Europe Report N°167
11 October 2005
EXECUTIVE SUMMARY AND RECOMMENDATIONS
Settlement of the long running Nagorno-Karabakh conflict — the most significant obstacle to stability in the South Caucasus — remains elusive, despite more optimistic noises recently from Azerbaijan and Armenia. Eleven years after the 1994 ceasefire, burgeoning defence budgets, increasing ceasefire violations, and continuing demonisation by each side of the other side are ominous signs that time for a peace agreement is running out. But a compromise can now be constructed around an approach that, while addressing all the matters in dispute, leaves the core issue of Nagorno-Karabakh’s ultimate status open for later resolution, after other measures have been put in place.
Key elements of that proposed settlement package include the withdrawal of the Armenia-backed Nagorno-Karabakh forces from the occupied districts of Azerbaijan surrounding the entity; the renunciation by Azerbaijan of the use of force to reintegrate the entity; the deployment of international peacekeepers; the return of displaced persons; and the re-opening of trade and communication links. Nagorno-Karabakh’s status should ultimately be determined by an internationally sanctioned referendum with the exclusive participation of Karabakh Armenians and Azeris, but only after the above measures have been implemented. Until then Nagorno-Karabakh would remain part of Azerbaijan, though in practical terms it would be self-governing and enjoy an internationally acknowledged interim status.
Today Armenia and Azerbaijan remain divided on vital points. Azerbaijan does not accept any compromise of its territorial integrity, nor does it agree that Nagorno-Karabakh’s population alone can vote on determining its final status. Armenia is not willing to support withdrawal from the seven occupied districts around Nagorno-Karabakh, or allow the return of Azerbaijan internally displaced persons (IDPs) to Nagorno-Karabakh, until the independence of Nagorno-Karabakh is a reality. There has been tentative discussion of a possible plebiscite to determine the entity’s final status, but with none of the necessary detail agreed as to who would vote on what, when and how, nor any agreement as to what other settlement conditions would create the context for such a vote.
The Minsk Group of the Organisation for Security and Cooperation in Europe (OSCE), currently co-chaired by France, Russia and the U.S., has been facilitating negotiations since 1994. After a decade of fruitless talks, a new format of meetings, the Prague Process, involving direct bilateral contact between the foreign ministers of Armenia and Azerbaijan was initiated in 2004. During the past twelve months the participants and OSCE co-chairs alike have publicly expressed optimism that a deal can be reached soon. But there is an urgent need to translate that generalised optimism into very specific agreement and action.
An earlier Crisis Group report explored how the Armenian and Azeri communities of Nagorno-Karabakh and the surrounding districts live today and view resolution of the conflict. Against that background, this report examines the causes of the Nagorno-Karabakh conflict, analyses the OSCE-led negotiations process as it has evolved since 1992, and identifies the necessary elements of a workable and achievable peace plan.
To Avoid a Resumption of Fighting:
1. All parties to the conflict should respect the 1994 ceasefire, refrain from using force, not promote the use of force, and end the arms race in the region by halting the rise of defence budgets.
To Create an Appropriate Environment for Conflict Settlement:
2. Azerbaijan should resume direct contact with the de facto Nagorno-Karabakh authorities and facilitate the development of closer contact between Karabakh Azeris and Karabakh Armenians.
3. The de facto Nagorno-Karabakh authorities should end support for settlement of formerly Azeri majority areas with Armenians, including by:
(a) stopping privatisation of land, homes and businesses in those areas;
(b) ceasing to establish local administrations and infrastructure in the occupied areas adjacent to Nagorno-Karabakh; and
(c) protecting the remaining Azeri homes.
4. Armenia should encourage the de facto Nagorno-Karabakh authorities to take a more conciliatory stance on resolution of the conflict.
To Address the Substantive Matters in Dispute:
5. The parties should sign an agreement that includes the following elements:
(a) renunciation of the threat or use of force to settle disputes, including any that may arise in connection with the implementation of the peace agreement;
(b) creation of a joint commission including Azerbaijan and Nagorno-Karabakh representatives and chaired by the OSCE to supervise implementation;
(c) incremental withdrawal of Nagorno-Karabakh forces backed by Armenia from all occupied territories around Nagorno-Karabakh, but beginning with five districts and occurring simultaneously with the deployment of international peacekeepers;
(d) withdrawal of Nagorno-Karabakh forces backed by Armenia from the Kelbajar district once appropriate security measures are in place at the Murov mountain pass, and from the Lachin district following agreements guaranteeing secure communications through the Lachin corridor;
(e) safe and voluntary return of displaced persons to their pre-war homes in the formerly occupied districts, once withdrawal and international deployment have been completed;
(f) assurances for free movement of people and goods, including the lifting of all blockades and the reopening of all transport and trade routes (road and rail) closed as a result of the conflict;
(g) implementation of confidence-building measures in cooperation with international organisations including the UN, International Committee of the Red Cross, OSCE and non-governmental organisations; and
(h) identification of a referendum mechanism for resolving the final status of Nagorno-Karabakh, as set out below, with provision until then for the entity to have internationally recognised interim status, and its governing bodies to be elected under international supervision.
6. The final status of Nagorno-Karabakh should be decided by a self-determination referendum, which would:
(a) be held after the return of displaced Azeris to former Azeri-majority areas in Nagorno-Karabakh and after an international conference determines that Nagorno-Karabakh has met international preconditions for statehood, including the protection of minority rights, such review to be conducted for the first time five years after the signing of the peace agreement;
(b) give Nagorno-Karabakh an appropriate range of options, including unity with, and secession from, Azerbaijan;
(c) be held with the exclusive participation of Karabakh Armenians and Azeris; and
(d) have its exact modalities agreed upon in talks chaired by the OSCE, based on the principle that all parties will recognise the validity of its result.
To Facilitate Public Acceptance of the Settlement:
7. Azerbaijan should allow Karabakh Azeris to play a bigger role in the negotiations and the internal political process, including by passing legislation allowing Karabakh Azeris to elect the head of their community, ensuring voting rights for displaced persons in the 2005 parliamentary elections, and permitting all candidates to campaign in collective centres.
8. Government officials and media in Azerbaijan and Armenia should refrain from using belligerent and xenophobic language against “the other”.
9. Officials involved in the negotiations process should agree to a broad common strategy for disseminating information about that process, coordinate efforts to present to the public elements of a possible agreement, and not be reluctant to start a debate on highly sensitive questions.
To Build Confidence and Guarantee Sustainable Peace:
10. Donors should assist Armenia and Azerbaijan in developing and carrying out small, cross-border, sub-regional trade, humanitarian and public health projects, including in response to disasters, and should fund and help carry out programs aimed at improving mutual understanding, tolerance and reconciliation that target civil society, teachers and journalists.
11. Donors should carry out a common assessment mission of needs in Nagorno-Karabakh and the adjacent occupied districts, and once a peace agreement is signed should hold an international donor coordination conference and begin implementing projects in the former conflict zone.
12. Armenia and Azerbaijan should each investigate war crimes, prosecute those responsible and adopt legislation to give amnesty to those who participated in the conflict but did not commit serious offences.
13. Armenia and Azerbaijan should establish joint commissions to:
(a) make a political assessment of the conflict’s causes and consequences; and
(b) deal with inter-state property return and compensation questions.
To Increase the Prospects for a Peace Agreement and to Give It Stability:
14. The UN Security Council, the OSCE and the EU Council of Ministers should pledge to serve as guarantors of the peace agreement.
15. The OSCE should expand the mandate of the Personal Representative of the Chairman-in-Office to include working with civil society, media and opposition political forces in order to facilitate contacts between the sides at the local level and build confidence and opening an office in the occupied territories, staffed with political, human rights and elections officers.
16. The EU should become more actively engaged in the conflict resolution effort by basing the office of its Special Representative for the South Caucasus in the region.
17. The EU should include long-term programs and strategies to promote confidence building in its Action Plans with Armenia and Azerbaijan.
Tbilisi/Brussels, 11 October 2005
 Crisis Group Europe Report N°166, Nagorno-Karabakh: Viewing the Conflict from the Ground, 14 September 2005.