Azerbaijan has intermittently displayed interest in investing in Kyrgyzstan, but the latest set of revelations courtesy of the Panama Papers documents leak suggests that even the presidential family in Baku wanted a piece of the action.
In 2012, an obscure company called Redgold Estates Azerbaijan Ltd. became one of several international bidders hoping to snap up some out of a set of around a dozen gold concessions at an auction in Kyrgyzstan.
In the evening, the televised auction was called off when a group of demonstrators charged into a broadcast studio demanding a halt to proceedings.
As is the norm with offshore companies, tracing the line from a public company to the ultimate beneficiaries is a confusing business. Following the thread linking Redgold Estates Azerbaijan Ltd. to the family of Azerbaijan’s President Ilham Aliyev is tricky and requires some circumstantial sleuthing.
All the claims are based on documents leaked from Panama-based law firm Mossack Fonseca, which has forged a reputation for providing offshore company services to all-comers.
According to an account published on April 4 by the Organized Crime and Corruption Reporting Project (OCCRP), Redgold Estates Azerbaijan Ltd. was incorporated 20 months before the Kyrgyzstan auction, in which it submitted five bids.
The leaked Mossack Fonseca files show that another company with the same name, Redgold Estates Ltd., was created six weeks before that in the Seychelles, one of many offshore jurisdiction favored for its privacy laws. Other than the name, the two company also shared the same Baku address.
Disturbing reports of atrocities, and official claims and counterclaims continue to stream from the Armenian-Azerbaijani conflict zone as fighting enters its third day. With no international media or conflict-monitoring mission apparently yet on the ground in the breakaway Nagorno-Karabakh region, it is next to impossible to glean frontline facts from the ongoing information war.
That lack of objective information could become even more critical in the coming days. Armenian President Serzh Sargsyan, a Karabakh native, pledged on April 4 that escalation of the fighting, the worst since the signing of a 1994 ceasefire, would prompt Yerevan to recognize Nagorno Karabakh as an independent state.
An Armenian investigative news service, Hetq.am, on April 4 published photos of two elderly residents they claim were killed and maimed by Azerbaijani troops when they overran the village of Talish in northeastern Karabakh on April 2. (Warning: graphic image) The Armenian government and the Karabakhi separatist forces it supports claimed they swiftly recaptured the village and nearby heights. Hetq.am said that their photographer, Hakob Poghosian, had then gained access to the village.
A screenshot of a video released by the de facto "defense ministry" of Nagorno Karabakh purporting to show the wreckage of an Azerbaijani helicopter shot down by Armenian forces. (source: https://www.youtube.com/watch?v=NqatFUgMFxM)
Azerbaijan's military claims to have "liberated" some territory in Nagorno Karabakh after the heaviest fighting in years broke out between Azerbaijani and Armenian forces over the disputed territory.
Fighting that broke out overnight April 2 has already resulted in an unprecedented death toll, with Azerbaijan confirming 12 of its soldiers killed and Armenia 18 of its soldiers, as of Saturday night local time. That makes this by far the deadliest outbreak of fighting since the two sides signed a ceasefire in 1994 (the previous worst episode was in 2014 when ten soldiers were killed over a three-day period).
Beyond that, there were claims and counterclaims from the opposing sides of many more enemy soldiers killed and various equipment destroyed. The fog of war, dense in any conflict, is particularly impenetrable in Karabakh, where there are no independent sources of information.
The most dramatic claim was the Azerbaijan Ministry of Defense's announcement that it had "liberated" some territory previously held by Armenian forces, naming the areas of Aghdere, Tartar, Aghdam, Khojavend, and Fuzuli.
"In a short period of time, as a result of a rapid counterattack by the Azerbaijani armed forces the front line of the enemy, built up for years, was penetrated in several sections, and several strategic heights and populated areas with strategic significance were cleansed of the enemy," the MoD said.
Azerbaijan's government has for the first time addressed an apparent dispute with Russia over arms shipments, blaming it on Moscow sending inadequate equipment.
Earlier this month, Russian Deputy Prime Minister Dmitry Rogozin (who holds the portfolio of defense industry issues) made an unannounced trip to Baku. Both Russian and Azerbaijani press reported, citing unnamed sources, that the visit was aimed at sorting out Azerbaijan's failure to pay for part of $4 billion in arms deals due to the financial crisis the country is suffering as a result of falling oil prices.
This week, Azerbaijani Foreign Minister Elmar Mammadyarov gave an interview to Russian newspaper Kommersant (which broke the news originally about the alleged payment problems). In it, Mammadyarov says that Baku has no problems paying, but that Azerbaijan was dissatisfied with what it had received:
There is no problem with payments, reports about unsolved financial issues between Russia and Azerbaijan are incorrect. We are paying everything in accordance with the contracts. There are problems in their implementation, in that the weapons arriving in Azerbaijan have to correspond to the technical parameters specified in the contracts. Dmitry Rogozin came to Baku to learn what were the problems connected to those parameters, he got a full explanation and there are no more problems....
Georgia is one sad post-Soviet place, according to the World Happiness Report, which for the second year running rated the Caucasus nation as the most downbeat country in the former Soviet Union. Out of this bunch, the Central Asian autocracy of Uzbekistan, ranked 49th out of 157 countries, is apparently having the most fun.
Judging by the report, Georgia has gone a long way from being the fun-in-the-sun spot of the USSR. American writer John Steinbeck once recalled that the Russians and Ukrainians he had met during his late 1940s travels to the Soviet Union all yearned for “magical” Georgia. “People who had never been there, and who possibly could never go there, spoke of Georgia with a kind of longing and admiration,” Steinbeck observed in his 1948 Russian Journal. “They spoke of Georgians as superman, as great drinkers, great dancers, great musicians, great workers and lovers. And they spoke of the country in the Caucasus and around the Black Sea as a kind of second heaven.”
Soviet media propaganda helped cultivate Georgia’s role as the place for happiness and abundance. In movies, female collective farmers in straw-hats picked tea leaves and warbled cheerful songs in piercing sopranos. News presenters on national TV were prone to smile when sharing news from what they persistently referred to as cолнечная Грузия, “sunny Georgia. “
Were Georgians faking it, then? Or have the economic struggles, civil turmoil and loss of territories of the post-Soviet era just ruined their mood?
In a sudden display of lenience, Azerbaijan’s strong-armed leader, President Ilham Aliyev, pardoned 137 inmates, including his critics, in one fell swoop on March 17.
Lawyer and rights defender Rasul Jafarov, prominent democracy advocate Anar Mammadli, several members of the youth movement NIDA and opposition party Musavat are among the prisoners to be freed under the amnesty. International civil liberty watchdogs have long insisted these individuals were persecuted in retribution for their criticism of the government and had pressed for their release.
Earlier on the same day, an Appeals Courts in Baku ordered the release of a controversially arrested journalist, Rauf Mirkadirov. The Appeals Court overturned Mirkadirov’s six-year sentence on charges for spying for Armenia, Azerbaijan neighbor and enemy. Amidst protests from international human-rights advocates, Mirkadirov spent two years in prison.
Late last year, a well-known peace and democracy activist, Leyla Yunus, who, like Mirkadirov, was engaged in civil diplomacy activism with Armenia, was freed from prison because of poor health. Her husband was also freed, but she was not cleared of charges that included spying for Armenia, an accusation seen as preposterous by civil-rights watchdogs.
The Murena amphibious assault ship, due to enter the Caspian Flotilla in 2017. (photo: Almaz Shipbuilding, Khabarovsk)
Russia's plans to introduce a new amphibious assault ship into its Caspian Flotilla has raised questions among just which of its neighbors' shores Russia envisages assaulting.
The new ship will join the Caspian Flotilla next year, according to a report by the Ministry of Defense-run TV Zvezda. The ship is designed to carry marine assault teams, including 140 troops and one tank or two armored personnel carriers, up to a beach.
"There is a valid reason for strengthening the Caspian Flotilla with this vessel," TV Zvezda reported. It quoted military analyst Alexander Mozgovoy: "The region is extremely unstable. There are both our North Caucasus republics, where terrorist groups appear quite often, and also the nearby states."
Russian military blogger Andrey Shipilov picked up the story and wrote a post entitled "Russia prepares for an invasion of the countries of the Caspian." He notes: "The equipment is purely offensive, the only function of which is to seize coastal territories. And just as it is written in the story, it's very necessary on the sea now; the only open question is which state's territory is the target of this necessity?"
Russia's senior defense industry official has made an unexpected visit to Baku, as a Russian newspaper reports that Azerbaijan is refusing to pay for a shipment of Russian arms.
"The fall in oil prices has affected everyone, and Azerbaijan is no exception," an unnamed Russian defense industry official told the newspaper Kommersant. As a result, a shipment of weapons ordered several years ago by Azerbaijan is currently sitting in port waiting for payment, the official said.
An early version of a story on the Sputnik Azerbaijan site cited an Azerbaijani military expert backing that up, but some time after it was published all references to Baku's failure to pay were erased.
In an apparent effort to sort out the situation, Russia's deputy prime minister in charge of defense industry, Dmitry Rogozin, arrived in Baku for a previously unannounced visit on Wednesday night. On Thursday, Rogozin posted a photo with him and Azerbaijan President Ilham Aliyev on his facebook page with the caption "Following positive negotiations with the leader of friendly Azerbaijan Ilham Aliyev." There was no indication of what may have resulted from the positive negotiations.
Counter to civil-rights activists’ hopes, it was petroleum rather than press freedom that took the top billing during European Union foreign policy chief Federica Mogherini’s visit to Azerbaijan. In Baku, Mogherini commended Azerbaijan as a reliable source of energy and strategic partnership for Europe. The civil liberties watchdogs argued that, with its displays of intolerance for homegrown critical opinion, Azerbaijan is not worthy of an EU partnership.
But for the EU policymakers, worthy partners in the region are mainly defined by cubic meters; not necessarily democracy rankings. Mogherini said in Baku on February 29 that there is an internal consensus within the bloc that its collective foreign policy should give priority to “partners and initiatives that are crucial for better diversification of the EU energy resources.” A key role is reserved for Azerbaijan is this regard, as it is the starting point of a forthcoming East-West natural-gas pipeline system.
Mogherini attended a big gathering on the Southern Gas Corridor, a 3,500-kilometer road to energy security for Europe. EU, US and British energy officials were all in town to partake in the discussion on what is touted as a fix for the continent’s politically prohibitive dependence on Russian natural gas. On hand also were officials from Azerbaijan’s neighbors Turkey and Georgia, both anticipating eventual shares of tens of billions of cubic meters of gas from the pipeline chain.
Russia has announced the details of a new shipment of arms it is sending to Armenia, a relatively rare move likely connected with Russia's ongoing tension with Turkey.
Last week, the Russian government announced that it would be providing Armenia with a $200 million credit to buy equipment including multiple-launch rocket systems, anti-tank missiles, handheld antiaircraft missiles and upgrades to tanks.
The credit was announced last year, as an apparent concession by Russia amid large-scale street protests in Armenia against the country's Russian-owned electricity company. But the details of the weapons to be acquired weren't released, which is the normal practice with Russian arms deliveries to Armenia, said Emil Sanamyan, an analyst who closely follows Caucasus military affairs.
In general, Armenia prefers to cultivate an air of mystery about what weaponry exactly it is acquiring, partly to keep its rival, Azerbaijan, off-guard but also because it likely is acquiring far less and so has little to gain by flaunting it. Azerbaijan, by contrast, tends to exaggerate its purchases in an effort to intimidate.
(That said, Azerbaijan's purchases are still substantial, and a large portion of them also come from Russia. This week, the Stockholm International Peace Research institute released a report noting that Azerbaijan was the largest importer of arms in Europe over the period 2011-15, and that it accounted for nearly five percent of Russian exports over that period.)