Spring 2002 (10.1)
Back On The World Map
Azerbaijan Into The Global Economy
by Richard Armitage
Edited remarks by Deputy Secretary of
State Richard Armitage on receiving the "Freedom Support
Award" at the Fifth Annual Conference of the U.S.-Azerbaijan
Chamber of Commerce (USACC) at the Renaissance Hotel, Washington,
D.C. on March 8, 2002.
Hafiz, [Pashayev, Azerbaijani
Ambassador to the U.S. since 1993] it's great to be back with
you. This is kind of like "old home week" for me. I'm
delighted to be back with the Chamber.
I'm struck, however, that if anybody should be receiving a leadership
award, it ought to be the people of Azerbaijan, who over the
last 10 years have led a region to a new way of life. So my own
view is, if you want to give any applause, let's give it to the
people of Azerbaijan, who deserve the award for leading the way
in the region.
Ambassador Pashayev, Ambassador [Ross] Wilson [U.S. Ambassador
to Azerbaijan since 2000], Ambassador Stan Escudero [Former U.S.
Ambassador to Azerbaijan (1997-2000) and now a business consultant
in Azerbaijan], whom I saw a moment ago, Minister [Farhad] Aliyev
[Azerbaijan Minister of Economic Development], and my friend
Mr. [Valeh] Alasgarov [SOCAR's General Manager, Foreign Investment
Division], so nice to see you again. And all friends of the U.S.-Azerbaijan
Let me say what a special pleasure it is for me to be here today
at the first U.S.-Azerbaijan Chamber of Commerce luncheon, post-907.
Now, the establishment of the World Trade Organization [WTO]
advisory is obviously an important step in Azerbaijan's accession
to the world economy and this body will help bring Azerbaijan's
trade regime into WTO compliance. Now, this entry into the WTO
is going to take time and a serious and sustained effort. But
the end result will be an Azerbaijan fully integrated into the
world economy and capable of attracting international investment
across multiple and diverse sectors.
And TDA [U.S. Trade & Development Agency] Director Askey
and Regional Director Dan Stein, who is on his way to someplace
or another right now, deserve credit, in my view, for the hard
work on this project. But we especially appreciate the firm commitment
and the steady leadership of Minister Aliyev, the Minister of
Economic Development. Well done, sir.
10 Year Ties
Now, you know, February 28th marked the 10th anniversary of the
establishment of diplomatic relations between the United States
And something I know a little bit more about, March 17th will
mark the 10th anniversary of the establishment of our Mission
in Baku. Having been there on the ground floor, I feel quite
good about that. But what a tumultuous birth occurred ten years
ago, as the people of Azerbaijan wrested themselves away from
outmoded Soviet institutions and turned firmly to the West.
And over these past 10 years, what we've seen is a rebirth, a
reappearance on the world map of the Republic of Azerbaijan after
an absence of more than seven decades. And the United States
supports a peaceful and stable Azerbaijan, a democratic state
based on the rule of law, participating in the global free market
economy and integrated into international and Euro-Atlantic institutions.
The road to this goal has not been easy, as we all understand,
and most tragic of all has been the conflict in Nagorno-Karabakh.
Our colleague, Ambassador Rudy Perina, is in Moscow now, going
to Azerbaijan tomorrow, in a continued search for a resolution
to this difficult issue between Armenia and Azerbaijan.
U.S. Aid to Azerbaijan
So where are we today? Well, since Azerbaijan regained its independence,
our nation has allocated more than $336 million in assistance
to Azerbaijan. In addition to that, the United States Government
has delivered $103 million in Defense Department excess and privately
donated humanitarian commodities to Azerbaijan over the past
Foreign aid is an enabling tool to help Azerbaijan improve its
capacity to participate effectively in the global economy, to
trade successfully, to attract investments. In Fiscal Year '02,
the overall United States Government assistance to Azerbaijan
is increasing, up from $46 million last year to over $52 million
this year. Security-related assistance, which is now allowed
since we've waived Section 907 restrictions [Congressional clause
in the Freedom Support Act of 1992 that denied aid to the government
of Azerbaijan], also increases significantly from $2 million
last year to over $10 million this year.
And for the first time, we believe we can pursue engagement with
all the nations of the South Caucasus, advancing our common goals
for stability and development of the region as a whole.
Now, the new assistance program includes new counter-terrorism
and security assistance initiatives, in addition to the ongoing
broad range of programs in the areas of democratic reform, humanitarian
aid, and economic reform. We're looking at beginning law enforcement
programs in Azerbaijan, which could include assistance in the
areas of forensic labs, counter-narcotics training and police
And we're looking at advisory programs on financial crimes and
terrorist financing, and training and equipment for maintaining
criminal records and databases of fraudulent passports and counterfeit
currency and training on countering organized crime. In the security
area, Azerbaijan will now be eligible for IMET [International
Military Education and Training] program grants to train Azeri
military personnel at U.S. institutions and to provide English
Additionally, Azerbaijan has been allocated $4 million from the
FMF [Foreign Military Financing] assistance, which will allow
the procurement of U.S. military articles and services to enhance
legitimate defense capabilities, interoperability, and peacekeeping
capabilities. Finally, Azerbaijan has applied to enter the National
Guard State Partners Program, and Azerbaijan's armed forces will
be paired with citizen soldiers of one of our states and learn
from what the National Guard does best, in areas of disaster
relief and humanitarian emergency training.
But beyond the new programs that the waiver of 907 has finally
made possible, we're going to continue to work in the areas where
we have been making progress for the past ten years. Our democracy
assistance programs are promoting the rule of law, helping NGOs
[non-governmental organizations], political parties and the media
to more effectively articulate public interest, as well as to
strengthen civil society.
U.S. programs also work with the Central Election Commission
and municipal councils. Since 1993, over $54 million has been
spent on educational exchange and democracy development programs,
and approximately $14 million has been budgeted for these programs
in Fiscal Year '02.
Exchanges and training and partnership programs provide opportunities
for current leaders and the next generation of Azerbaijan leaders
to learn about U.S. society and institutions firsthand, and even
more importantly, we believe, to forge personal ties with individual
Americans and personal ties to individual American institutions.
Since 1993, more than 1,700 Azerbaijanis have traveled to the
United States as participants in these programs, and there will
be more in the future.
Our economic reform programs focus on accelerating growth, development
of private, small and medium enterprises in agriculture and in
other related areas. The U.S. will continue to support American
companies through OPIC [Overseas Private Investment Corporation],
through TDA, as you saw today, and U.S. Export-Import Bank activities.
Our humanitarian assistance to Azerbaijan has primarily focused
on relief to refugees and internally displaced persons [IDPs],
to encourage economic development and to lessen human suffering.
And this must continue.
And lastly, we will provide particular nonproliferation assistance
under the Export Control and Border Security Program, including
support for patrol boats, for the maritime border guards, and
radio equipment for land border guards. The United States is
committed to an independent and sovereign Azerbaijan in control,
in full control, of its borders.
No American official can stand in front of an audience this recent
after the horrors of "9/11" without mentioning terrorism.
In particular, I want to mention what Azerbaijan is doing to
help the United States and the rest of the world in the global
war on terrorism. I'm delighted to say that Azerbaijan has an
outstanding record of cooperation with the United States on counter-terrorism
issues, cooperation that well precedes and predates the horror
of September 11th, in assisting investigations and in sharing
But after September 11th, President Heydar Aliyev and other leading
figures in Azerbaijan have given strong public support to our
efforts. The people of Azerbaijan have shown their support as
well. Crowds of thousands turned out in Baku to sign the U.S.
Embassy September 11th Condolence Book. Nor did it pass unnoticed,
the kindness and graciousness of President Aliyev who visited
our Ground Zero [what remains of the New York World Trade Center
after the terrorist attack].
But in addition to moral support, Azerbaijan stepped up to the
plate and offered crucial cooperation on the war on terrorism.
This cooperation continues to be vital. Azerbaijan has granted
blanket overflight rights to U.S. and coalition aircraft, and
has also offered the use of Azerbaijani air and military facilities
and the full cooperation of Azerbaijan's law enforcement and
Azerbaijan has worked hard to combat terrorist financing, the
dark side of the phenomenon of globalization. Azerbaijan ratified
the 1999 International Convention on the Prevention of the Financing
of Terrorism on October 1st of last year. And Azerbaijan is currently
preparing national legislation to implement this convention.
At the moment, they are operating under a presidential decree.
Baku has requested U.S. assistance in drafting that legislation
and other anti-terrorism legislation, and now that we have the
waiver, this too can be possible. With a greater engagement possible
since the waiver of 907, we can do even more in this very important
area, and it's inseparable from the drive for economic reform
that we investigate and freeze potential terrorist assets.
Now, many of our friends from the oil industry might be even
more interested in a short discussion of the Caspian. Azerbaijan
is the linchpin of the project that will bring prosperity to
the peoples of the South Caucasus and ensure their integration
with the world economy. That's the east-west energy corridor.
The Shah Daniz gas pipeline and the Baku-Tbilisi-Ceyhan oil pipeline
have moved from concept to blueprint, and will soon be a reality.
It's our view, our understanding, the construction phase will
begin this summer.
And we support Azerbaijan's peaceful development of Caspian resources
through international investments in existing production-sharing
arrangements. But it is our strong belief that the Caspian Sea
must be an area of cooperation, not an arena of conflict. We
support Azerbaijan and its efforts to deal peacefully with the
issue of Caspian boundaries in a way that allows resource development
When President Aliyev was recently here in the States [February
2002], and went on to Cleveland for a medical checkup, I had
two occasions to chat with him about this very issue. It is not
a secret to those in this room that Iranians were pressurizing
a bit our friends from Azerbaijan.
And as the President left for Cleveland, I assured him, on behalf
of our government, that we would keep our eyes fully open to
the question of Iranian pressure. And while he was staying in
Cleveland, I had the opportunity to call him again to update
him on what we had seen and what our view was, and to ask him
what he needed. We are not going to stand idly by and have friends
pressured by their neighbors, and everyone must understand this.
Now, beyond the energy section, we support Azerbaijan's attempt
to develop sectors other than the energy to ensure a robust and
diversified economy that brings prosperity to the country by
improving the investment climate, the administration of tax and
customs, and the strengthening of the rule of law.
For the past several years, the United States has imported art,
antiques, apparel and grains, seeds and fruit from Azerbaijan.
Textiles and agriculture are no less important for a healthy
Azerbaijani economy in the long run than oil and gas, and Azerbaijan
is one of the largest markets in the world for U.S. exporters.
This economic reform effort is vital to the prosperity of Azerbaijan.
Licensing, registration and other bureaucratic vestiges of the
former Soviet Union, coupled with a lack of clarity and transparency
in tax law and regulations, obviously, as you so well know, hamper
In January, we concluded the fourth meeting of the U.S.-Azerbaijan
Economic Task Force. Within this forum, Azerbaijan and the United
States can work together to focus on the development of Azerbaijan's
business environment, especially for the non-energy sector, and
urge government cooperation with the business community.
Now, finally - I guess this is a bit of self-promotion, Reza
[Vaziri, Co-Chair of the USACC] - as a graduate of the U.S.-Azerbaijan
Chamber of Commerce and as a past co-chair myself, I want to
commend the work of this Chamber in promoting U.S.-Azerbaijan
understanding, as well as investment.
As reflected in the remarks I've just made, the relationship
between the United States and Azerbaijan has expanded quite remarkably
over the past 10 years, and efforts such as you and your colleagues
in the Chamber have put forth have been absolutely key in helping
us maintain momentum, in ensuring cooperation, and in garnering
the opportunities, putting not only U.S. interests, but U.S.
and Azerbaijan mutual interests, forward.
So I am going to end my remarks today with a plea to the Chamber,
and a plea to the members of the Chamber: Please keep it up.
For a long time, it was the U.S.-Azerbaijan Chamber of Commerce
that was the real link between our two nations. I think now we've
got a pretty solid government-to-government link. It won't be
broken, and I don't want you to slacken in your efforts. Please,
please, keep it up.
Good luck to you all, and thank you very much.
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AI 10.1 (Spring 2002)
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