Ukraine-Azerbaijan: Conflict-Related

Almost immediately after the meeting of the Channel Four, President of Ukraine Vladimir Zelensky paid an official visit to Azerbaijan (December 16-17). The stingy lines of official communications of the two countries do not clarify the specific goals of the visit, being satisfied with the usual general statements in such cases. Meanwhile, Azerbaijan and Ukraine are two of the four GUAM members, a kind of “ambush horse”, always ready to become a platform for the relationship of the post-Soviet countries included in the association program with the European Union, with the states of this organization, especially with its eastern participants, among which an important place Poland. What conclusions can be drawn from official information on the visit of V. Zelensky?

Statistics published before the visit showed that trade between the two countries, which once amounted to about $ 1.5 billion, fell to $ 333 million by the end of 2015. Then, by the end of 2018, it grew to $ 829 million, with a tendency to increase. Behind these figures is a 16-fold increase in exports from Azerbaijan to Ukraine, which is unlikely to suit Kiev, proposing new projects for economic cooperation. It would seem that just these issues that made up the agenda of bilateral negotiations, especially since the visit of the previous president P. Poroshenko in July 2016 to Azerbaijan had similar goals.

Before detailing the conclusions, we assessed the activities of the current president of Ukraine by the country's population. According to the social survey by the I. Kucheriva Foundation for Democratic Initiatives, conducted jointly with the Kiev International Institute of Sociology (November 4-19), the majority of citizens evaluate the first steps in the activities of the president and his team as follows: 62% positive (19% - completely , 43% mostly positive), negative 24% (which is twice as much as in August). Seventy-five per cent support negotiations with the President of the Russian Federation, the decision to withdraw troops from the demarcation line (in the Donbass). The decision to enter the agricultural land market is negatively perceived (24% - for, 58% - against), and according to the decision on privatization of large state enterprises "for" - 55%, against - 22%. Apparently, the society supports political, and objects to economic initiatives of the president.

On December 12, a regular meeting of the heads of government of GUAM member states was held in Kiev, at which issues of political interaction, inter-parliamentary dialogue, the development of industry cooperation and interaction with other states and international organizations were discussed. A separate item was the development of a new program of action to resolve conflicts in GUAM member countries. As you know, since January 2020, the presidency of GUAM has been moving from Ukraine to Azerbaijan, and in this regard, Baku has already formulated its priorities: promoting national interests in European integration processes, intensifying activities in energy and infrastructure and transport projects, paying special attention to attracting investments. It is emphasized that Azerbaijan will make every effort to ensure that GUAM is an active participant in not only regional, but also international processes.

Before the visit, the Advisor to the President of Ukraine on political issues, N. Poturaev, classified the topics of negotiations in Baku in the following order: energy security of the region, diversification of energy sources, military-technical cooperation between the two countries, territorial integrity of states. According to him, Kiev wants Azerbaijan to invest more actively in the Ukrainian economy, for example, take part in the privatization of Ukrainian ports in the Black Sea.

Azerbaijani political journalist Shainoglu drew attention to the fact that the Donbass and Karabakh conflicts do not have fundamental differences. Since both states recognize the territorial integrity of each other and the Foreign Ministries of the two countries make joint statements condemning separatism. Shainoglu believes that “the issue of territorial integrity and its recognition in international institutions” will be the subject of negotiations.

During the bilateral meeting, the presidents of Azerbaijan and Ukraine discussed a number of issues. Among them, V. Zelensky singled out cooperation on the Southern Gas Corridor. Ukraine supports the Southern Gas Transport Corridor, and the parties “agreed to explore the possibilities of expanding it, since it is important for diversifying gas supplies to European consumers, therefore, the two countries’ unique transit potential should be used and developed infrastructure for this,” said the President of Ukraine. Meanwhile, President I. Aliyev emphasized that the Azerbaijani oil company SOCAR will expand its activities in accordance with the agreement, noting that today there are 60 SOCAR filling stations and 4 oil depots in Ukraine.

The negotiations resulted in signing four documents:

- The Protocol of intent between the city of Ganja and the city of Odessa;

- The Agreement of cooperation between the city of Guba and the city of Truskavets;

- The Agreement on cooperation in the field of regulation of business conditions;

- The Agreement on the establishment of an interstate government communication line between Baku and Kiev.

I. Aliyev, criticized the prolonged inaction of the intergovernmental commission (IPC), and emphasized that the two countries will hold a meeting of this organization on economic cooperation in January 2020 in order to implement measures to increase mutual trade. V. Zelensky, specifying that the IPC meeting will be held in late January, invited his colleague to pay an official visit to Ukraine.

According to the State Customs Committee of Azerbaijan, for 11 months of 2019, Azerbaijan exported goods to Ukraine for $ 334 million (1.83% of the country's total exports for this period); Ukrainian exports to Azerbaijan amounted to $ 429.9 million (specific weight 3.47 %).

The main issue at the talks, it seems, was the diversification of sources of oil and gas supplies from Azerbaijan. For well-known reasons, Ukraine is seeking routes for non-Russian energy resources. It is important not to lose, as happened before. Immediately after the collapse of the USSR, Ukraine began to seek the possibility of importing oil from the Middle East and Azerbaijan. In this regard, the determination of the route of the pipeline between the Black Sea ports (Baku-Novorossiysk and Baku-Supsa pipelines) and the Mediterranean port (BTC pipeline) has become a competition for the promotion of Azerbaijani oil to Europe. The choice of BTC as the main pipeline caused great disappointment in Ukraine, which considered itself the most promising transit country for oil imports from Azerbaijan. In this regard, Ukraine even completed the construction of a pipeline from the Odessa port of the Black Sea to Brody at the Polish border.

Initially, the Baku-Supsa oil pipeline was considered the most promising route: it was supposed to transport oil from the Georgian port of Supsa in the Black Sea by water to the Ukrainian port of Odessa, and from Odessa to the Polish border of Brody, a new pipeline could be brought to the Polish city of Gdansk. As a result, there was a large-scale scheme for the transportation of oil by Azerbaijanis to Eastern Europe. On the other hand, the US and Turkish governments have stepped up efforts to lay the BTC oil pipeline, which is today the main export pipeline for Azerbaijani oil.

Despite the fact that the cost of the BTC pipeline was more expensive than other projects, this option had one significant advantage - it did not load the sea traffic of the Bosphorus Bay. Thus, in November 1999, Azerbaijan, Turkey and Georgia agreed to build a BTC pipeline, leaving Ukraine out of the game.

As a result, since the BTC oil pipeline began functioning in 2006, the main direction of oil export by Azerbaijan has become not Ukraine and Eastern Europe, but Turkey, Italy, Israel and other Mediterranean countries.

Since independence, Ukrainian experts and some politicians have continuously argued that just reduction of dependence on Russian energy supply that is a common task for Ukraine, which can reduce Russia's influence on the country. In the context of the implementation of its southern foreign policy vector, Ukraine, along with a number of other states, has created a regional organization GUAM. However, before the crisis in 2014, Ukraine was not able to carry out effective diversification of energy supply sources.

In 2014, the occupation of Crimea and aggression in the Donbass by the Russian Federation made the political elite of Ukraine realize the need for a significant transformation of the state’s foreign economic course. This not only contributed to the diversification of energy sources, but also led to a radical change in the national energy security policy, namely, a gradual failure from Russian energy supply.

According to the publication of the State Statistics Service of Ukraine, in 2017, from January to July, Ukraine imported oil from countries such as Azerbaijan (86.69%), Kazakhstan (8.05%), the Islamic Republic of Iran (2.70%) and the Russian Federation (1.66%). It turns out that Azerbaijan has become the main supplier of oil to Ukraine.

Ukraine and Azerbaijan continue to discuss the problem of energy supply. So, P. Poroshenko, having visited Baku, agreed with I. Aliyev to restore the Odessa-Brody pipeline project. This arrangement was never implemented - the capabilities of this pipeline were not used. March 10, 2017 Ukrtransnafta PJSC announced that the company is resuming work on the oil pipeline from Odessa to Kremenchug after five years of inactivity. Since then, the Azerbaijani state-owned company SOCAR has been supplying oil to Ukraine, not through the Odessa-Brody pipeline, but through the Odessa-Kremenchug pipeline.

Obviously, Ukraine wants to close on itself one of the transportation routes for Azerbaijani and, therefore, Central Asian oil and gas. Another question is how much Azerbaijan is ready to risk stability of relations with Russia. True, Ukraine has an additional resource related to the possible connection of Poland to these plans. It seems an interesting question arises: can Poland and some other Eastern European EU members join GUAM?