How Armenia can benefit from establishing trade ties with Azerbaijan?

Besides the agony, tragedy, calamity, and tears, the Garabagh conflict brought economic collapse to the region. The three countries in the South Caucasus could trace the footprints of the three Baltic countries and could be rich and prosperous countries. However, due to the irredentist foreign policy of Armenia and the separatist elements in Georgia, the South Caucasus countries could not enjoy the same well-being.

Billions of dollars have been spent on the military and accommodations of IDPs and refugees so far, thousands of people died, land and water resources have been poisoned, and so on. Despite three years after liberating its territories, Azerbaijan cannot fully relocate the IDPs who were obliged to leave their homelands 30 years ago, because most of the former towns and villages leveled to the ground. Azerbaijan needs billions of dollars to restore them. Besides, the country cannot fully use the land for fear of landmines. Most experts say that the demining process will take dozens of years.

All conflicts in the South Caucasus broke out in the most beautiful districts of the region. So, they hampered the boost in tourism. The three countries could have made good fortune from tourism like Greece, and Portugal.

It is worth noting that in comparison with Azerbaijan, Armenia paid more. The country was isolated and all mega projects bypassed Armenia. It became the poorest country in the region and every third person has left Armenia for thirty years. As a result, the population dropped from 3.5 million to 2.6 million.

However, Azerbaijan's victory in the 44-day War in 2020 changed the situation dramatically. First, Armenians did not believe what had happened and could not accept the results. Some Armenian factions tried their best to change the situation in their own favor with different kinds of manipulations, but the anti-terror measures that commenced on September 19 and lasted 23 hours were enough to convince Armenians that everything was finished.

Simultaneously with this operation, news about restoring trade with Azerbaijan circulated in the Armenian media outlets citing the Armenian Economy Ministry. Could the two countries restore the economic relationship in the near future?

Azernews asked the opinion of Economist and Politician Natig Jafarly. According to him, the economic relations between Azerbaijan and Armenia are impossible devoid of signing the lasting peace treaty, opening of borders, communications, and restoration of other official relations. He added if there is no legal basis to regulate any relations between two countries, it is impossible to talk about any trade relations.

“However it's good that there are some people who are already talking about the economic relationship between the two countries in Yerevan. Azerbaijan has long been ready for the signing of a peace treaty, recognition of borders, mutually unblocking communications, and establishment of reciprocal trade relations. If Armenia signs the peace agreement and takes a step forward regarding the opening of communications, it will facilitate the establishment of trade relations,” Jafarly said.

He added that for Azerbaijan, Armenia is an additional market. It's true that this market is not so big, it's only a market of 2.5 million people. However, it could be profitable for goods, especially that Armenia needs, i.e. energy carriers, lubricants, fertilizers, and so on.

“It should be noted that establishing such relations is more profitable for Armenia. Because it will have access to a market of 10 million. Since Armenia is very dependent on the Russian market, it mainly needs to export agricultural products to new markets. From this point of view, the beginning of trade relations between Armenia and Azerbaijan can benefit both countries. However, as a prerequisite, the signing of a peace treaty is required for the creation of a legal basis for such trade,” Natig Jafarly concluded.