By stepping up its geopolitical ambitions in the South Caucasus, the EU is asserting itself more strongly in a highly complex and competitive environment while pursuing multiple objectives that are sometimes at odds with one another. The EU simultaneously tries to export its European values, to secure its trade and energy interests, to act as an impartial mediator in the protracted conflicts and to contain and push back Russian influence from especially Georgia and Armenia. This report has found that there are indeed opportunities for the EU to realize these objectives, but only if they are prioritized and pursued in a consistent manner. In this context, this report puts forward the following recommendations:

On the geopolitical role of the EU in the South Caucasus region at large:

In addition to its policy documents on the Eastern Partnership or on specific themes, the EU should develop a dedicated strategy for the South Caucasus as a whole. This strategy should clearly outline the EU’s various objectives and the way it aims to pursue them. It should have a clear focus on the security dimension as well as the (geo)political, economic and normative dimensions.

The EU should significantly strengthen its field presence in the three countries of the South Caucasus. It should particularly strive to achieve more coherence between the efforts of the European Commission, the EU Special Representative and the President of the European Council, the two field operations in Georgia and Armenia, and the bilateral efforts of its member states.

On Georgia

The EU should monitor and communicate the implementation of the 12 recommendations from the European Commission's Avis in a meticulous and impartial manner. Given the disappointment in Georgian society concerning the Georgian failure to obtain EU candidate status, the EU should communicate openly and honestly about the reasons for its decision. There is a clear need for the EU to show Georgian society that it has a vision for the future of the country and its relationship with the EU. The EU can also help to counter disinformation campaigns, including those that exploit fears of war or social conservative values and religious sentiments in Georgia.

The EU would do well to step back from Georgia's internal political arena and be a referee, not a player or a plaything. The partial failure of the Charles Michel agreement means that it is now up to domestic politicians in Georgia to take the steps which lie ahead. In the European approach, particularly from the European Parliament, the interests of party-political relationships with local parties should be avoided as much as possible in favour of an objective view of polarisation and domestic reforms. The Netherlands should continue to contribute to the development of political pluralism and multi-party democracy through bilateral projects, amongst others through its Embassy in Tbilisi.

The EU should continue to invest in both the construction and security of transport and energy connections. The Middle Corridor from the Caspian Sea via Azerbaijan and Georgia will become an increasingly important trade and transport route from China and energy-rich Central Asia to Europe. However, Russia can easily shut it down or sabotage it from South Ossetia, which is an acute problem, especially for oil and gas pipelines. Key logistic projects such as the deep sea Port of Anaklia, previously held back by internal political barriers in Georgia, have also gained importance due to the war in Ukraine and construction works may be resumed.

The EU will need to stand ready to make use of any opportunities to alleviate the negative effects of Russian pressure on Abkhazia and South Ossetia and attempts by Russia to further ‘Russify’ these regions. A key element in that regard is to ensure that Abkhaz continue to be able to travel to Georgia and/or the European Union, including for educational purposes. The EU could also engage with the Georgian authorities to try and foster a more constructive and gradual Georgian approach to conflict resolution which takes the local contexts into account.

The EU would do well to strengthen monitoring and knowledge of the protracted conflicts, including the situation in the areas themselves. The EUMM mission could use technological means (camera surveillance, drones) to better monitor further illegal shifts of the administrative border line (ABL) by the Russian side. In addition, the EU would do well to distribute reports from the EUSR more widely in the institutions and member states, as the EUSR, in contrast to the EUMM and other EU diplomats, has good access to and knowledge of the internal dynamics in Abkhazia and, to a lesser extent, South Ossetia.

On the Armenia-Azerbaijan conflict

While striving to be an impartial mediator between Armenia and Azerbaijan and acknowledging the complexity of the conflict, the EU should not succumb to the reflexes of ‘equidistance’ and ‘bothsideism’. It should particularly deter Azerbaijani efforts to impose its will on Armenia by force. The EU should therefore avoid giving Baku the impression in its strategic communications that it will turn a blind eye to further attacks on Armenia because of commercial and trade interests. It should continue to proactively contribute to the demarcation of the border and be more forceful in demanding the withdrawal of Azerbaijani troops from Armenian territory.

The EU should ensure that Armenia duly implements the commitments it has undertaken regarding the transport connection from Azerbaijan proper to Nakhchivan. It can play a role in the negotiations, provide expertise regarding the modalities of the transport connection, as well as investing financially in the construction of the road and railroad connection. The EU has an interest in its realisation, not only because it would lock in cooperation between Baku and Yerevan, but also because it would strengthen the Middle Corridor trade route at large. In this context it is also clearly in the EU’s interest to support the Armenian-Turkish normalisation process and the reopening of the border.

The recently deployed EU Mission in Armenia could play a crucial role and should be endowed with sufficient resources and flexibility to fulfil its mandateeven if Azerbaijan and Russia object to it. The EU should make clear to Azerbaijan that the EUMA is an essential part of its role as a mediator and should encourage Baku not only to grudgingly accept the Mission but to actively co-operate with it, ideally by allowing it to have access to the Azerbaijani side of the border.

While upholding the legal and political distinction between sovereign Armenian territory, on the one hand, and Nagorno-Karabakh as an integral part of Azerbaijan, on the other, the EU should not close its eyes to the dire situation of the ethnic Armenian population in Nagorno-Karabakh. As part of its mediation efforts, it should press Baku to offer a credible and internationally monitored arrangement to the ethnic Armenians that guarantees their security and fully respects their human rights, including minority rights. Continued access to Armenia through the Lachin Corridor and measures to combat hate speech should be an integral part of this arrangement, in particular after the Russian peacekeepers leave. The EU should strive to monitor the implementation of this arrangement by itself, as an integral part of its ongoing political and human rights dialogue with Azerbaijan, as well as through other bodies monitoring commitments that Azerbaijan has subscribed to, including obligations under the Council of Europe Framework Convention for the Protection of National Minorities (FCNM) and the OSCE.

In Armenia, the EU should make long-term investments in structurally strengthening the Armenian rule of law, democratic institutions and resilience. In the short term, Armenia's dependence on Russia is unlikely to change quickly and the EU should manage Armenian expectations in this regard, but the EU can and should play a long game here. The EU can use the space in the Comprehensive and Enhanced Partnership Agreement (CEPA) and the window of opportunity emanating from Armenia's disillusionment with Russia to implement some structural reforms now and to make the country less vulnerable to Russian interference in the longer term, including in the areas of countering hybrid threats and disinformation, energy security and efficiency and security sector reform.