ISSUE 4-2016
INTERVIEW
Роман Темников
STUDIES
Haji Gasimov Отар Довженко
RUSSIA AND AZERBAIJAN
Рафик Исмаилов Эльхан Шахиноглу
OUR ANALYSES
Евгений Магда
REVIEW
Jamil Hasanli
APROPOS
Богдана Костюк


Disclaimer: The views and opinions expressed in the articles and/or discussions are those of the respective authors and do not necessarily reflect the official views or positions of the publisher.

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STUDIES
EU EASTERN PARTNERSHIP POLICY AND AZERBAIJAN: THE WINDOW TO ENERGY SECURITY COOPERATION
By Haji Gasimov | Lawyer, Azerbaijan | Issue 4, 2016

Currently the foreign policy of the European Union towards the Southern Caucasus countries is in the phase of deepening and improving , particularly towards the Republic of Azerbaijan. The process is nourished  by the fact that over the time the Caucasus countries are from the political perspective developing steadily and on the ground of democratic governance, and it  makes these countries economically and legally inevitable partners for the EU to cooperate with. Moreover, excellent location of Azerbaijan Republic as an energy transit route and a supply source makes it subject to a competition among big powers.

Research methodology

The research is mainly based on using  the analytic, qualitative and comparative method. The necessary data were obtained from  from the statistics based on databases from the Republic of Azerbaijan, the European Union. The analysis research was enabled by the reading of reports from the European Union and the Republic of Azerbaijan as well as the website and news from the European Union and international newspapers. And comparative method wasapplied in order to figure out the most reasonable and accessible transportation routes crossing over the Southern Caucasus to the European Union  to satisfy/to provide for the EU`s energy security needs.

Introduction

In 1992, the European Council decided to sign the Partnership and Cooperation Agreement (PCA) with New Independent States (NIS) as the result of the emergence of a new political and economic situation. As regards to the relations with Azerbaijan Republic, The Partnership and Cooperation Agreement (PCA) between the EU and Azerbaijan was signed on April 22, 1996.[1] The PCA embraces all possible aspects, regarding social and economic spheres, energy security cooperation between Azerbaijan and the EU. Thus the agreement ensures frameworks forall kinds of cooperation between parties, except military area.[2]

The PCA is not only an agreement in itself between the NIS and for the EU, but also among all of the member states that comprise the EU, with the purpose of building partnership with bilateral agreements between the states. The PCA is a certain framework that allows the possibility of development of relations between the EU and its partner states.

The objectives of the Partnership and Cooperation Agreement signed between the EU and Azerbaijan were determined as following[3]:

  • To ensure an appropriate framework for the political dialogue between the parties that allows the development of political relations;
  • To support Azerbaijan's efforts to consolidate its democracy and to develop its economy for completing the transition period into a market economy;
  • To promote trade, investment and harmonious economic, social, financial, scientific, technological and cultural cooperation.

The formation, essence and objectives of the EU Neighbourhood Policy in respect to Southern Caucasus states (in relation with Azerbaijan Republic)

The European Neighbourhood Policy (ENP) was officially commenced in 2004, in order to promote and ensure security, stability and prosperity in the European Union’s close neighbourhood countries.[4] The ENP applies to the EU’s direct neighbours to the south - Algeria, Egypt, Israel, Jordan, Lebanon, Libya, Morocco, Palestinian Authority, Syria and Tunisia, and to the east – Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine.

The EU Council decision dated on the 14th of June, 2004 on accession of the Republic of Azerbaijan into the European Neighborhood Policy (ENP) was an important step for both sides- EU and Azerbaijan Republic to take forward the mutual relationship within bilateral cooperation. For Azerbaijan Republic, ENP constitutes higher level of political and economic integration to the EU and opens new stages and paths for the development of cooperation.

The EU Neighborhood Policy has found the following possibilities for Azerbaijan Republic:

  • the possibility to have a stake in the EU’s internal market in exchange for the implementation of  political, economic and administrative reforms and concrete progress in the achievement of the common values;
  • participation  in the process of further integration and liberalization to the EU in order to  ensure the free movement of people, goods, services and capital;
  • more effective political dialogue and cooperation with the EU Member States, preferential trade relations and open market, migration, collaboration  in the fight against drugs and organized crime, investment promotion, acquisition of new sources of funding, supporting  the accession of Azerbaijan Republic to the World Trade Organization and etc.[5]

However, from the beginning, the European Neighbourhood Policy (ENP) has found itself under strong criticism too. One of the main points, especially emphasized, is that it is neither  possible nor desirable to treat both of the southern and eastern neighbours equally due to the strong geographical and identity differences between countries. For example, African countries such as Algeria, Syria or etc. are completely different from Ukraine or Moldova which are located in Europe and share similar values to those promoted by the current EU member states. The EU itself throughout the last few years has  encouraged its Eastern neighbours with certain suggests, such as the promise to establish a visa-free regime in a longer perspective or the availability to enter the Energy Community[6], established specially for Western Balkan countries. Southern members have not received such promises yet and this process, it is unlikely they will receive them in future.[7]

Second critical matter is that, the European Neighbourhood Policy is not the only policy towards neighbours that the EU has developed its relations with. Apart from the ENP, there are policies running towards EFTA/EEA countries (Iceland, Switzerland, Norway, Liechtenstein) that are not concentrated on the membership issues but rather on a close cooperation, the enlargement policy towards the western Balkans (Albania, Bosnia and Herzegovina, Croatia, Macedonia, Montenegro, Serbia) and Turkey, or strategic partnership with Russia, which definitely does not seek membership in the EU. The ENP member countries have not received any kind of promise of membership, although the ENP never excluded such a prospect either.

There were also big differences in regarding the way in which each  EU member state view the future goals of  the European Neighbourhood Policy. For instance, in case of Germany, it mainly focuses on free trade with ENP countries, visa exemptions, much stronger cooperation on energy issues, migration control, fighting against organised crime, strengthening of sectors such as good governance, rule of law, justice, internal security, transport and environment. And France is willing to develop the ENP, in terms of energy supplies, migration control or fight against crime. Poland promotes the establishment of a community of values and strengthening of civil society contacts.[8]

EU and Azerbaijan Action Plan

After realization of the enlargement policy of the European Union approved on the 1st of May, 2004, The EU-Azerbaijan Action Plan[9] has brought a historical shift for the European Union in political, geographic and economic fields, further extending the political and economic collaboration between the EU and the Republic of Azerbaijan. It offers the prospective for the EU and Azerbaijan to develop an increasingly close mutual relationship, going beyond cooperation, to involve an important measure of economic integration and to deepen the political cooperation and the cooperation in the energy sphere. The European Union and Azerbaijan are determined to make use of this occasion to enhance and improve their relations and to promote stability, security and welfare. Such an approach is founded  on mutual partnership agreements.

This Action Plan is a first step in this process. The EU-Azerbaijan Action Plan is a political document laying out the strategic objectives of the cooperation between Azerbaijan and the EU. It embraces a five yearly period of time frame and the implementation will help  fulfilling the provisions in the Partnership and Cooperation Agreement (PCA) and will encourage and support Azerbaijan`s objective[10] of further integration to the progressive European structures.

The Action Plan was defined in 10 directions[11]:

  1. Contribute to a peaceful solution of the Nagorno-Karabakh conflict;
  2. Strengthen democracy in the country;
  3. Strengthening the protection of human rights and fundamental freedoms;
  4. Improve the business and investment climate;
  5. Improve functioning of customs;
  6. Underpin for balanced and sustainable economic development;
  7. Further approach of economic legislation and administrative practices;
  8. Strengthening of the EU-Azerbaijan energy security cooperation;
  9. Enhancement of cooperation in the field of Justice, Freedom and Security, including border management;
  10. Strengthen regional cooperation.

Implementation of the Action Plan will significantly advance and improve the process of the legal approximation of Azerbaijani legislation, norms and legal standards to those of the European Union.

By overall view of the Action Plan it is obvious that the ENP Action Plan is focused on following measures:

  • democratisation;
  • human rights;
  • socio-economic reform;
  • poverty alleviation;
  • energy security issues.

European Union Eastern Partnership Policy

In order to take the mutual relations further and to the advanced level, The Eastern Partnership (EaP) was promoted as an initiative of the European Union governing their relationship with the post-Soviet states of - Armenia, AzerbaijanBelarusGeorgiaMoldova and Ukraine. The Eastern Partnership was officially inaugurated by the European Union in Prague on May 7, 2009.[12]

The EaP undertakes to provide a venue for discussions of trade, economic strategy and energy security issues between the EU and its eastern neighbors of the six Post-Soviet countries of "strategic importance". It delegates the Eastern dimension and strengthens bilateral relations between the EU and its partners. Promotion of human rights and the rule of law in former Soviet states has been reported to form the "core" of the policy of the Eastern Partnership Programme. The EU draft of the EaP states that: "Shared values including democracy, the rule of law, and respect for human rights will be at its core, as well as the principles of market economy, sustainable development and good governance”.

The European Union would gain better relations with Azerbaijan which is one of the most important regions for the EU. These emphasized strategic steps let Europe obtain new market opportunities for its products; improve political relations and dialogue and etc. However, the most important advantage for the EU of getting closer to Azerbaijan is the Energy security phenomenon. Through the Southern Gas Corridor which enables the possibility to access Iran, Russia and connecting Turkmenistan, Kazakhstan, China, South Korea and Japan via the Caspian Sea and crossing transit routes.

Energy security phenomenon in the Eastern Partnership

The energy sector has already reached advanced level between the EU and Azerbaijan.  According to the European Union report of 2015, during 2014 the total value for mineral fuels, lubricants and related materials accounts for 13,052 Euro for exports from Azerbaijan to the European Union.

As Mirek Topolánek, President of the European Council mentioned in the opening speech at Eastern Partnership Summit in Prague in 2009: “I believe that it is indispensable to fill this framework with concrete projects, e.g. in the fields of energy or economy, as soon as possible”,[13] it is an obvious indicator of the importance of energy security phenomenon for the European Union.  

Eastern Partnership, in particular, energy security was accompanied by a plenty of statements by different parties either in its favor or against it. However, majority of the statements focused on energy security issues in the project. The above mentioned statement by Mirek Topolánek, then President of the European Commission features the importance of the energy issues in Eastern Partnership. But the significance of energy security issues is not restricted just to statements, but also it was reflected in major events. The Southern Corridor Summit was one of such events which took place the next day after the Eastern Partnership declaration summit in Prague. “The context of this Summit was very clear. Our strategic priority in the EU is to enhance energy security, in particular, by diversifying EU`s energy sources and energy routes... The Eastern Partnership is indeed a historic, I use the word historic, summit”.[14]

Nevertheless, statements around Eastern Partnership did also emphasize contradicting interests in the energy security issues. “The Eastern Partnership is an EU attempt to expand its "sphere of influence" in the quest for hydrocarbons, Russian Foreign Minister Sergei Lavrov has said, in Moscow's first major broadside against the new policy.”[15]

To grasp the essence of energy security interests of the European Union and Eastern partners` objectives, the energy profile of the region should be taken into account. Such a profile involves a number of areas ranging from transport infrastructures to energy disputes, and supply sources to energy policies.

The role of Azerbaijan Republic in providing Energy security for the EU and further challenges

The increased context of energy understanding makes the law a more significant factor in energy security among other means of governance, in particular economic tools. The EU energy policy now concentrates on the regulation of the issues directly related to energy security, such as energy supply, integration of the EU market and economic and sustainable competitiveness for the Union as a whole.

Article 176 of the Treaty on the Functioning of the European Union (TFEU) or Lisbon Treaty[16] is the culmination of a long and indirect political process towards greater cooperation among the EU member states on energy security issues. The treaty specifies that the four main aims of energy policy in the EU are:

  • to ensure the functioning of the energy market;
  • to ensure the security of supply in the Union;
  • to promote energy efficiency and energy saving, to develop new and renewable forms of energy;
  • to promote the interconnection of energy networks.

As regards to the EU and Azerbaijan relations in the field of energy supply, it is one of the most important factors in the development of relations between the EU and the South Caucasus region which has sufficient energy resources and is located in the basin of the Caspian Sea and the possible role as an alternative and additional source for the EU member states. It should be noted that in terms of energy, the EU member states are heavily dependent on external sources, in order to provide a stable and secure energy supply.

The legal basis for the cooperation in the field of energy is the Memorandum of Understanding on a strategic partnership between the EU and Azerbaijan Republic signed in November 2006. As a conclusion of the Memorandum four priority areas of cooperation were defined:[17]

  1. Establishment of a strategy and a programme for the gradual harmonization of Azerbaijani legislation with the Community legislation in the field of energy leading to the convergence of the electricity and gas markets;   
  2. Enhancing the safety and security of energy supplies from Azerbaij an and Caspian basin to the EU;
  3. Development of a comprehensive energy demand management policy, including concrete energy saving measures and measures to tackle climate change, making use of the relevant mechanisms under the Kyoto protocol.[18] In this context, the development of renewable energies should also be the priority;
  4. Technical Cooperation and the exchange of expertise.

The EU states alone account for 14–15 percent of the world’s energy consumption, whereas the total population of the Union is only 12 percent of the world population. The current energy demand is covered by 41% oil, 22% gas, 16% coal, 15% nuclear, and 6% renewable energy sources. It is expected that the situation will by 2030 continue to be dominated by fossil fuels: 38% oil, 29% gas, 19% solid fuels, 8% renewable, and barely 6% nuclear. Electricity is generated from the following sources: nuclear (35%), solid fuel (27%), natural gas (16%), hydro and other renewables (15%), and oil (8%).[19] The energy needs of EU are by řé percentcoverdbz import and it is expected that this will increase to 70 percent by 2020 or 2030. In addition, 45 percent of oil imports come from the Middle East and 40 percent of natural gas imports come from Russia.[20]

It is clear, the EU’s oil needs are met significantly by supply from the Middle East as well as North African countries and dependence on the oil from these regions will further increase. These countries are not considered to be stable, and as a result, there is a threat to the security of energy supplies to the EU member states.

Currently, over 80 percentage of gas consumption is accounted for by four EU member states (Germany, France, Italy, Netherlands). Greece and Portugal have recently introduced natural gas into their energy systems. On the other hand, Finland is not connected to the natural gas network of the EU, operating on the basis of one source of supply.[21] However, with facilitation by the EU, this and other states are intent on increasing the share of natural gas in their energy systems. For this reason, it is necessary to provide natural gas from alternative regions  which has available sufficient resources.

As it is seen, in the future the EU which aims for political unity as the ultimate goal, demands consistent and secure energy sources in order to maintain growth and prosperity levels.

The EU feels the need to develop as a foreign policy priority ensuring the security of oil and gas supplies, including securing cooperation during any crisis, improving inventory systems within the EU, diversifying energy sources, efficient use of existing energy resources, and energy security to do this.[22] According to this policy, the main objectives of the EU Common Energy Policy will be as follows:[23]

  • reducing dependence of the Union on imported energy sources;
  • geographical diversification of those energy sources secured from outside of Europe and ensuring their security and stability;
  • implementation of new energy saving technologies and taking measures to reduce energy consumption in industrial production;
  • the creation of a cooperative internal energy market and increasing competition among European companies;
  • the development of alternative energy sources and the preparation and application of the principles of environmental protection in the energy sector.

From this point, a priority along with other initiatives will be searching for alternative sources of supply for oil and natural gas. Regarding the geographic diversification of energy supplies, the first region to consider is the Caspian Sea. Indeed, such alternative resources are located in the New Independent States (NIS) like Azerbaijan, Kazakhstan, Uzbekistan and Turkmenistan located in the oil-rich Caspian Basin but they were inaccessible to the West before these states gained independence in 1991.

The oil resources of the region play an important role as alternative and additional supplies available to the European markets.

The states of this region are very actively engaged in the implementation of energy projects in cooperation with Western companies. Azerbaijan alone has signed over 30 Production Sharing Agreements for the development of its energy sector fields.[24]

The first such agreement, signed on September 20, 1994 in Baku and termed the «Deal of Century», regulates the operation of the Azeri, Chirag, and Guneshli oil fields with estimated reserves of 900 million tons.[25] Another important field located in Azerbaijan’s offshore sector of the Caspian Sea is Shah Deniz. An agreement about the operation of this field was signed in 1996, and as a result of further exploration, British Petroleum (BP) declared the discovery of a large amount of natural gas in August 1999. This is the next-largest field after Prudhoe Bay, which BP Amoco discovered in Alaska in 1970. Shah Deniz is located 70 km south-west from Baku in the Caspian Sea at a depth varying between 50 to 600 meters and covering an area of 860 km2. A consortium was established for the operation of this field among a number of companies, whose shares are as follows:

  • SOCAR (State Oil Company of Azerbaijan Republic)  -  (10%)
  • BP (British Petroleum) - (25.5%)
  • Statoil - (25.5%)
  • Iran’s OIEC (Oil Industries Engineering and Construction) - (10%),
  • Russia / Italy joint venture - (10%),
  • §    TPAO (Turkish Petroleum Cooperation) - (9%).[26]

The importance of the Shah Deniz deposit is that it is closer to European markets than all other natural gas deposits located in Eurasia.

With the objective of defining a strategy of cooperation with these states, in 1995, the EU established a conference on oil and gas management issues. Oil and natural gas reserves located in the vicinity of the Caspian Sea were identified as targets for regional cooperation strategies at this conference. From that period on, the Commission envisaged active cooperation to help in the process of modernization of the energy sector in the Caspian Sea region states.

The major initiatives have been realized through the framework of the INOGATE Program discussed earlier. On 16 April 1998, the «The Energy Charter Protocol on Energy Efficiency and Related Environmental Aspects»[27], also known as the Energy Charter Treaty, concerning the regulation of energy supplies, came into force. The Treaty was based on integrating the energy sectors into the broader European and world markets. So it can be seen that this treaty is relevant to the Caspian Sea region, Central and Far East Asia.

The strategic significance of gas has increased in Europe, especially in the Central and Eastern parts of the Europe, where states are very interested in diversifying supply and diminishing dependency on a single or dominant source. That is why the importance of the possibility of importing gas from Azerbaijan and the Central Asian countries is so high.[28] Therefore, after implementation of Shah Deniz 2, when the production of natural gas from this offshore field will increase up to 16 billion m3 of natural gas per year, Azerbaijan will manage to export its gas to European markets.

With this purpose, a new pipeline project was proposed by the Azerbaijani government. On 26 October 2012, Azerbaijan decided to construct the Trans-Anatolian Pipeline (TANAP) from the Turkish-Georgian border through the whole territory of Turkey up to its western border.[29] With this possibility, Azerbaijani gas will be delivered to the markets of Greece, Albania, Italy, and Bulgaria. For a similar purpose, it is planned to build the Trans Adriatic Pipeline (TAP) where gas will be transported from Turkey. In the future, it is expected that Azerbaijani gas will be supplied to other countries in the region as well.

Another export corridor project for the transportation of natural gas is AGRI (Azerbaijan-Georgia-Romania Interconnector) which LNG (Liquefied Natural Gas) from Kulevi Terminal in Georgia and leased by the SOCAR, will be transported by tankers via the Black Sea to the port of Constantia of Romania. AGRI will shape another alternative route for exporting Azerbaijani gas with the purpose of decreasing political and economic risks.[30]

Overall, it should be observed that, despite the fact that natural gas is a strategic product and reducing dependence on a single source or supply route is the main EU policy priority, all the pipeline projects to transport it have been implemented or proposed by Azerbaijan. Of course, some of these projects are supported by the EU at the same time.

One of such project was the Nabucco pipeline, which was proposed by a number of companies from Central and Eastern Europe. It was planned that gas from the Central Asian states and Azerbaijan would be pumped to Nabucco, with a total capacity of 31 billion m3 per year, starting at the Turkish eastern border and then transported through Turkey, Bulgaria, Romania and Hungary as far as the Austrian Baumgarten, where the major natural gas hub is located. From the East, Nabucco would be connected with the Baku-Tbilisi-Erzurum pipeline and, for gas exports from Central Asia, with the expected Trans-Caspian pipeline.

However, despite the EU’s attempts to form a minimum legal framework for cooperation with these countries, in practice, things are different. Rather, the EU tries to encourage regional initiatives, but not to participate in an active way. In this case, providing the EU with additional resources is the prerogative of the providers themselves, not initiated by the consumer. However, this kind of energy supply is very unstable, because without necessary support and security guarantees, the Caspian countries, because of the geopolitical aspects, are not able to export their oil and gas to European markets. In this case, one of the important factors is to create the necessary infrastructure for the transportation of energy resources from the region and provide it with the necessary security guarantees.

Conclusively, regarding the further challenges in energy security law in the EU, first of all the law needs to take into consideration athe new uses of energy and the increasing amount of trade in energy as well as its integration within sustainable development requirements. Market competition shall invite profit-seeking behavior of corporations for further cooperation and integration in the EU internal and external markets, especially in relation to environmental and sustainability constraints.[31] In addition, modern energy security matter also includes energy efficiency concerns, with the management of complex infrastructures such as integrating such networks in relation to fuel supplies. Moreover, the law needs to consider how to conform environmental targets with energy diversification needs as well.

The transport routes in Southern Caucasus and their significance for the European Union from the perspective of energy security

The major interest for the EU along with energy security in the South Caucasus region is transportation routes, and this field is also compatible to the delivering of energy resources, in a safely manner to the European markets. Moreover, establishment of the durable and alternative ways enable to get access to markets in the Eurasian region and promote improvement of their infrastructure within the EU’s interest.

Thus, transport is accepted as one of the most significant sectors of the EU economy. Approximately, ten million people are employed in this growing sector, the fiscal amount in which is going to approach 1000 billion euro per year. However, the EU undertakes to extend its transport market beyond Europe to Central and Far Asia as well. The foreign trade capacity between the countries of the Far East and the EU should not be underestimated. For instance, in 2015 the total volume of the exports from the EU Member states to China estimated 170,376.042.172 Euro. While, the total exports from China to the 28 EU Member states in respective year became 350, 435.699.381 Euro. As regards to the trade relations with Japan, which possesses another major economy of the Far East and is the EU’s second largest market partner in Asia, for the respective year of 2015, the trade turnover comprises 56, 584.909.345 Euro for the exports from the EU to Japan. In contrast, the export rate from Japan to the 28 EU Member states possesses prevalent indicators over that of made by the EU in which it is estimated over 59, 769.742.518 euro[32] in 2015.

Foreign trade at such levels between the two large economic zones undoubtedly demands additional alternative transportation corridors. The EU, in order to improve the security of the transportation routes in the Eurasian region, saw the need to add new routes to the existing transportation corridors. Almost all of the existing routes to the Far East and Southern Caucasus pass through Russia. The Trans-Siberian railway connects Moscow with Vladivostok, which is one of the most easterly destinations of Russia. The main advantage of the Trans-Siberian railway is time and cost of transportation. Thus, carrying loads from the port of Vostochniy located in the far east of Russia to the Russia-Finland border requires maximum 11–12 days; to Brest, 12.5 days and 14.5 days to Berlin. This is provided by the fact that during the movement of trains on this railway, it is possible to load and unload cargo along the way too. So it was very reasonable way for the EU.

Nowadays, 20% of all transportation between Europe and Asia is done by following this way, and taking into account the advantages,  it is predicted there will be more demand in the foreseeable future.

However the EU, which has clearly and accurately identified that, transportation routes over Russian area will not be as useful as Southern Caucasus region, so it has revealed the “TRACECA” (Transport Corridor Europe-Caucasus-Asia)[33] project as an alternative for the Trans-Siberian railway.

“TRACECA” was established in May 1993, at the Conference in Brussels where ministers of trade and transport of the 8 original founder states (5 Central Asian states and 3 South Caucasus states) showed consent for establishing “TRACECA”.  Today the TRACECA route comprises the transport system with 12 Member countries (Azerbaijan, Armenia, Georgia, Iran, Kazakhstan, Kyrgyzstan, Moldova, Romania, Tajikistan, Turkey, Ukraine and Uzbekistan) after adoption of “Basic Multilateral Agreement on International Transport for Development of the Europe-Caucasus-Asia Corridor”[34].  It aims to support member countries` political and economic independence by enhancing their capacity to access European and world markets through alternative transport routes and to encourage further regional cooperation among the partner states.

 “The Basic Multilateral Agreement on International Transport for Development of the Europe-Caucasus-Asia Corridor” signed in September 8, 1998 and it was the key document of “TRACECA” that established legal basis for the development of economic relations, trade and transport communication and cooperation in the energy sector in the regions of Europe, the Black Sea, the Caucasus, the Caspian Sea and Asia.

To regulate the issues in a legal way, implementation and the application of the provisions of the Basic Agreement is necessary, therefor the member states agreed to establish an Inter-Governmental Commission (IGC) consisting of highest intergovernmental authorities of the member states or their representatives with full authority to make decisions under the Basic Agreement.

Currently, the Basic Multilateral Agreement came into effect for all the “TRACECA” member countries. The Basic Multilateral Agreement is open for any state to accede, subject to the consent of all the Agreement Parties to such accession. According to the Article 16[35] of the Multilateral Agreement, it was signed for the period of 10 years. And the validity of the Basic Agreement shall be extended for successive five-year periods unless the parties declare otherwise.  

The main purpose of this project is to create an alternative route to Russia and Iran. In this state, the South Caucasus is the lifeblood of the project. The “TRACECA” project envisaged to be achieved in which would go through the South Caucasus and is an important and almost possibly inevitable, alternative route for connection to the Far East. 

Moreover, one of the main disadvantages and shortages of the Trans-Siberian railway, in comparison to the Great Silk Road project (“TRACECA”), revitalization which is considered under the “TRACECA” program framework, is that this corridor is much longer and is lengthening to Japan.

In comparison, the total length of the Trans-Siberian corridor, which begins in Korea and the Chinese north-eastern provinces, continues via Vladivostok, Khabarovsk and then via the Trans-Siberian railroad through Samara to Brest is 10,800 km. Meanwhile, the total length of the “TRACECA” corridor, starting from the same venue in China, crossing Almaty, Turkmenbashi port, via the Caspian Sea to Baku and then through Tbilisi to the Black Sea Port of Poti, and furthering to the Ukrainian port of Odessa or Bulgarian Varna, is only 6,900 km.[36] This situation shows the advantages and potential acceleration that the route can provide to the EU`s plans to develop alternatives to the existing routes.

In addition, as the result of “TRACECA” Program around 30 countries will benefit. As the EU economy requires a large supply of energy from alternative sources. The existence of these resources in Caspian Basin requires not only that these resources are exploited, it is also important to deliver them safely to the EU markets. Therefore, “TRACECA” Program promotes not only the creation of an alternative route between the European and Far Eastern markets, but also an alternative route between the countries of the South Caucasus, Central Asia and Far East that will positively influence the development of relations between them and, consequently, improve economic progress, cooperation in energy field and good governance as well.

Conclusion

The aim of this research work is to highlight the essence, objectives and legal aspects of the European Union Foreign Policy starting from Partnership and Cooperation Agreements, EU Neighborhood Policy and Eastern Partnership Policy towards Azerbaijan Republic and to emphasize the role of Azerbaijan in providing energy security for the European Union.

Within the scope of the conducted research, the EU and Azerbaijan relations discussed from a legal perspective starting from the period of signing PCAs, European Neighbourhood Policy and till the launch of the Eastern Partnership Policy. Also Energy security challenges for the EU and the EU energy security policy were mirrored within the research.

During the outlined research, one of the main point is that both ENP and EaP aim to encourage acceleration of the integration process and deliver EU rules and values to partner countries without offering full membership opportunity. However, in itself Eastern Partnership hides natural membership prospective under its term. Because it is clear cut evidence that Association agreements give some hope to the partners, thus simplification on visa facilitation encourages partner countries to integrate to the EU.

With regard to the sphere of energy security, it is a priority yet within the Eastern Partnership in order to take this ongoing energy security processes to a new stage. The research concludes that what the European Union itself needs is to reinforce the existing situation in the area of energy security and security of transit routes beginning from Japan and crossing from Southern Caucasus, as well as concentrate its efforts on diversification of supply sources.

“TRACECA” - being the most suitable transport route for the EU, does not aim just to provide energy security, it also supports political and economic independence of the partners by enhancing capacity to access European and world markets through alternative transport routes and to encourage further regional cooperation among the partner states.


Literature

[1] “The Partnership and Cooperation Agreement (PCA) between the European Communities and their Member States on the one part and the Republic of Azerbaijan of the other part”, signed 22nd April, 1996 in Luxembourg and came into force June 22, 1999

[2] http://www.economy.gov.az/index.php?option=com_content&view=article&id=1038&Itemid=183&lang=en    The Ministry of Economy and Industry of the Republic of Azerbaijan, (25 December, 2014)

[3] http://mfa.gov.az/?language=en&options=content&id=555 (Ministry of Foreign Affairs of the Republic of Azerbaijan)

[4] Esther Barbé and Elisabeth Johansson-Nogués, “The EU as a modest ‘force for good’: the European Neighborhood Policy” International Affairs, vol. 84:1 (2008):81.

[5] http://www.fhn.gov.az/organizations.php?eng-5/menu/382  (Ministry of Emergency Situations of the Republic of Azerbaijan)

[6] http://www.energy-community.org/portal/page/portal/ENC_HOME/MEMBERS (Energy Community, it was established by an international treaty in October 2005 in Athens, Greece. The Treaty entered into force in July 2006)

[7] Grzegorz Gromadzki, “Pięć tez o Europejskiej Polityce Sąsiedztwa” (Five Theses about European Neighbourhood Policy), Policy Brief, Batory Foundation, Warsaw, October 2008, 3.

[8] Barbara Lippert, “European Neighbourhood Policy: Many reservations – some progress – uncertain prospects,” (International Policy Analyses, Friedrich Ebert Stiftung, June 2008): 10.

[9] http://eeas.europa.eu/enp/pdf/pdf/action_plans/azerbaijan_enp_ap_final_en.pdf   (ENP Action Plan, adopted on the 14th of November, in 2006)

[11]http://www.economy.gov.az/index.php?option=com_content&view=article&id=1038&Itemid=183&lang=en  , The Ministry of Economy and Industry of the Republic of Azerbaijan, (25 December, 2014)

[13] Mirek Topolánek, President of the European Council, Opening Speech at Eastern Partnership Summit, Prague, Czech Republic, May 7, 2009

[14] Jose Manuel D. Barroso, President of the European Commission, Statement following the Southern Corridor Summit, Prague, Czech Republic, May 8, 2009

[15] Valentina Pop, EU Expanding its Sphere of Influence, EUobserver.com, in March 21, 2009

[16] The Treaty of Lisbon amending the Treaty on European Union and the Treaty establishing the European Community, (signed December 13, 2007, came into force December 1, 2009), Article 176

[17] http://ec.europa.eu/energy/international/doc/mou_azerbaijan_en.pdf (Memorandum of Understanding on a strategic partnership between the EU and the Republic of Azerbaijan in the field of energy)

[18] http://unfccc.int/resource/docs/convkp/kpeng.pdf  , Kyoto Protocol To The United Nations Framework Convention On Climate Change

[19] http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52000DC0769:EN:HTML  , Green Paper - Towards a European strategy for the security of energy supply/*COM/2000/0769 final */

[20] http://europa.eu/legislation_summaries/energy/external_dimension_enlargement/l27037_en.htm

Commission Green Paper of 29 November 2000 Towards a European strategy for the security of energy supply COM(2000) 769 final, ibid

[22] Zeynep Sutalan, “Avrupa Birliği’nin Enerji Politikası ve Turkiye” (The EU`s Energy Policy and Turkey”), Strateji Ongoru Dergisi (Strategic Foresight Review), Istanbul, TASAM, No 3, Autumn, 2004, p. 111

[23] Avrupa Birliği El Kitabı (The EU Handbook), 2003, p. 97 Avrupa Birliği, 2003, p. 97.

[24] Rovshan Ibrahimov, “Azerbaijan`s Energy History and Policy:From Past till Our Days”, Energy and Azerbaijan: History, Strategy and Cooperation, Rovshan Ibrahimov (ed.), SAM, Baku, 2013, p.27.

[25] Rovshan Ibrahimov, “Azerbaijan`s Energy History and Policy: From Past till Our Days”. p 24.

[26] Rovshan Ibrahimov, “Azerbaijan`s Energy History and Policy: From Past till Our Days”, ibid., p 27.

[27] “Energy Charter Protocol on energy efficiency and related environmental aspects”, 16.04.1998

[28] Rovshan Ibrahimov, “Azerbaijan`s Energy History and Policy”, ibid., p. 26-28

[30] http://www.gun.az/Ariz_Huseynov/55526   ,  Ariz Huseynov.  Gun.az, 08.11.2012

[31] Commission Green Paper of March 8, 2006: "A European strategy for sustainable, competitive and secure energy" COM (2006) 105

[32] http://madb.europa.eu/madb/statistical_form.htm  European Commission, Market Access Database

[34] http://www.traceca-org.org/en/traceca/basic-documents/  (Basic Multilateral Agreement on International Transport for Development of the Europe-the Caucasus-Asia Corridor,  signed in September, 1998)

[35] http://www.traceca-org.org/en/traceca/basic-documents/traceca-agreements/mla-multilateral-agreement/ 
(“Basic Multilateral Agreement on International Transport for Development of the Europe-the Caucasus-Asia Corridor”), Article 16.1

[36] Rovshan Ibrahimov, “Avrupa Birliyi-Güney Kafkasya Devletleri İlişkileri” (The EU-South Caucasus States Relations), PhD thesis, Ankara University, Ankara, 2008, p. 133.

 

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