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"Negative trends are coming together, the combination of which is, frankly, alarming," external relations commissioner Benita Ferrero-Waldner said at an experts' forum in Slovenia on Monday (28 August), citing a recent upswing in aggressive rhetoric and arms spending.
"Defence spending is going through the roof," she stated. "There is a serious danger of the rhetoric lowering the threshold for war," the commissioner added, referring to the so-called "frozen conflicts" of Abkhazia and South Ossetia in Georgia and Nagorno Karabakh in Azerbaijan.
The three regions tore away from Georgia and Azerbaijan in three separate conflicts in the early 1990s which together claimed some 35,000 lives and displaced hundreds of thousands before the various warring parties ceased fire after reaching tense impasses.
Local diplomats say potshots are still exchanged "daily" on the Nagorno Karabakh border and "monthly" on the borders of the Georgian territories, with one woman shot dead in fighting between Georgian troops and Abkhazian separatists in the Kodori Gorge in July.
The International Crisis Group's (ICG) Europe director, Nicholas Whyte, shared Ms Ferrero-Waldner's analysis, saying "That's an extremely reasonable concern...they are preparing for war."
He cited Georgian military aggression in Abkhazia and Azeri aggression in Nagorno Karabakh as the most likely risks to peace in the short term.
Georgia's military budget proportionally increased faster than any other country's in the world last year, he stated, while Azerbaijan has boasted that its military budget in 2007 will be the size of the total budget of Armenia - its main aggressor in the conflict over the ethnic-Armenian dominated Nagorno Karabakh region.
Georgian and Azerbaijani diplomats in Brussels both say they are committed to diplomatic conflict resolution under the various multinational formats at work in the region, but Georgia sees Abkhazia and South Ossetia as Russian-run mafia enclaves while Baku makes no secret of its growing impatience with the status quo.
"[Displaced] Azerbaijani people have been waiting for the liberation of the occupied territories, to return to their occupied lands for 15 years," an Azeri diplomat told EUobserver. "It's ridiculous to wait for ever, to stand and do nothing."
Russia is an added complicating factor in the troubled region, with between 2,000 and 3,000 Russian "peacekeeping" troops stationed in Abkhazia and South Ossetia as well as significant numbers in Armenia, and with Moscow issuing thousands of Russian passports to the Georgian separatists.
If fighting breaks out, the ICG's Mr Whyte believes both Georgia and Azerbaijan "are underestimating" the severity of the international and Russian reaction to the conflict, with Baku also underestimating the tactical defensibility of Nagorno Karabakh by an inferior force.
Ms Ferrero-Waldner is planning to visit the region in October to sign political and economic "action plans" for closer EU integration, with the Georgian and Armenian action plan texts set to "take note that [these countries] have expressed their European aspirations" for future EU membership.
The texts are also set to give Georgia and Armenia the option to formally "align themselves" with "some" future EU statements on common foreign and security policy topics, but with Ms Ferrero-Waldner on 28 August warning that "the most important impediments to the region's development are the frozen conflicts."
The region is strategically important to the EU, with Azerbaijani oil already flowing from Baku via Georgia and Turkey to Europe through the so-called BCT pipeline, and with plans afoot for major gas pipelines to the EU from the Caspian Sea basin in the next five to ten years.
Most analysts agree that the energy income to supplier state Azerbaijan and transit state Georgia is helping to buy extra arms and creating a bullish political atmosphere however. "Oil is not helping to lubricate conflict resolution," Mr Whyte said.
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