What If The Caucasus Developed Different Regional Cooperation?

The Actual History

The South Caucasus—comprising Armenia, Azerbaijan, and Georgia—emerged from the collapse of the Soviet Union in 1991 as independent states facing profound challenges. Rather than developing meaningful regional cooperation, these post-Soviet republics became entangled in a web of conflicts, competing alliances, and external influences that have shaped their trajectories for over three decades.

The most devastating regional conflict erupted between Armenia and Azerbaijan over Nagorno-Karabakh, a predominantly Armenian-populated enclave within Azerbaijan's internationally recognized borders. This dispute dates back to 1988 when the region's legislative body voted to join Armenia, sparking ethnic tensions that escalated into full-scale war after both countries gained independence. The 1992-1994 First Nagorno-Karabakh War resulted in approximately 30,000 casualties and displaced hundreds of thousands. Armenian forces, supported by the Republic of Armenia, secured control over Nagorno-Karabakh and seven surrounding Azerbaijani districts, creating a buffer zone. The conflict ended with a Russian-brokered ceasefire in 1994, but without a comprehensive peace agreement.

Georgia faced its own separatist challenges in the regions of Abkhazia and South Ossetia. Following violent conflicts in the early 1990s, both territories achieved de facto independence with Russian backing. These tensions culminated in the 2008 Russo-Georgian War, after which Russia formally recognized both territories as independent states, effectively cementing Georgia's territorial fragmentation.

The region's economic development has been severely hampered by these unresolved conflicts. Trade links were severed, with the Armenia-Azerbaijan border and the Armenia-Turkey border remaining closed since the 1990s. The region developed competing transportation networks rather than integrated ones, with Azerbaijan and Georgia cooperating on projects like the Baku-Tbilisi-Ceyhan oil pipeline and the Baku-Tbilisi-Kars railway that deliberately bypass Armenia.

Regional institutions remained weak or ineffective. While all three countries joined the Commonwealth of Independent States (CIS) initially, Georgia withdrew following the 2008 war with Russia. The GUAM Organization for Democracy and Economic Development (Georgia, Ukraine, Azerbaijan, and Moldova) formed in 1997 as a counterweight to Russian influence, but Armenia was notably absent, instead joining the Russian-led Collective Security Treaty Organization (CSTO) and later the Eurasian Economic Union.

External powers have played significant roles in the region's fragmentation. Russia maintained military bases in Armenia and the breakaway Georgian territories while selling weapons to both Armenia and Azerbaijan. Turkey closely aligned with Azerbaijan, with whom it shares ethnic and linguistic ties, while maintaining a closed border with Armenia due to historical grievances related to the 1915 Armenian genocide. The European Union and United States pursued engagement through initiatives like the Eastern Partnership but failed to foster meaningful regional integration.

The fragile status quo in Nagorno-Karabakh collapsed in 2020 when Azerbaijan, with Turkish support, launched a decisive military offensive that recaptured much of the territory lost in the 1990s. The 44-day Second Nagorno-Karabakh War ended with a Russian-brokered ceasefire that significantly altered regional dynamics. Azerbaijan completed its reconquest in September 2023 with a lightning offensive that led to the exodus of the enclave's Armenian population.

By 2025, the South Caucasus remains divided, with no comprehensive regional cooperation framework. Armenia and Azerbaijan continue difficult normalization talks, Georgia maintains its pro-Western orientation while living with the reality of Russian-backed separatist territories, and the economies of all three countries continue to function well below their potential, constrained by closed borders, mutual suspicion, and the gravitational pull of competing external powers.

The Point of Divergence

What if the newly independent South Caucasus states had established meaningful regional cooperation in the early 1990s? In this alternate timeline, we explore a scenario where the leaders of Armenia, Azerbaijan, and Georgia recognized their shared interests and interdependence, choosing cooperation over conflict despite historical tensions and external pressures.

The point of divergence occurs in December 1991, immediately following the Soviet Union's collapse. During this period of uncertainty and possibility, several alternate pathways could have emerged:

In one plausible scenario, the newly elected leaders of the three South Caucasus republics—Levon Ter-Petrosyan of Armenia, Ayaz Mutalibov of Azerbaijan, and Zviad Gamsakhurdia of Georgia—could have met in a neutral location like Tbilisi or Batumi and signed a "Caucasus Stability Pact." This agreement would have established principles for peaceful conflict resolution, recognized existing Soviet administrative borders while creating special autonomy arrangements for disputed regions, and committed the three states to economic integration and joint approaches to external powers.

Alternatively, international mediation could have played a more decisive role. The United Nations, OSCE, or even the European Community (predecessor to the EU) might have convened an international conference on the Caucasus in early 1992, similar to the European Conference on Yugoslavia. This conference could have produced a comprehensive regional settlement before the Nagorno-Karabakh conflict escalated into full-scale war.

A third possibility involves the internal politics of these states. More moderate nationalist forces might have prevailed in early elections or political struggles, bringing to power leaders who prioritized economic development and regional stability over territorial maximalism. For instance, if Abulfaz Elchibey had never become Azerbaijan's president in 1992, replacing the more pragmatic Mutalibov, Azerbaijan might have pursued diplomatic rather than military solutions to the Nagorno-Karabakh issue.

The most compelling divergence scenario combines elements of all three: facing economic collapse and security threats following the Soviet breakup, the three South Caucasus leaders agree to a Turkish and European-mediated summit in January 1992. Despite domestic political pressures, they sign the "Tbilisi Declaration," establishing a framework for resolving territorial disputes through negotiation rather than force, creating a South Caucasus Economic Community, and pledging neutrality in relations with major powers. The declaration defuses the escalating Nagorno-Karabakh crisis by agreeing to interim autonomy arrangements pending a final settlement and creates a regional peacekeeping force with international observers.

This pivotal moment—choosing cooperation over conflict when multiple paths still seemed possible—becomes the foundation for a dramatically different regional trajectory, one where the South Caucasus builds institutions for managing differences rather than allowing them to fester into decades of hostility and missed opportunities.

Immediate Aftermath

Conflict Prevention and Management

The most immediate effect of the Tbilisi Declaration would be the prevention of full-scale war over Nagorno-Karabakh. Rather than the devastating conflict that claimed thousands of lives and displaced hundreds of thousands in our timeline, this alternate history sees the implementation of an interim autonomy arrangement:

Interim Status Agreement: Nagorno-Karabakh receives substantial self-governance within Azerbaijan's borders, with guaranteed rights for the Armenian population. International observers from the newly created South Caucasus Security Forum (SCSF) monitor compliance.
Demilitarization: Armed militias on both sides are disbanded, with a neutral peacekeeping force comprising Georgian troops and international observers ensuring security.
Refugee Support: Unlike our timeline, where hundreds of thousands became refugees, most civilians remain in their homes. The few thousand already displaced (before the point of divergence) receive assistance to return.

In Georgia, the Tbilisi Declaration leads to different outcomes in Abkhazia and South Ossetia. The Georgian government offers enhanced autonomy to both regions, and while tensions persist, they don't escalate into the full-scale conflicts of our timeline. South Ossetia accepts the arrangement by mid-1992, while negotiations with Abkhazia prove more challenging but eventually yield a special status agreement by early 1993.

Economic Integration Initiatives

Recognizing that economic interdependence could cement political cooperation, the three countries rapidly pursue several key initiatives:

Free Trade Area: By late 1992, the South Caucasus Free Trade Agreement eliminates most tariffs between the three countries, creating an integrated market of nearly 17 million consumers.
Joint Infrastructure Commission: Rather than competing transportation networks, this body plans regional infrastructure including highways, railways, and energy corridors designed to benefit all three states.
Caucasus Development Bank: Capitalized initially with $200 million (primarily from international donors), this institution finances cross-border projects with an emphasis on border regions and areas hosting minority populations.

These economic initiatives deliver quick benefits. Trade between the three countries grows by 300% between 1992 and 1995. The economic catastrophe that characterized the early post-Soviet years is somewhat mitigated, with GDP contraction less severe than in our timeline. Foreign investment increases as the region gains a reputation for stability in contrast to other post-Soviet areas.

Regional Institutions

To sustain cooperation, the three countries establish several lasting institutions:

South Caucasus Council: Meeting quarterly at the head of state level, this forum becomes the highest decision-making body for regional affairs, addressing emerging issues before they escalate.
Permanent Secretariat: Based in Tbilisi (as a compromise location), a small but effective bureaucracy develops to implement decisions and maintain institutional memory.
Parliamentary Assembly: Composed of delegates from the three national parliaments, this body begins meeting in late 1992, focusing on harmonizing legislation and building people-to-people ties.

These institutions face early challenges, particularly as nationalist opposition in all three countries criticizes perceived compromises. In Azerbaijan, President Mutalibov faces an attempted coup in March 1992 by hardliners opposed to the Nagorno-Karabakh compromise but survives with Georgian and international support. In Armenia, President Ter-Petrosyan's more conciliatory approach toward neighbors strengthens his hand against more radical nationalist forces, allowing him to consolidate power more effectively than in our timeline.

International Reactions

The Caucasus cooperation framework elicits mixed reactions from regional powers:

Russia: Initially suspicious, Russia reluctantly accepts the arrangement as it struggles with internal challenges during the early Yeltsin years. The Russian government secures assurances that the framework isn't anti-Russian and receives guarantees about the status of Russian minorities and military facilities in the region.
Turkey: Enthusiastically supports the initiative, seeing an opportunity to expand influence while addressing historical tensions with Armenia. Turkish President Turgut Özal visits all three capitals in mid-1992, pledging economic support and offering to mediate ongoing negotiations over Nagorno-Karabakh.
Iran: Cautiously positive, particularly valuing stability on its northern border during a period of reconstruction following the Iran-Iraq War. Offers energy cooperation and transit routes to all three countries.
United States and European Community: Provide diplomatic and financial support, seeing the Caucasus cooperation framework as a rare post-Soviet success story. The EC pledges development assistance and eventual consideration for closer economic integration.

By 1994-1995, what began as a crisis management mechanism evolves into something more substantial. The three countries establish a unified customs code, begin harmonizing economic regulations, and launch flagship projects including the "Trans-Caucasus Pipeline" designed to transport Azerbaijani oil through Georgia and Armenia to Mediterranean ports. While challenges remain, particularly regarding Nagorno-Karabakh's final status, the foundations for lasting regional cooperation are firmly established, dramatically altering the region's trajectory compared to our timeline.

Long-term Impact

Political Evolution and Conflict Resolution

The cooperative framework established in 1992 fundamentally transforms the political landscape of the South Caucasus over the following decades:

Nagorno-Karabakh Resolution

By the early 2000s, after years of negotiations facilitated by the South Caucasus Council and international mediators, a permanent settlement for Nagorno-Karabakh emerges:

Enhanced Autonomy: The region receives extensive self-governance within Azerbaijan, with its own parliament, police force, educational system, and cultural protections. The arrangement draws inspiration from successful autonomy models like South Tyrol in Italy.
Special Economic Status: To support economic development, Nagorno-Karabakh receives tax advantages and investment incentives, transforming it from a potential conflict zone to an economic crossroads.
Security Guarantees: A multinational observer mission ensures compliance with the agreement, while Armenia receives formal guarantees regarding the rights and security of the Armenian population.

This settlement, formalized in the 2005 "Comprehensive Agreement on Nagorno-Karabakh," represents a stark contrast to our timeline's ongoing conflict. Instead of two destructive wars (1992-1994 and 2020), ethnic cleansing, and intergenerational trauma, the region gradually becomes a model for addressing complex territorial and ethnic disputes.

Georgian Territorial Integrity

Georgia's approach to Abkhazia and South Ossetia follows a similar, though more protracted path:

South Ossetia becomes fully reintegrated into Georgia by the early 2000s as a special autonomous region with extensive language rights and local governance. Cross-border ties with North Ossetia (in Russia) are maintained through special arrangements.
Abkhazia presents greater challenges, but by 2010, following negotiations supported by Russia and the South Caucasus Council, it accepts a confederal arrangement within Georgia with substantial self-rule and constitutional protections for the Abkhaz language and culture.

Without the 2008 Russo-Georgian War that occurred in our timeline, Georgia maintains territorial integrity while accommodating minority concerns through institutional arrangements rather than force.

Economic Transformation

The economic impact of sustained regional cooperation proves particularly significant:

Integrated Infrastructure

By 2025, the South Caucasus possesses one of the most integrated regional infrastructure networks among post-Soviet states:

Energy Corridors: Rather than the competing pipelines of our timeline, a comprehensive network of oil and gas pipelines connects Azerbaijani resources to markets through both Georgia and Armenia, with branch connections to Iran and Turkey.
Transportation Network: The "South Caucasus Railway" links all major cities across the three countries, connecting to Russia, Turkey, and Iran. The "Caucasus Highway" system provides modern road connections that facilitate trade and tourism.
Digital Integration: Joint investments in telecommunications infrastructure, including shared satellite systems and fiber optic networks, create one of the most digitally connected regions in the former Soviet space.

Economic Specialization and Complementarity

The three economies develop complementary specializations that enhance regional competitiveness:

Azerbaijan leverages oil and gas revenues to develop petrochemicals, renewable energy technology, and sovereign wealth investments that benefit the entire region.
Georgia becomes a logistics and tourism hub, capitalizing on its Black Sea access and scenic landscapes. The financial sector in Tbilisi develops as a regional banking center.
Armenia focuses on high-tech industries, precision manufacturing, and cultural tourism, leveraging its educated workforce and diaspora connections.

By 2025, the "South Caucasus Economic Zone" achieves a combined GDP of approximately $210 billion—about 40% higher than the combined economies in our timeline—with substantially more equitable distribution of wealth and opportunity across the region.

Geopolitical Positioning

Perhaps the most profound long-term impact comes in the realm of geopolitics, where the South Caucasus transforms from a contested space between great powers to a model of "strategic neutrality":

Balanced External Relations

Unlike our timeline's division into pro-Western and pro-Russian camps, the South Caucasus pursues a balanced approach:

European Integration: All three countries sign Advanced Association Agreements with the European Union by 2015, harmonizing regulations and gradually integrating into the European single market without pursuing full EU membership.
Constructive Russian Relations: Special protocols maintain Russian access to transportation networks and energy markets while respecting the sovereignty of the three states. Russian military bases are gradually phased out by mutual agreement, replaced with commercial partnerships.
Regional Connectivity Hub: The South Caucasus positions itself as a crucial link in both China's Belt and Road Initiative and Europe's connectivity strategy, extracting benefits from both without becoming dependent on either.

Security Architecture

The region develops a unique security model that replaces dependence on external powers with mutual guarantees:

South Caucasus Security Pact: Signed in 2008, this agreement commits the three states to mutual defense while maintaining military neutrality regarding external blocs. None of the three countries joins NATO or the CSTO as in our timeline.
Coordinated Defense Planning: Joint military exercises, shared border security protocols, and standardized equipment procurement create interoperability without formal alliance structures.
Confidence-Building Measures: Regular military information exchanges, limits on forces near sensitive borders, and advance notification of exercises transform the security environment.

By 2025, this distinctive position allows the South Caucasus to maintain productive relations with Russia, Turkey, Iran, the European Union, and the United States simultaneously—a stark contrast to the region's division in our timeline.

Social and Cultural Impact

Beyond politics and economics, the cooperative framework transforms society in profound ways:

Reconciliation and Historical Dialogue

Truth and Reconciliation Process: Beginning in the early 2000s, the three countries establish joint historical commissions to address painful episodes including the Armenian genocide, Soviet-era deportations, and post-Soviet conflicts. While consensus on historical narratives remains elusive, the dialogue itself defuses historical grievances as drivers of contemporary politics.
Educational Exchanges: Over 100,000 students participate in intra-regional educational programs between 1995 and 2025, creating a generation of leaders with personal connections across national boundaries.

Cultural Renaissance

Caucasian Identity: A revitalized conception of shared "Caucasian" identity emerges alongside (not replacing) national identities, drawing on common historical experiences, culinary traditions, and cultural practices.
Regional Cultural Institutions: The Caucasus Cultural Heritage Foundation (established 2003) preserves and promotes shared traditions, while the Caucasus Film Festival becomes a globally recognized showcase for regional cinema.

By 2025, the South Caucasus of this alternate timeline stands as an example of how historically antagonistic neighbors can transform their relationships through institutional cooperation, economic integration, and cultural exchange—offering lessons for other divided regions like the Balkans, Central Asia, and the Middle East.

Expert Opinions

Dr. Svante Cornell, Director of the Institute for Security and Development Policy and specialist in Caucasian geopolitics, offers this perspective: "The South Caucasus we observe in our own timeline represents a classic security dilemma, where each state's pursuit of security through external alliances and military preparation made its neighbors less secure. The alternate timeline where regional cooperation emerged in 1992 shows the potential for what security theorists call a 'security community'—where war becomes unthinkable through dense institutional connections and shared identity. What's particularly striking is how this cooperation could have altered Russia's approach to its 'near abroad.' Without vulnerable, divided states to manipulate, Russia might have been forced to develop more constructive engagement strategies rather than the divide-and-rule tactics we've witnessed in our timeline."

Dr. Anna Ohanyan, Professor of Political Science and International Relations at Stonehill College, provides this analysis: "What we're examining here isn't just an alternate geopolitical arrangement but a fundamentally different political economy. In our timeline, the South Caucasus suffered from what I call 'regionalism of the weak'—fragmented states with minimal economic integration and high vulnerability to external pressure. The cooperative framework in this alternate scenario would have created 'positive sovereignty' where the states mutually reinforce rather than undermine each other's independence. The most profound effect would likely be on domestic governance. The economic dividends of cooperation would strengthen moderate political forces while weakening the nationalist entrepreneurs who have dominated our timeline's politics by exploiting territorial conflicts."

Ambassador Carey Cavanaugh, former U.S. Special Negotiator for Eurasian Conflicts and Chairman of the OSCE Minsk Group, notes: "Having personally attempted to mediate the Nagorno-Karabakh conflict, I'm struck by how differently things might have unfolded had we established institutional mechanisms for cooperation before positions hardened and blood was shed. The tragedy of our timeline is that most serious proposals for resolving the region's conflicts ultimately resembled arrangements that might have been achievable in 1991-1992 without the intervening decades of suffering. What's particularly revealing about this alternate timeline is how it highlights the narrow window for peacemaking that exists immediately after major systemic shocks like the Soviet collapse—when institutions are fluid, identities are in flux, and the shadow of the future looms large. Once conflict narratives become entrenched and vested interests develop around division, the path to cooperation becomes exponentially more difficult."