Towards Cooperative Energy Security in the South Caucasus

Abstract:
This article develops the idea of cooperative energy security as it applied to the South Caucasus in the mid-1990s. Following some some introductory remarks, it analyzes comprehensively the insufficiency of proposals on the table at the time and the triad of obstacles to energy development and transport yet to be overcome in the South Caucasus. Beyond this, it identifies and discussses the then-neglected problem of coordinating foreign direct investment, national macroeconomic stabilization, and the elevation of financial standards including the need for better transparency. It proposes a unique means for solving this problem, and offers a general conclusion.

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Contents

• [ Abstract ]
• [ Introductory Remarks ]

1. Solutions Already Proposed And Why They Will Not Work
    
2. The Real Requirements for Energy Security: A New Triad
   • Political Stability Manifests Compatible National Interests
   • Secure and Dependable Transport Manifests Cooperation
   • An Investment-Friendly Financial and Legal Climate Realizes Energy Security
      
3. The Unspoken Problem And How To Solve It
   • The Unspoken Problem
   • How To Solve It
      
4. Conclusion

[ page 71 ]

[ Introductory Remarks ]

The South Caucasus is becoming once again a part of the Middle East as broadly conceived under the British Empire. The disappearance of the Cold War distinction between central Asia and southwest Asia conditions and redefines the problem of security in the region.[1] Indeed, "Southwest Asia" was a creation of Western strategists and never really existed as an organic unity of a cultural, economic, or any other kind. As a geopolitical unit it is disintegrating. dissolving into the broader band of countries stretching into Central Asia from the Black Sea littoral. The whole macro-region from the Caspian Sea to the Black Sea, and all their littoral states from the Balkans to Central Asia, is becoming the focus of new sets of regional international networks of interdependence. International regions are not what they used to be, nor are they, despite their increasing autonomy of great power conflict, any longer as mutually separable as they were earlier this century.

The fate of Georgia, Armenia, and Azerbaijan is inseparable from the success or failure of developing this broader region both economically and politically, and ensuring its stability. The current turmoil in the South Caucasus will be remembered with fond nostalgia if policy makers do not address wholly predictable demographic and geographic sources of forthcoming conflicts. In the crescent of central and "southwest" Asia, where the median age is in the low twenties, a demographic explosion is inevitable. The population of this crescent of countries from Turkey through Kazakhstan, already over a third of a billion, is projected will double in the next quarter-century.[2] People will migrate to the cities—they have already started—

[ page 72 ]

and there, following the economic and social pattern of Iran in the 1970s, they will become a lumpenized mass. As is already happening in Kuwait and Saudi Arabia, an increasingly educated middle class will seek a greater voice in the political process. An average annual growth rate of 5% would be necessary in the GNP to cope with the demographic explosion, but GNP is currently declining.

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Notes

1. For a broader, theoretical treatment of this point, see Beverly Crawford, "The New Security Dilemma under International Economic Interdepencence," Millennium, vol. 23, no. 1 (Spring 1994), pp. 25–55. [ Return to text. ]
    
2. Eduard Bos, My T. Wu, Ernest Massiah, and Rodolfo A. Bulatao, World Population Projections, 1994–95 Edition: Estimates and Projections with Related Demographic Statistics (Baltimore, Md.: Johns Hopkins University Press for the World Bank, 1994). [ Return to text. ]
    

DR. ROBERT M. CUTLER was educated at MIT and The University of Michigan, where he earned a Ph.D. in Political Science, and has specialized and consulted in the international affairs of Europe, Russia, and Eurasia for twenty years. He has held research and teaching positions at major universities in the United States, Canada, France, Switzerland, and Russia, and contributed to leading policy reviews and academic journals as well as the print and electronic mass media in three languages.