Armenia, Azerbaijan Mull CFE Treaty Withdrawal in Year of "Many Uncertainties" for OSCE

Russia has unilaterally frozen its commitments under the Conventional Forces in Europe (CFE) Treaty to protest NATO enlargement and what it claims is foot dragging by alliance members on ratification of an adapted version of the disarmament pact that was signed in 1999.

The Russian move took effect in mid-December. Since the treaty contains no provision for suspension, Moscow's actions effectively mark its withdrawal from the CFE regime. Spain, which held the Organization for Security and Cooperation in Europe's rotating chairmanship in 2007, has urged Russia to reconsider its decision.

"The loss of the CFE system of limitations, information and verification would be detrimental to all and could have security implications for all of Europe," Spanish Foreign Minister Miguel Angel Moratinos wrote in a statement issued shortly after the Russian moratorium entered into force. "No steps should be taken that could undermine the viability of the CFE regime, or put this landmark regime at risk," Moratinos added, before urging other CFE states to do "everything they can" to preserve the treaty.

Yet, shortly afterwards, another two former Soviet republics suggested that they, too, were weighing a possible withdrawal from the CFE Treaty. Armenia's Defense Minister Mikael Harutyunian hinted that Yerevan could suspend its commitments under the CFE Treaty in response to what he described as rival Azerbaijan's continuing military build-up.

"[We have] made no such decision yet," regional media quoted Harutyunian as saying on December 14. "But if Azerbaijan does not stop buying and bringing in large quantities of weapons in contravention of [the CFE Treaty], then Armenia could make such a decision."

Addressing a news conference in Baku the next day, Azerbaijan's Foreign Minister Elmar Mammadyarov called for a revision of the CFE Treaty to take new geopolitical realities into account. "Azerbaijan has specific problems connected to the CFE Treaty because of the existence of uncontrolled territories where neither Azerbaijani, nor international representatives can carry out inspections," the Xeberler-Azerbaycan news agency quoted him as saying on December 15.

Mammadyarov said Baku was particularly concerned by the military situation in seven Azerbaijani administrative districts that are occupied by Armenian forces. The Azerbaijani foreign minister alleged that Armenia was "illegally" storing large quantities of weapons and ammunition in the occupied territories.

The successive Armenian and Azerbaijani announcements did not come as a surprise to Finland, which took over the OSCE chairmanship on January 1. OSCE officials in early December told EurasiaNet that Helsinki was worried that either one of the two South Caucasus states, or both, might withdraw from the CFE Treaty in 2008.

In his first public statement as OSCE chairman-in-office, Finnish Foreign Minister Ilkka Kanerva said he believed 2008 would be "characterized by many uncertainties." Among issues he said he expected to be "prominent" during Finland's chairmanship, Kanerva listed the post-Soviet protracted conflicts, and the fate of the CFE Treaty.

Yerevan and Baku, which remain formally at war over Azerbaijan's Nagorno-Karabakh enclave, have long been blaming each other for allegedly exceeding their respective CFE quotas.

Speaking at the annual OSCE Ministerial Council in Madrid on November 29, Armenia's Foreign Minister Vardan Oskanian accused Azerbaijan of "blatantly and unapologetically" violating its holdings of treaty-limited equipment in excess of CFE ceilings.

Addressing that same forum the next day, Mammadyarov returned the charge. He said the stockpiles of weapons and ammunition he claimed Armenia had been accumulating in the occupied territories "exceeded by far all possible quotas."

Baku and Yerevan have long been suspected of concealing forces above CFE limits.

In 1998, a report commissioned by the United States stated that neither Armenia nor Azerbaijan was in compliance with its CFE treaty obligations. However, the report concluded that the compliance issues were not "militarily significant."

But the situation may be different now. Baku's defense spending has been growing steadily since 2004 -- an increase made possible by its soaring oil revenues. [For background see the Eurasia Insight archive]. Regional defense experts put Azerbaijan's military spending per capita at more than $100 a year, compared to $70 in Armenia.

In a report released last November, the Brussels-based International Crisis Group (ICG) think tank said that, in addition to some 20 combat aircraft, Azerbaijan purchased at least 12 multi-launch rocket systems and dozens of artillery systems, anti-tank guns, and T-72 battle tanks between 2004 and 2006. The United Nations Register of Conventional Arms shows that these items were purchased from Ukraine, Belarus, and Georgia.

Armenia has not declared any new acquisitions to the UN Register since 2005, when it reported purchasing 10 Russian-made Su-25 combat aircraft from Slovakia the year before.

Officially, Baku's military budget rose to $1.1 billion in 2007, whereas Yerevan's defense spending reached $280 million. President Ilham Aliyev once boasted that Azerbaijan's military budget would total more than Armenia's overall public spending, and in a nationwide address December 31, he vowed to continue modernizing Baku's armed forces. Aliyev revealed that the country's 2008 defense budget would amount to no less than $1.2 billion.

Although the ICG report says that Armenia's defense spending and declared acquisitions "do not compare" with those of Azerbaijan, it notes that Yerevan is benefiting from Russia's military assistance within, or beyond the framework of the Collective Security Treaty Organization.

Azerbaijan maintains that part of the military equipment that Russia recently withdrew from Georgia was transferred illegally to Armenia. Yerevan and Moscow have both rejected Baku's claims.

Even though it remains unclear whether Armenia and Azerbaijan will follow Moscow's example and withdraw from the CFE Treaty, the fact is that Russia has set a dangerous precedent.

Regional political commentators agree that the CFE Treaty has helped maintain a military balance between Armenia and Azerbaijan, thus helping to prevent a resumption of hostilities. They fear that if the CFE Treaty framework collapses, the Caucasus could become caught in a new cycle of violence. As both Armenia and Azerbaijan are entering election years, calls for a review of their respective CFE quotas are likely to increase.