invested heavily in Russia. Both the Do÷ru Yol Partisi (the True Path Party) government under Tansu Çiller (1993–1997) and the Anavatan (Motherland) government led by Mesut YÕlmaz (1997–2000) were accused of using their influence to secure the implementation of Blue Stream. Corruption scandals were associated with every stage of negotiation and construction of the project.69 The signing of the contract was geopolitically significant to the reversal in Turkish–Russian relations. It was signed during Russian Prime Minister Viktor Chernomyrdin’s visit to Turkey on 16–17 December 1997.70 However, the Justice and Development (AK Party) government harshly criticized the gas deal made by previous governments and attempted to reduce Turkey’s dependence on Russia in 2003. The Justice

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and Development government aimed to reduce the proportion of natural gas supplied by Russia from seventy percent to thirty percent within five years.71 The Blue Stream project undermined Turkey’s long-term energy independence and security. Russia gained the upper hand over Turkey through the legal mechanism of take or pay, leaving Turkey to pay exorbitant penalty fees for suspending the supply of Russian gas into its distribution system.72 The contract is forcing Turkey to reconsider its plans to support the newly independent Turkish republics in Central Asia. Direct importing of their natural gas has become less feasible and much more financially taxing for Turkey.

New Initiatives in Energy Cooperation The completion of the BTC pipeline marked a turning-point in cooperative relationships among Baku, Tbilisi, Ankara, and Jerusalem.73 The inauguration ceremony for the pipeline, which was supported by the United States, took place in the Turkish Mediterranean port on 6 July 2006.74 Israel sent its Minister of National Infrastructures, Binyamin BenEliezer to the ceremony, at which thirty-six other countries were represented. Israel was interested in building a 600 kilometre extension to the BTC pipeline, connecting to its Red Sea port in Eilat so that Caspian oil and gas could be delivered to Eastern markets.75 The pipeline’s first delivery of Azerbaijani oil reached Israel in July 2006. It was only the sixth time that crude oil had been delivered via the pipeline to the Turkish terminal of Ceyhan and on to international markets. As a matter of general policy, Israel keeps the sources of its energy imports and some other national issues confidential. However, if Israel had been secretly purchasing Azerbaijani oil, from this point on it underscored its strategic cooperation with Azerbaijan and Turkey by making this information public.76 Azerbaijan and Turkey took significant political and economic risks by selling and transferring oil to Israel in defiance of Iranian and Arab regimes. Currently, one sixth of Israel’s oil imports come from Azerbaijan.77 When the Azeri–Chirag–Güneúli (ACG) oil field in the Azerbaijani Caspian shelf reaches its maximum extraction capacity, Azerbaijan is expected to generate twenty-nine billion USD in oil revenue over the following twenty years.78 Israel is interested in purchasing natural gas from the Shah Deniz field, which could reach an extraction volume of between nine and twenty-four billion cubic metres annually. Israel needs to import 1.7 billion cubic metres of gas, some of which could come from Azerbaijan. It is also

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proposed to extend the completed Baku–Tbilisi–Erzurum natural gas pipeline to the Ceyhan energy centre in Turkey. Israeli officials have expressed an interest in purchasing as much Azerbaijani gas as possible, and have discussed the possibility of a long-term contract with their Turkish counterparts.79

Conclusion The post–Cold War years brought an end to the threats to Turkey and the wider region posed by the Soviet Union. However, Turkey faced a number of new challenges to their general security. The Turkish authorities tried to transform their status in the region from consumer to producer of security for world markets. This initiative necessitated facing and overcoming a number of challenges, both regionally and internationally. Moreover, globalization and the end of the Cold War had shifted the definition of security to include non-military issues such as energy security. Meanwhile, regional oil and gas producers like Azerbaijan, Kazakhstan, and Russia sought to take advantage of the ongoing conflict in the Persian Gulf and the rising demand for petrochemical energy sources in the world market. The post–Soviet Union era provided new opportunities for global consumers and regional countries to gain clear access to reliable sources of petrochemicals in the Caucasus and Central Asia. Due to its geographical location, Azerbaijan found itself in a favourable position for transferring Central Asian resources to Western markets. The energy demands and the new geopolitical climate required fresh international initiatives, either bilaterally or multilaterally.80 The sharing and distribution of petrochemical resources in the Caspian shelf were problematic for the neighbouring countries in the early 1990s. Major energy security issues, with the potential to affect world energy markets, arose in the area. Meanwhile, the relations of the two Westernleaning regional democratic countries were diversified on various issues. In this climate, the relationship between Turkey and Israel helped to promote Azerbaijan’s independence and economic viability and its cooperation with the other potential Central Asian Turkish republics. The United States supported these two countries in their challenge for power in the Caucasus and Caspian regions. This was not easily achieved, but the US government’s support for the region was evident in its involvement with the BTC project from 1995 onwards. An inauguration ceremony for the BTC oil pipeline was held in Ceyhan on 6 July 2006. The pipeline extended around the territories of

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Russia and Armenia, both of which have close relations with Iran. This geopolitical project was built to transport Caspian oil to the Turkish port of Ceyhan for Western markets, supporting Azerbaijan’s economic and political independence against challenges from Russia and Iran. This was important for American and Israeli policymakers, who shared the same original perceptions and recognized the strategic value of the construction of the pipeline. Israeli officials began to discuss with Turkey the potential to extend the pipeline to Israel for eastern markets. However, Turkey’s overall strategy was not fully realised due to Russia’s political challenge as the dominant producer-country of hydrocarbons to the energy network. The active and planned pipelines (BTC and South Caucasus Gas) will make significant contributions to the overall economic viability and environmental security of all three transit countries, Azerbaijan, Georgia, and Turkey. This is particularly important from economic and environmental perspectives in the light of the commercial exploitation of Georgia and Azerbaijan. These are more or less dependent on transit fees from the pipelines as significant revenue sources. On the other hand, Turkey’s regulated transit fees are low in relation to its economic size: $40 million annually in the last six years, with an expected rise to $300 million when the pipeline reaches its full capacity. This falls short of the $1.5 billion that Turkey had expected to earn from BTC business. These projections include pipeline and terminal operations, transit fees, and upstream investments. It is forecast that the Caspian region could pump over 6 million barrels a day, roughly six percent of the daily world oil demand, by 2020.81 In the near future, energy, water, and environmental security may be the most important issues in relationships among the regional countries. In such an environment, cooperation and the maintaining of alliances will be important to national and regional security among the parties. The BTC pipeline and other planned pipeline projects will reduce the risk posed by potential environmental disasters in the Turkish Straits, since they will significantly reduce oil tanker traffic.82 At its full capacity, the pipeline will avoid around 450–500 additional tanker journeys a year, which amounts to approximately thirty-five percent of current tanker traffic through the Bosporus and Dardanelles. In addition, Russia’s export traffic to Baltic ports decreased from 3.1 million to 2.6 million barrels per day (bbl/d) in 2006. Currently, 50,000 vessels including 5,500 oil tankers pass through the Straits annually, but crude production and export from Azerbaijan and Kazakhstan are expected to increase this traffic.83 (See fig. 27-1 for proposed Bosporus Bypass Options).

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In the sphere of natural gas, the increasingly important alternative to oil, cooperation among countries has had a less propitious effect. The Blue Stream contract stipulates that Russia has exclusive rights to the construction and operation of the Blue Stream pipeline project. Russia challenges any initiative to change the status quo, as exemplified by its invasion of Georgia in August 2008. Nevertheless, the Blue Stream project does present potential opportunities, providing an energy bridge not only from east to west but also from north to south, to transport Russian natural gas to Israel for the eastern markets. In this and other possible future scenarios, there will be great potential for Turkey to increase its geopolitical stature in the SWAC and to fulfil the need for energy security in Greater Europe.84 Recent developments suggest that, in the medium term, Russia would reap most of the financial benefits as the exclusive gas exporter and transit country of the region and of the world. With bilateral energy relations as they are at present, Russia has the capacity to exert political influence on and economic leverage over Turkey. Projects delivering oil, gas, electricity, and water from source countries through Turkey to the Asian and European markets offer the possibility of a breakthrough for Turkey and involvement in energy and security provision for Israel. On the other hand, the conflict between Russia and Georgia in August 2008 had important implications for the West in general and for Turkey, Israel, and the United States in particular. The conflict took place near the BTC and South Caucasus pipelines, which were critical for delivering energy resources to Western markets. Russia sent a clear message to the international community about who was in charge and in control of delivery and distribution of natural resources in the area extending from the Caucasus to Central Asia.85 This would indicate that the energy game is not fully over, and that there are many projects to plan and alliances to be formed as challenges in the region continue.

Notes 1

Most of the data on energy were obtained from the United States Energy Information Administration (henceforth EIA), see http://www.eia.doe.gov. 2 F. Sönmezo÷lu, UluslararasÕ Politika ve DÕú Politika Analizi [International policy and analysis of foreign policy] (Istanbul: Filiz Kitabevi, 2005); idem, Türk DÕú PolitikasÕ [Turkish foreign policy] (Istanbul: Der YayÕnlarÕ, 2006); B. Aras, The New Geopolitics of Eurasia and Turkey’s Position (London: Frank Cass, 2002); A. Liel, Turkey in the Middle East: Oil, Islam, and Politics (London: Lyne Rienner Publishers, 2001); A. Machlis, “Azerbaijan courts Jews, Israel to Win Favour with US,” 2001, http://www.jewishaz.com/jewishnews/000218/charsid2.html; M. AydÕn,

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“Global De÷iúim ve Geniúleyen Türk DünyasÕ: Türkler ve Türkiler,” [Global change and the expanding Turkish world: Turks and Turkics], in Türkiye’nin DÕú Politika Gündemi [Foreign policy agenda of Turkey], ed. ùaban H. ÇalÕú, øhsan D. Da÷Õ, and Ramazan Gözen (Ankara: Liberte YayÕnlarÕ, 2001), 271–291; S. BölükbaúÕ, “Türkiye ve øsrail: Mesafeli YakÕnlÕktan Stratejik OrtaklÕ÷a,” [Turkey and Israel: From distanced relationship to the strategic partnership], in ÇalÕú, Da÷Õ, and Gözen, eds., Türkiye’nin DÕú Politika Gündemi; N. A. Güney, “Rusya Federasyonu’nun Yeni Güvenlik PolitikasÕ Çerçevesinde Türkiye’ye BakÕúÕ” [Turkey in the perspective of the new security policy of Russian Federation], in Türkiye’nin KomúularÕ [Turkey’s neighbours], (Ankara: ømge Kitabevi Ankara, 2002), 333–376; O. TanrÕsever, “Sovyet-SonrasÕ Dönemde Rusya’nÕn Kafkasya PolitikasÕ” [Russian Caucasus policy in the post-Soviet era], in Türkeú and Uzgel, eds., Türkiye’nin KomúularÕ, 377–410; B. K. Yeúilbursa, Orta Do÷uda So÷uk Savaú ve Emperyalizm [The Cold War in the Middle East and Imperialism], (Istanbul: IQ Kültür Sanat YayÕncÕlÕk, 2007). See also ødris Bal, ed., Türk DÕú PolitikasÕ [Turkish foreign policy] (Ankara: Nobel YayÕnlarÕ, 2004), and articles therein. 3 S. Peterson, “Middle East Balance of Power Shifts as an “Axis” is Born,” Christian Science Monitor 1996; A. Murinson, “Azerbaijan–Turkey–Israel Relations: The Energy Factor,” Meria: The Middle East Review of International Affairs 12, no. 3 (September 2008): 1–9. 4 Efegil, “Türk-Rus øliúkileri,” 351–359; Ersoy, “Bölgesel Entegrasyon,” 537–550. 5 D. Pipes, “The Emerging Turkish–Israeli Entente,” The National Interest, no. 50 (Winter 1998): 38–39; J. M. Nomikos, “Israel–Turkey Defense Relations: Will It Last?” Research Institute for European Studies (October 1996); Nomikos, “Looking Back to See Forward: Israeli—Turkey Defense Relations,” Special Report, Research Paper No. 39. Research Institute for European Studies, 1997; A. Nachmani, Israel, Turkey, and Greece: Uneasy Relations in the East Mediterranean (London: Frank Cass, 1998); idem, The Remarkable Turkish–Israeli Tie, Middle East Quarterly 5, no. 2 (1999); idem, “Turkey–Israel Strategic Partnership,” BESA Security and Policy Studies, no. 42, Ramat Gan (Israel: The BESA Center for Strategic Studies, 1999). 6 Kalafat and AslanlÕ, Türkiye-Azerbaycan øliúkileri, 379–396; Kalafat, “Türkiye– Türk Cumhuriyetleri Kültür øliúkileri,” 464–466. 7 Necdet Pamir was the initiator of the BTC with respect to Turkish public opinion and business circles. He was an energy security analyst with the Turkish Petroleum Corporation (Türkiye Petrolleri Ananim OrtaklÕ÷Õ, TPAO). Pamir emphasized the BTC project’s strategic value rather than its economic profitability. The line will bypass Russia and Iran, and thus Turkish republics in Central Asia will no longer be dependent on Russia to export their oil and gas, so they will be able to exercise their foreign policy and national decisions more freely; see Pamir, “Orta Asya ve Kafkasya’da,” 507–535. 8 U.S. Energy Information Administration, Turkey Country Analysis Brief, http:// www.eia.doe.gov/emeu/cabs/turkey.html; US Energy Information Administration, Israel Country Analysis Brief, http://www.eia.doe.gov ; ArÕ, “Türkiye, Irak ve ABD,” 667–699, 701–723.

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ø. AltÕnsoy, “Samsun–Ceyhan Pipeline” [Samsun–Ceyhan BoruhattÕ], Zaman, 7 December 2005, p. 3; idem, “Turkey now has a Voice in Energy Policies” [Türkiye’nin enerji politikalarÕnda sözü var,” Zaman, 14 July 2006, p. 5. 10 K. KasÕm, “Türkiye–øsrail øliúkileri: øki Bölgesel Gücün Stratejik OrtaklÕ÷Õ,” [Turkish–Israeli Relations: The strategic partnership of two regional powers], in Bal, ed.,Türk DÕú PolitikasÕ, 809–820. 11 T. ArÕ, “Geçmiúten Günümüze Türkiye’nin Orta Do÷u PolitikasÕnÕn Analizi ve øliúkileri Belirleyen Dinamikler” [The analysis of Turkish Middle East policies from the past to the present and the effective dynamics], in Bal, ed., Türk DÕú PolitikasÕ, 667–699, 701–723. 12 Various modes of cooperation were envisaged, such on the PKK-KADEK, alQaida, ASALA for Turkey; Hizbullah, Islamic Jihad, and Hamas for Israel; and weapon of mass destruction and other transnational threats for the US (EIA: Israel; KasÕm, “Türkiye–øsrail øliúkileri,” 809–820. 13 EIA: Israel. 14 Sönmezo÷lu, UluslararasÕ Politika, 21–38. This study is one of a number of excellent books in the field of political theory written in Turkish. It contains a number of discussions on the formation of security issues in a state’s foreign policy, and sets out the state and other players’ roles within the framework of statehood. 15 Sönmezo÷lu, Türk DÕú PolitikasÕ, 690–755; Pamir, “Orta Asya ve Kafkasya’dam,” 515–531. 16 Sönmezo÷lu, Türk DÕú PolitikasÕ, 21–33. 17 Murinson, “Azerbaijan–Turkey–Israel,” 5. 18 Bal, Türk DÕú PolitikasÕ, 823–841; Murinson, “Azerbaijan–Turkey–Israel,” 8. 19 EIA: The Caspian Sea Region. 20 H. Erdemir, Türkiye–øsrail øliúkileri [Turkey–Israeli Relations] (Manisa: Celal Bayar University BasÕmevi, 2007), 1–22. 21 Erdemir, Türkiye–øsrail øliúkileri, 23–59. 22 EIA: The Caspian Sea Region; Murinson, “Azerbaijan–Turkey–Israel,” 1–14. 23 See maps in figs. 27-2 and 27-3 for existing and proposed pipelines. 24 EIA: The Caspian Sea Region; EIA: Turkey, 7. 25 The BTC is the first direct pipeline to deliver crude oil from the Caspian Sea to the Mediterranean without crossing Russian territory or passing through the Bosporus. The length of the BTC is 1,100 miles and will cost around $4 billion to build (EIA: Turkey, 3). 26 C. Bollyn, “The Great Game: The War for Caspian Oil and Gas,” American Free Press, 14 October 2004, http://www.rense.com/general15/game.htm. 27 Sönmezo÷lu, Türk DÕú PolitikasÕ, 288–316, 440–441. 28 Sönmezo÷lu, Türk DÕú PolitikasÕ, 443–457. 29 Sönmezo÷lu, Türk DÕú PolitikasÕ, 362–368. 30 Liel, Turkey in the Middle East, 68–72. 31 EIA: Turkey, 7. 32 EIA: The Caspian Sea Region. 33 Estimates stand at over 700 billion cubic meters, http://www.gasandoil.com/ goc/company/cnc93719.htm.

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EIA: Turkey, 3. EIA: The Caspian Sea Region. 36 EIA: Turkey, 8–9. 37 Kalafat, “Türkiye-Türk Cumhuriyetleri,” 463–500. 38 Pamir, “Orta Asya ve Kafkasya’da,” 507–535. 39 Erdemir, Türkiye–øsrail øliúkileri, 2–3. 40 “Silk Road Legislation Passes US Senate Tonight,” Website of Senator Sam Brownback, http://brownback.senate.gov/pressapp/record.cfm?id=175947& (link now broken). 41 Machlis, “Azerbaijan courts Jews.” 42 EIA: Turkey, 6. 43 Machlis, “Azerbaijan courts Jews.” 44 US Energy Information Administration: Israel Country Report, http://www.eia.doe.gov. 45 The dispute focuses on the question of whether the Caspian is a sea or a lake and has implications for both the applicability of the UN Convention on the Law of the Sea and negotiation of the boundary demarcation regime. 46 Pamir, “Orta Asya ve Kafkasya’da.” 47 H. Erdemir, “The Requirement for International Relations Knowledge by Business Management in the Example of the Turkish-Iranian Gas Contract of 1996,” Social Research (Siauliai University) 1, no. 9 (2007): 73–80. 48 Murinson, “Azerbaijan–Turkey–Israel,” 15. 49 Murinson, “Azerbaijan–Turkey–Israel,” 15. 50 The head of Gazprom, Rem Vyakhirev, visited Turkey on 29 August 1997 and handed the two projects over to the Turkish authorities. 51 EIA: Turkey, 3. 52 As reported by Eurasianet, http://www.eurasianet.org. 53 EIA: Turkey, 2; http://globalization.icaap.org/content/v3.1/03_stern.html. 54 EIA: Turkey, 3. 55 EIA: Israel; EIA: Annual Oil Market Chronology, 1–51. 56 “Zorlu øsrail’de santral inúa edecek” [Zorlu will build power plant in Israel], Zaman, 12 October 2005, http://www.zaman.com.tr/haber.do? haberno=219036. 57 Under the contract, Merhav is responsible for the refining of up to two million tons of crude oil and ultimately would produce 900,000 tones of gasoline a year; see Murinson, “Azerbaijan–Turkey–Israel,” 53. 58 “The Merhav deal included the prospective development of upstream gas resources, negotiating rights of way with Azerbaijan and Georgia, and constructing a 2,000 kilometres pipeline capable of transporting 30 billion cubic meters of gas annually. Azerbaijan and Georgia would have benefited financially from transit fees, but the international consortium (Amoco, Unocal with Conoco, Halliburton, Enron, Bechtel, Mobil and GE Capital) was suspended. The TCGP project was met with intense opposition from the Russian Government, which applied considerable pressure on the Western oil concerns involved in the project”: Murinson, “Azerbaijan–Turkey–Israel.” 59 EIA: Turkey, 1–5. 60 EIA: Turkey, 6. 35

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61 For further discussion on the contract and analysis of criticisms, see Erdemir, Türkiye–øsrail øliúkileri, 73–80; see also Murinson, “Azerbaijan–Turkey–Israel,” 1–15. 62 See “Turkey: The Key to Caspian Oil and Gas,” Institute for Advanced Strategic and Political Studies (Israel), http://www.iasps.org/strategic/strat13.pdf. 63 “U.S Trade Sanctions: Effective Tool or Superpower Cudgel?” Federation of American Scientists website, 26 August 1996, http://www.fas.org/irp/news/1995/ 960826mr.htm. 64 EIA: Turkey, 9. 65 “Gazprom’s Trouble In Turkey,” http://english.neftegaz.ru/analit/comments .php?one=1&id=1073. 66 EIA: Turkey, 9. 67 EIA: Turkey, 7. 68 Güney, “Rusya Federasyonu’nun,” 337–338. 69 The former Turkish Prime Minister Mesut YÕlmaz and two former Turkish energy ministers, Cumhur Ersümer and Zeki Çakan, have been under Turkish state court investigation on corruption charges stemming from multiple allegations of bribery of the Turkish state officials who signed the agreement to construct the Blue Stream project. The Beyaz Enerji “White Energy” secret police investigation of 2001 specifically named Cumhur Ersümer as the prime suspect. 70 Friedrich-Ebert-Stiftung website, http://www.fes.de/globalization. 71 EIA: Turkey, 7–9. 72 EIA: Turkey, 9. Nevertheless, some opportunities or alternatives may lie before Turkey regarding alterations in the contracts. The Sharon government pursued an improvement in relations with Russia in the hope of reaching Russian energy through Turkish territory. The completion of the Blue Stream project made this dream a tangible reality for Israel. At the official opening ceremony of the Blue Stream, President Vladimir Putin reiterated Russian interest in transporting Russian gas to Israel through an extension of the Blue Stream pipeline or by liquefied natural gas (LNG) tankers. This may occasion new negotiations between the Turkish authorities and the Russians and Israelis on the contract terms. 73 The BTC pipeline was regarded as a world-class pipeline, which was/is expected to make a positive difference by bringing significant benefits to the region. “By avoiding the Turkish Straits, it will help relieve the inevitable growth in oil-related traffic and associated environmental risks, while creating substantial revenues for the transit countries. It will also strengthen the economic and political links between Azerbaijan, Georgia, Turkey and the West,” T. BayatlÕ, “BP Developments,” Azerbaijan International 15, no. 1 (2008): 66–70. 74 “Zorlu øsrail’de santral inúa edecek,” Zaman. 75 “Zorlu øsrail’de santral inúa edecek,” Zaman; Murinson, “Azerbaijan–Turkey– Israel,” 8–15. 76 BayatlÕ, “BP Developments”; Machlis, “Azerbaijan courts Jews.” 77 Murinson, “Azerbaijan–Turkey–Israel,” 7–14; R. Al-Shawaf, “Russian– Georgian Conflict Impacts Middle East,” Turkish Daily News, 18 September 2008. 78 BayatlÕ, “BP Developments.” 79 http://news.bakililar.az/news_ministr_nacionalnoy_infr_9154.html.

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Turkey was very sensitive about the spread of radicalism and extremist activities in the former Soviet Union countries. This was shared by Western countries, and in particular the US and its regional ally Israel. These concerns have forced countries with similar interests and concerns in the region to work cooperatively. Thus, for various practical reasons, there was a focus on Azerbaijan, with increasingly intense diplomacy and security cooperation. The active military-strategic alliances in the region were a driving force for further cooperative initiatives between Turkey, Israel, and the US. 81 See “The Caspian Sea Region,” http://www.eia.doe.gov/emeu/cabs/Region _ni.html. 82 “Ever-growing oil exports from the Caspian Sea region make the Bosporus and Dardanelles one of the busiest and the most dangerous chokepoints in the world supplying Western and Southern Europe with 2.4 million bbl/day.” EIA: World Oil Transit Chokepoints: Bosporus, 7–8, http://www.eia.doe.gov. 83 EIA: Bosporus, 7. 84 ø. AltÕnsoy, “Samsun-Ceyhan Pipeline” [Samsun-Ceyhan BoruhattÕ], Zaman, 7 December 2005, p. 3; idem, ‘Turkey now has a Voice.” 85 Murinson, “Azerbaijan–Turkey–Israel,” 1–15.

CHAPTER TWENTY-EIGHT GAZPROM: A LEADING ACTOR IN THE POST-SOVIET GAS POLICY-MAKING PROCESS IN THE BLACK SEA REGION EVRIM EKEN1

Introduction Due to the increasing role of business in global politics, which is yielding new forms of political activity with world-wide influence, scholars of international relations have begun to pay greater attention to the activities of transnational corporations in foreign policy-making processes. Studies have focused on the instrumental, structural, and discursive power of business, and the new forms taken by their political activities—such as public–private partnerships, self-regulation, and classical activities such as lobbying.1 Some scholars concentrate on state– business interactions and argue that these social forces are capable of reshaping and even changing certain state structures.2 This paper examines the influence of world gas giant Gazprom on Russia’s natural gas policy towards the Black Sea region, using an actorspecific analysis. In accord with Hans-Jürgen Bieling’s approach to state– business relations, it is proposed that relations between Gazprom and the Russian state, as well as Gazprom’s transnational interactions with other states, should be interpreted as products of a business-oriented transformation of statehood which was advanced by globalization and global governance.3 After the collapse of the USSR, and as a result of the transformation to a market economy, the number of actors taking part in Russian foreign 1

PhD Candidate at St. Petersburg State University, School of International Relations, Department of Theory and History of International Relations, Russian Federation.

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policy-making processes has increased. This has been most obvious in energy policy making, where full state control over the national energy sector has diminished and become shared by many others, including energy companies, bureaucrats, and so-called oligarchs. The interests of the newly emerged actors are satisfied through relations with other influential actors. The enigmatic and non-transparent nature of the Russian political system perhaps makes it difficult to picture those relations and so estimate to what extent Gazprom is capable of implementing its own policies, which are developed to secure the interests of a small number of individuals and sometimes challenge those of the state. This study is thus proposed as a focused project, rather than as a comprehensive research study which would aim to provide a general examination of the Russian gas policy-making process as regards the Black Sea region. In recent years, Russia has reaped significant benefits from the Black Sea region and Gazprom has played an important role in this process by creating and implementing vital gas projects. This has allowed Russia to slow the pace of other gas producers in the race to reach European markets, and has encouraged Russia’s geopolitical revival as an energy superpower. According to many commentators, Gazprom is being used as a weapon by the state, which owns almost 51% of the company stake. It can be argued, however, that Gazprom should be considered as an entity that actively develops its own policies, implementing them whenever an internal or external opportunity arises, and utilizing all available economic and political instruments. At the same time, since the classical definitions of “state” and “national interest” are highly problematic, the fact that it is a state company does not by itself support the view that Gazprom’s policies serve only the public good. The first section of this paper will try to portray the existing energy policy-making environment in Russia, giving special priority to Gazprom’s relations with other actors, particularly with the presidential administration. In the second section, the factors that cause Gazprom to be an influential actor will be examined. The third and final section deals with the main features of Russian gas policy towards the Black Sea region. Along with the geopolitical and economic motives shaping state policy, special attention will be given to the enigmatic relations between the plenipotentiary actors of the energy policy-making process and interest groups hoping to benefit from energy business both in Russia and abroad, the deciphering of which would shed light upon the missing pieces of this complicated puzzle.

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An Overview of the Energy Policy-making Environment in Post-Soviet Russia In Soviet times, ideological factors played a crucial role in all kinds of domestic and foreign decisions, which were mostly made by the Communist Party and Politburo. After the collapse of the USSR, the question of what were “the real center(s) of power” in Russia became more complicated, as the country was in transition towards a market economy, and the newly emerging social and economic conditions created new actors which actively participated in policy-making. Along with the constitutionally plenipotentiary actors such the president, the parliament, government, and oligarchs were also effectively involved in the decisionmaking process. Many authors emphasize that the oligarchy comprises not only industrialists and businessmen but also the executives of enormous state companies like Gazprom and RAO EES, as well as members of the Soviet legacy nomenclature.4 Within the post-Soviet energy policy-making environment, in which their interests often competed with the state, the oligarchs made great efforts to ensure that their own policies would be put into effect. During Yeltsin’s presidency, particularly in his second term after the 1996 elections, the influence of interest groups was obvious. The representatives of the energy and private banking sectors were especially influential on the president’s decisions.5 Oligarchs became politically more effective when, for health reasons, the president was de facto out of office for several months. Furthermore, as a result of the second privatization process, which began just after the 1996 elections and was a “loans for shares” agreement between state and businessmen, these oligarchs brought most of the state institutions and companies under their control. In order to influence the plenipotentiary decision-makers in their favour, they made active use of all available instruments, including financial support for electoral campaigns, lobbying, public and private partnerships, and others. For instance, it has been claimed that Gazprom financed Yeltsin’s presidential election campaign in 1996 to the tune of 280 million roubles (around US$1 million).6 Commentators have suggested that Gazprom CEO Rem Vykhirev gave this financial support in order to save his position, which he was sure to lose if the Communist candidate Zyuganov came to power after the election.7 The privatization processes initiated during the 1990s played a vital role in relations between the state and Gazprom. As a result of active lobbying by the nomenclature during the first privatization wave in 1991,

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the gas sector was not divided like the oil sector (from which more than twenty firms emerged), and all gas fields and gas distribution networks remained controlled by Gazprom. However, since the majority of the company shares were owned by its own managers, only a few people had influence on final decisions.8 The former minister of finance B. Fyodorov has described the process as “the biggest robbery of the century, perhaps in human history.”9 Another event that strengthened the power of a number of individuals in developing Gazprom policies occurred in January 1994 when Gazprom and the government signed a trust ownership agreement, which resulted in company executives, in particular CEO Rem Vyakhirev, controlling all the government’s shares (then 38.4%).10 Victor Chernomyrdin, former minister of the USSR gas industry and prime minister of the Russian Federation (RF), was another influential figure. He held the post of prime minister from December 1992 to March 1998, and resigned under Yeltsin in March 1998, after which he was hired as a member of the Gazprom Consultative Committee in 1999.11 These two members of the Soviet legacy were among the most effective figures both in political life and in national energy policy making. During their management, the company was often condemned by the public and opposition groups for corruption and failure to meet its tax obligations. For instance, it was claimed that Chernomyrdin’s “Our Home is Russia” party was financially supported by Gazprom—in the Russian press the party was referred to as “Our Home is Gazprom.” Active involvement in politics paved the way for Gazprom to avoid fulfilling its tax duties in 1994.12 Its power was described bluntly in a comment by Stanislav Tkachenko: “No one other than the Russian company Gazprom under Rem Vyakhirev as the CEO and Viktor Chernomyrdin as Prime Minister had the same influence on national politics and economy.”13 During Putin’s first presidency (2000–2008) the transparency of the policy-making process was still highly questionable, but what was clear was that the new leadership’s priorities and methods in implementation of energy policy were apparently changed. Using its rich energy sources to solve the economic problems in the country seemed to be the central priority of the energy policy pursued by the new president as he inherited a collapsed economy from Yeltsin. It should be noted that Putin’s basic ideas were developed in his PhD dissertation written in the 1990s. In a study tinged with patriotic sentiment, he argued that Russia’s rich natural resources should be managed effectively in accordance with a wellplanned federal state strategy and by using modern business methods, to

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draw high profits and so boost the living standards of Russian citizens and retain the country’s prestigious position in world politics.14 This was one of the official motives for the struggle against the socalled oligarchs, who were controlling the country’s most precious energy sources. However, it should be emphasized that, even for Putin, who seemed a more powerful statesman than his predecessor, it was not possible to totally annihilate the oligarchs and to establish full Kremlin control over Russian political life. Thus, some oligarchs like Abramovich and Deripaska, who acted jointly alongside the new president, were able to maintain their strong positions in the country.15 In other words, over the course of time, the struggle against interest groups turned into a fight against those—like Hodorkovsky, Berezovsky, and Gusinsky—who vehemently and publicly opposed Putin. Although the oligarchic nature of the political system could not be totally abolished, in the Putin era the role of the state in energy companies was manifestly strengthened. The government’s blocks of shares were consolidated and the taxation system was changed in favour of the state budget.16 For example, Rosneftegaz, a state-owned oil company, bought 11% shares in Gazprom in 2005 and in this way the state’s share in the gas monopoly increased to 50%. Additionally, the staffing policy pursued by the new president was another sign of his enthusiasm for gaining control over the state energy companies, as displayed by the fact that the old Soviet nomenclature in Gazprom were replaced by Putin’s own men. Aleksey Miller, a friend and subordinate official of Vladimir Putin in the St. Petersburg municipality, was appointed as the new CEO in May 2001.17 Another good example which demonstrates Putin’s aim to gain full control over Gazprom is Chernomyrdin’s assignment as the RF ambassador to Ukraine. As mentioned above, in the Yeltsin era he was very influential in the gas sector, which is why his assignment was interpreted as an “honourable exile”18 for “Mr. Gas.”19 In addition, salient figures from the presidential administration were appointed to the board of directors of the country’s largest energy companies. For example, Putin’s presidential successor Dmitry Medvedev was Putin’s deputy when he was appointed to Gazprom’s board. Undoubtedly, these kinds of top-position assignments in state energy companies allowed Putin to manage the policy-making process, particularly regarding challenging issues concerning the state and energy companies—e.g., pipeline routes and price regulation.20 Sharp increases in oil prices positively impacted the collapsed economy, which is why during Putin’s second presidential term priority was given to the use of energy resources as a tool to transform Russia into

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an energy superpower and to regain its strong international position.21 The newly created large public companies are able to compete with currently existing private national companies, and transnational companies provided a way to implement this policy. In December 2005, Putin approved the federal law which paved the way for the rest of Gazprom’s shares (almost 49.9%) to be opened to investors both from inside Russia and abroad, in place of the previous national trade in St. Petersburg.22 The shares became available in Moscow, London, and New York through depository receipt schemes. A very short time after that legislation, Gazprom ranked 4th among the largest companies in the world in terms of market capitalization (US$239.33 billion in 2006).23 As a result of these efforts, the Kremlin gained strong control over the gas sector and the policy-making process. But it would be inaccurate to claim that the Kremlin had full control over Gazprom. It is still not clear who really directs the gas giant and in whose favour. The answers to these questions are hidden in a nebulous haze. Some of Putin’s active opponents, like B. Nemtsov and V. Milov, condemn him for managing Gazprom personally and refer to the company as “the leading personal project of Putin.” They claim that company policies do not serve national interests, but rather the interests of some individuals.24 Viatcheslav Morozov, an expert on international politics, argues that: what looks on the surface as an expansion of state ownership in the strategic sectors of the economy, may perhaps be more appropriately described as a merger between the state and the corporations, with the logic of national interest being subdued to the logic of profit. The state is used as a tool to maximize the earnings of top managers, who at the same time often figure as key state officials and would be presidential candidates.25

The results of the March 2008 presidential elections vindicated Morozov’s arguments, as Dimitry Medvedev, who was Putin’s deputy and president of Gazprom’s Directory Board, replaced Putin as president. Subsequently, the Russian Federal Government seemed to take control over the energy policy-making process at the expense of the Kremlin, since Putin continued his active political life as prime minister and played an active role in developing and realizing new projects. In this section, we tried to approach the post-Soviet policy-making environment from within a historical framework, but due to the lack of transparency in Russian political life, a full mapping of the energy policy environment is not totally possible. Still, two things are quite clear: first, given the enormous power of the company in politics and the economy, he

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who directs Gazprom, directs Russia. Secondly, gas policy decisions made during the first Putin era indicate that somehow the state and the company usually come to an agreement or at least serve mutually beneficial interests. The following section aims to analyze the factors that allow Gazprom to exist as an actor which is capable of putting into effect its own policies as an entity in the decision-making process.

Gazprom as a Leading Actor of the Gas policy-making Process: Troubles vs. Expansion The worldwide financial crisis, which broke out in October 2008, caused great turmoil for Russian energy companies, primarily because of the sharp decrease in oil prices. In May 2008, Gazprom CEO Aleksey Miller declared that the company was the world’s third largest in terms of market capitalisation—which then stood at US$362 billion.26 In the year following the crisis, Gazprom’s market value decreased by two-thirds, ousting it from its third-place position. In 2010, Gazprom’s current value stood at approximately $141 billion,27 and it ranked 16th among the world’s most influential companies in the “Global 2000” annual ranking published by Fortune magazine.28 As the crisis unfolded, Gazprom was criticized because of its ambitious business strategy, which foresaw expanding company activities not only in the gas business but also in different spheres of the economy both within Russia and abroad. However, as Philip H. de Leon put it very clearly, although the company plays dangerously, Gazprom is too big to fail.29 Undoubtedly, in the post-crisis conditions, the company has faced many obstacles to its expansion and has needed to modify its strategies; but given its enormous power in Russian economic and political life, Gazprom is still capable of acting effectively within the policy-making process. The following section analyses Gazprom’s strategies for expansion in Russia and abroad, the problems it faces, and the implications for the company’s capability to be an effective policy-making agent. One of the most important factors behind Gazprom’s power is its control over the Russian energy sector. Today, Gazprom is the world’s largest gas company focused primarily on geological exploration, production, transmission, storage, processing, and marketing of gas and other hydrocarbons. It controls more than 60% of Russia’s proven gas reserves (723.4 billion cubic meters) and almost 17% of world gas reserves.30

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Meanwhile, Gazprom has expanded its activities in the oil and power sectors. Gazpromneft in the oil sector and Gazprom Energoholding in the power sector became leading players within just a few years. For instance, as a result of active participation in the privatization of the power monopoly RAO EES, Gazprom was generating 16% of total power in Russia by the beginning of 2010. 40% of its power is generated by gas and Gazprom is one of the biggest electricity consumers in Russia.31 Therefore, controlling big assets in the power sector could be economically profitable for Gazprom, since the power and gas sectors are mutually dependent. No doubt, control over the power sector will strengthen its position in political life against other energy lobbies. Being the unique owner of gas export rights, and having control over the world’s biggest gas network, Gazprom is able to block other national companies’ access to foreign markets and also has an advantageous position in developing external energy policies. All exports rights over Russian gas were given to Gazprom through the federal law approved by Putin in July 2006. It should be noted that the legal text does not clearly state the name “Gazprom” as the unique owner of export rights. Rather, the text reads that export rights are given to that company which “totally controls the Russian natural gas network.”32 It is well known that this company, controlling the whole gas network, is none other than Gazprom; and given the importance of this control for the company, it would never rescind it. The whole gas sector, not just the gas network, is under the strict control of the gas giant. Independent gas producers represented by vertically integrated oil companies and specialized gas companies account for 25% of explored reserves, while Gazprom owns 55% of them. The rest belongs to the undistributed fund. The “Energy Strategy for Russia until 2020” document, which was adopted in 2003 by President Putin, emphasizes the vital role of private gas producers in the national gas industry during the coming two decades. Growth of independent gas production is expected to reach 140–150 billion cubic meters per year (bcm/yr). The independent gas producers have claimed that regardless of whether favourable business conditions are given, their contribution could reach 250 bcm/yr, and with an optimistic forecast of 350 bcm/yr. The relations between the state, Gazprom, and private producers are intricate and complex. Even though the need for gas market reform has been officially emphasized by the government, in practice sufficient efforts have not been exerted. At a conference in Paris in 2003, the president of the Union of Independent Gas Producers, V. N. Baranov,

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made the following statement in relation to the problems of independent gas producers: The goal of gas market reform could be illustrated by the sharp steps that should be taken by Gazprom, like to stop the attempts to establish control over the most promising projects of gas producers non-affiliated with Gazprom, which includes direct withdrawal of productive assets from independent gas producers; discriminatory tariffs for independent gas producers; continuing policy of depriving independents from free access to the Gas Transportation System despite its de jure existence; barring them from access to solvent gas market outlets in CIS, Baltic States and Russia; preferred import of Central Asian gas without regard for its dangerous consequences; and depriving them from exporting gas to non-FSU countries.33

This view notwithstanding, Gazprom evinces no great enthusiasm for taking those “sharp steps,” which would cause it to lose its dominant position in the market. Restricted access to the pipeline system for independent producers of gas, for example, has resulted in significant flaring, or selling the produced gas to Gazprom at very low prices. Today, only 25% of associated gas is used and the remainder is flared, which pollutes the environment and sends tens of billions of roubles up in smoke—up to 20 billion cubic meters of associated gas being flared every year in Western Siberia alone. In 2008, Russia flared some 40 billion cubic meters of associated petroleum gas in total, resulting in a loss of nearly US$13 billion to the state.34 In November 2009, the Federal Government ordered oil companies to consume up to 95% of their associated gas by 2012.35 However, as many Russian oil firms are quick to point out, building costly gas facilities would cause huge expenses and financial losses unless there was state support, and unless the monopolist Gazprom was willing to buy the gas at reasonable prices.36 Some writers attribute Gazprom’s unwillingness to permit oil firms to access the gas network not only to technical also to political reasons. For example, Roman Kupchinsky argued that Gazprom’s full control over pipelines gives Putin a major edge in domestic and foreign policy, with which he is able to exert pressure on oil companies and on regional leaders.37 Additionally, it can be suggested that, given the production decreases and price disputes within and among Central Asian countries, in the near future Gazprom could force the independent producers to meet a significant part of the internal gas demand by associated petroleum gas (approximately 50 bcm/yr). Moreover, if the state would financially support them by compensating their losses during the building of new gas

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facilities, considering the increased internal gas prices, oil firms could compromise with Gazprom over meeting the internal demand. Gazprom aims to widen its export options as much as possible, but has trouble with the internal market. As Russia is one of the biggest gas consumers in the world, the company must first meet the domestic demand. In 2008, according to BP statistics, 19.6% (601.7 billion cubic meters (bcm)) of the world’s gas production was in Russia, while 13.9% (420.2 bcm) was consumed from within the country.38 Gazprom holds almost 95% of the total production and meets the internal gas market demand at very low prices. Although at the end of 2007, the Federal Taxation Service (FTS) endorsed the regulation which obtains growth in wholesale gas prices at 25%, in comparison with the cost for exported gas these prices are still quite low. Thus, although Gazprom sells 2/3 of the produced gas inside Russia, it gets only 1/3 of total revenues from the internal market. By the end of 2007, a thousand cubic metres of gas for industrial utilization cost 1,690 roubles/tcm (thousand cubic metres; almost $67), and gas for residential utilization cost 1,290 roubles/tcm (almost $51).39 According to the regulations, by 2010 the gas prices for Russian consumers were to reach the prices for the exported gas (the average price for European users is approximately $350–400/tcm), but tariffs declared in April 2010 implied that wholesale gas prices for home and industry use would reach 1,903 roubles/tcm (almost $65) and 2,478 roubles/bcm (almost $85), respectively.40 Considering the pressures from big industrial consumers—the big firms of electricity, metallurgy, and the oil industry— increasing the prices for Russian users to the level of the prices of exported gas would be more difficult than expected and state institutions like FTS will have trouble implementing the new price regulation. On the other hand, this policy could cause a decrease in internal gas consumption, and force consumers to use alternative energy resources in the future. The other important factor that makes Gazprom a powerful agent in Russian energy policy-making is its gradually increasing influence over external energy markets by purchasing majority shares in the national companies specialized in hydrocarbon transportation and stockpiling.

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Table 28-1 Gazprom’s subsidiaries41 (selected)42

major

Shares at least 50% (shares in the company) Armenia (more than 80% in Armrocgazprom) Austria (50% in GHW ZGG, JV with OMW, Centrex) Belarus (50% in Belgazprombank) Bulgaria (50% in Overgas Inc. AD) Finland (100% in North Transgas Oy) France (50% in FRANGAZ, JV with Gaz de France) Germany (50% in WIEH GmbH&Co KG, JV with Wintershell AG) 100% in Gazprom Germania GmbH Greece (50% in Prometheus Gas S.A.) Italy (50% in Promgaz SPA, JV with ENI) Kazakhstan (50% in KazRosGaz, JV with KazMunayGaz) Moldova (51% in Moldovagaz) Netherlands (100% in Gazprom Finance B.V. and 51% in PeterGaz B.V.) The United Kingdom (100% in Gazprom Marketing and Trading Limited) Turkey (more than 51% in Bosporus Gas Corporation A.S.

joint

ventures

and

overseas

Shares less than 50% (shares in the company) Czech Republic (37.5% in Gas-Invest S.A.) Czech Republic (33% in Vemex s.r.o.) Estonia (37.5% in Eesti Gaze) Finland (25% in Gasum Oy) Germany (49% in Ditgaz, JV with E.ON Ruhrgas) Hungary (38.1% in DKG-EAST Co.) Hungary (25% in Borsodchem) Latvia (20% in AO Latvias Gaze and 30% in Stella Vitae) Lithuania (37% in Lietuvos Dujos), Poland (48% in SGT EuRoPol GAZ S.A., JV with PGNiG) Poland (35% in Gas Trading S.A.) Romania (25% in WIROM WIEE, JV with DISTRIGAZ) Slovakia (16.3% in SPP) Turkey (45% in Trusgaz, JV with BOTAù)

As seen in table 28-1, Gazprom owns major shares in most of the former Soviet Union (FSU) and European countries’ national energy companies. But some of the FSU republics have managed to keep their distribution and transport systems within their own state monopolies. For instance, certain Black Sea coastal states, particularly Romania, Ukraine, and Georgia,43 have shown relative success in preventing Gazprom acquiring majority shares in their national gas and transportation companies. Expanding downstream markets in other countries is very advantageous for Gazprom regarding the implementation of its own policies in these countries, as these jointly founded companies actively lobby for its interests in their home countries. One should note that the

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liberalization of energy markets of the EU member and candidate countries provides good opportunities to Gazprom for its further expansion towards downstream markets. The company actively puts in bids to increase its profits. As pointed out by Konstantin Simonov, expanding downstream and selling gas to the last user has the potential to increase company profits at least three times.44 Gazprom’s external expansion strategy also includes collaborating with other leading gas producers, and the company has already signed cooperation agreements with the energy companies of Iran, Libya, Algeria, and Venezuela. The agreements seek cooperation in both upstream and downstream markets. When we consider the current geopolitical rivalry between the United States and Russia, those agreements, which were mostly signed with anti-US countries, stand as an eloquent example of the coincidence between the interests of Gazprom and the Russian state. While the company desires to be a worldwide gas giant, the state wants to prevent US domination in world politics and retain influence over regions where it has significant security concerns. In addition, these attempts at cooperative efforts by Gazprom were interpreted as steps towards the creation of a gas cartel among gas producers—a so-called Gas OPEC. But due to the nature of the gas market, the establishment of such a cartel seems virtually impossible in the near future. First, the creation of a cartel would imply that gas could be as strategic a resource as oil; but the worldwide gas market can be created only when gas, like oil, can be transported to different parts of the world more easily. At present, gas is transported via pipelines and as Liquefied Natural Gas (LNG) by tankers. The relative proportion of LNG in the market is still too small. If its share in the market increased, then gas also could be transported globally and might come to be considered as strategic as oil. Significant investments in developing LNG technologies are needed, and technological innovation will provide for easier and cheaper production of LNG. Gazprom projects in the LNG sector are currently underway in Sakhalin and Shtokman. When these projects are concluded, Gazprom will be able to deliver its gas to distant markets (such as the United States) by tankers. It will also allow the company to manipulate the gas prices more markedly than it does now. Furthermore, policies that utilize gas as a tool or weapon could gain a more global character rather than remain predominantly regional. It is noteworthy that the establishment of such a union exists within the long-term plans of both Gazprom and the state. But for now, as the Russian leadership has done since 2002 when Putin first invited Eurasian gas producers to establish a gas union, these calls should be interpreted as pragmatic steps to keep discussions about

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creating such a cartel on the agenda of the international community. It can be suggested that interactions with Iran and Algeria are a way of gaining leverage over European states that hesitate to deepen their reliance on Russia as an energy supplier. In order to estimate to what extent Gazprom is capable of affecting national energy policies, one must also focus on issues related to its expansion inside Russia. Currently, the company acts in different spheres of the national economy and is actively involved in Russian political life. On the one hand, its economic and political power provides the company with an advantageous position as against rival state institutions and companies. But, on the other hand, since expansion requires significant financial investments, the company regularly faces financial problems. Many observers argue that the ambitious entrepreneurial activity of Gazprom decreases share values, which should be invested in technological innovation. They assert that in its efforts to gain political and economic power, the company neglects its own duties within the gas sphere—such as maintaining security of supply or developing gasification structures inside Russia.45 Currently, Gazprom holds all or at least the majority of the shares of important companies in the energy industry (e.g., Gazpromneft). The company is also active in various spheres of the economy, including finance (e.g., Gazprombank), infrastructure, insurance, media (e.g., Gazprom Media), and sports (e.g., the Zenith football team of St. Petersburg). In Russian political life, Gazprom lobbyists play a very influential role, particularly with respect to deputies and local authorities financed by Gazprom during electoral campaigns.46 This allows the gas giant to lobby in parliament on behalf of its interests. Gazprom has certainly made headway on this front. For example, parliament still has not approved the European Energy Charter (EEC), which attempts to prevent monopolies in order to guarantee energy security in Europe. Furthermore, the government has declared that Russia would not approve the Charter any time soon.47 Although Gazprom portrays itself as a powerful, worldwide energy giant, it faces obstacles that are primarily related to financial issues and challenges to its ambitious business strategy. First, the company needs a large amount of investment for restoration and/or expansion of the old and limited pipeline network, and, moreover, there are still gasification problems in some eastern districts of the Russian Federation. This problem can be solved by attracting foreign investments. Gazprom welcomes this solution and has attempted to attract foreign investment, but the negative actions of some state institutions has undermined these efforts, dissuading

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foreign investors and thus demonstrating that Russia is not seen as a reliable country for energy investments. On the other hand, in order to export more gas to European and eastern markets, Gazprom needs to diversify and expand the export routes. For the construction of new pipelines, the necessary capital should be acquired and sufficient political support provided. Additionally, the lack of capital prevents the company from developing the licensed gas fields, which would meet the increasing gas demand of gas-thirsty industrialized countries.48 It therefore buys large amounts of Central Asian gas and reexports most of it to the FSU and Europe. This policy is not as profitable as it was in the early 2000s. Kazakhstan, Turkmenistan, and Uzbekistan wanted to increase the gas price for Gazprom. In 2008, they asked Gazprom to pay approximately US$225–295/tcm.49 In April 2009, due to a breakdown in the Turkmen part of the Central Asian Centre pipeline, gas deliveries to Russia were cut off, and following the decrease in gas demand in European markets due to the worldwide financial crisis, Gazprom discontinued its purchases of gas from Turkmenistan. By the end of December, both sides signed a new agreement according to which Gazprom must annually buy 30 billion cubic metres of gas at $240– 250/tcm from Turkmenistan.50 To sum up, it is quite difficult to establish to what extent Gazprom has an influence on final decisions within the current Russian policy-making environment, where relationships among state institutions are still enigmatic. But it is impossible to ignore the Gazprom factor in the policymaking process both inside and outside Russia, in view of several points: the great expansion of the company in different spheres of the Russian economy; the monopoly position in export rights over Russian gas and control over pipelines; company properties and joint ventures in Europe and the FSU; and its strengthened ties with leading European gas companies. At a conference in 2000, V. Kalyuzhniy, then the energy minister of RF and Vladimir Putin’s representative to Central Asia, confessed to the power and impact of oil and gas industries in saying the following: [T]heir influence, and I am not afraid to express that their power, allows us to say that they not only serve as energy suppliers both inside and outside Russia, but also they make and implement important foreign policy decisions in accordance with the Russian national interests.51

However, his claim that final decisions are made in accordance with Russian national interests is highly problematic. In the next section, different aspects of the Russian energy policy towards the Black Sea

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region will be presented. Along with the geopolitical and economic factors, the section will concentrate in particular on interest groups’ influence upon the policy-making process.

Gazprom’s Policies towards the Black Sea Region: The Geopolitical, Economic, and “Mysterious” Aspects of the Gas Policy-making Process A thorough analysis of the post-Soviet Russian gas policy-making process towards the Black Sea region, or anywhere else, could be provided if three factors are taken into account: the geopolitical challenges and the security concerns of regional and global powers; the competing economic interests of the state and energy companies; and the non-transparent relations among policy makers. But the role of the latter is difficult to analyze, and researchers should pay more attention to it. From the point of view of geopolitics, Russian interests in the Black Sea region are manifest. The importance of Russia’s “near abroad”52 is clearly emphasized in Russian foreign and national security concepts, and the necessity of the use of its rich energy resources for realizing Russia’s geopolitical interests was underlined in both energy strategy documents towards 2020 and 2030.53 The five-day war between Russia and Georgia in August 2008 provided evidence that the policy makers of Russia are primarily considering the geopolitical priorities and concerns of the Russian Federation in the Black Sea region. However, this war should not be interpreted as a desire for territorial expansion through the FSU, but rather as a wild response to the US-backed Georgian government, which publicly pursued an anti-Russian foreign policy. As a result, Russia has signalled its return to geopolitics, but nevertheless failed to attain its final goal of making the current pro-American government resign from office. In the Foreign Policy Concept of the Russian Federation which was approved by then president Dmitry Medvedev on 12 July 2008,54 special emphasis was laid upon two points: first, that Russia’s new foreign policy will be focused on the establishment of a multi-polar world instead of the US-headed uni-polar one, and thus that Russia would attempt to prevent all US-led actions, both in the region and around the globe. Second, that Russia will “take care” of the interests of the states that have strong historical, social, political, and economic ties with the RF, and share common interests with it. Along with the FSU, Iran, Libya, Venezuela, India, China, Cuba, Syria, and Vietnam also have secured places on Russia’s list of “close friends”—meaning states which pursue a foreign

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policy course more or less clashing with US interests. It is appropriate to mention here that, Russia has recently signed agreements or held negotiations with most of these states, seeking wide co-operation in the spheres of energy and security.55 Russo–American relations remain problematic, despite the American administration under President Obama frequently expressing its desire to rectify the mistakes of the former administrations in the regions surrounding Russia. A response to the so-called Greater Middle East project, which is often interpreted as a reconstruction of the Middle East and Central Asia in favour of US interests, remains a determining factor in Russia’s strategies towards these regions. Undoubtedly, energy issues are sensitive since the world’s richest resources are located there. Russia uses all possible leverage to gain control over energy sources and energy transportation routes, particularly in Central Asia and the Black Sea region. Gazprom is actively serving the implementation of this policy. The economic factor is mostly related to the troubles of Gazprom in its gas production and transportation facilities and the company’s ambitious gas export policy, particularly towards Europe. While the demand for gas is increasing in the highly industrialized European and eastern markets, the gas giant is struggling with decreases in gas production rooted in the problems previously mentioned (see the second section of this chapter). In order to overcome gas supply and delivery problems, Gazprom has developed a strategy incorporating three main goals: x Gaining almost full control over Central Asian gas; x Diversification of gas transport options to Europe, diminishing the number of transit countries as far as possible, and bypassing all existing and planned pipelines that are alternative to the Russian ones; x Expanding into the downstream and upstream gas markets of both gas consumers and suppliers by creating joint ventures; acquiring high stakes in national energy companies; and actively taking part in projects for the discovery and development of new gas fields. In recent years Gazprom has achieved almost all of these three goals. The first two are tightly interdependent. Getting full control over Central Asian gas allows Gazprom to guarantee the gas supply to both internal and external markets, especially when extra gas is needed to compensate the declines in its own production—and, moreover, it spells the death of Western plans for importing Central Asian gas to Europe. According to BP statistics, almost 5% of the world’s tapped gas reserves exist in Central Asia. Local political leaders frequently claim that

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the prospective reserves in Central Asia, particularly in Turkmenistan, are larger than the proved reserves.56 But because of the lack of investments for developing the current infrastructure, as well as the limited transport facilities, Central Asian countries cannot increase their gas production. Table 28-2 Amounts of proved reserves, current production and consumption of gas in Central Asia Central Asian Countries

Proved Reserves (trillion cubic metres: tcm) (% share of total)

Production (bcm)

Consumption (bcm)

Turkmenistan Uzbekistan Kazakhstan

7.94 tcm (4.3%) 1.58 tcm (0.9%) 1.82 tcm (1%)

66.1 62.2 30.2

19.0 45.6 20.6

Source: BP Statistical Review of World Energy.57

All existing gas pipelines reach European markets through Russia and all are controlled by Gazprom. Kazakhstan, Uzbekistan, and Turkmenistan export most of their gas via the Central Asian Centre (CAC), of which construction was started in 1967 and is now seriously in need of modernization. The current capacity of the pipeline is about 50 bcm/yr. As a result of effective diplomacy headed by President Putin in May 2007, a declaration was signed by Gazprom, Kazakhstan, and Turkmenistan, according to which Gazprom will buy large amounts of gas and a new pipeline will be constructed along the passageway of Central Asia Center3. The Near-Caspian Pipeline (Prikaspiiskiy gazoprovod) will have a capacity of 30 bcm/yr. In addition, the existing CAC will be modernized and its capacity will reach 60 bcm/yr, while Gazprom will take an active part in discovering new gas fields, exploring and exploiting the proved reserves, and providing technical assistance. In December 2007, the parties signed an intergovernmental agreement on the construction of the NearCaspian pipeline. In 2008, the agreement was ratified by these three states. The parties decided to start construction by 2009, but the project feasibility study took longer than expected. At the end of 2009, Turkmenistan and Russia declared that they would construct the pipeline jointly and that construction would begin in 2010. Western countries are also actively developing new projects that bypass Russia, in order to diversify export routes for Central Asian and Caucasian gas. The Trans-Caspian Pipeline, South Caspian Pipeline, and Nabucco can be listed among them.

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Other projects which would bypass Russia have been proposed by Black Sea coastal states. For example, in January 2008, Ukrainian exprime minister Yulia Tymoshenko proposed a pipeline which would carry gas from Turkmenistan via the Caspian Sea, South Caucasus, and the Black Sea, to the Ukraine and the EU. The second stage of the so-called White Stream would carry Turkmen gas via Azerbaijan and Georgia to Europe across the Black Sea. But the Turkmen side claimed that Kiev had not negotiated this project with Ashgabat.58 In addition, in July 2005, Kiev proposed two other pipeline projects, the realization of which could carry Iranian gas to Europe through Ukraine (Iran–Armenia–Georgia–Russia– Ukraine–Europe; or, bypassing Russia, Iran–Armenia–Georgia–Black Sea–Ukraine–Europe).59 Except for the completed South Caspian Pipeline (Baku–Tbilisi– Erzurum), the viability of all the other projects—such as the Trans-Caspian and Nabucco—is complicated. The realization of these projects will only become possible by overcoming current financial, political, and legal problems. For instance, disputes between Turkmenistan and Azerbaijan over the Caspian seabed jurisdiction have not as yet been totally resolved. Additionally, the amount of proved reserves in Turkmenistan makes it a receptive supplier to all gas deals that oblige Turkmenistan annually to pump billions of cubic metres of gas, though current production is capable of meeting only internal consumption and the gas exports to Russia and China. Therefore, large amounts of investment for increasing the gas production in Central Asian countries, particularly in Turkmenistan, should be provided. Moreover, political problems and diversified priorities within the national strategies of the project partners can be considered another threat to the accomplishment of these projects. For example, as financial problems seriously threaten the realization of Nabucco, participation of financially powerful companies in the project is vital. The Turkish government prevented the participation of Gaz de France in the project following the French parliament’s ratification of Armenian claims accusing the Ottoman Empire of committing genocide during the First World War. The German RWE (Rheinisch-Westfalisches Elektrizitatswerk AG) became the sixth participant in the project, instead of Gaz de France.60 But the viability of Nabucco still seems in doubt, as there is fertile ground for creating political disputes within the EU members and candidate states. It is noteworthy that Gaz de France, which was forced to withdraw from Nabucco, later became interested in the rival “SouthStream” project developed by Gazprom and Italian company Eni.61

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Gazprom’s active gas diplomacy both in Europe and Central Asia is another important factor which is hindering these projects’ realization; if the West cannot develop a unilateral strategy against Gazprom, projects bypassing Russia will remain on paper alone. It is doubtful that there is a common energy policy among the EU members, despite the existence of the “Green Paper on Energy” which determines the primary parameters of European energy security. This paper puts two leading tasks before the EU members: first, diversification of supply sources, with direct access via the Black Sea region to the eastern Caspian as a major objective; and second, ensuring national or EU control (as opposed to Russian control) of energy transport systems in Europe. In particularly, Germany, Italy, Spain, and France are not acting in accordance with the common strategy.62 In our opinion, the tightly developed partnership between leading European energy giants (e.g., ENI and Ruhrgas) and Gazprom prevents the EU institutions (e.g., the EU Commission) from putting their own policies into effect, which aims primarily to diminish the influence of energy monopolies over the European energy market. Gazprom’s effective pipeline diplomacy is arguably the most important factor threatening the viability of the West-backed projects. In order to defend this position, this paper will now describe the cornerstones of Gazprom’s pipeline policy, and then focus on the tools used by the gas giant to bypass the rival projects. Gazprom’s pipeline policy is structured around the following four goals, which are mainly shaped by its economic interests: x x x x

Diversify gas transport options to Europe; Diminish the number of transit countries as much as possible; Diversify the gas export markets; Bypass all existing and planned pipelines that are alternative to the Russian ones—although this policy is often ignored by the Russian officials, the practice mentioned below shows otherwise.

Currently, about 80% of Russia’s oil and gas is delivered to the West via European countries, the Turkish Bosporus Straits, or the Dardanelles. And almost 80% of gas is exported to Europe through the territories of Ukraine, as this country is highly dependent on Gazprom for its gas supply. This is why Turkey and Ukraine are the two key countries in the Gazprom pipeline strategies. The construction of the Blue Stream pipeline, which carries Russian gas directly to the Turkish Black Sea port of Samsun and has a capacity of 16 bcm/yr, encouraged Gazprom to develop other projects bypassing USbacked transit countries like Ukraine and Poland. It is pertinent to mention

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here that at the end of 1990s, the US-backed Trans-Caspian Pipeline project—which still remains a proposal—and the Russian Blue Stream project were competing. The active Gazprom lobby in Turkey, which was primarily made up of major construction firms doing business in Russia, had overcome all the obstacles and the first gas pumped through the Blue Stream arrived in Turkey at the end of 2002. There are currently three planned pipelines: South-Stream, MedStream, and North-Stream. Gazprom has solved all the problems attendant on the construction of the North-Stream project, which will carry Russian gas via the Baltic Sea to Germany and then to the UK, and on 9 April 2010 construction was started.63 At this time there were still some problems, however, with the first two projects, which are rivals to Nabucco and Trans-Caspian. Nevertheless, Gazprom and Russian negotiators appear to have been relatively successful in their attempts to overcome these. On 23 June 2007, Gazprom and ENI signed an agreement for constructing a new gas pipeline, which starts from the Russian gas compressing station Beregovaya and then winds through the Black Sea seabed until it reaches Bulgaria, where it is separated into two wings, one from Bulgaria to Austria via Serbia and Hungary, and the other from Bulgaria to Italy via Greece.64 From 2007 onwards, the Russian Federation concluded bilateral agreements with Italy, Serbia, Hungary, Croatia, Greece, Bulgaria, Slovenia, and Austria on the construction of the SouthStream pipeline. It is noteworthy that Austria, which had signed an intergovernmental agreement with the RF during Putin’s visit in April 2010,65 withdrew from the South-Stream project in April 2008, whereupon the project owners decided to invite Slovenia to join in its place.66 Gazprom plans to deliver 63 bcm gas annually via the South-Stream. This is three times larger than the amount of gas that would be delivered (31 bcm/yr) via the rival Nabucco. Realization of this project will prevent the potential competitor suppliers from reaching Western gas markets, or at least delay the alternative projects from coming to fruition. Gazprom will take over critical infrastructure in Europe as part of the supply deals. Thus the gas giant will protect its monopoly over Central Asian gas, and the company will be in a stronger position vis-à-vis negotiations for prices—and could even dictate its own prices. By now, South-Stream seems particularly more viable than Nabucco. Considering the fact that the EU will need an additional gas supply of 280 bcm/yr by 2030, both of these projects will be needed, but in the short- and mid-term there will be intense competition between them. Energy specialist Vladimir Socor has pointed out that the possibility of Ukrainian opposition could weaken the viability of the South-Stream.

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According to maritime law, Ukraine and Romania cannot officially veto the South-Stream outright, but they can question it thoroughly—for instance, they can demand an extensive study of the project’s impact on the environment, and on shipping and maritime safety generally; and they are entitled to evaluate these studies and independently assess their findings. They are also entitled to demand modifications to the route proposed by Russia.67 But, in view of former prime minister Tymoshenko’s statements at the beginning of 2008, the Ukrainian government seems to be using this right as a bargaining tool for lower gas prices and to get Russian permission for the construction of the White-Stream project in the case that that project is accepted by the EU.68 On the other hand, following the election of pro-Russian candidate Viktor Yanukovych against Yulia Tymoshenko in the Ukrainian presidential elections of February 2010, there should now be a positive shift in Russian–Ukrainian relations. The agreements signed by Russian and Ukrainian presidents during their meeting on 21 April 2010 clearly point towards this. According to the new gas contract, Russia allows Ukraine a $100 discount—assuming the current price stands at $330, Ukraine will pay $230/tcm after May 2010. Additionally, if the prices drop below $330, Ukraine will get a discount of 30%. As Putin has emphasized, this discount will by no means cause any financial damage to Gazprom, because Gazprom will get a discount on taxes and export duties equivalent to the company’s losses which should be paid to the Russian state for gas exports to Ukraine. This discount will therefore cause significant damage to the Russian state’s budget, but not to Gazprom.69 In exchange for the gas price discount, the lease on Russia’s Black Sea fleet, due to expire in 2017, will be prolonged for twenty-five years, at least until 2042, and Ukraine will charge Russia a lower rent.70 Beyond this, Putin also made a proposal for a gas merger which was highly surprising for both parties (including Russia). Speaking after the meeting on 30 April 2010 with his Ukrainian counterpart Nikolay Azarov in Sochi, where proposals to merge the two nations’ nuclear energy companies were discussed and where he also signed an order confirming the zero export duty on gas exports to Ukraine, Putin suddenly noted that Gazprom and Ukraine’s Naftogaz could also be merged. Should this proposal be accepted, Gazprom will absorb Ukraine’s oil and gas sectors. But considering the asymmetric financial capacities of these companies, as the result of this merger Ukrainian Naftogaz would be entitled to no more than 10% of Gazprom shares,71 which is why the Ukrainian opposition accused the new administration of pursuing a plan to liquidate Ukraine as an independent state and called for mass protests.72 Undoubtedly, these

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recent agreements will ease the realization of Gazprom projects in the region since the new Ukrainian administration will not take a position to weaken them. Today, Turkey’s position towards both Nabucco and the South-Stream plays a critical role in the development of energy projects in the Black Sea region. As mentioned above, whichever project begins first will postpone the other in the short and mid-terms. Considering the results of the meetings of the Turkish and Russian premiers on 6th August 2009 and 13th January 2010, Turkey’s positive position towards the South-Stream has acted as a catalyst to its construction. During the latter meeting, both sides declared that Gazprom would finish the seismic research at the seabed in the Turkish economic zone by November 2010. Russian energy minister S. Shmatko emphasized that Turkey’s permission to proceed with seismic research in its economic zone implied its consent to start pipeline construction.73 If the results of the seismic research are affirmative, then the construction could be started by the end of 2010, at the earliest. If the Turkish negotiators give priority to the realization of Nabucco, they will not let the Russian project overshadow it. It can be argued that two factors were quite influential on recent events that have occurred in favour of the South-Stream: the active Gazprom lobby in Turkey, made up of private energy companies including Bosporus Gaz Corporation Inc. (and the joint venture by Gazprom in Turkey) and Aksa Energy; and second, the divergence among the EU members regarding energy policy matters. The Italian prime minister’s unexpected attendance in negotiations between his Turkish and Russian counterparts on 6 August 2009 is a striking example of this divergence. It should be noted that Berlusconi’s action is not surprising, since the South-Stream is a common project of the Italian company ENI and Gazprom. The other proposed pipeline, Med-Stream, has been in planning since 2004 and will carry Russian gas via Blue Stream to Turkey, then via the Mediterranean to Israel and the Middle East, and probably on to Far East and Europe. The project aims to pass oil, gas, water, and fibre optic cables simultaneously through the Med-Stream pipeline.74 Turkey had opposed the project until summer 2008. The Turkish government’s final decision was perhaps influenced by the efforts of the American and Israeli lobbies; gaining oil production rights in certain Iraqi oil fields; guaranteeing the security and economic sustainability of the BTC oil pipeline; and finally the lobbying activities of some Turkish energy companies—particularly the government-backed “ÇalÕk Group”—which desired to participate in the pipeline construction.75

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Finally, the Black Sea region plays an important role in Gazprom’s expansion policy into other markets. This is in two ways. First, Gazprom expands into upstream markets by participating in projects for discovery, exploration, or production of new gas fields. Usually, the company signs cooperation or partnership agreements with the major state and private companies in question. Secondly, the gas giant expands towards foreign downstream markets by establishing joint ventures for realizing gas deals, and getting high shares in energy production, transportation, and distribution companies. Gazprom has exhibited notable success in expanding into the Black Sea region’s national energy markets. It already owns major shares in Moldovan76 and Armenian energy companies. Even though this expansion is highly supported by the Russian state, it is sometimes costly for the state’s budget. For example, after long negotiations, Armenia agreed to sign an agreement that increases Gazprom’s shares from 45% to 80%77 in the joint venture company Armrocgazprom, which has full control over the gas transportation and distribution system of Armenia.78 But Gazprom, refusing to continue selling cheap gas to Armenia, increased its prices for this country, which is highly dependent on Russian gas. In order to maintain friendly relations with its faithful ally, the Russian state compensated the deficit in Armenia’s state budget by selling it weapons at very low prices.79 Also, despite the disputes between Moscow and Kiev, the Ukrainian state energy company Chernomorneftegaz (Black Sea Oil and Gas), which exploits gas in the Ukrainian offshore area in the Black Sea, signed a protocol with Gazprom. According to that protocol, the gas giant has the right to exploit a part of Ukrainian gas.80 The second method of expansion is usually more implicit. Expansion toward foreign downstream markets provides Gazprom with an opportunity for effective lobbying through those Gazprom-backed companies for their common interests. By doing so, Gazprom indirectly becomes involved in the energy market regulation services of other states. For example, according to the EU Directives on Turkish energy market liberalization, in view of the fact that the gas market is being reshaped and the gas release programme is currently in progress, the Turkish natural gas company BOTAù should release a major part of its import rights (up to 80%) to private companies. At the beginning of this process, Gazprom asked BOTAù to release gas import licenses only to companies that had already received a letter of consent from Gazprom. In other words, Gazprom’s permission is the decisive factor in the distribution of gas import licences. As a result, in June 2005, the Turkish parliament enacted a law which made an amendment to the natural gas market law, requiring

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companies to obtain the preliminary consent of the sellers prior to the auction.81 Undoubtedly, in this way, as the biggest gas seller to Turkey, Gazprom aimed to prevent rival companies from gaining import rights in the Turkish market, so to expand its control over the downstream gas business in this country. When this policy is implemented, Gazprom will be able to reach every last consumer of gas in the Turkish market—where about 65% of imported gas provided is already from Russia. For example, since August 2009, Gazprom has had the controlling parcel of shares of Bosporus Gaz Corporation Inc., which received some of the gas import licenses. Gazprom has declared its intention to increase its shares in this joint venture up to 80%.82 As a testament to the ability of these joint ventures in lobbying for Gazprom interests, it should be noted that Ali ùen, who then controlled the majority of shares of the Bosporus Gaz Corporation, acted as an intermediary between Turkey and Russia in resolving disputes over gas prices in summer 2003. A long list could be provided of the geopolitical and economic factors determining Gazprom’s strategies within the Black Sea region. However, what must be emphasized is that the economic expansion of Gazprom maintains Russian influence over regions where the state has significant security concerns. Finally, as mentioned above, the analysis of the non-transparent relations among policy-makers is very important for an accurate mapping of Russian gas policy towards the Black Sea region. However, it is almost impossible to obtain exact data proving the existence of these kinds of relations. As James Sherr correctly observed, there is a total lack of transparency, and it is impossible to understand what is going on unless you yourself are taking part, or you have special ties and connections inside these institutions.83 In addition, policy-making processes in other regional states are no more transparent than in Russia. Despite efforts to establish more democratic and transparent institutions, there are still Soviet legacy hierarchic and mysterious state structures in the FSU countries. And in Turkey, which is one of the key countries regarding energy issues in the Black Sea region, public–private relationships are not quite transparent, making it difficult to know exactly under what circumstances energy decisions are made. An analysis of Russian–Ukrainian gas relations would be useful in order to shed light on the influence of such relations on policy formulation in the two countries. For example, after the gas crisis in January 2006, in addition to the wider geopolitical and economic reasons for the crisis, Russian and Ukrainian experts paid particular attention to the role of the enigmatic intermediary “RosUkrEnergo.”

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Gas deals with Central Asian countries, particularly Turkmenistan and Ukraine, have been managed by intermediaries since 1994. In the beginning, Kiev was so low in cash that companies were using Ukrainian products and goods to barter for gas, which was purchased from Central Asia. The first intermediary in the FSU gas business Respublika was founded in accordance with an agreement signed between the Ukrainian and Turkmenistani presidents in 1994. The company was selling Ukrainian products to Turkmenistan to compensate for its gas debts. Gazprom wanted to take full control of that profitable business and so started to barter gas for Ukranian products via the company Omraniya, which was trading in Turkmenistan. According to some Russian experts, over the course of time, as a result of close relationships between V. Chernomyrdin, R. Vyakhirev, and Ukranian pro-Russian president Kuchma, Omraniya became a monopoly in this business.84 Soon after, Omraniya was registered in the United States with the new name Itera. In a very short time Itera became an international corporation with steadily growing subsidiaries. By the end of 1999, it was running 120 companies with 7,000 employees in twenty-four countries. By 2000, Itera Holding was also managing five regional corporations engaged in a variety of commercial activities that included developing gas fields in Russia. It gained control over Ukrainian–Turkmen gas deals and also sold and delivered gas to Western Europe (50 bcm in 1999), where it demanded and received payment from its customers in hard currency. Meanwhile, Ukrainian gas debts to Russian gas were gradually getting bigger. Possibly, Russian statesmen and the top-managers of Gazprom, who benefited from this business, were overlooking the unpaid Ukrainian debts.85 The reason for Itera’s success is mysterious, and the party that pocketed the huge profits from this business is still a matter of speculation. According to J. S. Adams, Itera has acted as a private adjunct of Gazprom, carrying out policies advantageous to both companies, but which Gazprom preferred not to be involved with.86 In 2002, when Russia had a new president and Gazprom a new CEO, Itera was dismissed from Ukrainian–Russian gas trade and a new intermediary Eural Trans Gas was founded; within two years, it gained both high profits and a rather negative public reputation due to claims of corruption.87 The creation of this new intermediary following the change of top positions in the Russian state and Gazprom management, also confirms the existence of mysterious relations between the state and businessmen. Complexity and the enigmatic air surrounding Ukraine–Russia energy relations increased further after the creation of RosUkrEnergo (RUE) in

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summer 2004 to replace Eural Trans Gas. Eural Trans Gas managers moved over to RUE and Gazprom, through its Swiss-registered ARosgas Holding A.G., which owned 50% of RUE. The remaining half was owned by Centragas Holding, an Austrian-registered company owned 100% by Raiffeisen Investment A.G., which had long refused to disclose the names of the Ukrainian owners. In July 2005, Centragas CEO Wolfgang Putschek denied that RUE had any ties to the rich Ukrainian businessman Mogilevich.88 After the January 2006 gas crisis between Russia and Ukraine, D. Firtash, and I. Fursin were announced as Gazprom’s Ukrainian partners.89 Additionally, Putin declared that this company had been founded on Ukraine’s initiative and that the Ukrainian shares in the company belonged to businessmen who were accused of corruption.90 The re-export rights of Central Asian gas to Europe were given to this company by the agreement signed after the Russia–Ukraine gas crisis in January 2006.91 Annually, RUE was buying approximately 30–55 bcm gas from Gazprom Export at the Turkmen–Uzbek border and transporting it to the Russian–Ukrainian border, where this intermediary was selling it to Naftogaz. This was practically unprofitable for RUE, but it yielded enormous profits by re-exporting Central Asian gas to Poland, Romania, and Hungary.92 Following the January 2009 Russo–Ukrainian gas war, RUE was dismissed from this profitable business. Some experts accused the company of being a major contributor towards the gas dispute and suggested that if RUE had not been connected to the Russian–Ukraine gas trade, there would probably not have been a gas war in January 2009.93 According to some commentators, the real reason behind removing RUE was political rivalry between top Ukrainian politicians, who were striving to win the 2010 presidential elections. They argued that getting full control over the money flowing through RUE was important, particularly for former President Yuschenko and former Prime Minister Tymoshenko, since both of them needed to be financially supported during their election campaigns. Thus, these businessmen, who had close relationships with Yuschenko, were dismissed and Naftogaz, which was under the command of the energy ministry—meaning it was under the control of the prime minister—got control over the Russo–Ukrainian gas business.94 As is well known, they lost the elections to the pro-Russian Yanukovich, who, just a few weeks after his inauguration in March 2010, assigned D. Firtash’s men once again to key positions in the public energy companies. Some energy experts suggest that even if RUE did not return to the Russian– Ukrainian gas trade, Firtash’s interests would somehow be protected, as evidenced by the new assignments.95

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Dimitry Medvedev justifies the necessity of these intermediaries by reference to the incapability of the Ukrainian economy to manage the direct gas trade with Russia.96 The intermediaries do indeed play a role as an engine of business amid these weak transition economies. But what Medvedev said is only what can be observed at the tip of the iceberg; in reality these companies play an instrumental and even structural role, as the semi-lawless environment provides business elites with fertile ground to realize their interests. As Kupchinsky points out: some of these middlemen companies have been linked to organized crime groups in Russia and in Europe while others are suspected of laundering millions of dollars into the accounts of high-level Russian, Ukrainian, and other officials. The huge sums involved have a corrupting influence on local government officials and deprive the citizens of their countries of the honest services they deserve and expect from their elected and appointed officials … .97

In the end, given the conditions of non-transparency, no one is capable of explicitly proving the definite role of these companies in gas policymaking processes. However, their influence on Russian energy policy and on energy relations with the regional states should not be ignored.

Conclusion A general definition of an “international actor” might be any possible entity (including individuals) that actively participates in international relations and is capable of developing its own strategies. Referring to the sociologist Alain Touraine, Tsygankov sets out the following general criteria for being an actor: referring to itself using “I,” being recognized by others, and having membership within a particular group.98 In view of the evidence of its economic and political power as set out in this paper, and alongside its relationships with state institutions and interactions with other interest groups, Gazprom clearly fulfils these criteria, and thus can be classed as an actor. What is questionable, though, is the extent to which Gazprom is capable of implementing its own strategies. This paper has suggested that economic and political factors are significant for determining the current status of Gazprom as a leading actor. The economic factor is quite obvious, as the gas giant needs to solve its existing financial problems and improve its abilities for further transnational activities. The political factor is related to its increasing capacity to influence other state institutions and statesmen in favour of its interests, as well as whether the company can strengthen its political

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power within the state, and so be more effective in impacting final decisions. Undoubtedly, energy, especially natural gas and oil, is one of the main focal points of the world’s economic development, and under these circumstances the Russian state will use its rich resources to boost the economy and to retain its status in the international arena. In the coming decades, it will remain an important tool in Russia’s negotiations with its neighbours in the creation of a new security, political, and economic architecture for Eurasia.99 In order to achieve these goals, gaining control over the Black Sea region, which is at the crossroads of existing and planned strategic pipelines, is vital. Gazprom’s expansion into the Black Sea will maintain its influence over regions where the state has significant security concerns. That is why Gazprom is quite often regarded as a state tool. On the other hand, the mechanisms of national gas policy formation in Russia are extremely complicated. Considering the gradually increasing influence of business over decision makers’ final decisions, the very question of the statehood of the Russian Federation is called into question. In this context, Medvedev’s rather frequent criticism of the Russians’ tendency to disregard the law—which he calls “legal nihilism”—is significant.100 On the surface, constitutionally legitimate actors, including the presidential administration and the Federal Government under Putin’s rule, represent themselves as the strongest institutions in the policymaking process. But, in reality, energy policies are often developed as a result of competition and bargaining among politicians, bureaucrats, and interregional actors within Russia, and influenced by competition between companies. So it is not surprising that Gazprom uses the weakness of the system for its benefit.101 This is why researchers should concentrate on the mysterious relationships among policy makers both in Russia and in the other regional states to expose the abuse of energy policy in favour of individual or institutional interests.

Notes 1 Doris A. Fuchs, Business Power in Global Governance (Boulder, CO: Lynne Rienner Publishers, 2007); Michael A. Cohen and Maria Figueroa Küpçü, “Privatizing Foreign Policy,” World Policy Journal 22, no. 3 (2005): 34–52; 2 Robert W. Cox, “Social Forces, States and World Orders: Beyond International Relations Theory,” Millennium: Journal of International Studies 12, no. 2 (1981): 162–175; Hans-Jürgen Bieling, “Conceptualising the Relationship between Business and the State in the Age of Globalisation,” Business and Politics 9, no. 3 (2007): Article 5, available at: http://www.bepress.com/bap/vol9/iss3/art5.

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Bieling, “Conceptualising,” 3. Sergei Guriev and Andrei Rachinsky, “The Role of Oligarchs in Russian Capitalism,” The Journal of Economic Perspectives 19, no. 1 (Winter 2005): 131– 150; Yakov Pappe, Oligarhi: Ekonomicheskaya Hronika 1992–2000 [Oligarchs: Economic chronicle 1992–2000], 2nd ed. (Moscow: Gosudarstvennyy Universitet Vysshaya Shukola Ekonomiki, 2000), 17–25. 5 Hans-Henning Schroder and Claudia Bell, “El’tsin and the Oligarchs: The Role of Financial Groups in Russian Politics between 1993 and July 1998,” Europe-Asia Studies 51, no. 6 (September 1999): 971. 6 V. A. Lisichkin and L. A. Shelepin, Rossiya pod vlastyu plutokratii [Russia under the authority of plutocracy] (Moscow: Algoritm, 2003), 288. 7 Valerii Panyushkin and Mihail Zygar, Gazprom: Novoe Russkoe Oruzhie [Gazprom: The new Russian weapon] (Moscow: Zaharov, 2008), 41. 8 Dimitry Surovtsev, “Gazprom Follows Unique Course to Privatization,” Oil & Gas Journal (Tulsa) 94, no. 13 (May 1996): 62–66. 9 Matt Bivens and Jonas Bernstein, “The Russia You Have Never Met,” Demokratizatsiya 6, no. 4 (Fall 1998): 622–623. 10 Panyushkin and Zygar, Gazprom, 36. 11 Pappe, Oligarhi, 98–99. 12 Bivens and Bernstein, “The Russia You Have Never Met,” 622; Fiona Hill and Florence Fee, “Fuelling the Future: The Prospects for Russian Oil and Gas,” Demokratizatsiya 10, no. 4 (Fall 2002): 476. 13 Stanislav Tkachenko, “Actors in Russia’s Energy Policy towards the EU,” in The EU–Russian Energy Dialogue: Europe’s Future Energy Security, ed. Pami Aalto (Aldershot: Ashgate, 2008), 182. 14 V. V. Putin, “Strategicheskoe Planirovanie Vosproizvodstva Mineral’nosyr’evoy Bazy Regiona v Usloviyah Formirovaniya Rynochnyh Otnosheniy— Sankt-Peterburg i Leningradskaya Oblast” [Strategic planning of regional mineralraw material reproduction in the conditions of market relations formation—St. Petersburg and Leningrad district] (PhD diss., St. Petersburg Mining Institute, 1997). See also Martha Brill Olcott, “The Energy Dimension in Russian Global Strategy: Vladimir Putin and The Geopolitics of Oil,” James Baker III Institute for Public Policy, Rice University, Working Paper, October 2004, pp. 16–17. 15 A. Yu. Zudin, “Biznes i gosudarstvo: K novoy modeli vzaimootnosheniy” [Business and state: Towards a new model of relations], in Kto i kuda stremitsya vesti Rossiyu? Aktory makro-, mezo-, i mikrourovney covremennovo transformatsionnogo protsesa [Who wants to drive Russia and in which direction? Actors of macro-, meso-, micro-levels of modern transformation process], ed. T. I. Zaslavskaya (Moscow: Ɇȼɒɋɗɇ, 2001), 212. 16 Stanislav Tkachenko, “Actors in Russia’s Energy Policy towards the EU,” in The EU–Russian Energy Dialogue: Europe’s Future Energy Security, ed. Pami Aalto (Aldershot: Ashgate, 2008), 170–171. 17 Paul Starobin, “Give Gazprom a Fresh Start, President Putin,” Business Week (New York), no. 3735, 4 June 2001, p. 21. 18 Panyushkin and Zygar, Gazprom, 8–12. 4

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19 Because of his strong ties with the gas industry some writers called him “Mr. Gas.” See Viktor Timchenko, Putin i Novaya Rossiaya [Putin and the new Russia], (Rostov-na-Donu: Feniks, 2005), 91. 20 Stanislav Tkachenko, “Actors in Russia’s Energy Policy towards the EU,” in The EU–Russian Energy Dialogue: Europe’s Future Energy Security, ed. Pami Aalto (Aldershot: Ashgate, 2008), 167–168. 21 Konstantin Simonov, Energeticheskaya Sverhderzhava [Energy superpower], (Moscow, Algoritm, 2006), 5. 22 Rossiiskaya Federatsiya Federalnyy Zakon o vnecenii izmeneniya v ctatyu 15 federalnogo zakona “O gazosnabzhenie v Rossiiskoy Federatsii” [Federal Law of RF Amendment in article 15 of the Federal Law “About the Gas Supply in the Russian Federation], no. 182-F3, 23 December 2005, http://document.kremlin .ru/doc.asp?ID=031479. 23 Yelena Miyazina and Mikhail Averchenko, “Chetvertiy v mire: Gazprom obognal po kapitalizatsii BP” [4th in the World: Gazprom Outran BP in Capitalization], Vedomosti, 27 April 2006. 24 Boris Nemtsov and Vladimir Milov, “Nezavisimyj Expertnyj Doklad ‘Putin’ i ‘Gazprom’” [Independent expert report: Putin and Gazprom] (Moscow, 2008), 5–10. 25 Viatcheslav Morozov, “Imperial Discourse in Russian International Studies: Empire vs. the Corporatist State as Images of Putin’s Russia,” Paper presented at the CEEISA 2006 Convention at the University of Tartu, http://www.ceeisaconf .ut.ee/109100. 26 “CEO says Gazprom set to Become World’s Top Company,” Ria Novosti, 27 May 2008, http://en.rian.ru/business/20080527/108617528.html. 27 Gazprom, “Aktsioneram i investoram” [To shareholders and investors], http://www.gazprom.ru/investors/. 28 Aleksandra Ponomareva, “Prilichnaya Kompaniya” [Decent company], Izvestiya, 23–25 April 2010, pp. 1, 3. 29 Philip H. de Leon, “Gazprom: Angel or Demon?” 29 January 2010, http://www.offshorenet.com/2010/01/gazprom-angel-or-demon.php. 30 Gazprom, Godovoy Otchet 2006 [Annual report 2006], 27. 31 Denis Fedorov, “Vystuplenie general’nogo direktora OOO ‘Gazprom Energoholding’ Denisa Fedorova na vctreche rukovoditeley OAO Gazprom and glavnyh redaktorov regionalnyh CMI” [Speech of director general of OOO “Gazprom Energy Holding” Denis Federov at the meeting with executives of Gazprom and leading editors of regional mass media], 22 March 2010, http://www .mosenergo.ru/docs/31862.aspx. 32 “Rossiiskaya Federatsiya Federalnyy Zakon, Ob Eksporte Gaza” [Russian federation federal law on export of gas], Moscow, no. 117-F3, 18 July 2006, http://document.kremlin.ru/doc.asp?ID=034809. 33 V. N. Baranov, “Independent Gas Business in Russia: Contribution to Energy Security,” Energy Security: Russian Gas Companies’ Role, Second Annual International Conference, held by Independent Gas Producers Union jointly with the International Energy Agency, Paris, 25 November 2003.

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34 Roman Kupchinsky, “Russian Gas Flaring: A Political or Technical Problem?” Eurasia Daily Monitor 6, no. 211 (16 November 2009), http://www.jamestown .org/single/?no_cache=1&tx_ttnews%5Btt_news%5D=35735. 35 “Russia Takes Steps to Reduce Gas Flaring,” EurActiv, 17 November 2009, http://www.euractiv.com/en/energy-efficiency/russia-takes-steps-reduce-gasflaring/article-187377. 36 “Russia May Fail to Meet Gas Flaring Target by 2011,” Reuters UK, 9 October 2007. 37 Kupchinsky, “Russian Gas Flaring.” 38 British Petroleum, BP Statistical Review of World Energy, June 2009, pp. 24, 27. 39 Igor L’vov, “Gaz poshol vverh” [Gas was turned upside], Rossiiskaya Gazeta, 6 December 2007. 40 “V Rossii uvelichivayutsa optovye tseny na gaz dlya naceleniya” [Wholesale gas price for population is increased in Russia], K2K News, 1 April 2010, www.k2kapital.com. 41 Nadejda Makarova Victor, “Gazprom: Gas Giant under Strain,” Program on Energy and Sustainable Development at Stanford University, Working Paper 77, January 2008, pp. 75–78. See also Gazprom official website, http://www.gazprom .ru/subsidiaries/. 42 Selected countries with big gas markets in Europe, the former Soviet Union, and the Black Sea region were selected. 43 “Georgia Rejects Gazprom deal,” 9 November 2006, http://politicom.moldova .org/news/georgia-rejects-gazprom-deal-19952-eng.html. 44 Simonov, Energeticheskaya Sverhderzhava, 24. 45 Nemtsov and Milov, “Nezavisimyj Expertnyj Doklad,” 11–33. 46 Sergey Pravosudov, “Lobbisty v Gosdume: Chuto, pochem i kto zakazyvaet muziku” [Lobbyists in state Duma: Who plays the music, for what and for how much], 15 September 2003, http://www.compromat.ru/page_13604.htm. 47 “Russia–EU New Pact Talks Unconditioned by Energy Charter—Lavrov,” Ria Novosti, 12 January 2010, http://en.rian.ru/russia/20100112/157519709.html. 48 “Gazprom opyat poteryal dobychu: Ona podaet bystree chem y nezavisimyh proizvoditeley” [Gazprom again lost production: It keeps on reducing faster than independent gas producers], Kommersant, 3 July 2009. For a critical evaluation, see Nemtsov and Milov, “Nezavisimyj Expertnyj Doklad,” 11–18. 49 “Rezhim podkluchitel’nogo blagopriyatsvovaniya: ‘Gazprom’ stanovitsiya donorom Turkmenii” [Regime of most-favoured state status: Gazprom will become the donor of Turkmenistan], Kommersant, 28 July 2008; “Kazahstan gotovit Gazprom k finasovym poteriyam” [Kazakstan prepares Gazprom to Financial Disbenefit], Nezavisimaya Gazeta, 19 March 2008. 50 “Tsena postavok gaza iz Turkmenii v RF coctavit $240–250 za tysyachu kubov” [Price for Turkmen gas to Russia Amounts $240–250 for thousand cubic metres], Ria Novosti, 23 December 2009, www.rian.ru/economy/20091223/200950245.html.

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V. I. Kalyuzhniy, “Privetstvie” [Welcoming speech], Mezhdunarodnaya Zhizn (Special edition on Russian foreign policy and oil and gas strategy for 21st century; Moscow) (Spring 2000): 6–7. 52 In the political parlance of Russia and some other post-Soviet states, the “near abroad” (blizhneye zarubezhye) refers to the foreign republics which emerged after the collapse of the USSR. The term has been used in English since the early 1990s, usually to assert Russia’s right to maintain major influence in the region, but also for marketing purposes by various companies. For instance, President Vladimir Putin has declared the region to be Russia’s “sphere of influence,” and one strategically vital for Russia. 53 “Energeticheskaya Strategiya Rossii na period 2020 Goda” [Energy strategy of Russia towards 2020], Rossiiskaya Biznes Gazeta, 7 October 2003, p. 1. 54 Konseptsiya vneshney politiki Rossiiskoy Federatsii [Foreign policy concept of RF], Pr-1440, approved by the president of RF on 12 July 2008, www.kremlin.ru/ text/docs/2008/07/204108.shtml##. 55 “Gazprom hochet stat’ Liviiskim exporterom” [Gazprom wants to be the exporter of Libya], Kommersant, 10 July 2008; “Gazprom beryot Evropu v kleschi” [Gazprom’s pincer movement towards Europe], Nezavisimaya Gazeta, 15 July 2008. 56 “Tsena pobedy” [Price of victory], Kommersant (Special appendix), 26 July 2007. 57 Source: BP Statistical Review of World Energy, June 2009, pp. 22, 24, 27. 58 “Gazprom zazhali mezhdu Kievom i Ashhabadom” [Gazprom was squeezed between Kiev and Ashgabat], Nezavisimaya Gazeta, 16 June 2008. 59 Natalia Grib and Oleg Gavrish, “Ukraina nachinaet gazovye manery” [Ukraine is starting gas manoeuvres], Kommersant (Ukraine), 26 July 2005, p. 7. 60 “Nabucco’da FransÕzlar ‘out’ Almanlar ‘in’” [In Nabucco French are ‘out’ and Germans are ‘in’], Radikal, 26 January 2008. 61 “Gaz de France raccmatrivaet vozmozhnoct’ uchastiya v ‘Yuzhnom potoke,’” [Gaz de France is examining the possibility of participation in the ‘South Stream’], Kommersant, 7 February 2008. 62 Keith C. Smith, Russia and European Energy Security: Divide and Dominate, Washington D.C., Centre for Strategic and International Studies (CSIS), October 2008, p. 16. 63 “Torzhestvennaya tseromoniya k nachalu ctroitel’ctvo” [Grand ceremony for the beginning of construction], http://www.nord-stream.com/ru/press0/truby.html. 64 “Turtsiya protif soglasheniya mezhdu ‘Gazpromom’ and ENI” [Turkey is against the agreement between Gazprom and ENI], Kommersant Online, 26 June 2007. 65 “Dzudo posle gaza: Rossiya gotova cnabzhat ‘golubym toplivom’ Evropu kak minimum cto let” [Judo after gas: Russia is ready to supply Europe with gas for minimum a hundred years], Rossiiskaya Gazeta, 25 April 2010. 66 “Avtstria vypodaet iz ‘Yuzhnogo Potoka’: Gazoprovod mozhet proyti cherez Slovenia v Italiyu” [Austria withdraws the ‘South Stream’: Pipeline may pass through Slovenia to Italy], Kommersant, 14 April 2008. 67 Vladimir Socor, “Gazprom’s South Stream Pipeline can be Halted in the Black Sea,” Eurasia Daily 5, no. 43 (6 March 2008), www.jamestown.org.

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68 “V yuzhnom potoke vcpyla Ukraina: Dlya ctroitelstva potrebuyetsa yeyo coglasie” (In South Stream pipeline Ukraine came to the surface: For construction of pipeline her permission is required], Kommersant, 29 February 2008. 69 “Putin: ckidka na gaz dlya Ukrainy cdelena za chet budzheta” [Putin: Russian budget will finance gas discount for Ukraine], 22 April 2010, http://www.gazeta .ru/news/business/2010/04/22/n_1486479.shtml. 70 “Prezidenty nashli obshiy yazyk” [Presidents came to an agreement], Nezavisimaya Gazeta, 22 April 2010. 71 Natalia Grib and Oleg Gavrish, “Voccoedineniye Ukrainy c Gazpromom” [Reunification of Ukraine with Gazprom], Kommersant, 4 May 2010. 72 Catherine Belton and Roman Olearchyk, “Anger in Kiev at Putin Gas Merger Proposal,” Financial Times, 30 April 2010. 73 “Rossiya i Turtsiya dogovorilis’ o cotrudnichestve v energetike” [Russia and Turkey agreed on co-operation in energy], Kommersant Online, 6 August 2009, http://kommersant.ru/news.aspx?DocsID=1216825. 74 “Ankara’da HÕzlÕ Enerji Trafi÷i” (Fast energy traffic in Ankara), Radikal, 18 July 2008. 75 Sinan O÷an, “Akdeniz Boru HattÕ Projesi (Med Stream)” (Mediterranean pipeline project), TURKSAM Enerji Enstitüsü, 26 July 2008, http://www.turksam .org/tr/a1447.html. 76 “Gazpromu predlozhili Moldovckie nedra” [Moldovan gas deposits were offered to Gazprom], Nezavisimaya Gazeta, 21 February 2008. 77 Armrosgazprom, “Kompaniya cegodniya” [Company today], http://www .armrusgasprom.am/ru/company/. 78 “Armenia otkazala Rossii v gazoprovode” [Armenia turned down Russia’s requests for pipeline], Kommersant, 25 January 2006. 79 “Armeniyu ubedili oruzhiyem” [Armenia was persuaded with a weapon], Kommersant, 24 March 2006. 80 “Chernomorneftegaz dobyvaet partnerov” [Chernomorneftegaz Gets Partners], Kommersant, 2 April 2007. 81 Law Regarding the Amendment to the Natural Gas Market Law No. 5367, Official Gazette, no. 25856, 25 June 2005, http://www.epdk.org.tr/english/ regulations/natural/law/ngas1.doc. 82 “Ali ùen Bosphorus Gaz’daki Hisselerini Gazprom’a SattÕ” [Ali ùen sold his stakes in Bosporus gas to Gazprom], Zaman, 21 August 2009; TarÕk YÕlmaz, “Gazprom Türkiye’ye Dev Projelerle Geldi” [Gazprom came to Turkey with enormous projects], Rota Haber, 27 March 2009, http://www.porttakal.com/habergazprom-turkiye-ye-dev-projelerle-geldi-269159.html. 83 James Sherr, “Colored Revolutions,” Harvard Black Sea Security Program-2006, Cambridge, Massachusetts, 14 April 2006, conference presentation, www.harvard-bssp.org/files/2006/.../Sherr_ENG_final.doc. 84 Panyushkin and Zygar, Gazprom, 149–150. 85 Panyushkin and Zygar, Gazprom, 150. 86 Jan S. Adams, “Russia’s Gas Diplomacy,” Problems of Post-Communism 49, no. 3 (May/June 2002): 15–16. 87 Panyushkin and Zygar, Gazprom, 148–151.

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88 Taras Kuzio, “Tangled Russian-Ukrainian Gas Deals Provide Opportunities for Corruption, Influence,” Eurasia Daily Monitor, Jamestown Foundation, 19 August 2005, http://jamestown.org/edm/article.php?article_id=2370177. 89 Smith, Russia and European Energy Security, 15. 90 Sergei Kulikov, “Moskva i Kiev perekidyvayutsa posrednikami,” Nezavisimaya Gazeta, 15 February 2008. 91 “Gazovoe coglashenie mezhdu ‘Gazpromom,’ ‘Naftogazom Ukrainy,’ i ‘RusUkrEnergo’” [Gas agreement among Gazprom, Naftogaz Ukrainy and RusUkrEnergo], Ukrainskaya Pravda, 5 January 2006, http://www2.pravda.com .ua/ru/news/2006/1/5/36448.htm. 92 “Ukraina: Vsya vlast gazovym posrednikam” [Ukraine: Full authority is given to intermediaries], 23 March 2010, http://www.newsland.ru/News/Detail/ id/478681/. 93 Roman Kupchinsky, “Gazprom’s European Web,” Jamestown Foundation, http://www.jamestown.org/programs/books/bookpaypalorder/. 94 Tatiana Ivzhenko, “Pokazatel’naya porka” [Significant whipping], Nezavisimaya Gazeta, 5 March 2009; Tatiana Ivzhenko, “Koalitsiya protif Yuschenko i cpetscluzhb” [Coalition vs. Yuschenko in intelligence service], Nezavisimaya Gazeta, 6 March 2009. 95 “Ukraina: Vsya vlast gazovym posrednikam” [Ukraine: Full authority is given to intermediaries], 23 March 2010, www.newsland.ru/News/Detail/id/478681/. 96 Kulikov, “Moskva i Kiev Perekidyvayutsa Posrednikami.” 97 Kupchinsky, “Gazprom’s European Web.” 98 P. A. Tsygankov, “O coderzhanii termina “mezhdunarodnyy aktor”: vklad cotsiologii” [On the content of term “international actor”: Contribution of Sociology], in Prostranstvo i vremya v mirovoy politike i mezhdunarodnyh otnosheniyah: materialy 4 konventa RAMI. v 10 T [Space and time in world politics and international relations: Materials of fourth convention of the Russian association of international research, 10 volumes], ed. A. Yu. Mel’vil (Moscow: MGIMO-University, 2007), 32. 99 Simonov, Energeticheskaya Sverhderzhava, 5–11. 100 “Medvedev ocudil pravovoy nigilizm kritikov izbiratelnoy cictemy Rossii” [Criticizing the Russian election system, Medvedev condemned legal nihilism], 22 January 2010, altai.regnum.ru/news/1245681.html. Also see: “Rossiya dolzhna preodelet pravovoy nigilizm-Prezident Rossii Medvedev” [Russia must overcome legal nihilism—president of Russia Medvedev], 7 May 2008, http://www.rian.ru/ politics/20080507/106773965.html. 101 de Leon, “Gazprom: Angel or Demon?”

CHAPTER TWENTY-NINE DOMESTIC SUPPLY OF NATURAL GAS AND OIL IN RELATION TO TOTAL ENERGY DEMAND IN TURKEY: HOW CAN ITS ENERGY NEEDS BE SECURED? øDRIS DEMøR

Introduction Energy, which is described as the capability to do work, is an essential component of economic output and development. The amount of energy that a country consumes is also an indicator of its level of development or industrialization. Countries initially try to meet their energy needs mainly through their domestic resources. If domestic sources are inadequate to meet the demand, then they have to import the shortfall from energy-exporting countries. In a country’s economy, high energy prices can have implications for employment, balance of payments, inflation, etc. When domestic energy production is unable to meet demand, one of the major responsibilities of a country’s decision makers is to secure an adequate energy supply at reasonable prices from foreign sources. It is clear that, in order to secure supply, the decision makers face several challenges. Threats to the security of a country’s energy supply include a physical interruption of the flow of energy—such as sabotage to the energy transfer infrastructure, accidents, and natural disasters—which may disrupt the planned flow for predicted consumption. The inadequacy of existing infrastructure is another source of threat to energy supply security. The consequences of political actions such as strikes and sanctions also present a threat to the security of supply. To secure that supply, it is essential for an energy-importing country to promote competition among its energy

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suppliers. Lack of competition can also be regarded as a threat to the security of supply.1 In order to overcome the unwanted consequences of the lack of a secure and adequate energy supply, countries must implement contingency measures. They must plan for an energy disruption scenario by accumulating considerable reserves and also increase capacity by means of investments and regulatory incentives. Diversifying sources of energy supply is another very important measure to be taken. For this, technology for producing new and alternative energy types should be developed. Consumption should be reduced through energy conservation measures, such as enacting new laws and establishing new institutions that are responsible for monitoring these efforts. In addition to the domestic efforts mentioned above, countries now have to focus on establishing political alliances with alternative energy exporters and developing new infrastructure to transport various types of energy.2 As a developing country with an ever-growing energy demand, but lacking adequate domestic supplies, Turkey relies mostly on external energy sources. In this respect, we will examine the energy policy of Turkey from a theoretical approach, focusing mainly on the notion of the security of supply as explained above. In our study, we will seek answers to the following questions: x What is the domestic energy supply of Turkey in relation to its total energy demand? x How is the total primary energy mix of Turkey structured? x What are the proven/probable/possible oil and natural gas reserves of Turkey? x What kind of energy security policies does Turkey pursue? x What benefit does Turkey gain from its energy transit/hub position? x What are the regulatory incentives taken by the state in overcoming the problem of energy security? In order to provide answers to these questions, our research is structured as follows. After defining the theoretical framework, the current state of Turkish energy consumption and domestic production will be presented. The expected rise in energy consumption due to the increase in population, industrialization, and living standards will also be indicated.

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Next, energy trade with partners will be discussed. In this section, in addition to international agreements and policies, international political and economic alliances for supplying energy are indicated. Finally, Turkey’s policy formulation and the state’s influence over the Turkish energy market will be scrutinized. In this part, legal arrangements, regulatory studies, and the protectionist policies of the state are presented.

Domestic Supply in Total Energy Demand in Turkey The Ministry of Energy and Natural Resources (MENR) estimates that by 2020, natural gas, oil, and coal are going to occupy a dominant position in the total energy demand. By improving alternative energy sources, conducting more efficient energy-conservation studies, and implementing the necessary legal arrangements, the percentage of oil and gas in Turkey’s total energy demand can fall from 60.7% in 2000 to 47.1% by 2020. Coal usage is expected to rise from 26.6% in 2000 to 39.5% in 2020. It is estimated that 2923.00 Mtoe3 of oil and gas and 2024.00 Mtoe of coal is going to be consumed. By 2020, hydro and nuclear energy will contribute 8.7% to the total supply. Geothermal, solar, and other alternative energy sources will account for a further 5%.4 Different sectors will use different proportions of the total energy consumption of Turkey. The demand of the industry sector is estimated to rise from 29.7% in 2000 to 40.4% by 2020. Over the same period household usage is expected to fall from 25% to 15% and the transport sector’s requirements from 19% to 13%.5 It is clear that there is a great gap between the expected energy demand and the domestic supply capability of Turkey. The gap between the total demand and domestic supply is expected to rise from a level of 59.94 Mtoe in 2000, to 234.95 Mtoe in 2020, and to 311.00 Mtoe in 2025. The amount of domestic supply available to meet the demand is expected to fall from 34.2% to 16.4% between 2000 and 2025.6 In the same period, domestic coal supply and production is expected to rise from 16.151 Mtoe to 40.752 Mtoe, hydroenergy from 3.763 Mtoe to 9.305 Mtoe, and geothermal and solar energy from 7.516 Mtoe to 13.811 Mtoe.7 It is necessary for Turkey to close the gap between energy demand and domestic production with imports. It is estimated that the ratio of domestic supply will fall from 34.2% in 2000, to 19.4% in 2020, and to 16.4% in 2025. According to the studies of the MENR, the cumulative amount of energy to be imported is 311 Mtoe by 2025. This places a heavy burden

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upon the national budget and occupies a very important place within the balance of payments calculations. The policy of Turkey, like all other countries, is to diversify energy sources and secure supplies by signing commercial agreements with energy-exporting countries in accordance with efficient domestic policies,8 such as conducting research into energy conservation and privatization.

Domestic Oil Demand and Supply Turkey’s oil reserves are estimated to be between 1.8 billion and 10.4 billion tonnes and the amount of oil to be used from these reserves by 2020 is expected to be between 274 million tonnes and 1.58 billion tonnes. Based on the data of existing fields, Turkey’s proven reserves are estimated to be 978.7 million tonnes. The amount of profitable oil to be produced is estimated to be 149.7 million tonnes, much of which has already been exhausted.9 Oil accounts for 40% of the total energy consumption of Turkey. Almost 90% of this is imported from various sources. The total consumption of crude oil was 23.901 Mtoe in 1990, 32.297 Mtoe in 2000, and 32.551 Mtoe in 2006.10 The domestic production of crude oil was 2.284 Mtoe in 200611 and 2.671 Mtoe in 201012. It is clear that the gap between production and consumption will continue to widen in the future. The main reasons for this are the increase in crude oil consumption due to rising industrialization, elevated living standards, and decreasing domestic crude oil production. It is clear that Turkey is almost 90% dependent on imports to meet its demand for oil. Dependence on foreign sources is likely to continue to rise in the future. Meanwhile, the Turkish Government has diversified its sources for energy imports. The main exporters to Turkey are Saudi Arabia, Iran, Iraq, Libya, Syria, Egypt, Algeria, and Russia, while much of the demand is expected to be met by the Baku–Tbilisi–Ceyhan Pipeline (BTCP).13

Domestic Natural Gas Demand and Supply Turkey’s gas reserves are estimated to be 18.1 billion cubic meters (bcm). The amount of gas that can be produced is estimated to be 12.3 bcm. In 1990, Turkey consumed 3.110 Mtoe of natural gas. This figure had increased to 13.728 Mtoe in 2000 and 28.867 Mtoe in 2006.14

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However, domestic natural gas production falls far short of satisfying demand and Turkey is almost totally dependent on foreign sources. From her domestic sources, Turkey produced 212 mcm (million cubic meters) in 1990, 639 mcm in 2000 and about 907 mcm in 2006.15 Wide usage of natural gas is not peculiar to Turkey. There is a growing tendency to use natural gas throughout the world. Natural gas is regarded as the fastest-growing sector in the world’s primary energy consumption mix. Turkey’s policy on natural gas consumption is based on several considerations. Turkey uses natural gas for generating electricity. Moreover, Turkey can obtain natural gas relatively locally, mainly from Russia. Turkey and Russia, the two most influential countries of the Black Sea region, maintain a relationship that is mutually advantageous. Situated as it is, at the crossroads of natural gas producers and consumers, Turkey intends to act as an energy hub. Turkey acts as an energy hub by means of existing pipelines and infrastructure under construction. Completed international projects are: the Baku–Tbilisi–Ceyhan crude oil pipeline, the Blue Stream natural gas pipeline, the Baku–Tbilisi–Erzurum natural gas pipeline, the Iraq–Turkey crude oil pipeline, and the Tabriz–Erzurum natural gas pipeline. International projects at the planning stage are: the Azerbaijan natural gas pipeline, the Egypt–Turkey natural gas pipeline, the Iraq–Turkey natural gas pipeline, the Nabucco Project, and the Eastern Europe gas ring. As the standard of living and industrial development of the country continues to improve, the demand for electricity will also continue to rise. The technological flexibility and practicality of natural gas power plants, in addition to their environmentally friendly features, puts natural gas at the forefront of energy use in Turkey. Turkey is surrounded on one side by the energy-resource-rich countries of the Caspian Sea and the Middle East, and energy-dependent, importing countries of Europe on the other. These European countries are largely dependent on Russia for their natural gas supply.16 Turkey, in this sense, can serve as a transport route for energy resources to these countries. In addition to the Russian option, the European countries can enjoy the continuous flow of Caspian and Middle Eastern natural gas and crude oil through infrastructure hosted by Turkey. This increases Turkish ambitions of acting as an energy hub in the region. Turkey, benefitting from its geographical position, imports natural gas from Russia and Iran and Liquefied Natural Gas (LNG) from Algeria and Nigeria in large quantities. Russia, already the largest natural gas supplier to Turkey, will improve this position with the Blue Stream Project.17 Meanwhile, it should not be forgotten that Turkey can decrease its

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dependency on Russian natural gas by making use of supplies from Iran, Turkmenistan, and Azerbaijan. Because of its fast-growing economy and population, to satisfy its increasing energy needs Turkey signed natural gas and LNG agreements with other natural-gas-exporting countries. Pursuing a policy of expanding the terms of the already existing framework agreement with Russia, in 1993 it was agreed to increase the gas supply by 2 bcm per year, beginning in 1996.18 Thanks to its huge gas resources, geographical proximity, and an already existing infrastructure, Russia has been a convenient partner for cooperation with Turkey in this respect. As these two important countries border the Black Sea, they have expanded their trade and sought other areas of mutual economic gain. According to data provided by BOTAù (the official pipeline operating company), Turkey supplied natural gas mainly from Russia and Iran as well as Algeria, Nigeria, Turkmenistan, and Azerbaijan. In 2000 Turkey imported a total of 14.822 bcm natural gas, though the imported amount of natural gas increased gradually to 32.466 bcm in 2010 and to 39.723 bcm in 2011.19 By diversifying sources Turkey can also secure supplies at reasonable prices. It should also be noted that long-term gas sale agreements concluded with major suppliers open new doors for Turkish foreign policy. In this respect, the energy policy of Turkey embodies a multidimensional approach. Turkey does not intend to be a final consumption market for Russian, Iranian, Azerbaijani, and Turkmen natural gas. Indeed, Turkey intends to behave as a middle market between the energy rich regions of the Caspian Sea and the Middle East, and the major energy consuming regions of Europe.20 Turkey is well aware that once the linking structures, such as pipelines, are built, they are fixed. They cannot be removed or redirected. When the pipeline infrastructure from Russia or Central Asia to Europe is settled via its territory, Turkey will benefit both economically and politically.21 Apart from satisfying its own domestic needs, Turkey is also a very important, if not vital, element in securing the energy needs of the European Union. Europe will be tied to Turkey through natural gas pipelines such as the Nabucco Project and the East Europe Gas Ring. Having a strong hand in this respect, Turkey intends to make use of this multidimensional energy security policy both to secure its domestic energy needs and to have an advantageous position in its accession process to the European Union.22 To be prepared for any emergency situation, Turkey has built a number of LNG terminals and storage tanks that will hold an adequate supply. The first terminal was built in Marmara Ere÷lisi in 1994. The first stockpiling

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infrastructure was built between Kuzey Marmara and De÷irmenköy in 1998. Turkey has already started building an LNG terminal with a capacity of 4–6 bcm in øzmir Alia÷a in order to meet some of the increased demand for natural gas and to be able to diversify the natural gas supply. Turkey will also have a share in the liquification process and natural gas reserves of Egypt and Yemen as part of the acquisition of new sources abroad, as contracted in 1996.23 Since both gas and oil are used to generate electricity in Turkey, as well as for industry and transportation, energy planning studies concerning electricity usage are also relevant to the use and regulation of gas and oil supplies.

Energy Planning Studies Turkey has implemented seven Five Year Development Programmes since 1961. However, it is argued that the energy policy of Turkey for the last two or three decades has not been well planned and has served the interests of particular individuals. The debates are mainly focused on the White Energy Operation and claims of corruption on the Blue Stream Project with Russia. Despite these claims of corruption, Turkey still has to meet an increasing demand for energy. The level of electricity consumption of each individual is regarded as one of the indicators of the level of development of a country. The per capita Gross National Product (GNP) of Turkey for 1999 was $2,878 and the electricity consumption per capita was 1,860 KWh. At that time the per capita level of electricity consumption in the world was 2,300 KWh. The figure for the Organization for Economic Cooperation and Development (OECD) countries was 6,991 KWh in 1996. Electricity consumption in Turkey is well below this level.24 Because of this, Turkey must build the necessary infrastructure and develop plans to meet an energy demand that increases by 8%–10% every year. These plans and policies are coordinated by the MENR. The MENR is responsible for energy planning, directing policies, preparing projects for these policies, granting rights for the development of sources, directing policies on production and distribution of energy, calculating the cost of energy, and approving the investment policies of the relevant institutions. The ministry conducts its duties and works in cooperation with the Energy Market Regulatory Authority (EMRA), established in 2001, and the Energy Summit, established in 1998. The Energy Summit aims to analyze and evaluate the prospects for energy production and consumption and give advice on the essentials of the national energy policy. The

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establishment of an Energy Institute is also being negotiated, to provide a forum for debating national energy policies and strategies.25

Legal Arrangements One of the main pillars of the legal arrangements for establishing an effective energy policy for Turkey, in order to close the gap between demand and domestic supply, is privatization. The first legal arrangement on privatization was implemented in 1984 by Article 2983. In the same year, Article 3096 granted other national and foreign private companies the right to generate and transmit electricity, in addition to the state-owned Turkish Electricity Institution. This article made it possible to establish the Build-Operate-Transfer (BOT; in Turkish, Yap-øúlet-Devret) system. At the end of the contract period the facilities were supposed to be transferred to state.26 The BOT system did not operate well because of bureaucratic obstacles, long controlling mechanisms, and some legal restrictions. A new model, Build-Operate (BO: Yap-øúlet), was enacted with Article 4283. In accordance with the BO system, national and foreign companies were given the right to produce energy. Energy production from hydro, geothermal, and nuclear sources were excluded from the programme. It was also made possible to apply to international courts for arbitration in case of dispute.27 In order to overcome difficulties and restrictions over foreign investment and credits, Turkey changed its Constitution. In order to make its domestic law and Constitution compatible with the international rules of Arbitration, Articles 4446, 4493, and 4501 were changed in 2000. These newly enacted laws made foreign investment in energy production possible and helped Turkey meet its domestic needs. Legal arrangements intended to restructure and open the energy market for competition led to the establishment of the Energy Market Regulatory Authority (EMRA; EPDK) which began operating in 2001. Being responsible for governing and regulating the electricity market, the natural gas market, and the oil market in Turkey, EMRA aims to provide a stable and strong energy market. To this end, EMRA is responsible for establishing a market based on competition, reaching decisions to stabilize the market, preparing necessary legal and economic grounds for producing low-cost energy, promoting private investments, governing the production and distribution energy licences, and regulating prices in the energy markets.28

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Another legal arrangement was the establishment of the Energy Conservation Centre (ECC; ETM) in 1993. This aims to promote sustainable development and more effective ways of using energy, increasing production while lowering energy consumption. Another aspect of the energy planning policy of Turkey is the diversification of alternative energy sources. Since Turkey is a country dependent on imports, alternative domestic sources have to be used effectively. There have been studies focusing on generating solar energy, geothermal energy, wind energy, hydrogen energy, and nuclear energy. Due to their compatibility with the local surroundings and environmentally friendly features, the use of alternative energy sources is widely encouraged. Since the southern and western regions of Turkey are lavished with sunlight most of the year, generating energy from the sun is seriously discussed in official chambers. The initial construction period of this initiative requires a large investment, but because it does not harm the environment and the running costs are low, solar energy is the favoured alternative option. Generating energy from wind has environmental advantages, such as the absence of radioactivity, waste, and emissions into the atmosphere. The general wind mapping of Turkey is completed. Many wind farms have been created, mainly in the western and southern parts of the country, and are growing in number. Obtaining energy from nuclear reactions is another alternative considered by Turkey. Although Turkey presently has no nuclear energy facilities, it is seen as an important investment area that will contribute to the Turkish energy sector, providing cheap energy, promoting technology, and providing employment opportunities at all levels. The first studies of nuclear power plants were conducted between 1967 and 1970. Although the building of a power plant was always on the agenda, there were no important developments until the 1990s. According to new energy planning conducted by the MENR, it is proposed to add 87,329 MW of nuclear-generated power to domestic production by 2020, calculated to be 11%.29

Conclusion It is clear that Turkey has to meet its need for energy to achieve sustained development and economic recovery. It should also be noted that the multidimensional approach of the Turkish energy security policy has demonstrated that this strategy is not limited to domestic concerns, but

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also embodies international elements and foreign associations. Turkey intends to be one of the core elements of the security of the energy supply structure of the European Union. In order to realise this intention, Turkey prioritizes pipeline projects as well as domestic demand and supply possibilities in planning its energy policy. This study has looked closely at Turkey’s energy security policy from a theoretical perspective. We have tried to explain that Turkey’s strategy for energy supply security relies heavily on government intervention and state monopoly (TPAO, BOTAù etc.). However, there have been some attempts on the part of the Government to privatize the energy sector (TUPRAù) and involve the private sector in some areas with systems like Build and Operate. Yet this study argues that the state should, and will, continue to significantly direct and intervene in energy policies until the market is fully able to secure a domestic energy supply sufficient to meet Turkey’s needs.

Notes 1 Philip Andrews-Speed et al., The Strategic Implications of China’s Energy Needs, Adelphi Paper 346 (Oxford: Oxford University Press, 2002), 14. 2 Gawdat Bahgat, “Energy Security in a New World Order,” Journal of Energy and Development 30, no. 1 (2004): 47. 3 toe = tonne of oil equivalent, the amount of energy released by burning one tonne of crude oil. Mtoe = megatoe, one million toe; Gtoe = gigatoe, one billion toe. 4 “21. YüzyÕla Girerken Türkiye’nin Enerji Stratejisinin De÷erlendirilmesi,” TÜSøAD Yay. no. 1998–12/239, Ankara, p. 87. 5 TÜSøAD, “21. YüzyÕla Girerken,” 88. 6 TÜSøAD, “21. YüzyÕla Girerken,” 91. 7 TÜSøAD, “21. YüzyÕla Girerken,” 92. 8 TÜSøAD, “21. YüzyÕla Girerken,”, 97. 9 http://www.enerji.gov.tr/reservler.html. 10 http://www.enerji.gov.tr/EKLENTI_VIEW/index.php/raporlar/detayGoster/ 4314. 11 www.enerji.gov.tr/EKLENTI_VIEW/index.php/raporlar/detaySec/6603. 12 www.enerji.gov.tr/EKLENTI_VIEW/index.php/raporlar/detaySec/62173. 13 Meliha AltunÕúÕk, “Turkey and the Changing Oil Market in Eurasia,” The Political Economy of Turkey in the Post Soviet Era, ed. Libby Rittenberg (Westport: Praeger, 1998), 162. 14 www.enerji.gov.tr/EKLENTI_VIEW/index.php/raporlar/detayGoster/4314. 15 Figures from www.enerji.gov.tr/. 16 Andreas Chollet et al., “Options for Transporting Russian Gas to Western Europe: A Game-Theoric Simulation Ananlysis,” DIW Discussion Papers, Discussion Paper No. 261 (Berlin, 2001), 2. 17 B. Sasley, “Turkey’s Energy Policy in the Post–Cold War Era,” Middle East Review of International Affairs 2, no. 4 (1998): 48.

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BOTAù website, www.botas.gov.tr/dogalgas/dg_alim_ant.html. www.botas.gov.tr. 20 Agata Loskot, “Turkey: An Energy Transit Corridor to the EU?” CES Studies (2005): 19. 21 Selma Stern, “Turkey’s Energy Industry and her International Relations,” www.dundee.ac.uk/cepmlp/car/html/car7_article20.pdf. 22 John Roberts, “The Turkish Gate: Energy Transit and Security Issues,” Turkish Policy Quarterly 3, no. 4 (Winter 2004): 101. 23 BOTAù website, http://www.botas.gov.tr/aktiviteler.html. 24 Yavuz Ege, “Avrupa Birli÷i’nin Enerji PolitikasÕ ve Türkiye’nin Uyumu,” in AB’nin Enerji PolitikasÕ ve Türkiye, ed. Yavuz Ege (Ankara: UPAV, 2004), 37. 25 See http://www.enerji.gov.tr. 26 TÜSøAD, “21. YüzyÕla Girerken,” 261. 27 TÜSøAD, “21. YüzyÕla Girerken,” 265. 28 Meliha AltunÕúÕk, “Avrupa Birli÷i’nde Petrol ve Do÷al Gaz PiyasalarÕna Yönelik Politikalar ve Türkiye UygulamalarÕ,” in Ege, AB’nin Enerji PolitikasÕ ve Türkiye, 159. 29 http://www.enerji.gov.tr. 19

PART V: ECONOMY

CHAPTER THIRTY ENHANCING SECURITY AND STABILITY IN THE BLACK SEA REGION THROUGH ECONOMIC COOPERATION ALIOSHA NEDELCHEV*

Introduction Historically, the seas have played a dual role for the coastal states and their peoples—either as boundaries and battlefields, or as bridges facilitating trade and cooperation. The Black Sea was no exception to this rule, but over time, the political, economic, and cultural environment of the region has changed substantially. Meanwhile, the people living in the region began to realise ways of exploiting their common heritage in the interest of all. Today, with its rich and diverse environment, important routes for energy resources, and transport connections between the neighbouring regions, the Black Sea region holds vast potential. It is also a key area for fighting organized crime and illegal migration. It is our common responsibility and endeavour to unlock this potential for the benefit of our nations.

The Black Sea Economic Cooperation (BSEC) The Black Sea Economic Cooperation (BSEC) was established on 25th June 1992. Today the BSEC is a fully fledged international organization, which encompasses a legal entity, principal and subsidiary bodies, and established areas of cooperation. The BSEC is a regional forum of economic cooperation covering the territories of the Black Sea littoral states, the Balkans, and the Caucasus. *

Deputy Secretary General Black Sea Economic Cooperation (BSEC) Permis.

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The main actors involved in cooperation in the BSEC region are its twelve member states.1 Furthermore, observer status was granted to seventeen states and international organizations that expressed their readiness to make a practical contribution to the work of the BSEC.2 In addition, the BSEC promotes partnership relations3 with a number of states and international organizations interested in cooperating on various matters of mutual concern.4 I could not but also mention the BSEC-related bodies5, which are an important part of the BSEC family, and contribute significantly to the regional cooperation process. In accordance with the Charter (Article 4) and decisions of the Council, the BSEC member states are actively engaged in various areas of cooperation6, in realization of which they are assisted by eighteen working groups. As is well known, BSEC does not deal directly with political and security issues, and it has not made any attempt to tackle the so-called frozen conflicts of the region, since it is not empowered to do so by its charter. On the other hand, BSEC’s role in this respect is much wider. This role is based on the common understanding of the rising importance of the wider Black Sea area, and the paramount responsibility which rests with BSEC, the most inclusive cooperation organization in the region, in promoting economic development and preserving security and stability.7 From the very first day of its existence, BSEC’s security concerns stemmed from its fundamental goal “to ensure that the Black Sea becomes a sea of peace, stability and prosperity, striving to promote friendly and good neighborly relations.”8 Ten years later, the Heads of State or Government of the BSEC Member States made a significant step forward by declaring, “the political, economic and security developments in Europe clearly indicate that peace on the continent depends on the stability and prosperity of its regions. They also demonstrate that the Black Sea region is in need of further efforts towards security and stability.”9 The principal body of the Organization is the Council of Ministers of Foreign Affairs. In their statements and declarations Foreign Ministers frequently address issues related to security and the protracted conflicts in the region. In its last declaration, for instance, the ministers “recognized that the existing protracted conflicts in the region impede cooperation and emphasized the need for their earliest peaceful settlement on the basis of the norms and principles of international law.”10 And we must not forget, either, that BSEC provides a forum enabling the representatives of the member states who do not have diplomatic relations with each other, or have serious bilateral political or other

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problems, to meet among themselves, and to discuss these issues on the margins of meetings of the Council of Ministers of Foreign Affairs. BSEC, as a regional economic organization, has focused mainly on economic issues. This approach has been qualified as the “BSEC method: security through economic cooperation.” By expanding economic cooperation, the BSEC has already greatly contributed to strengthening security and stability in the region. Cross-border cooperation through streamlined border controls, custom procedures, and visa facilitation, are additional efforts on our part to strengthen the stability and security in the region. And within BSEC, we are working hard to make progress in that direction. The Memorandum of Understanding (MoU) on Facilitation of Road Transport of Goods in the BSEC Region is expected to streamline such procedures. Two Agreements, one for visa facilitation for lorry drivers, and one for business people, have been opened for signature at our Ministerial Meeting, which took place in October 2008, in Tirana. Furthermore, besides the establishment of a new field of cultural cooperation, additional efforts are being invested in promoting cooperation in existing areas like education, science and technology, healthcare and pharmaceuticals etc. All these efforts have a positive impact on regional security and stability. BSEC also has a positive record overall in so called “soft” security issues covering cooperation in combating crime, illegal trafficking of drugs and arms, terrorism, corruption, and money laundering, as well as response to emergency situations.11 Activities in the sphere of institutional renewal and good governance also contribute to strengthening security and stability in the region. Allow me at this point to comment briefly on the recent developments within the BSEC that are related to this topic: On June 25th 2007, BSEC celebrated its fifteenth anniversary, and the BSEC Summit, which was held in Istanbul, adopted a Summit Declaration. The Summit Declaration encompassed the following: x It endorsed and promoted a new project-oriented policy of BSEC; x It considered reform processes designed to enhance the efficiency and effectiveness of the organization; and x It reflected a new period of enhanced relations between BSEC and the European Union (EU). One of the main objectives of the current Albanian chairmanship was the implementation of BSEC structural reforms, so that BSEC will be able in future to respond quickly to new challenges of regional cooperation. In

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order to achieve this aim, a brainstorming meeting was organized to discuss the future of BSEC and to reflect on enhancing its efficiency and credibility. As a result, draft guidelines on improving the efficiency of the BSEC were drawn up. This document was examined and, in principle, agreed upon at the Informal Meeting of the Ministers of Foreign Affairs (New York, 25th September 2008). As was mentioned earlier, the completion of the Summit Declaration reflected the new period of enhanced relations between the BSEC and the EU. It underlined the importance of establishing a strategic relationship between the two organizations. To achieve this goal, a number of important steps have been taken. In 2007, the Commission of the European Communities was granted observer status in BSEC. The BSEC Ministers of Foreign Affairs met in Kiev on 14th February 2008, and discussed the development of mutually beneficial cooperation between the BSEC and the EU. At that meeting they adopted a Declaration on a BSEC–EU enhanced relationship. On the same day, foreign ministers of the countries of the EU and of the wider Black Sea area met in Kiev to initiate Black Sea Synergy cooperation. In the joint statement, ministers identified significant challenges and opportunities in the wider Black Sea area, which may require coordinated action at the regional level. They agreed that greater involvement by the European Union can increase the potential of Black Sea regional cooperation. BSEC is looking for closer cooperation and coordination with the EU in areas of mutual interest, ensuring complementarity and synergies, and avoiding duplication of work. The initial results and experience of the first year of the Black Sea Synergy revealed the practical utility and the potential of this regional policy approach. The launch phase of the Synergy has been completed and implementation has begun. The BSEC member states are of the view that, during that period, BSEC–EU relations have seen further development that aimed to enhance institutional relations between the two organizations, and therefore that BSEC–EU interaction should be consolidated. In this context, within the framework of Black Sea Synergy, concrete partnerships with the EU in particular areas of cooperation (transport and environment) should be encouraged. The summit declaration endorsed and promoted the new projectoriented policy of BSEC. At the moment, in the framework of BSEC there are two special funds: the Project Development Fund (PDF), which was established in 2002, and the Hellenic Development Fund (HDF), which was created in 2008.12 Since the start of the PDF operations, a total of forty-two projects have been submitted to the BSEC working groups, out

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of which twenty-seven have been endorsed and forwarded to the committee of senior officials. Of those twenty-seven PDF applications endorsed, twenty-two have been finally approved for funding by the steering committee. Meanwhile, in the field of transportation, the BSEC attributes enormous importance to transport infrastructure projects, for the realization of which it has signed two MoUs: one on the coordinated development of the Black Sea ring highway, and the other on the development of the motorways of the sea in the Black Sea region.13 The Black Sea ring highway is a 7,100 kilometre project. It aims to upgrade the existing road infrastructure into a four-lane highway, so that it creates a ring road around the Black Sea. It is expected that the finalization of this project will have the following benefits for the region: facilitating intra-BSEC trade as well as BSEC exports; connecting the Black Sea road system to that of Europe and Asia; and developing tourism in the area. It may also contribute to finding a solution to the frozen conflicts. The development of the motorways of the sea in the BSEC region is interconnected with the Black Sea ring highway. Activities within this project include the upgrading of port facilities, identification of projects of common interest, securing free and fair competition in international shipping, facilitation of access to all modes of transport, and promotion of intermodality and enhancement of maritime security and safety in the BSEC region. With the establishment of scheduled passenger lines and roll-on/rolloff (ro-ro) ferries, which will connect the basic ports of the Black Sea to the Black Sea ring highway and to ports of the Mediterranean, BSEC will be able to substantially expand its potential.

Conclusion We are convinced that BSEC’s importance will increase as a result of its new project-oriented approach. Without a doubt, this will create new opportunities for regional cooperation. I would like to express our wish that this book be another important step in enhancing our common understanding and devotion to the noble idea of making the Black Sea a really Blue one for future generations living in the Black Sea region.

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Notes 1

Republic of Albania, Republic of Armenia, Republic of Azerbaijan, Republic of Bulgaria, Georgia, Hellenic Republic, Republic of Moldova, Romania, Russian Federation, Republic of Serbia, Republic of Turkey, and Ukraine. 2 Republic of Austria, Republic of Belarus, Republic of Croatia, Czech Republic, Arab Republic of Egypt, French Republic, Federal Republic of Germany, State of Israel, Republic of Italy, Republic of Poland, Slovak Republic, Republic of Tunisia, United States of America, International Black Sea Club, Energy Charter Secretariat, Black Sea Commission, Commission of the European Communities. 3 Republic of Hungary, United Kingdom, Black Sea International Shipowners Association (BINSA), Black & Azov Seas Ports Association (BASPA), Union of Road Transport Association in the Black Sea Economic Cooperation Region (BSEC-URTA), Black Sea Region Association of Shipbuilders and Shiprepairers (BRASS), Regional Commonwealth in the Field of Communications (RCC), International Network for SMEs (INSME). 4 Moreover, BSEC obtained the status of observer in the UN General Assembly and signed cooperation agreements with the United Nations Economic Commission for Europe (UN/ECE), United Nations Development Program (UNDP), United Nations Environment Program (UNEP), United Nations Industrial Development Organization (UNIDO), United Nations Food and Agriculture Organization (UN/FAO), World Bank, World Trade Organization (WTO), Energy Charter Secretariat, Eurasian Economic Community (EAEC). 5 Parliamentary Assembly of the Black Sea Economic Cooperation, BSEC Business Council, Black Sea Trade and Development Bank, and International Center for Black Sea Studies. 6 Trade and economic development; banking and finance; communications; energy; transport; agriculture and agro-industry; health care and pharmaceutics; environmental protection; tourism; science and technology; exchange of statistical data and economic information; collaboration between customs and other border authorities; human contacts; combatting organized crime, illicit trafficking of drugs, weapons and radioactive materials, all acts of terrorism and illegal migration, or in any other related area, following a decision of the Council. 7 Kiev Declaration, 18th Council of MFA, Kiev, 17 April 2008. 8 Summit Declaration, Istanbul, 25 June 1992. 9 Decennial Summit Declaration, Istanbul, 25 June 2008. 10 Kiev Declaration, 18th Council of MFA, Kiev, 17 April 2008. 11 See: Agreement among the Governments of the Black Sea Economic Cooperation Participating States on Cooperation in Combating Crime, in Particular in its Organized Forms, Kerkyra, 2 October 1998; Additional Protocol to the Agreement, Kiev, 15 March 2002, and Athens, 3 December 2004; Agreement among the Governments of the Participating States of the Black Sea Economic Cooperation (BSEC) on collaboration in Emergency Assistance and Emergency Response to natural and man-made disasters, Sochi, 15 April 1998; Additional Protocol to the Agreement, Kiev, 20 October 2005. 12 The HDF is envisaged to become operational at the end of 2008.

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Both MoUs were signed in Belgrade on 19 April 2007. The MoU on the Ring Highway will enter into force on 1 November 2008. The MoU on Motorways of the Sea needs one more notification from member states in order to enter into force.

CHAPTER THIRTY-ONE ANALYSES OF THE BANKING SECTOR IN BLACK SEA REGION COUNTRIES AND TURKEY BIRGÜL ùAKAR*

Introduction The banking sector’s main function is financial intermediation, giving depth to the financial system, providing funds for loans, and directing sources to productive areas through risk and yield analysis. Due to potential risks caused by high interest and transaction costs that arise in unstable economic conditions, the banking sector works with high risk premiums. In such conditions, banks may be unable to support research projects for product development and major investments. Generally, newly established companies face difficulties finding alternative finance channels, such as selling shares/stocks in the financial markets. Companies in Turkey, particularly newly established ones, do not show significant improvement from the issue of bonds and stocks. In times of economic instability it is impossible to issue bonds and stocks to provide sources of finance from the market, especially for new, small, or medium-sized companies such as information technology sector businesses. Furthermore, legal restrictions prevent a company that has made no profit in the previous three years from going public. In the present financial structure, turning the idle funds and savings of people into productive investments depends on the banking system in general. This immature structure is inadequate for lending money efficiently to companies and contributes little to solving the employment problem and increasing the international economic competitiveness of the country. Turkey’s level of financial development has opened the way for *

Kadir Has University Social Science Institute, Istanbul, Turkey.

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companies to receive funds such as through indirect commercial borrowing from the market. The results of both theoretical approaches and empirical studies show that one of the requirements of sustainable economic growth is the necessity for banks to obtain stable funding. Banks make choices based on risk and efficiency when considering funding applications from companies. These criteria are identified with economic efficiency and are considered in parallel. Banks are very selective in their choices and try to provide funds for investments that are realistic and implementable. They direct the course of economic growth by turning savings into investments to fund both speculative and technologically developable projects. Since banks increase available funding and distribute it to productive fields, they can make a positive contribution to economic growth. In its Banking System Outlook report,1 Moody’s stated that the Turkish banking system faces low profitability within an unstable business atmosphere, with weak asset quality and a weak capital structure. The share and structure of loan portfolios in the Turkish banking system has shown interesting changes in the period studied. For example, while the share of loans in banks assets was 54% in 1980, it decreased to 47% in 1990, and 20% in 2001, but increased slightly to 23% in 2002. As the security portfolios of the banks receive more and more shares from government bonds and treasury bills, the level of loans that real sector manufacturing companies could borrow has decreased. The share of bonds and bills went from 6% in 1980, to 10% in 1990, 35% in 2001, and 41% in 2002.2 Economic growth in Turkey was 20% in the period 1990–2000, but decreased during the financial crisis of 2000–2002. Except in the crisis years of 1994, 1998, 1999, 2001, and 2002, the number of fixed capital investments has increased. The unemployment rate was 9.6% in 1990 and 10.6% in 2002. The share of foreign currency in total deposits was 21% in 1990, but increased in 1994 and 2001 due to devaluation to 50% on average between 1994 and 1997, 44% between 1998 and 2000, 55% in 2001, and 54% in 2002. The rate of inflation was over 50% from 1990 to 1999, but decreased to less than 40% as a result of an inflation-decreasing program. However, it increased again after the November 2000 and February 2001 crisis. With further measures and trust effects on the markets, inflation started to decrease once again.3 In this study, a ratio analysis of recent Turkish and Black Sea countries’ banking sectors has been used. All data used in the paper has

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been derived from the TBB (Turkish Banks association), the TMB (Central Bank of Turkey), the TIK (Turkish Statistical Institute) and annual publishings of the Turkish State Planning Organization. A literature review has been conducted of the banking sector’s productivity performance in Turkey and the world and the relation between financial intervention and macroeconomic growth. These issues are discussed below under three headings: Banking Sector Activity; Macro-economic Development; and Financial Efficiency.

Banking Sector Activity The banking sector can be productive and work efficiently only when the difference between the marginal resource cost to investors and yields to savers is at a minimum. When this difference is high, due, for example, to monopolist structure, inadequate regulations, institutional deficits, and non-productive investments, the banking sector can adversely affect economic growth. The same negative effects can also occur in developed monetary systems when precautionary savings decrease. The rate of conversion of deposits into loans is lowered. Furthermore, if the banking sector cannot direct sources towards productive investments, its contribution to macroeconomic growth can be restrictive. While assessing loan requests, banks make choices according to risk/yield criteria. The effect of the banking sector’s productivity and efficiency on economic growth is closely related to a country’s level of economic, social, and legal development. Empirical research on the relation between financial development and growth contributes to solutions by defining financial development, determining the appropriate channelling of effects, and presenting institutional and legal factors.4 Levine and Zervos, studying the relation between economic growth and financial development (in different measures for multi-country analyses), found that financial development leads to economic growth.5 In countries that have developed financial depth, stocks, and debentures, markets are important to banking from the point of view of financial solutions.6 Besci and Wang emphasize the role of intermediaries in the same context.7 Levine and Carkovic indicate that a developed banking sector and liquid debenture/stock markets have independent positive effects on economic growth.8 Levine and Zervos studied the relation between the economic growth and market developments in the security and bakery sectors. They found that both sectors’ effects on economic growth were independent of each other, and concluded that the liquidity of stock

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markets and developments in the banking sector affected economic growth, capital savings, and productivity levels. They found that there is a similar strong relation between the financial development and economic growth.9 Claessens and Laeven found that where the banking sector is competitive, industries depending on external sources of finance support economic growth and expand more rapidly in the market.10 It is expected that as the financial market develops, factors of productivity will also increase. GünçaydÕ and Küçükçiftçi, using the Leontief input–output model, found that the input usage of financial sectors has decreased between 1985 and 1990. Although they slightly increased in 1996, they never reached the level of 1973.11 The real sector can achieve sound and sustainable growth if the banking sector works productively and efficiently, providing long-term loans with appropriate costs. Economic dynamism can be enhanced by low intermediary costs, low banking liabilities, and low credit costs.12 Research conducted for 80 countries in the period between 1960 and 1989 showed that intermediary costs are higher in less-developed countries and that economic growth is achieved together with increasing financial development.13 The banking sector indirectly provides stability in economic growth by financing investments through individual and institutional savings. Funds of Turkish banks, however, are used to finance the public sector. Therefore, the shares of government bonds in current assets of the banks are sometimes very high.14 Eriú defines the transforming of deposits into loans as high in developed markets.15 In the competition created by public borrowing with no risk and high yield, risk premium payments and the real interest paid by the private sector increases the production costs of the real sector.16 This increase in production costs decreases the competitiveness of companies, which decreases exports and increases imports. Thus, the trade deficits and foreign exchange out-flows of countries increase. As a result, production and employment declines and the economy shrinks.17 Such market dynamics are generally described by the theory of savings and of expenditure which can be summarised as follows: loans provide purchasing power in the markets; the increased money supply elevates individuals’ income levels; and in accordance with their spending and saving habits, these individuals either spend more or save more. As a result of the increase in demand, manufacturers increase their investments to produce new goods and services. Hence, the increased supply takes place without inflation. As a result of this, production volumes, employment level, gross national income, and individual income rises in

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the short term. However, if the economic structure and production capacity cannot meet the increase in demand, depending on the loan supply, there will be an increase in prices. Any increase in prices indicates that the availability of loans should be reduced. If it is not conducted effectively prices will continue to increase at an accelerating rate, leading to a “lending/loan inflation.” The method of loan usage is of great importance to the enhancement of economic performance. In addition, loans granted for production and investment, but directed instead to consumption, will also lead to inflation. A 1% decrease in loan interest rates leads to a 0.6% increase in loan volume and a 20% increase in production. A decrease in credit interest by 1% yields a 0.6% expansion in loans. And one unit of credit yields a 0.2% production increase. The loan total created by bank lending for 1 unit within a year is 1.5 (credit multiplier). With the increase in intermediation cost for 1 billion YTL (New Turkish Lira), the funds that arise in the general economy will create an income of about 1.8 billion YTL. The compensation of tax losses due to the discounts in income is 63% for the first year. As a result of the increase in banks’ profitability and efficiency, the increase in income tax due to raised transaction volume/capacity can meet the cost to the treasury. Although bank loan usage changes over time, it is still not at a satisfactory level. For example, in Turkey, between 1997 and 2001, companies’ bank loan share was under 40%; between 1995 and 2001, the rate of the financial system’s total sources to fixed capital investment was about 35%; between 1992 and 2002, the share of the financial sector to Gross Internal Product was between 2% and 3%. Between 1986 and 2001, the internal loan volume and industrial production have moved in the same direction. The real interest rates, which are important indicators of trust in the economic atmosphere, are the reverse of the growth in industrial production. However, it is important to lower the “real interest rates” in order to handle international debts. It is also important to keep growth rates under control. Lowering real interest can be made possible by building a solid public financial structure, creating a surplus, breaking the debt and interest cycle, decreasing the public sector borrowing requirement, and sustaining financial discipline.

Macroeconomic Development In an effort to determine the level of development of Turkey according to technological improvement, it could be observed that technology-based sectors have slowed down since 1990. For example, when a comparison is

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made across a number of national economies in 1996, high technology sectors (such as computers, electronics, communications, and medicine) and low technology sectors (such as food, clothing, and textiles) have shares of 3% and 5% respectively in Turkey, while the OECD average is around 15% and 19% respectively. The total share of intangible investments in 1995 (such as research and development and software) in GDP was only 2.3%, compared to the OECD average of 7.9%. The number of researchers per ten thousand employees was only 7, compared to 55–75 researchers for most OECD countries. The number of patents received from international institutions was only 4, which is a really minute number when compared to 94,000 patents received in United States, 4,000 in France, 10,000 in Germany, 33,000 in Japan, 3,700 in South Korea, and 800 in Israel. Nevertheless, there have been some promising developments in the technological capabilities of Turkey that have increased competitiveness and positively impacted on economic growth and stability between 2001 and 2005.18

Financial Efficiency Banks contribute to the development of a country’s economy by pooling idle, small, and short-term funds to provide a source of finance to private and public sector institutions. A development banking system can find foreign funds for the economy in loan volumes more than those collected from deposits. A developed banking system increases monetary policy efficiency and affects the control of monetary volume. Increasing the efficiency of the banking sector raises the income level of individuals and accelerates deposits. The main target in the strategy for economic growth is to accelerate capital savings and productivity. The following trend table shows the growth, unemployment level, and labour productivity in Turkey between 2000 and 2008. It can be seen here that Gross National Product growth has a higher correlation with labour efficiency than with unemployment.

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Table 31-1 Growth in Turkey, Development of Unemployment, and Labour Efficiency Year 2008 2007 2006 2005 2004 2003 2002 2001 2000

GNP MillionUSD 825.000 658.000 400.000 361.500 300.600 239.800 180.100 146.100 201.500

% GNP Growth Rate 2.5 6.4 6.0 7.6 9.9 5.9 7.9 -9.5 6.3

Unemployment Rate % 11.6 10.3 10.3 10.3 9.7 10.1 9.4 7.5 6.3

% Labour Efficiency 3.1 5.9 6.5 7.1 7.8 6.4 8.1 -5.1 -0.5

Source: www. tuik.gov.tr/VeriBilgi, 15.11.2009, http://www.tuik.gov.tr/Start.do

Taxes are one of the main components restricting financial efficiency in the Turkish banking system. In the period 1991–2008, the total sum of taxes collected by the Turkish banking system from end users and transferred to the state budget was $43.8 billion. Lowering the tax load on the banks, directly or indirectly, will make financial intermediation more efficient, increase transaction volume, and contribute to the productivity of banking system. Turkey began implementing a foreign trade policy based on market economy rules rather than import protectionism. As a result, economic growth increased in the 1980s but bank deposits were reduced. This pushed interest rates up and limited the amount of loans that were made.

A Comparison of the Black Sea Countries and Turkish Banking Systems in Terms of Indicators of Financial and Banking Sector Efficiency In this section, based on recent general indicators such as total bank assets, number of banks, total loans, and total savings, the banking industries of Turkey and the Black Sea countries Russia, Romania, and Bulgaria are compared. An analysis has been carried out by comparing the values of indicators from Turkey and other Black Sea countries. At the end of this section, there will be some recommendations for necessary precautions to be taken in order to reach the average level of the EU countries.

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Turkey’s figures are higher than the figures of the other Black Sea countries on the basis of the above-mentioned indicators. It seems possible for European Union banking arrangements such as the taxation, subsidies, and protection to be adopted in Turkey and the Black Sea countries, in order to reach European Union standards.

Total Assets In 2008 Russia had the highest and Bulgaria the lowest total assets. The average asset volume of the EU was 2,578.91 billion Euros. One of the greatest handicaps of the Turkish banking system for financial integration with EU is its low asset volume. Table 31-2 Total Assets in Turkey and Black Sea Countries (billion EUR) Country

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

129.9

123.72

142.11

168.08

250.00

260.73

328.94

330.96

Russia

-

124.26

239.76

188.6

285.02

405.00

562.47

676.20

Romania

-

15.3

14.7

22.63

34.83

51.08

72.06

78.17

Bulgaria

6.24

7.5

8.87

12.72

16.81

21.58

30.21

35.56

EU Avg. 1,365.06 1,466.96 1,517.78 1,511.00 2,251.37 1,986.99 2,403.99 2,578.91 (Euro Area)

Source: European Banking Federation.19

As indicated in table 31-2, Turkey has a relatively high asset volume compared with Romania and Bulgaria. The asset volume of the Turkish banking system was around 142 billion Euros in 2003, 168 billion Euros in 2004, 250 billion Euros in 2005, 260 billion Euros in 2006, 328 billion Euros in 2007, and 330 billion Euros 2008. The most significant development regarding the asset volumes of the Black Sea countries is their growth trend. The asset volume of the Turkish banking system is far below that of Russia. The growth trend in asset volume is a clear indication of economic development among the Black sea countries: x The Turkish banking sector’s asset volume increased to 20.9% in 2001, decreased to 4.8% in 2002, but started to rise to a rate of 14.8% in 2003, 18.2% in 2004, 55.2% in 2005, and 26.2% in 2007, but decreased to 1% in 2008.

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x The Russian banking sector’s asset volume increased to 92.9% in 2003, decreased to –21.3% in 2004, but jumped to 43.6% in 2006, however, decreased to 38.7% in 2007 and to 20.3% in 2008. x The Romanian banking sector’s asset volume decreased to –3.9% in 2003, increased to 53.9% in 2004, doubled to 46.6% in 2006, but then decreased to 41.1% in 2007 and to 8.5% in 2008. x The Bulgarian banking sector’s asset volume increased to 26.2% in 2001, decreased to 20.2% in 2002, and to 18.3% in 2003, jumped to 43.4% in 2004, but decreased to 28.4% in 2006, while increased to 39.9% in 2007, but again decreased to 17.7% in 2008. Table 31-3 Growth of Total Assets in Turkey and Black Sea Countries by Percentage (%) Country

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

20.9

-4.8

14.8

18.2

55.2

10.4

26.2

1.0

Russia

-

-

92.9

-21.3

51.6

43.6

38.7

20.3

Romania

-

-

-3.9

53.9

53.9

46.6

41.1

8.5

Bulgaria

26.3

20.2

18.3

43.4

32.2

28.4

39.9

17.7

EU Avg. (Euro Area)

4.4

8.1

3.5

-0.4

48.9

-11.7

20.9

7.3

There is a significant positive correlation between Turkey, Romania, and Bulgaria. But with the Russian figures, a correlation with the EU countries can be seen. In total asset growth, Romania and Bulgaria are more similar to each other than to Russia. The data presented in tables 31-2 and 31-3 show that the Russian economy has a different economic performance compared to the other Black Sea countries. These figures indicate that the Russian economy is more interrelated with European Union countries’ economies.

Number of Banks In 2008 Russia had 1,058 banks, followed by Turkey with 45, Romania with 43, and Bulgaria with 30.20

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Table 31-4 Number of Banks in Turkey and Black Sea Countries Country Turkey Russia Romania

2000

2001

2002

2003

2004

2005

2006

2007

2008

79

61

54

50

48

47

46

46

45

1,274

1,319

1,329

1,329

1,299

1,253

1,189

1,136

1,058

-

-

38

38

39

39

39

42

43

Bulgaria

34

35

34

35

35

34

32

29

30

EU Avg. (Euro Area)

465

449

436

417

407

470

471

469

473

Source: European Banking Federation21

EU countries averaged around 473 banks at the end of 2008. Recently, important developments and trends have been observed in the Black Sea countries, particularly a growing competitive market and an increasing trend of merging corporations and acquisitions through purchasing. The number of banks is decreasing as can be seen in table 31-4. Approximately 58 banks have withdrawn from the market through merger and acquisition operations. With 45 banks and 5 private finance institutions, the Turkish banking system follows the banking system of Russia. Economic changes have raised the level of competitiveness, increased the number of mergers and acquisitions, while at the same time causing the number of the banks to decrease. Table 31-5 Growth in the Number of Banks in Turkey and the Black Sea Countries by Percentage (%) Country

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

-22.8

-11.5

-7.4

-4.0

-2.1

-2.1

0

-2.1

Russia

3.5

0.8

0

-2.3

-3.5

-5.1

-4.5

-6.8

Romania

-

-

0

5.2

0

-2.5

7.7

2.4

Bulgaria EU Avg. (Euro Area)

2.9

-2.9

2.9

0

-2.9

-5.9

-9.4

3.4

-3.4

-2.2

-4.4

-2.4

15.4

1.4

-0.4

0.8

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Total Loans In 2008, with total loans of 479.83 billion Euros, Russia again ranks top among the Black Sea countries, followed by Romania with 49.25 billion Euros, Turkey with 140.55 billion Euros and Bulgaria with 25.05 billion Euros. The average total loans of the EU were around 1062.39 billion Euros in 2008.22 Table 31-6 Loans in Turkey and Black Sea Countries (billion EUR) Country

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

8.46

25.92

34.55

51.97

91.27

123.82

158.66

40.55

Russia

45.99

49.58

111.30

111.70

159.40

226.87

341.47

479.83

Romania

-

-

7.27

10.43

16.36

27.39

42.24

49.24

Bulgaria

2.11

3.08

4.61

7.06

9.14

21.58

18.90

25.05

EU Avg. (Euro Area)

651.57

683.64

707.69

736.85

826.28

736.29

1,009.65

1,062.39

Source: European Banking Federation,23

Table 31-7 Loan Growth of Turkey and Black Sea Countries by Percentage (%) Year Country

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

-0.83

2.06

0.33

0.50

0.76

0.36

0.28

-74.44

Russia

0.24

0.08

1.24

0.00

0.43

0.42

0.51

0.40

Romania

-

-

-

0.43

0.57

0.67

0.54

0.16

Bulgaria

0.39

0.46

0.50

0.53

0.29

1.36

-0.12

0.32

EU Avg. (Euro Area)

0.39

1.39

2.39

3.39

4.39

-5.39

0.37

0.05

Turkey aside, the growth in total loans in the Black Sea countries exceeded the growth rate of the EU countries. This shows us that these

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Black Sea countries have more economic growth potential than the EU countries.

Total Savings When savings in 2008 are analyzed, Turkey has the largest volume with 212.36 billion Euros. Turkey is second after Russia and Bulgaria has the smallest volume with 21.35 billion Euros. The EU’s average is 884.03 billion Euros for the same year. The volume of savings shows a steadily increasing trend in the Black Sea countries. Table 31-8 Total Deposits in Turkey and Black Sea Countries (billion EUR) Country

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

86.01

80.27

88.37

104.79

153.21

159.07

201.95

212.36

Russia

-

64.51

79.30

109.70

80.43

153.89

214.57

354.28

Romania

-

-

10.23

14.97

22.09

30.47

19.85

37.65

Bulgaria

4.42

5.77

6.20

8.56

11.24

15.15

39.49

21.35

EU Avg. (Euro Area)

588.77

616.48

656.07

688.10

790.77

825.02

1074.18

884.03

Source: European Banking Federation24

Table 31-9 Growth of Total Deposits in Turkey and Black Sea Countries by Percentage (%) Country

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

-0.07

-0.07

0.10

0.19

0.46

0.04

0.27

0.05

Russia

-1.00

-

0.23

0.38

-0.27

0.91

0.39

0.65

-

-

0.46

0.48

0.38

-0.34

0.89

Romania

-

Bulgaria

0.33

0.31

0.07

0.38

0.31

0.35

1.60

-0.45

EU Avg. (Euro Area)

0.09

0.05

0.06

0.05

0.15

0.04

0.30

-1.77

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Asset Quality Asset quality impacts many facets of bank operations and is one of the critical factors in determining a bank’s overall condition. The quality of loan portfolios, including credit card portfolios and credit administration programs, normally have a substantial effect on asset quality, because loans are usually the largest of the asset items and represent the greatest potential risk to capital. Review of credit card portfolios is carefully rolled into the comprehensive review of asset quality. Problems within the card portfolio can detract from management’s ability to successfully and profitably manage other bank activities. The asset quality rating incorporates the quantity of existing and potential credit risks associated with the credit card portfolio(s) and the ability of management to identify, measure, monitor, and control the credit risk. It should consider the adequacy of allowances for credit card losses and all other risks that may affect the value or marketability of the card portfolio, including, but not limited to, operating, strategic, and compliance risks and risks to market reputation. Prior to assigning an overall asset quality rating, examiners should consider several factors within the context of any local, regional, or national conditions that might impact the card portfolio and, consequently, bank performance. Table 3110 shows that Turkey has the lowest asset quality when compared to the other Black sea countries. The asset quality of the Turkish banking sector increased in 2002 and 2003. There were significant dips in 2001 and 2004 but it recovered by 2006. Russia has the best asset quality. Except for 2001, Russian banking continued to remain strong and consistent between 2000 and 2006. With the exception of Turkey, table 31-10 shows a similar trend for other Black Sea countries. The main reason of this difference is local economic conditions in Turkey. Table 31-10 Total Loans/Total Assets in Turkey and Black Sea Countries 2000

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

0.31

0.07

0.21

0.42

0.31

0.36

0.48

0.48

0.12

Russia

0.38

0.34

0.40

0.46

0.59

0.56

0.56

0.61

0.71

Romania

-

-

-

0.49

0.46

0.46

0.54

0.59

0.63

Bulgaria

0.31

0.34

0.41

0.52

0.56

0.54

0.53

0.63

0.70

Chapter Thirty-One

516

The total loans/total deposits ratio shows the investment activity of a bank. From table 31-11, Russia is the most successful country in lending its deposits. Turkey and Bulgaria had very similar results in 2006, but before that Turkey was inconsistent. The impact of the banking crises in Turkey at the end of 2001 and 2002 are easily recognised. Table 31-11 Total Loans/Total Deposits in Turkey and the Black Sea Countries 2000

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

0.55

0.98

0.32

0.39

0.49

0.59

0.78

0.79

0.19

Russia

0.74

-

0.76

1.40

1.02

1.98

1.48

1.59

1.35

Romania

-

-

-

0.71

0.70

0.74

0.89

2.13

1.31

Bulgaria

0.46

0.48

0.53

0.74

0.82

0.81

0.75

0.48

1.17

Balance-sheet Ratios The total deposit/total assets ratio in Turkey is almost steady between 2003 and 2007. However, the figures of Russia, Romania and Bulgaria show significant fluctuation. An increase in total deposits will enable sufficient funds to be lent to trigger economic activity. Table 31-12 Total Deposits/Total Assets in Turkey and Black Sea Countries Country

2000

2001

2002

2003

2004

2005

2006

2007

2008

Turkey

0.56

0.66

0.65

0.62

0.62

0.61

0.61

0.61

0.64

Russia

0.49

-

0.52

0.33

0.58

0.28

0.38

0.38

0.52

Romania

-

-

-

1.15

0.66

0.63

0.59

0.28

0.48

Bulgaria

0.67

0.71

0.76

7.71

0.67

0.67

0.72

1.31

0.58

Conclusion The banking sector is critical to the process of economic growth since it plays an important role in capital accumulation, technological development, and employment. With stable developments in the economy, and a large share of public securities in their placements (credits), banks

Analyses of the Banking Sector in Black Sea Region Countries

517

turn investments into credits more rapidly. Banks are expected to increase their intermediary functions in future. Increased shares of credits in their balance sheets are the most important indicators of this. In a comparison of their total bank assets, number of banks, total loans and total savings, the figures for Turkey, Romania, and Bulgaria fall far below the average figures of the EU countries. Turkish banks are required to cut costs, increase efficiency, and increase economies of scale through merger and acquisition operations in order to achieve the figures of EU members. This seems possible for Turkish banking as the arrangements applied in the EU countries for taxation, subsidies, and protection are to be adopted, with a view to achieving the EU standards. However, new supportive tax arrangements are required, such as abrogation or tax rate reduction for savings and banking transactions. A tax rate reduction for savings and banking transactions might help to increase the productivity and financial efficiency of the banking sector. The productivity and financial efficiency of the banking sector play important roles in capital saving, technological development, and employment, particularly in a period of economic growth. Taxes, which are one of the major factors restricting financial efficiency, have an important place in the Turkish banking system. For example, in the period of 1991–2006, the total sum of taxes which banks collected from the final user and transferred to the state budget was $17.8 billion, while the financial load on the banking system was $17.9 billion. The reduction of these of taxes will contribute greatly to the productivity and efficiency of the banking system by increasing transaction volume and activating financial intervention. With the highest asset quality, the Russian baking sector is the most successful amongst the Black Sea countries. Coordination among the banking sectors of the Black sea countries will improve economic growth.

Notes 1

George Chrysaphinis, Banking System Outlook 2005, Moody’s website, http://www.moodys.com/cust/default.asp. 2 The Banks Association of Turkey, http://www.tbb.org.tr/net/donemsel. 3 C. Yenal Kesbiç, Ercan Baldemir, and Esat BakÕmlÕ, “Bütçe AçÕklarÕ ile Parasal Büyüme ve Enflasyon ArasÕndaki øliúki: Türkiye için Bir Model Denemesi,” øøBF Yönetim ve Ekonomi Dergisi (Celal Bayar Üniversitesi) 11 (2004): 35–37. 4 Birgül ùakar, Banka Kredileri ve Yönetimi (Istanbul: Beta BasÕm YayÕn A. ù., 2006).

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5 Ross Levine and Sara Zervos, “Stock Market Liquidity and Economic Growth: A Critical Appraisal of the Levine/Zervos Model,” Political Economy Research Institute, University of Massachusetts, Working paper No. 47, 1998. 6 G. Robert King and Ross Levine, “Capital Fundamentalism, Economic Development and Economic Growth,” World Bank, Policy Research Working Paper, Vol. 1285, 1994. 7 Zsolt Besci and Ping Wang, “Financial Development and Growth,” Economic Review (4th Quarter 1997), 46–62. 8 Ross Levine and Maria Carkovic, “Finance and Growth: New Evidence and Policy Analyses for Chile,” in Economic Growth: Sources, Trend, and Cycles (Central Bank of Chile, 2002). 9 Ross Levine and Sara Zervos, “Stock Market Liquidity and Economic Growth: A Critical Appraisal of the Levine/Zervos Model,” Political Economy Research Institute, University of Massachusetts, Working paper No. 47, 1998. 10 Stijn Claessens and Luc Laeven, “What Drives Bank Competition? Some International Evidence,” Journal of Money, Credit and Banking 36 (2004): 563– 83. 11 Öner GünçaydÕ and Suat Küçükçiftçi, “Türkiye Ekonomisinde Finansal KÕsÕtlarÕn De÷iúen Rolü ve Önemi: 1973–1996,” TBB, BankacÕlar Dergisi, no. 42 (2002): 75–80. 12 BDDK, Mali Sektör PolitikalarÕ Dairesi (2003), “AracÕlÕk Maliyetleri— Ekonomik Büyüme øliúkisi,” AracÕlÕk Faaliyetlerinin AraútÕrÕlmasÕ ÇalÕútayÕ, http://www.bddk.org.tr/turkce/yayinlarveraporlar/abant_calistayi.doc. 13 BDDK, Mali Sektör (2003). 14 BDDK, Mali Sektör (2003). 15 Hayati Eriú, “Finans Sektörünün Reel Sektörü Fonlama Etkinli÷i AçÕsÕndan Türk ve øngiliz Finans Sistemlerinin KarúÕlaútÕrmalÕ De÷erlendirilmesi,” (YayÕnlanmamÕú) Marmara Üniversitesi AraútÕrma Projesi, 1999. 16 BDDK, Mali Sektör (2003). 17 Orhan O÷uz, “øktisada Giriú Temel Kavramlar ve Prensipler,” østanbul Marmara Üniversitesi øktisadi ve ødari Bilimler Fakültesi YayÕnlarÕ, 1992, pp. 175–98. 18 ùeref SaygÕlÕ, Cengiz Cihan, and Hasan Yurto÷lu, Türkiye Ekonomisinde Sermaye Birikimi, Büyüme ve Verimlilik: 1972–2000, DPT 2665 (2002), p. 103, http://ekutup.dpt.gov.tr/sermaye/saygilis/turkiye.pdf. 19 Source: European Banking Federation statistics 2008, 2007, 2006, http://www.ebf-fbe.eu/uploads/documents/publications/Stats/Stats_2008.xls, /Stats_2007.xls, /Stats_2006.xls. Euro Area: Belgium, Germany, Greece, Spain, France, Ireland, Italy, Luxemburg, Netherlands, Slovenia, Austria, Finland, Portugal. 20 European Banking Federation, statistics 2008. 21 European Banking Federation, statistics 2008, 2007, 2006. 22 European Banking Federation, statistics 2008. 23 European Banking Federation, statistics 2008, 2007, 2006. 24 European Banking Federation, statistics 2008, 2007, 2006.

CHAPTER THIRTY-TWO A HANDICAP TO REGIONAL ECONOMIC COOPERATION: POVERTY (THE EXAMPLE OF TURKEY) OGUZ KAYMAKCI,* OMER CANBEYOGLU,† AND DENIZ EMRE TURKGENC‡

Introduction Poverty is one of the leading developmental issues of today. It not only prevents countries’ overall development, but also leads to social problems that push societies into vicious circles. Poverty is the primary factor making national development as well as regional collaboration more difficult. Black Sea Economic Cooperation is not an exception to this. Among the Black Sea littoral countries, Turkey has a significant propensity towards poverty, although it is one of the more advanced countries in terms of corporate identity and its economy. Poverty reveals itself in different ways in Turkey. The most obvious are income poverty and absolute poverty. The term “income poverty” refers to an income that is below an accepted standard, usually determined as the income level that is sufficient to meet basic needs. The term “absolute poverty,” on the other hand, refers to the minimum level of consumption needed for individuals and households to be able to physically continue their life. In addition, there are many other classifications of poverty such as objective–subjective, rural–urban, chronic, and temporary poverty.

*

Sakarya University, Faculty of Economics and Administrative Sciences, Department of Economics, Turkey. † University of East London, MBA. ‡ St. John Fisher College, Rochester NY, MBA.

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Improvements and Development Process Issues in the Global Economy During the process of globalizing their economies and coalescing into multinational formations, those nations who have not yet completed their development in parallel with technological and scientific reforms are faced with significant obstacles. Nonetheless, they gain remarkable benefits to their wellbeing from globalization. Increasingly, industrial production requires less raw material and energy as a result of using alternative and new artificial materials, and due to the contribution of computerized production.1 Many agricultural products exported by developing countries are now produced in the laboratories of multinational companies. In addition to this, some artificial materials are now being used instead of metals. This new technological trend is likely to affect developing countries’ economic trajectory. In other words, this may turn developing countries into producers of antiquated products.2 Multinational technological reform puts forty-seven million people entering the labour force market out of business every year. The competition among multinational companies is forcing them to move towards automation and to restructure their production process, resulting in a reduction in employment. Technological development is one of the most important differences between industrialized and Third World countries.3 The developed (industrialized) countries are much stronger than the others in respect to their economy, finances, and technology, although they constitute only a small proportion of the world in terms of population and size.4 Statistics from the IMF and World Bank show that while the population of the industrialized countries consists of approximately 15 percent of the world’s population, they enjoy 75 percent of the global income. While the United States alone receives 21 percent of this income, the rest of the world (146 developing countries) shares 44.5% of the overall world product. Turkey’s portion is around 0.1%.5 Income disparities between rich and poor countries have significantly increased in the past twenty years. These diverse effects of globalization are mentioned in UNDP reports. Globalization is a new distribution of privilege, bereavement, wealth and poverty, resources, weakness, poverty and frailty, freedom and limitation. In recent years, the unfairness of income distribution has increased remarkably. To conclude, we can say that the poverty of some countries around the world is the result of a

A Handicap to Regional Economic Cooperation: Poverty

521

certain stability as well as the adjusting of policies implemented during the development of the world economy.6

Black Sea Economic Association and Poverty: Prospects for Income Distribution in Turkey The per capita income in Turkey has increased from $1,000 in 1970 to $3,000 in 2000. At present, the per capita income is between $5,000 and $9,000. Although this rate seems to signify plentiful growth, it is still a long way from that experienced by developed countries. How satisfactorily this income increase has been distributed among the masses during this thirty-eight year period of growth is another important question. This aspect constitutes perhaps the main difference between economic growth and economic development. One may only claim that economic development is taking place if the general welfare of the population accompanies economic growth. In this respect, poverty is one of the main socio-economic issues in Turkey. In the Turkish context, since 1960, quite immoderate income distribution has occurred, and suggestions for amendments have been presented in five-year development plans. For the last decade, however, the distribution of income between people or households has been a priority, with the advent of dramatic increases in wages.7 In order to determine the distribution of total income, it is useful to divide households into groupings of 5 percent. The poorest 5% of the overall population obtained 0.7% of the total income in 1987, and managed to retain this share with only slight depreciation down to 0.69% in 1994. The urban population of the same grouping shows a worsening income distribution, while the rural population raised its total income from 0.62% in 1987 to 0.73% in 1994. The top (richest) income group (the top 5%) received a share of 23.01% of the total income in 1987, which rose to 30.34% in 1994. This increase occurred mainly in urban areas. This group’s urban portion saw a 23.82% share in 1987, and raised their share to 33.84% in 1994. Meanwhile, the rural portion did not obtain any significant rise—from 20.77% in 1987 to 20.40% in 1994. According to the results of research carried out by various institutions on poverty, approximately 926,000 Turkish people, who make up 1.35% of the whole population, are classified as living in food poverty. Urban areas account for 0.91% (376,000 people), while rural areas account for 2.01% (550,000 people) of the proportion of people living in food poverty. Meanwhile, 26.96% of the population (18,441,000 people) are classified

522

Chapter Thirty-Two

as suffering from poverty generally. 21.95% (9,011,000 people) of this group live in urban areas, while 34.48% (9,429,000 people) live in rural areas. The results show that 3,693,000 Turkish people, in other words, 22.45% of Turkey’s total population, are living in general poverty. This research also investigated the number of people whose daily spending is under $1, $2.15, and $4.30 (calculated at purchasing power parity). According to these calculations, 136,000 (0.20%) Turkish people spend less than $1 per day; 2,082,000 (3.04%) people spend less than $2.15; and 20,721,000 (30.3%) spend less than $4.30 a day. These numbers are distributed between urban and rural areas as follows: 0.03% (10,000), 2.37% (971,000), 24.62% (10,106,000) for the urban and 0.46% (126,000), 4.06% (1,111,000), 38.82% (10,615,000) for the rural population respectively. As a final point, research shows that the general poverty figure is 14.74% (10,080,000). This number is made up of 11.33% (4,651,000) for the urban population and 19.86% (5,430,000) for the rural population.8 When considering regional differences within Turkey, we can show that the Ege and Marmara regions have the lowest levels of poverty, and enjoy a little more than half of the total income of Turkey. The eastern and south-eastern regions of Turkey share the least portion of national income. This situation causes these regions to experience the highest rate of poverty in Turkey. There are a number of reasons why Turkey’s eastern region experiences higher levels of poverty, including: historical factors; environmental factors; social structure; and managerial policies. As the results of the five-year development plan from 2001 to 2005 show, 95% of the people who were classified as living in poverty and older than six years of age had low education levels (below high school), including those who were classified as illiterate. In Turkey, combating poverty is carried out by central administration units including: the Mutual Assistance and Support Fund; the Ministry of Health; the Ministry of Education; the Institution of Retirement Fund; the Ministry of Social Services; the Institution of Charitable Funds; the Ministry of Finance; and the Social Help and Solidarity Fund.

The History of the Fight against Poverty within the Turkish Economy Turkey’s economy has passed through different periods since the establishment of the republic. Until 1980, governments followed a strategy of import substitution while making only a small commitment to liberalization. After 1980, the government embraced a new export strategy.

A Handicap to Regional Economic Cooperation: Poverty

523

During the early years of the republic, Turkey’s economy was weak and unproductive. Because of that, the Izmir Economic Congress was held in 1923 and formulated economic policies that were followed until 1930. Those decisions originated from a liberal point of view. Attempts were made to accelerate the rate of development by supporting the Teúvik-i Sanayi Law (the Law of Promoting Industry, 1927) and initiating the Iú (pronounced “ish”) Bank, the Sanayi Maadin Bank (1925), the Sumerbank, and transportation works, especially railways. The first five-year industrial plan focused on import substitution and industrialization. In this way, imports, which made up 70% of consumer goods, made way for domestic production. The second five-year industrial plan was devoted to heavy industry, but this plan could not be implemented due to the outbreak of the Second World War. Then, in 1946, a period started in which the protectionist economic policies, which had been in place for sixteen years, were gradually relaxed. Turkey’s import substitution development strategy was radically changed after 1950. The private sector began to be encouraged instead of following a policy of state socialism. For the first time, foreign capital was admitted (through law no. 5821). Import substitution continued from 1960 until 1980. Although attempts have been made to conserve the foreign exchange rate through import substitution, paradoxically, the external dependency of the economy has grown. Despite a commitment to diminishing the public sector, this has not been possible in practice due to the weak capacity of the private sector. We can list some of the failures of the import substitution strategy in this period as follows: waste of resources; external dependency; orientation against export industry; increase of external debt; and the brittle structure of foreign capital. Since 1980, the strategy of industrialization has radically changed. A developmental model has been adopted that gives priority to exports. Turkey’s situation can be traced in the UNDP’s Human Development Report. According to this report, Turkey’s human development performance is ranked as 96 among 175 countries. While Norway’s Human Development Index (HDI) was 0.944, Turkey’s index was 0.734. The human development performance of Turkey rose by 0.145 points between 1975 and 2001. Looking at the parameters of education, health, and living standards, the expected life-span in Turkey was 70.1 years, the literacy rate was 82%, and per capita income was $58909. The figures for public expenditure based on the share of GNP (Gross National Product) for the same year were 3.6% for health, 3.5% for

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education, 4.9% for the military, and 15.2% for debt payments. Debt expenditures were 4.5 times higher than educational and health expenditures, which are crucial for the country’s development. This is one of the factors exacerbating the level of poverty in Turkey. In terms of technological values, research and development (R&D) expenditures account for 0.6% of GNP. In Turkey, the number of people who are employed or studying in scientific fields is 306 per one million people, whereas the corresponding figure in Norway is 4,112 per one million.

Conclusion When we consider all the Black Sea littoral countries, we can state that they do not display hugely different characteristics from each other. The reason why these countries’ national incomes do not meet expectations can be explained by a vicious circle of economic factors (low income leading to low savings, leading to low investment, and hence to low income). An important point is that these countries, which have not been able to break out of their vicious cycle, can establish only a limited volume of commerce. Yet, as long as these problems are not solved, there is the potential risk of having a regional economic vicious circle operating among the countries around the Black Sea. Most of the countries in the region experience similar problems, including the lack of quality and quantity in production tools, the lack of education in order to provide a skilled and qualified labour force, deficiencies in organizational talent and entrepreneurial spirit, a low standard of living, and health problems that adversely affect their efficiency and standards of living. In particular, the lack of good governance causes the problems mentioned above to become chronic. It will be difficult for the countries that make up the membership of the Black Sea Economic Cooperation to become a global economic force in the near future unless they solve the problem of poverty.

Notes 1

UNDP, “Making New Technologies Work for Human Development,” Human Development Report 2001 (New York: Oxford University Press, 2001), 54. 2 O. KaymakcÕ, “AGÜ’ler Küreselleúme ve AB øliúkileri,” AB Üzerine Notlar (Ankara: Nobel YayÕn-Da÷ÕtÕm, I. BaskÕ, 2005), 190. 3 A. N. Agarwala and D. Singh, The Economics of Underdevelopment (New York: Oxford University Press, 1965), 24.

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4 F. ùenses, Küreselleúmenin Öteki Yüzü Yoksulluk (Istanbul: øletiúim YayÕnlarÕ, 2001), 76. 5 M. N. Coúkun, “Bölgesel Geliúme Stratejileri ve Akdeniz Ekonomisi,” Türkiye Ekonomi Kurumu 3 (December 2005): 181–198. 6 M. Chossudousky, Yoksullu÷un Küreselleúmesi, IMF ve Dünya BankasÕ ReformlarÕnÕn øçyüzü, trans. Neúenur Domaniç (Istanbul: Çivi YazÕlarÕ YayÕncÕlÕk, 1999), 107. 7 DPT, “Gelir Da÷ÕlÕmÕnÕn øyileútirilmesi ve Yoksullukla Mücadele,” ÖøK Raporu (Ankara: DPT YayÕnlarÕ, 2001), 6. 8 DPT, Birleúmiú Milletler, DPT, Birleúmiú Milletler, BinyÕl KalkÕnma Hedefleri Raporu Türkiye 2005, Vol. 9 (2005): 47. 9 UNDP, Human Development Report 2001, 81–90.

CONTRIBUTORS

Saffet AKKAYA, (Middle East Technical University/Turkey) Mujib ALAM (Assist. Prof. Dr./Jawaharlal Nehru University/India) Aslihan ANLAR (Research Assist. Middle East Technical University/Kocaeli Univ./Turkey) ødris BAL ( Prof. Dr./ Kütahya AK Party Deputy and member of the Commission on Foreign Affairs Turkey) Mehmet BøLGøN (Istanbul University/Turkey) Giray Saynur BOZKURT (Assoc.. Prof. Dr./Sakarya University/Turkey) Nicolae Iordan-CONSTANTINESCU (Assoc. Prof. Dr. / Romanian Banking Institute/Romania) Zurab DAVITASHVILI (Prof. Dr./Tbilisi State University, Member of the Board of Governors/ Georgia) ødris DEMøR (Assist. Prof.Dr./Ahi Evran University/Turkey) Nihat ÇELøK (Research Assistant, Kadir Has University/Turkey) Halil ERDEMøR (Assist. Prof. Dr./Celal Bayar University/Turkey)

Blue Black Sea

527

Evrim EKEN (PhD Cadidate, St. Petersburg State University / Russian Federation) Yevgeniya Jane GABER (Senior Lecturer, Odessa National Mechnikov University/Ukraine) Mohammad Hassan KHANø, (Dr.ømam SadÕq University/ Iran) Jatinder KHANNA (Dr. Jawaharlal Nehru University/India) Sergei KONOPYLOV (Prof. Dr. Director of the Black Sea Security Program at Harvard University/USA) Elhan MEHTøYEV (Director Peace and Conflict Resolution Center/Azerbaijan) Ertan EFEGøL & Neziha MUSAOGLU, (Assoc. Prof. Dr& Assist. Prof. Dr./Sakarya Univ.&Trakya Univ./Turkey) Aliosha NEDELCHEV, (Ambassador Deputy Secretary General of the Permanent. International Secretariat of the Organization of BSEC /Turkey) Guner OZKAN, (Assist. Prof. Dr./Mugla University/Turkey) Grigoriy PEREPELYTSIA (Prof. Dr. Kyiv Taras Shevchenko National University. Director, The Institute of Foreign Policy for Academy of Diplomacy, MFA/Ukraine) Sercan SALGIN, (Dokuz Eylül University/Turkey) Hanna SHELEST, (Senior Researcher, Odessa National University/Ukraine) Alexander SOTNICHENKO, (Assist. Prof. Dr./Saint –Petersburg State University/Russian Federation)

528

Contributors

Birgul SAKAR, (Dr./Kadir Has University/Turkey) Oguz KAYMAKCI & Omer CANBEYOGLU & Deniz Emre TURKGENC, (Assist. Prof. Dr./Sakarya Univ./Turkey&University of London/ UK & St. John Fisher College/US) Agshin UMUDOV, (University of Uppsala/Sweden) Çi÷dem ÜSTÜN, (Assist. Prof. Dr./GedizUniversity/Turkey) Alaeddin YALÇINKAYA, (Prof.Dr./Sakarya Univ./Turkey) Natalija Nechayeva-YURøYCHUK, (Dr./ Bukovyna State Finance Academy/Ukraine)