South Caucasus Navigates A New Order – Analysis
Key Takeaways:
On 10 August the U.S., Armenia, and Azerbaijan marked one year after the White House summit and restated work on TRIPP—a corridor from Azerbaijan to Nakhchivan across Armenia. The route is not built. Armenia’s Constitutional Court hears the U.S. framework on 15 September; a new Armenian constitution and a 2027 referendum are also tied to Baku’s peace terms.
The author says 2020–23 left Azerbaijan stronger: more gas to Europe (TANAP/TAP to 16 countries by 2026), a thicker Middle Corridor, a 2026 U.S. strategic charter, and a wider Turkic-state role. Ties with Russia cooled after the 2024 airliner crash, then partly settled. Baku wants to be hard to bypass.
Armenia is buying Azerbaijani fuel, talking Kars–Gyumri rail with Türkiye, and adding EU and U.S. connectivity deals while Russia still supplies gas, holds Gyumri, and has squeezed farm exports. Civil Contract won June 2026 polls. Georgia still invests in ports and the Middle Corridor but faces rival routes, a frozen EU path, and a turn toward China and Central Asia. No one is said to have picked a single new patron.
On August 10, the United States, Armenia, and Azerbaijan marked the one-year anniversary of the White House peace summit. They reaffirmed their commitments and highlighted progress toward implementing the Trump Route for International Peace and Prosperity (TRIPP) (U.S. Department of State, August 10). The project would connect Azerbaijan to its Nakhchivan exclave through Armenian territory, deepen Western engagement with Armenia, and introduce a new competitor to Georgia’s established transit networks. The initiative comes as Azerbaijan and Armenia move toward a peace agreement following decades of conflict over Nagorno-Karabakh and Azerbaijan’s 2023 takeover of the territory.
The route is not yet built. Armenia’s Constitutional Court is reviewing the government’s framework agreement with the United States, with a hearing scheduled for September 15 (News.am, August 5). Should the court find the agreement constitutional, it will go to the National Assembly for ratification.
Armenia’s constitution has also become central to a second regional process. Azerbaijan has made constitutional changes a condition for signing a peace agreement with Armenia, arguing that references to the 1990 Declaration of Independence imply territorial claims against Azerbaijan (Azerbaijani Ministry of Foreign Affairs, March 13, 2025). Armenia is preparing a new constitution, with the government planning a referendum on its adoption in 2027 (Prime Minister of Armenia, March 21, 2025; Azernews, July 10). This constitutional process now bears directly on both the U.S.-backed transit project and the Armenia–Azerbaijan peace process.
For decades, the three South Caucasus countries occupied relatively fixed roles. Georgia served as the region’s main east–west transit corridor and its most Western-oriented state. Armenia remained constrained by closed borders and dependence on Russia. Azerbaijan used its energy resources to build economic power while maintaining limited ties with Western institutions. Now, Armenia is emerging as a new channel for Western engagement and regional connectivity, Azerbaijan is positioning itself as a major energy and transit hub while pursuing a multivector foreign policy, and Georgia faces competition for its traditional role as the region’s principal east–west corridor and democratic anchor. While the proposed route is not the sole cause of these changes, it is a byproduct of a new regional order in the South Caucasus.
Post-Victory Azerbaijan
Azerbaijan entered the postwar period from a strong position and used it to expand its influence in multiple directions. Baku hosted the 29th UN Climate Change Conference (COP29) in 2024, expanded its role in European energy markets, and, by 2026, was supplying 16 countries via the Trans-Anatolian Pipeline (TANAP) and the Trans-Adriatic Pipeline (TAP) (Interfax, January 16). It strengthened the Middle Corridor, with cargo transportation through Azerbaijan increasing by 90 percent over three years, while the Baku–Tbilisi–Kars (BTK) railway’s annual freight capacity reached five million tons (President of Azerbaijan, November 16, 2025, accessed August 12).
The same pragmatism shaped its relationship with Russia. Relations deteriorated sharply after the December 2024 Azerbaijan Airlines crash, which killed 38 people, but began to normalize after Russian President Vladimir Putin acknowledged in October 2025 that Russian air defenses had caused the incident (see EDM, January 15, 2025). In April, Azerbaijan and Russia announced a settlement that included compensation (Russian Ministry of Foreign Affairs, April 15; see EDM, April 21). Baku confronts Russia when necessary but restores ties when doing so serves its interests, reflecting a foreign policy based less on ideological balancing than on transactional diversification from a position of strength.
Azerbaijan has also expanded its engagement with Washington and Central Asia (see EDM, September 9, 10). A February 2026 Charter on Strategic Partnership with the United States broadened cooperation in defense, cybersecurity, digital infrastructure, and regional connectivity (U.S. Embassy in Azerbaijan, February 11). Baku has simultaneously deepened its role in the Organization of Turkic States (OTS). In May, Azerbaijani President Ilham Aliyev joined the OTS informal summit in Turkistan, where leaders discussed digitalization, transport, trade, energy, and connectivity (OTS, May 15; see EDM, May 19). In June, Azerbaijan hosted the OTS Council of Central Banks in Baku, deepening financial ties with Central Asian states (Central Bank of Türkiye, June 4). This expanding network gives Baku greater room to pressure Armenia, increase leverage over Russia, deepen ties with Türkiye, attract Western investment, and expand its partnerships across Central Asia and beyond.
These relationships further reinforce Azerbaijan’s broader connectivity strategy. Baku seeks a direct link to Nakhchivan and Türkiye, greater flows through the Middle Corridor, and Armenia’s integration into regional transport networks. As energy markets evolve, transit offers Azerbaijan another source of regional influence. The objective is not simply to move goods more efficiently, but to make Azerbaijan increasingly difficult to bypass.
Armenia’s Search for Options
The collapse of the previous security environment exposed the limits of Armenia’s dependence on Russia. For decades, Moscow was Yerevan’s principal security partner, while closed borders with Türkiye and Azerbaijan left Georgia as its main route to external markets. This dependence extended to energy. Russian gas reaches Armenia through Georgia via the North Caucasus–Transcaucasia pipeline, which transported 2.7 billion cubic meters in 2025 (Interfax, May 27). With no alternative route, any disruption to Georgian transit could threaten Armenia’s energy security. Its exclusion from major regional infrastructure projects, including the Baku–Tbilisi–Ceyhan and Baku–Tbilisi–Erzurum pipelines and the BTK railway, further reinforced its isolation. This model became difficult to sustain after 2020, as Russia’s ability and willingness to provide security guarantees came under greater scrutiny.
Yerevan’s response has been to diversify rather than replace one patron with another. Normalization with Azerbaijan and Türkiye could reopen routes that have been closed for decades and integrate Armenia into regional transportation networks (see EDM, May 22). Between December 2025 and July 2026, Azerbaijan has supplied Armenia with more than 14,000 tons of diesel and around 5,000 tons of gasoline, while more than 40,000 tons of transit cargo from third countries have reached Armenia through Azerbaijan (Armenpress, July 10; Caspian News, July 22). In April, Armenia and Türkiye established a working group to rehabilitate and operationalize the Kars–Gyumri railway, reviving a direct rail connection between the two countries (Turkish Ministry of Foreign Affairs, accessed August 12). Reopening these routes could turn Armenia’s geography into an asset, positioning it as a transit link between the Black Sea, Türkiye, Azerbaijan, and Europe.
That shift is already reflected in Armenia’s engagement with Washington and Brussels. The United States has tied its relationship with Armenia to peace, connectivity, and economic development, culminating in the May 2026 TRIPP Framework Agreement, which Armenia submitted for constitutional review in July (U.S. Department of State, May 26; see EDM, June 3; Government of Armenia, July 16). At the May 2026 EU–Armenia summit, the two sides launched a Connectivity Partnership focused on transport, energy, and digital infrastructure, linking Armenia to wider European and regional networks (see EDM, May 11; Prime Minister of Armenia, accessed August 12).
Armenia’s dependence on Russia through the Collective Security Treaty Organization (CSTO), the Russian military base at Gyumri, the Eurasian Economic Union (EAEU), and continued reliance on Russian energy and markets constrains its diversification. Moscow has shown that these ties remain sources of leverage. At the September 1 Shanghai Cooperation Summit in Bishkek, Armenian Prime Minister Nikol Pashinyan said Armenia no longer considers the Gyumri base a “vital necessity,” while Putin offered to withdraw Russian troops from it “as early as tomorrow,” shifting responsibility for a potential rupture onto Yerevan and playing on Armenian domestic fears of Turkish dominance without a Russian military base (see EDM, September 8). Beginning in May, Russia progressively tightened restrictions on Armenian imports, culminating in broad restrictions on Armenian agricultural and other goods on June 11, four days after Armenia’s parliamentary elections (see EDM, June 5; The Moscow Times, June 11). Russian Deputy Prime Minister Alexei Overchuk also warned that Armenia could lose its preferential gas and oil arrangements if it pursued EU membership (News.am, May 27). The pressure is structural, not merely electoral, since Russia accounted for roughly 35 percent of Armenia’s exports in 2025 (Armenian Council, July 14).
Moscow’s pressure raises the cost of Armenia’s Western turn while reinforcing the logic of diversification. The more Russia uses economic access as leverage, the stronger Yerevan’s incentive to seek alternative markets and strategic partners. The June 7 election demonstrated the political resilience of this strategy—the pro-Western Civil Contract party won 49.81 percent of the vote, giving Pashinyan another mandate to pursue his course (ARKA News Agency, June 8). Armenia’s economic activity index rose 7.9 percent in the first half of 2026, suggesting that Russian restrictions had so far produced sectoral rather than economy-wide effects (Armenpress, August 7).
Georgia’s Search for New Leverage
Georgia’s Black Sea coastline, rail network, ports, and position along the Middle Corridor continue to make it a key link between Europe and Central Asia. Tbilisi is investing heavily to preserve that role, mobilizing $7 billion for transport and logistics infrastructure by 2032 (Georgian Ministry of Economy and Sustainable Development, May 15). Freight turnover rose 21 percent in the first four months of 2026, while the Asian Development Bank approved $250 million for the Tbilisi Bypass highway project (Georgian Ministry of Economy and Sustainable Development, July 6; Asian Development Bank, July 30).
TRIPP and the normalization of Armenian–Azerbaijani relations threaten Georgia’s long-standing role as the region’s primary transit corridor. Both countries now have greater incentives to develop routes that could reduce their reliance on Georgian territory. This became tangible in December 2025, when Georgia initially imposed a high tariff on the first Azerbaijani fuel shipment to Armenia through Georgia. After Azerbaijan indicated it could establish a direct border connection with Armenia, the dispute was settled, and Georgia moderated its position (Carnegie Europe, April 1). The episode showed how normalization expands Georgia’s neighbors’ alternatives and, with them, their bargaining power.
The shift was also visible at the World Economic Forum in Davos in January. Armenian President Vahagn Khachaturyan and Aliyev appeared together on a panel and discussed connectivity and direct transport between their countries. Georgia was not invited for the second consecutive year (Caspian Post, February 23). Türkiye has also reduced Georgia’s intermediary role through a series of steps in 2026, including removing a restriction on direct Armenia–Türkiye trade and launching Istanbul–Yerevan flights on Turkish Airlines (ARKA News Agency, March 11; Armenian Ministry of Foreign Affairs, May 13).
Tbilisi’s response has been to broaden its economic and connectivity partnerships while strengthening Georgia’s value as a regional hub. In July, Uzbekistan and Turkmenistan made consecutive state visits to Georgia, with Tashkent elevating ties to a strategic partnership and proposing to connect the China–Kyrgyzstan–Uzbekistan railway with the BTK line (see EDM, July 15; JAM news, July 17). In June, Georgia and the People’s Republic of China (PRC) elevated bilateral relations to a comprehensive strategic partnership, building on $2.7 billion in bilateral trade in 2025 and an upgraded free-trade agreement (PRC Ministry of Foreign Affairs, June 9). Georgia also announced state ownership of the Anaklia deep-sea port in July, with the first vessel expected in 2029 (Georgian Ministry of Economy and Sustainable Development, July 6; see EDM, July 16).
This economic diversification is unfolding alongside a domestic political shift. Protests over the disputed October 2024 election have continued into 2026, while Georgia’s EU accession process remains essentially at the halt it reached in 2024, and its strategic partnership with the United States remains suspended (Civil Georgia, November 30; European Council, accessed August 13). The ruling Georgian Dream party has increasingly turned to economic performance and anti-corruption as alternative sources of legitimacy. In his June annual report to Parliament, Georgian Prime Minister Irakli Kobakhidze cited 8.2 percent economic growth in January–April 2026, claimed that corruption at the highest levels had been eliminated, and said the International Monetary Fund projects Georgia to have the highest economic growth among countries in the region and Europe through 2031 (Parliament of Georgia, June 26).
Georgia is responding to shrinking transit exclusivity by accumulating other forms of leverage. As Armenia and Azerbaijan gain alternatives to Georgian routes, Tbilisi is broadening its economic partnerships and strengthening its infrastructure. Reduced dependence on the West gives Georgia greater room for a transactional foreign policy, but also weakens the Western-oriented role that once amplified its geographic advantages.
Conclusion
The South Caucasus is moving from a regional order structured by conflict and fixed strategic roles toward one defined by connectivity, competition, and diversification. Azerbaijan’s victories in 2020 and 2023 removed the conflict that had long shaped relations among the three states, giving Baku greater freedom to shape the regional agenda. Armenia is using normalization with Azerbaijan and Türkiye to overcome its geographic and strategic isolation, while Georgia is adapting to a region where its traditional transit advantage is no longer exclusive.
None of the three South Caucasus states is choosing a new patron. All three are seeking greater room to maneuver, but from very different positions. Azerbaijan diversifies from strength, Armenia from dependence, and Georgia from a position of declining Western political leverage.