VYTAUTO DIDŽIOJO UNIVERSITETAS POLITIKOS MOKSLŲ IR DIPLOMATIJOS FAKULTETAS REGIONISTIKOS KATEDRA
Toghrul Musayev
AZERBAIDŽANAS-KINIJA: POLITINIAI IR EKONOMINIAI SANTYKIAI 1991-2011 M. IR ATEITIES PERSPEKTYVOS (lietuvių kalba)
Magistro baigiamasis darbas
Rytų Azijos regiono studijų programa, valstybinis kodas 621L20007 Politikos mokslų studijų kryptis
Vadovas Dr. Rytis Bulota ______( Moksl. laipsnis, vardas, pavardė) (parašas) (data)
Apginta______(PMDF dekanas) (parašas) (data)
Kaunas, 2012
VYTAUTAS MAGNUS UNIVERSITY THE FACULTY OF POLITICAL SCIENCE AND DIPLOMACY THE DEPARTMENT OF REGIONAL STUDIES
Toghrul Musayev
AZERBAIJAN-CHINA: POLITICAL AND ECONOMIC RELATIONS IN 1991-2011 AND FUTURE PROSPECTS (in English)
Final Master‘s Thesis
East Asia Region Studies programme, Code 621L20007 Field of Studies: Political Sciences
Advisor Dr. Rytis Bulota ______
(degree, name, surname) (signature) (date)
Defended ______
(Dean of PMDF) (signature) (date)
Kaunas, 2012
“Interest does not tie nations together; it sometimes separates them. But sympathy and understanding does unite them”
Woodrow T. Wilson
Acknowledgements
I would like to express my deepest thanks to my teacher Justina Razumaite who supported me during this research and provided me with useful sources and was always willing to talk to me and assist in understanding of certain political issues and concepts that I exploited in the present research. My greatest appreciation also belongs to Dr. Rytis Bulota, my supervisor, for his valuable advice and insights that he shared with me. Besides, I am truly indebted and thankful Dr, Associate professor Ogtay B.Jalileyli, director of Confucius Institute of Baku State University, for the support and guidance he showed me throughout my thesis writing. I am sure it would have not been possible without his help. Above all, I would like to thank to all of my family and my friends boosted me morally and provided me great information resources.
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Abbreviations
AEC Azerbaijan Entrepreneurs Confederation
AR Azerbaijan Republic
AZPROMO Azerbaijan Export and Investment Promotion Foundation
CC Central Committee
CCCPC Central Committee of Communist Party of China
CCCPSU Central Committee of the Communist Party of Soviet Union
CIS Commonwealth of Independent States
CPC Communist Party of China
EU European Union
GDP Gross Domestic Product
JV Joint Ventures
KMG KazMunaiGas
MFA Ministry of Foreign Affairs
NATO North Atlantic Treaty Organization
OSCE Organization for Security and Cooperation in Europe
PRC People’s Republic of China
RF Russian Federation
ROC Republic of China
SOCAR State Oil Company of AR
TRACECA Transport Corridor Europe-Caucasus-Asia
UAE United Arab Emirates
UN United Nations
USA United States of America
USD United States Dollar
USSR Union of Soviet Socialist Republics
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Table of Contents
Acknowledgements…………………………………………………………………………………i Abbreviations……………………………………………………………………………………….ii Table of Contents…………………………………………………………………………………..iii List of Figures and Tables…………………………………………………………………………iv Santrauka…………………………………………………………………………………………...v Abstract…………………………………………………………………………………………….vi I. Introduction………………………………………………………………………………………1 1.1 Scope of the Research………………………………………………………………………...2 1.2 Theoretical Framework……………………………………………………………………….2 1.3 Review of Literature and Sources…………………………………………………………….4 II. Emergence of Sino-Azeri Relations after 1991………………………………………………..6 2.1 Priorities of Foreign Policy of Azerbaijan and China………………………………………...6 2.2 Diplomatic Recognition of Azerbaijan by PRC………………………………………………9 2.3 Bilateral Cooperation after 1991……………………………………………………………..10 2.3.1 Historical Visit of Heydar Aliyev to China…………………………………………….10 2.3.2 Visits of the President of the AR, Ilham Aliyev to PRC………………………………17 2.4 Concluding Remarks…………………………………………………………………………25 III. Political Dimension in Azerbaijan – China Relations………………………………………26 3.1 Armenian Issue in Sino-Azeri Relations…………………………………………………….26 3.2 Importance of Nagorno-Karabakh and Taiwan Conflicts in the Relations………………….27 3.3 Azerbaijan – China Multilateral Cooperation……………………………………………….30 3.3.1 Historical Importance of the Silk Road……………………………………………….30 3.3.2 Transport Corridor Europe-Caucasus-Asia –TRACECA……………………………..32 3.4 Concluding Remarks……………………………………………………………………….35 IV. Economic Bilateral Cooperation……………………………………………………………..37 4.1 Economic Relations between Two Countries and New Projects…………………………...37 4.2 Energy Issue in the Relations……………………………………………………………….41 4.3 Azeri Cooperation with Chinese Business Circles………………………………………….44 4.4 Concluding Remarks………………………………………………………………………..46 V. Future Prospects………………………………………………………………………………..48 Conclusion………………………………………………………………………………………….51 List of References………………………………………………………………………………….54 Appendices…………………………………………………………………………………………57 Appendix 1: Political Map of AR…………………………………………………………………..58 Appendix 2: Map of PRC…………………………………………………………………………..59 Appendix 3: Main Economic Indicators of AR and PRC…………………………………………..60 Appendix 4: General Overview of AR……………………………………………………………..62 Appendix 5: General Overview of PRC…………………………………………………………....64 Appendix 6: List of the Documents Signed between the PRC and AR…………………………….67
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List of Figures and Tables
Figure 1: Heydar Aliyev (M) on the Great Wall of China…………………………………………12 Figure 2: Chinese President Hu Jintao (L) holds a ceremony to greet Azerbaijani President Ilham Aliyev in the Great Hall of the People in Beijing, the capital of China, on March 17, 2005…………………………………………………………………………………………………18 Figure 3: Chinese President Hu Jintao (2nd R) and his wife Liu Yongqing (1st R) pose for photos with Azerbaijani President Ilham Aliyev (2nd L) and his wife before a welcoming luncheon in Beijing, China, Aug. 8, 2008………………………………………………………………………..24 Figure 4: Transport Corridor Europe-Caucasus-Asia (TRACECA) routes………………………..34 Figure 5: The trade relations between the AR and PRC…………………………………………...41
Table 1: The position of the PRC in the voting at the General Assembly of the UN on the amendment to the draft resolution on cooperation between UN and OSCE……………………….29
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Santrauka
Kinija yra viena iš pačių didžiausių valstybių pasaulyje. Kinija pasižymi senovine kultūra ir giliomis tradicijomis. Kiniečiai pasauliui padovanojo neįkainojamų pasiekimų visai civilizacijai. Vykstant Antrąjam pasauliniam karui ir po jo Kinijos piliečių kova baigėsi pergale ir pasekoje buvo įkurta Kinijos Liaudies Respublika 1949 metais. Kinijos žmonės tapo teisėtais savo žemių, likimo ir valios savininkais. Per trumpą istorijos laikotarpį, 50 metų, Kinija besivystydama nukeliavo tolimą kelią. Istorija ir laimėjimai, pasiekti per Kinijos Liaudies Respublikos laikotarpį padėjo šaliai prilygti kitoms pirmaujančioms ir pažengusioms valstybėms. Tačiau tai lėmė ne tik tai, jog Kinija turi daugiau nei vieną milijardą gyventojų ar tai, jog šalies teritotijos dydis vienas didžiausių pasaulyje. Tai lėmė Kinijos žmonės, kurie eina progreso bei vystymosi keliu bei tai, jog šalyje pasiekta didelių laimėjimų socioekonominėje srityje. Kinija užima svarbią vietą tarptautinėje politikoje ir pasaulio gyvenime. Kinijos Liaudies Respublika yra ilgalaikė Saugumo Tarybos narė Jungtinių Tautų Organizacijoje bei aktyviai dalyvauja daugybėje tarptautinių ir regioninių organizacijų. Štai kodėl santykiai tarp Azerbaidžano ir Kinijos yra tokie svarbūs Azerbaidžanui. Po Azerbaidžano nepriklausomybės atgavimo – tai nutiko prieš maždaug 20 metų - žinoma, Azerbaidžanas ieškojo savo nepriklausomybės pripražinimo pasaulio valstybėse. KLR buvo viena pirmųjų valstybių, pripažinusių Azerbaidžano nepriklausomybę; diplomatiniai santykiai buvo įkurti tarp Azerbaidžano ir KLR. Po to kai KLR ambasada pradėjo veikti Azerbaidžane ir kai Azerbaidžano ambasada – Kinijoje. Sino – Azeri tarptautiniai santykiai perėjo į naują fazę, kai Azerbaidžano šalies vadovas Heydar Aliyev nusprendė atlikti vieną iš savo pirmųjų oficialiųjų vizitų į Kiniją, ir šis vizitas pralaužė ledus tarptautiniuose santykiuose. Po šio istorinio vizito tolimesni pareigųnų vizitai bei dabartinio Azerbaidžano Respublikos prezidento Ilham Aliyev vizitai gerino santykius metai iš metų. Abipusiai vizitai tarp šalių tęsiami dideliu tempu. Tagi, šio tyrimo tikslas yra nuodugniai išanalizuoti dabartinę situaciją ekonominiuose ir politiniuose santykiuose tarp AR ir KLR. Iš tyrimo aišku, jog paskutiniu laikotarpiu santykiai tarp Kinijos Liaudies Respublikos ir nepriklausomo Azerbaidžano vystėsi didėjančiu tempu. Azerbaidžanas teikia didelę reikšmę santykiams su KLR, stengiasi ir stengsis vystyti ir stiprinti šiuos santykius visose gyvenimo sferose ir pasaulio politikoje.
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Abstract
China is one of the largest countries in the world. China is a country having very ancient culture and rich history. The people of China have given matchless gifts to the world civilization. During the World War II and after the World War II, the struggle of Chinese people has resulted in a great victory and the PRC has been established in 1949. The Chinese people became the owner of their lands, their fate and their will. During a short period of history – in 50 years, the Chinese people have survived a great path in its development. The historical past of China and the successes gained in the period of PRC have forwarded China to the line of leading and advanced countries. It is not only for the reason that China has more than one billion of population and it is one of the largest countries for its territory, but it is due to the fact that the Chinese people go with the way of progress, development and they have achieved great successes in socio-economic developments. China takes important place in international policy and world life. The PRC is the permanent member of the Security Council of the United Nations Organization and takes active part in a number of international and regional organizations. That’s why the relations between Azerbaijan and China are of a great importance for Azerbaijan. After Azerbaijan got its independence – this happened about 20 years ago – of course Azerbaijan looked for recognition of its independence by world countries, world community. The PRC was in the row of the first countries that recognized the state independence of Azerbaijan; diplomatic relations have been established between Azerbaijan and PRC. After that the embassy of the PRC began to perform in Azerbaijan and the embassy of Azerbaijan began to perform in China. Sino-Azeri relations have entered in a new phase when Azerbaijan’s national leader, Heydar Aliyev decided to make one of his first official foreign trips to China and this trip has broken the ice in the relations. After his historical visit, the visit of Azerbaijani officials and current president of AR Ilham Aliyev to China made the relations closer year by year. Mutual visits between countries continue in a great tempo. Therefore, this research aims to thoroughly analyze the current situation of the political and economic relations between AR and PRC. It is clear from the research that in the last periods the relations between the PRC and independent Azerbaijan have developed in an increasing tempo. Azerbaijan gives great importance to the relations with PRC and it does and will do its best to develop and strengthen these relations in all fields of life and world policy.
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I. Introduction
The international authority and leadership position of Azerbaijan in the region is increasing day by day in the modern world. In recent years, the activities of AR in foreign policy are characterized by dynamism. Azerbaijan gives importance to the bilateral and multilateral relations with big and small states of Asian continent and the relations with international and regional organizations of this region. East Asian countries especially differ from other Asian countries with their high development in the world. In the thesis, the economic and political relations between PRC - one of the world powers - and AR - leader country in South Caucasus region will be researched. First of all, it should be noted that the root of current relations between Azerbaijan and China is not too old. By the end of 1991, Azerbaijan - China relations have been improved in the framework of USSR relations with China. China has began the process of plans for the region when Soviet Union started to collapse and after a short period of Soviet Union’s collapse, it attempted to create relations with Azerbaijan as it has done with other Soviet countries. Also, after getting its independence, Azerbaijan has taken initiatives to build relationships with China. PRC has recognized the Independence of AR on December 27, 1991. Diplomatic relations between AR and PRC have been established on April 2, 1992. While analyzing the relations between the countries, it is clear that relations with China are of a very great importance in terms of Azerbaijan. Because, China is expected to be one of the strong powers in the world, at the same time it is one of the countries that Azerbaijan will benefit from economic and military potential of. Azerbaijan is an important country for the China as well. The end of the Cold War and anxiety of China on the ongoing processes with the prominence of polarity affects its foreign policy. For the China, to eliminate the threats to its existence, to reach the resources needed for the development and growth in every field more easily, to reinforce the position of the regional power for becoming a global power, to ensure the emergence of multi- polarity within this framework, to change the current structure of the international system and others are among the priority targets. China’s policy on Azerbaijan has developed in this context. One of the most important factors influencing intensification of Azeri-Chinese relations may be considered the mutual visits of the officials of both countries and the agreements reached on the related matters during these visits.
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1.1 Scope of the Research
To be more specific, the research question of the thesis include how to strength the tempo of the current relations between the countries in the framework of interests of both countries. To describe and analyze the relations between the countries in political and economical sphere is the main task of this master thesis. That’s why, this thesis is based on analytical-descriptive method. The subject of the research is the political and economical relations between AR and PRC, the role of these relations in multilateral cooperation and international organizations, mutual interests of both countries in the regions and the efficiency of relations. The aim of the research to prove the hypothesis - the effective mutual visits between the countries contribute to strengthen the relations. To prove this hypothesis, it is required to carefully analyze the mutual visits, efficiency of the agreements signed during the visits and the development rate of the relations after the visits. The main objectives of the research are: To describe the main concepts and definitions which are related to the relations between countries in order to provide clear and exact understanding of the theoretical and methodological bases of the relations; To follow the development rate of the relations and the efficiency of the bilateral and multilateral agreements between countries in order to find out the role of the mutual visits, to see how this role has been changed throughout the time and to determine its importance for the future relations; Basing on the results of the analysis, to find out and point the possible solutions for these problems, which would be useful for the countries to improve the current situation and increase the efficiency of the relations. The sample period for this research covers the time from the restoration of independence of AR in 1991 till nowadays.
1.2 Theoretical Framework
At the beginning of the 1980s, a new theory school being alternative to the theory of political realism in the international world began to act as opponent. It was Kenneth Waltz who brought this theory named “Neorealism” to the literature through his book, “Theory of International Politics”. Waltz argues in favour of a systemic approach: the international structure acts as a constraint on state behaviour, so that only states whose outcomes fall within an expected range
2 survive. This system is similar to a microeconomic model in which firms set prices and quantity based on the market.1 Neoralism is theory of International Relations which posits that states' actions can often be explained by the pressures exerted on them by international competition, which limits and constrains their choices. Neorealism thus aims to explain recurring patterns of state behaviour, such as why the relations between Sparta and Athens resembled in important ways the relations between the US and the USSR. Kenneth Waltz characterizes international relations as the single organism – as the interstate relations system.2 The action principles of this system are continuous; they are improved gradually and are regulated by the legal norms obligatory for all. The international power is distributed among the power balances (leading countries) existed in the world in order to maintain balance of forces. The states are forced to comply with the rules of international relations system and their behaviours are regulated through internal and external influence mechanisms. Waltz's theory, as he explicitly makes clear in "Theory of International Politics", is not a theory of foreign policy and does not attempt to predict or explain specific state actions, such as the collapse of the Soviet Union. The theory explains only general principles of behaviour that govern relations between states in an anarchic international system, rather than specific actions. Waltz argues that the world exists in a state of perpetual international anarchy. He distinguishes the anarchy of the international environment from the order of the domestic one. In the domestic realm, all actors may appeal to, and be compelled by, a central authority - 'the state' or 'the government' - but in the international realm, no such source of order exists. The anarchy of international politics – its lack of a central enforcer – means that states must act in a way that ensures their security above all, or else risk falling behind. This is a fundamental fact of political life faced by democracies and dictatorships alike: except in rare cases, they cannot count on the good will of others to help them, so they must always be ready to defend for themselves.3 Other neorealist John J. Mearsheimer asserts that China's rise will be unpeaceful4 and that the US will seek to contain China and prevent it from achieving regional hegemony. He believes that China will attempt to dominate the Asia-Pacific region just as the U.S. dominates the western hemisphere. The motivation for doing so would be to gain a position of overwhelming security and superiority against its neighbours which it sees as potential challengers to its status.5 Since the disintegration of the Soviet Union, China has developed good neighbourhood relations with the
1 Kenneth Waltz. Theory of International Politics. Mc Graw-Hill. 1979. P. 63 2 Hasanov Ali. Current International Relations and Foreign Policy of Azerbaijan. Azerbaijan Press. Baku.2005 P. 27 3 Kenneth Waltz. Theory of International Politics. Mc Graw-Hill. 1979. P.114 4 Mearsheimer, John J. (April 2006). "China's Unpeaceful Rise". Current History. China and East Asia (Current History Magazine) 105 (690): 160–162. Accessed May 1, 2012. < http://mearsheimer.uchicago.edu/pdfs/A0051.pdf> 5 “Australians should Fear the Rise of China”. Accessed May 1, 2012. http://mearsheimer.uchicago.edu/pdfs/A0053.pdf 3 independent and sovereign states (Azerbaijan is one of these countries) in the former Soviet Union and particularly Russia and China's neighbours in Central Asia on a new basis. This has created a good neighbourhood environment for China to pursue its program of reform, opening-up and socialist modernization and contributed to peace and stability in both Asia Pacific and the rest of the world. By issuing the neorealist framework Azerbaijan and China relations are more likely to be the both win-win game. Apart from having different form of institutionalisation and different ideological stance both states tend to have bilateral relations on the basis of economic interests. As Kenneth Waltz mentioned thought international relations based on the anarchy cooperation of the states also possible. Even in the foreign policy goals these two countries differ dramatically. What make them to pursue bilateral relations and having increasing tendency in the relations mainly refer to the on the interest. Applying neorealist framework in the following chapters I will give more detailed information. Apparently, the “neorealists” are more optimist and they assess the international relations as the controlled system unlike the supporters of the political realism describing the international relations as the permanent and uncontrolled (anarchic) field of conflicts of the national concerns of the states. Of course, this theory seemed more vital under conditions of multipolar world policy and for that reason it had been able to protect its leading position in the world for a long time. The research is conducted in a form of the policy analysis: it includes problem statement, background information on the current condition involved in respect to the described problem, policy options and recommendation on how to improve the current situation.
1.3 Review of Literature and Sources
The research process for this master thesis can be divided into three main parts or stages: The first primary stage is collection of information; it includes work on the paper as well as electronic sources of information, such as books, articles, web pages etc. All collected information will be afterwards reviewed and systemized with the structure of the paper accordingly. The second stage is the careful and thorough analysis of the collected information and making correspondent conclusions required for answering the research question on the basis of the conducted analysis and verifying or denying the suggested hypothesis. The last third stage consists of writing, reviewing and correcting the final paper and afterwards creating and preparing the power point presentation. The literature used for the research includes books, legal documents which contain bases and principles of the relations between two countries and describe and determine the mutual visits,
4 bilateral and multilateral agreements; books and collections, which contain ideas of the leading Azerbaijani politicians, officials and economists about the issue; books containing analysis of the current socio-political and economic situation in Azerbaijan and China; articles and publications of the modern economists and political scientists; and Internet-materials, which contain information on official statistics and current activities of the both countries and possibilities to improve the current situation. An excellent analysis of the Azerbaijan-China relations has been carried out by Ahmadov Misir.6 His book was a valuable source for defining the strategy and perspectives of the relations. But this book published after the rocket scandal in 1999, the author noted in the book that this event will freeze the relations between countries. Another important source that contributed to the research was a joint project of The Foreign Minister of AR and PRC Embassy in Azerbaijan.7 This book was published for the 10th anniversary of the diplomatic relations between Azerbaijan and China, so it covers all the activities which happened in those 10 years. Other insightful academic book edited by Hasanov Ali.8 It was a useful for the perception of the main features of the relations between countries. The theoretical framework was shaped with the assistance of scholarly works on theory of neorealism by Kenneth Waltz9 and John J. Mearsheimer10. With regard to the structure, the paper consists of the summary, introduction, four chapters, conclusion and the list of the used literature and sources. The research problem is identified and research theory and literature used are described in the introduction. The first chapter contains general overview about two countries, their foreign policy in the XXI century and emergence of Azerbaijan-Chinese relations after 1991, diplomatic recognition, the political issues between countries, mutual visits and bilateral agreements. The second chapter analyzes the influence of conflicts to the relations and multilateral cooperation between countries. The third chapter describes the economic relations between countries in the field of energy issues and economic projects. The fourth chapter is about the future prospects of the relations between countries. Lastly, the final section of the thesis presents a conclusion and summarizes findings of the research.
6 Ahmadov Misir. The Strategy and Prospects of Azerbaijan-China Relations. Gorgud Press. Baku.1999 7 Azerbaijan-China: 10th Anniversary of Diplomatic Relations. Baku.2002 8 Hasanov Ali. Current International Relations and Foreign Policy of Azerbaijan. Azerbaijan Press. Baku.2005 P.359- 380 9 Kenneth Waltz. Theory of International Politics. Mc Graw-Hill. 1979. 10 Mearsheimer, John J. (April 2006). "China's Unpeaceful Rise". Current History. China and East Asia (Current History Magazine) 105 (690): 160–162. Accessed May 1, 2012. < http://mearsheimer.uchicago.edu/pdfs/A0051.pdf> 5
II. Emergence of Sino-Azeri Relations after 1991
This section will overview emergence of Azerbaijan-Chinese relations after 1991 and mutual visits between countries. Furthermore, the priorities of foreign policy of countries will be discussed; diplomatic recognition of Azerbaijan and the potentials and possibilities for bilateral cooperation will be explored and explained. The issues discussed in this section will be further verified in the other section of this thesis.
2.1 Priorities of Foreign Policy of Azerbaijan and China
PRC, one of the world’s largest countries, is situated in Asian continent. On October 1, 1949, after the declaration of the PRC, it has taken worthy place in the world community and has gained an international reputation in the world. It should be noted that China is a nuclear country and permanent member of the UN Security Council. The PRC is recognized by some leading countries in the beginning of 70s and established diplomatic relations with Japan in 1972, and with the USA in 1978. Though 156 countries have established diplomatic relations with China, the number of countries having diplomatic relations with Taiwan is only 25. The PRC leaders visit different countries regularly. The PRC, the permanent member of UN Security Council, endeavors active partnership in the context of international organizations. Foreign policy strategy of China is as follows: China tries to form multipolar world; China tries to establish fair and rational international political and economic order, it is against any manifestation of hegemony and power policy; China supports the protection of democracy in the international relations; China is against any manifestation of terror and stresses the necessity to strengthen international partnership against terrorism; China is interested in strengthening the neighborhood and friendship relations with border countries; China sets the principle of “One China”, e.i. recognition of Taiwan province as the integral part of China by other countries as main condition and declares that it guides the following principles: The Principle of Independence: China prefers to take independent position both in domestic and foreign policy. 6
The Principle to Safeguard Peace in the World. China will never enter to the arming competition, enlarge its territory by military way, will oppose hegemonism, and will not interfere to the internal affairs of any country. China supporting the principle to establish and develop friendship relations and cooperation deems necessary to settle territorial and border issues through negotiations and dialogue. The Principle to cooperate with developing countries. The Principle to carry out open policy. China agitates international partnership on the basis of equality and mutual benefit with both the developed and developing countries. The PRC, pursuing independent foreign policy according to its interests, attaches importance to the partnership with western countries and countries of the third world to develop its economy. The PRC makes account of independent foreign policy with the USA and the USSR being against super power hegemony and has established diplomatic relations with the countries which were the members of the Soviet Union after the collapse of the USSR. China has entered into diplomatic relations with independent former Soviet Republics after the collapse of Soviet Union. Soviet Union survived until 1991. In 1991, drastic changes took place in the Soviet Union. By the end of 1991, the Union of Soviet Socialist Republics finally disintegrated, and 15 republics have become independent countries. The three Baltic States first have declared their independence, followed by other Soviet republics. In compliance with the principle of non-interference in the internal affairs of other countries and, of respect for the choice made by people of other countries, China has quickly entered into diplomatic relations with these countries getting independence recently. On December 25, 1991, when Gorbachev announced his resignation as the president of the Soviet Union, the spokesman of the Chinese Foreign Ministry said in his statement that since the former Soviet Republics had announced independence, the Chinese government, in compliance with the principle of not interfering in the internal affairs of other countries, respected the choices of the people of these countries. On December 27, Foreign Minister Qian Qichen sent a telegram to the Foreign Minister of the Russian Federation, informing him that China had re-appointed the Ambassador Wang Jinqing to the former Soviet Union as the ambassador to the Russian Federation. During the same day, Foreign Minister Qian sent telegrams to the foreign ministers of 11 countries, namely, Ukraine, Byelorussia, Kazakhstan, Uzbekistan, Tajikistan, Kirghizstan, Turkmenistan, Georgia, Armenia, Azerbaijan and Moldova, declaring that the PRC recognized their independence and was ready to enter into negotiation with them on the establishment of diplomatic relations. Between late December, 1991 to early January, 1992, the delegation of the Chinese government has visited 8 countries: Ukraine, Russia, Byelorussia, Uzbekistan, Kazakhstan, Tajikistan, Kirghizstan and Turkmenistan, and held talks with the governments of these countries on the establishment of 7 diplomatic relations. On January 2, 3, 4, 5 and 6, China respectively signed communiqués on the establishment of diplomatic relations with Uzbekistan, Kazakhstan, Tajikistan, Kirghizstan and Turkmenistan. On January 30, 1992, the Prime Minster of Byelorussia has visited China during which a communiqué on the establishment of diplomatic relations was signed by the two countries. At the same time, Chinese ambassador to Russia, as the representative of China, respectively held negotiations with Ukraine, Moldova, Azerbaijan, Armenia and Georgia on establishment of diplomatic relations at the ambassadorial level and respectively signed communiqués on the establishment of diplomatic relations with them on January 4, 30, April 2, 6 and June 9. 11 AR is situated in the South Caucasus region. It is a secular and unitary republic; regained independence by separating from the Soviet Union on October 18, 1991. PRC has recognized the Independence of AR on December 27, 1991 and has started to make diplomatic relations on a regular basis after Azerbaijan has become the Member of UN on March 2, 1992. Azerbaijan has been following an independent foreign policy since gaining independence in 1991. This policy aims at the strengthening and development of the state system and the protection of the national interests of Azerbaijan. Azerbaijan builds its foreign policy on the principle of respect to the international legal standards and norms, the state sovereignty and territorial integrity and the principles of non-intervention into the internal affairs.12 Azerbaijan protects and implements its national interests through participation in the regional initiatives and the aforementioned organizations. The priorities of the foreign policy of AR are as follows:
To develop a pluralist democracy based on market economy and supremacy of the law; To follow an independent foreign policy for the purposes of restoration of territorial integrity and sovereignty of Azerbaijan; To avoid risks endangering the security, political independence, sovereignty and the territorial integrity of Azerbaijan; To settle the Armenian-Azerbaijan conflict on Nagorno-Karabakh through negotiations on the principles of Lisbon summit and within the framework of the OSCE Minsk Group; To eliminate the outcomes of Armenian military aggression to Azerbaijan; To develop friendly neighborhood and mutual useful relations with bordering states; To strengthen security and stability in the region; To prevent illegal transportation of weapons and other equipment in the region;
11 “China entered into diplomatic relations with independent former Soviet Republics”. The Ministry of Foreign Affairs of the PRC. November 17, 2000. Accessed March 1, 2012.
Devotion to existing global regimes on prevention of the distribution of nuclear weapons and forming the South Caucasus as the zone free from nuclear weapon; Demilitarization of the Caspian basin; Integration into the structures of European and Transatlantic security and co-operation including the NATO, the European Union, the Union of Western Europe and the European Council; Expediting the development of different spheres of the economy deriving the advantage of the important strategic-geographical position of Azerbaijan in the intersection of the East and the West; To develop the Eurasian transport corridor with the participation of Azerbaijan. (TRACECA)13 China thus had entered into diplomatic relations with all the 15 independent former Soviet Republics. In the same year, China started to set up embassies in and dispatched resident ambassadors to these countries. By April, 1993, China had ambassadors (including serving concurrently) in all these countries. China now enjoys stable bilateral relations and normal trade relations with these countries. Since the disintegration of the Soviet Union, China has developed good neighborhood relations with the independent and sovereign states in the former Soviet Union and particularly Russia and China's neighbors in Central Asia on a new basis. This has created a good neighborhood environment for China to pursue its program of reform, opening-up and socialist modernization and contributed to peace and stability in both Asia Pacific and the rest of the world.14
2.2 Diplomatic Recognition of Azerbaijan by PRC
While searching the history of Chinese-Azeri relations, it has been clear that diplomatic relations between two countries have been established very rapidly after the collapse of Soviet Union. PRC has recognized the Independence of AR on December 27, 1991. Diplomatic relations between AR and PRC have been established on April 2, 1992. After that, on August of 1992, the PRC has opened its embassy in Azerbaijan, the first ambassador of it has been appointed on December 1, 1993. Azerbaijan has also not hidden its interest in China and Milli Mejlis (National
13 “The priorities of the Foreign Policy of the AR”. Accessed March 5, 2012.
Assembly) has adopted decision on opening the embassy of AR in PRC on September 3, 1993 and the embassy of Azerbaijan began to perform in this country. In these years, three documents have been signed between AR and PRC. These are: 1992 1. The Joint agreement on the creating diplomatic relationships between the PRC and AR. Baku, April 2, 1992 1993 1. The memorandum on the good turnover (1993) between the Ministry of Foreign Economic Relations and Foreign Trade of the PRC and the Ministry of Foreign Economic Relations of the AR. Beijing, March 13, 1993 2. The agreement on the allocation of the state credit for the exportation of the goods from the PRC to the AR between the Government of the PRC and the Government of the AR. Beijing, March 13, 199315 One of the most important factors influencing intensification of Azeri-Chinese relations may be considered the mutual visits of the officials of both countries and the agreements reached on the related matters during these visits.
2.3 Bilateral Cooperation after 1991
In order to understand how the bilateral cooperation was formed and under which influences it developed, it is worthwhile reviewing the history of mutual visits between countries and the agreements reached on the related matters during these visits.
2.3.1 Historical Visit of Heydar Aliyev to China
The Ex-President of AR, Heydar Aliyev has made official visit to the PRC on March 6-11, 1994 with the invitation of Jiang Zemin, the chairman of PRC. On March 6, 1994, the Ex-President of AR, Heydar Aliyev has made official visit to Beijing by the invitation of Jiang Zemin, the Ex-President of the PRC in accompaniment of the delegation consisting of members, representatives or intellectuals of the government, well known scientists and Art Workers. This was the first visit of high level official person to the PRC in the history of AR. The delegation of Azerbaijan was received in the highest level and very well. The flags of Azerbaijan and PRC were raised on the Popular Tiananmen Square and the delegations were placed
15 “List of the documents signed between the PRC and AR”. The Ministry of Foreign Affairs of AR. Accessed February 25, 2012.
16 Ahmadov Misir. The Strategy and Prospects of Azerbaijan-China Relations. Gorgud Press. Baku.1999. P. 74 17 Ibid. P. 75 11
Figure 1: Heydar Aliyev (M) on the Great Wall of China
Source: www.modern.az news agency18 Tamerlan Garayev, the former Ambassador Extraordinary and Plenipotentiary of AR in PRC, said in this respect: “The preparation for meeting ceremony with Azerbaijan President has been done in accordance with the highest etiquette level in Chinese Diplomacy. The Minister of Health and the Minister of Foreign Affairs having special status will permanently accompany Heydar Aliyev during his visit in the PRC. Also I would like to remind that special regime is applied only in the meetings with persons having extraordinary reputation and status. Application of such regime in Beijing from 22:00 on March 06 completely reflects the attitude of the Chinese administration towards Heydar Aliyev”.19 Such a fact is also interesting that the Chinese administration and diplomacy does not disclose their opinions on the conflicts happening in any country of the planet, they hold neutral position. But, in Azerbaijan case the situation changes. The foreign policy administration of China thinks that modification of borders of Azerbaijan and capture of its territories is intolerable. The respect expressed by the high circles of the PRC towards the personality of Heydar Aliyev is very great. The Ex-President of the PRC noted in the process of talks of the leaders of two countries that there had been a lot of sources not used in relations between two countries. This relates to study of reforms experience of China by Azerbaijan or other methods of providing credits and economic assistance to Azerbaijan.20 The agreement was obtained in this respect that the PRC would allocate
18 “Conversation with the deputy Sabir Rustamhanli”. Accessed March 4, 2012.
The parties will take active parts in the events fighting against organized and international crime – illegal circulation of narcotic drugs, terrorism, illegal acts jeopardizing the relations of sea shipping and civil air relations, illegal extraction of cultural resources and they will sign particular treaties in the case of necessity. The Government of AR recognizes that the Government of PRC is the only legal country and Taiwan is the integral part of China. The Government of AR certifies that it will not build official relations with Taiwan. The Government of PRC supports the efforts of the Government of AR directed to development of economy and protection of national independence. It recognizes and respects the sovereignty and territorial integrity of AR. The parties will not take part in actions or events of the third state directed to the other party. The Parties undertake not to allow use of their territories and facilities against the other party by the third state. This Declaration does not violate the concerns of the third states, rights and obligations of the parties arising out of international agreements.21 At the same time, they have signed very important documents on opening the air lines, scientific-technical relations, medicine, stimulation and mutual protection of investments, as well as on other important fields of cooperation that will give mutual favor and real economic results. List of the documents signed in1994: 1994 1. The agreement on the visa-free regime during the official visits between the Government of the PRC and the Government of the AR. Beijing, January 4, 1994 2. The protocol on the conference between the Ministry of Foreign Affairs of the PRC and the Ministry of Foreign Affairs of the AR. Beijing, January 4, 1994 3. The agreement on the visa-free visits of tourists groups between the Government of the PRC and the Government of the AR. Beijing, January 4, 1994 4. The consulate convention between the Government of the PRC and the Government of the AR. Beijing, January 4, 1994 5. The agreement on the cooperation in the field of tourism between the Government of the PRC and the Government of the AR. Beijing, March 7, 1994 6. The agreement on the stimulation of the investment and mutual protection between the Government of the PRC and the Government of the AR. Beijing, March 8, 1994
21 Azerbaijan-China: 10th Anniversary of Diplomatic Relations. Baku.2002 P.164
14
7. The agreement on the cultural cooperation between the Government of the PRC and the Government of the AR. Beijing, March 7, 1994 8. The mutual declaration on the foundations of the friendship relations between the Government of the PRC and the Government of the AR. Beijing, March 7, 1994 9. The protocol on the establishment of air connection between the Government of the PRC and the Government of the AR. Beijing, March 7, 1994 10. The agreement on the cooperation in the field of health and medicine between the Government of the PRC and the Government of the AR. Beijing, March 7, 1994 11. The protocol on the cinematography, radio and TV between the Government of the PRC and the Government of the AR. Beijing, March 7, 1994 12. The agreement on the cooperation in the field of science and technology between the Government of the PRC and the Government of the AR. Beijing, March 7, 1994 13. The agreement on the allocation of the state credit for the exportation of the goods from the PRC to the AR between the Government of the PRC and the Government of the AR. Beijing, May 24, 199422 What are the real results of that historical visit? In order to answer this question, it would be better to get acquainted with the opinions of National Leader Heydar Aliyev and the members of delegation of the government. China is one of the largest states of the world. The independent state of Azerbaijan directing to the principles in establishing mutual useful cooperation with all countries of the world should have close relations with China too. This visit of Heydar Aliyev is arisen out from these necessities. China itself is very interested in relations with Azerbaijan. The invitation of the Chairman of the PRC to visit his country testifies that. As it is known, there were not so many embassies of foreign countries in Azerbaijan at that time. But, China has opened its embassy in Azerbaijan. It is to say, China is very interested in Azerbaijan. This is useful for Azerbaijan. Because, the availability of friendly relations with such a great state playing very important role in political and economic life of the world is of great importance. Also China is one of the permanent members of Security Council of the UN. Heydar Aliyev describing the final of his visit to China: “I can’t say anything decisive about what Azerbaijan will gain from economic model of China. Because, it should be analyzed. In any case, we should use anything useful for us in the world. But in China case and the political results of the visit, China defends the independence, territorial integrity of Azerbaijan, integrity of its borders. These were reflected in the declaration that have signed and in statements of the leader of
22 “List of the documents signed between the PRC and AR”. The Ministry of Foreign Affairs of AR. Accessed February 25, 2012.
23 Azerbaijan-China: 10th Anniversary of Diplomatic Relations. Baku.2002 P.66 24 Ahmadov Misir. The Strategy and Prospects of Azerbaijan-China Relations. Gorgud Press. Baku.1999. P. 86-87 25 Ibid. P 88 16
1996 1. The protocol on the exchange of ratification decrees of the consulate convention between the Government of the PRC and the Government of the AR. Baku. March 29, 1996 1998 2. The framework agreement on the submission of the deduction credit to the AR by the PRC between the Government of the PRC and the Government of the AR. Baku, June 18, 1998 1999 3. The agreement on the cooperation between the Supreme People’s public prosecutor's office of China and the public prosecutor's office of the AR. Beijing. September 9, 199926
The chairman of Standing Committee of National People’s Congress, Li Peng has made official visit to Azerbaijan on June 21-24, 2000. The issues of development of relations between Azerbaijan and China in the field of policy, economy, culture and other fields, strengthening cooperation of two countries in international organizations have been discussed during the visit and wide exchange of views was conducted in respect to other matters on situation in the Caucuses.
2.3.2 Visits of the President of the AR Ilham Aliyev to PRC
The second official visit of the head of state of Azerbaijan to China was made after 10 years. The president of AR, Ilham Aliyev has been in official visit in PRC on March 16-19, 2005. The President of AR, Ilham Aliyev has gone to official visit to PRC on March 16, 2005 with the invitation of Hu Jintao, the chairman of PRC. The President of AR, Ilham Aliyev and his wife going to official visit to PRC have been greeted by the high ranking state and government officials of PRC with high hospitality in the International Airport decorated with the state flags of both countries. The official greeting ceremony of the President of AR, Ilham Aliyev has been held in Parliament of PRC. Hu Jintao, the chairman of PRC has greeted the head of state of Azerbaijan and his wife with great respect and esteem. The heads of state and government of China have been introduced to the president of Azerbaijan, and the members of the delegate of Azerbaijan have been introduced to the leader of PRC.
26 “List of the documents signed between the PRC and AR”. The Ministry of Foreign Affairs of AR. Accessed February 25, 2012.
Figure 2: Chinese President Hu Jintao (L) holds a ceremony to greet Azerbaijani President Ilham Aliyev in the Great Hall of the People in Beijing, the capital of China, on March 17, 2005.
Source: www.peopledaily.com.cn news agency27 After that, the President of AR, Ilham Aliyev has met Hu Jintao, the chairman of PRC. Mister Hu Jintao, greeting the head of the state of Azerbaijan cordially, stated that Azerbaijan people celebrates one of its most ancient and beloved holidays. The head of the state of PRC delivered to the president and people of Azerbaijan most cordial Novruz congratulations. Mister Hu Jintao specified the state visit of the president Ilham Aliyev to China as the important event supporting improvement of relations between two countries. By expressing his assurance that this visit would give new impulse to the Azerbaijan-Chinese friendship, he stated that meeting with the president of Azerbaijan had created great possibilities for discussing the existing potentials of cooperation. And they would try to get maximum use of these possibilities. The head of state of China has stated that there is sufficient information in his country about expedient policy implemented by the president Ilham Aliyev in the direction of rise of Azerbaijan and improvement of social welfare of the population and expressed his pleasure of strengthening of leadership position of our country in South Caucuses.28 During the talks, exchange of views was conducted in respect to Armenian-Azerbaijan, Nagorno-Karabakh conflict. Mister Hu Jintao said that he supported the territorial integrity of Azerbaijan unconditionally. He stated that the position of China encountering analogous problem in Taiwan issue was to defend the settlement of conflicts through peace ways in accordance with the
27 “Chinese president vows to further political, economic ties with Azerbaijan”. People’s Daily Online. March 18, 2005. Accessed March 4, 2012.
29 Ibid. 30 Ibid. 19
of Friendship Relations” dated March 7, 1994, will try to extend and improve the agreement-legal basis in all fields of mutual cooperation. 4. The parties are solidary with the idea of implementation of active measures by the governments of both countries for discovering the potential of commercial-economic cooperation in order to create useful possibilities for building and development of direct relations among the economic subjects of both countries. The parties agitate and support extension of cooperation among the enterprises of both countries under equality and mutual benefits in the fields of oil, oil-chemistry industry, light industry, machinery, agriculture, transport, telecommunication and other fields of infrastructure. The Azerbaijan-China Intergovernmental Commission on commercial- economic cooperation will play an active role in this process. The China side welcomes participation of Azerbaijan in large-scale development of western regions of China. 5. The China side highly appreciates the achievements gained in ensuring stability in the society and dynamic development of economy since Azerbaijan got its independence. The China side emphasizes its satisfaction from the results of bilateral commercial-economic cooperation for the last years. China supports Azerbaijan to be accepted to the World Trade Organization in recent future and it is sure that this will assist to increase of the level of universality and representation of the WTO, extension of influence of multilateral commercial mechanisms and development of cooperation between Azerbaijan and China under common rules. Azerbaijan highly appreciates the achievements that China gained for the years of implementation of reforms and open policy and recognizes its state status with full market economy. The China side emphasizes that it is ready to support the efforts of Azerbaijan in future in agitation of social-economic development of the country. 6. The Parties deem necessary the strengthening of cooperation either within regional framework or in bilateral format in the direction of transport and freight between two countries for development of the project of Transport Corridor Europe – Caucuses – Asia (TRACECA). The Parties will agitate the relevant authorities of the countries to close cooperation for preparation and implementation of new projects in the field of transport within the framework of Trans-Asian transport project in accordance with the “Treaty between the Governments on the network of Asian motor ways” within the framework of Social – Economic Organization for Asia and Pacific Ocean of the United Nations Organization. 7. The parties will assist extension and improvement of cooperation in the humanitarian field and they will stir the exchanges to greater activities in the field of culture, science, education, tourism, sport and information. The parties intent to implement all signed 20
agreements, various types of student and youth exchange, introduction of languages, training of specialists in a duly manner, to agitate direct contacts between higher educational institutions and scientific-research institutes, to assist relations among regions under social basis. The Parties will make joint efforts for development of cooperation in the field of bank- finance and realization of joint investment projects. The Parties will start to cooperate in and develop the field of environmental protection in bilateral, regional and global levels. The Parties will implement and develop the cooperation and relations meeting the concerns of ensuring security of both countries in the military field and not contradicting the international obligations undertaken by them. 8. The Parties positively appreciate the mutual relations between them in the activities of the UN and its structures, as well as other international and regional organizations within the framework of cooperation on issues of mutual concern. The Parties certify that they are ready to stir the consultations on bilateral, international and regional matters of mutual concern to greater activities in future too. 9. The Azerbaijan side acknowledges that there is only one China in the world, the Government of PRC is the only legal state representing China, and Taiwan is the integral part of China. The Azerbaijan side acknowledges that it supports not building any official relations, not being in official contacts with Taiwan, it acts against “Independent Taiwan”, the efforts of establishment of “two Chinas” or “one China and one Taiwan”. The Azerbaijan side understands and supports the efforts of China in ensuring and strengthening of peace and stability in Taiwan Strait region and in common in the Asia-Pacific Ocean region, including the “law on fighting against Separatism” adopted by “the Meeting of People Representatives of Whole China” for “independence of Taiwan”, in prevention and taking measures against separatist forces. The China side highly appreciates this position of Azerbaijan. 10. The Parties emphasize that the existing and increasing terrorism, separatism and extremism not only endanger the security of sovereign states, but also to the peace and stability in the whole world. Prevention of such dangers in useful manner is only possible through joint efforts and joint activities. The Parties support bilateral and multilateral cooperation in order to act against new global challenge and dangers, including fighting against international terrorism, illegal circulation of narcotic drugs and precursors, smuggling, and legalization of cash, transnational organized crime, human trafficking and illegal weapon smuggling. 21
The parties condemn every emergence of terrorism, separatism, extremism, they act against them with determination and state that they are ready to strengthen cooperation in fighting against them within the framework of UN Regulations and other relevant international antiterrorism agreements, as well as, to support mutual activities between relevant authorities of both countries. 11. The China side certifies that it supports the sovereignty and territorial integrity of AR and calls for implementation of relevant resolutions of the Security Council of the UN on Nagorno-Karabakh conflict, it states that it supports peaceful settlement of this conflict, as well as, it supports the efforts of international community in this direction. 12. Both parties call development of international dialogue and cooperation in the field of human rights, act against double standards in international policy. The parties will try to strengthen mutual support and cooperation on those matters in multilateral format in order to deepen mutual understanding through consultations and exchange of views in human rights issues, development of bilateral relations and to assist to sound development of international works on protection of human rights. 13. The parties declare that the support and strengthening of friendship cooperation between AR and PRC is not against the third states and it will not violate their concerns.31 Azerbaijan-Chinese negotiations have been held in a wide composition under supervision of the heads of state of the countries on March 17. The treaty on cooperation has been signed between Azerbaijan and Chinese officials, the Ministry of Youth, Sport and Tourism of Azerbaijan and Youth Federation of Whole China, the treaty between Azerbaijan State Television and Radio Broadcastings Company and Central Television of China, Memorandum on mutual relations was signed between the Ministry of Communications and Information Technologies of Azerbaijan and Ministry of Information Industry of China, as well as treaty and other bilateral treaties on technical-economic cooperation were signed between the governments of Azerbaijan and China. 2005 1. The mutual declaration between the Government of the PRC and the Government of the AR. Beijing, March 17, 2005 2. The contract on delivery between the Government of the PRC and the Government of the AR. Beijing, March 17, 2005
31 “The official visit of the president of AR Ilham Aliyev to PRC”. World of Diplomacy Journal. №10. January-March 2005. Baku. P 9-12. Journal of the Ministry of Foreign Affairs of the AR. Accessed March 28, 2012.
3. The agreement on the cooperation in the field of trade and economy between the Government of the PRC and the Government of the AR. Beijing, March 17, 2005 4. The agreement on the mutual assistance in the field of custom issues between the Government of the PRC and the Government of the AR. Beijing, March 17, 2005 5. The agreement on the prevention of the evasion of tax levies and removal of the double tax on the incomes between the Government of the PRC and the Government of the AR. Beijing, March 17, 2005 6. The agreement on the cooperation in technical-economical field between the Government of the PRC and the Government of the AR. Beijing, March 17, 2005 7. The memorandum on the technical support by the Ministry of Foreign Affairs of the PRC to the Ministry of Foreign Affairs of the AR. Beijing, March17, 2005 8. The agreement on the cooperation between the Ministry of Justice of the PRC and the Ministry of Justice of the AR. Beijing, March 17, 2005 9. The agreement on the cooperation in the field of affairs with youth between the Federation of Youth of Common China of PRC and the Ministry of Youth, Sport and Tourism of the AR. Beijing, March 17, 2005 10. The memorandum of understanding on the cooperation between the Ministry of Information Industry of PRC and the Ministry of Communication and Information Technologies of the AR. Beijing, March 17, 2005 11. The protocol on the cooperation in the field of culture and artwork (2005-2009) between the Ministry of Culture of PRC and the Ministry of Culture of the AR. Beijing, March 17, 2005 12. The agreement on the Technical and Sport cooperation between Olympic Committee of China and National Olympic Committee of the AR. Beijing, March 17, 2005 13. The cooperation agreement between Central Television of China and State Television and Radio Broadcasting Company CJSC of the AR. Beijing, March 17, 200532 The directions of cooperation between the states of Azerbaijan and China have been discussed in the meetings during the visit and it was determined that there were large prospects in this field. The words of Hu Jintao, the president of PRC testify the prospects of the relations: “China is always ready to keep high level relations with Azerbaijan, to expand the exchanges between governments, parliaments and parties in various levels, to form and improve the mechanisms of dialogue and consultations, to strengthen the mutual political confidence regularly”.33
32 “List of the documents signed between the PRC and AR”. The Ministry of Foreign Affairs of AR. Accessed February 25, 2012.
President Ilham Aliyev visited China the second time on August 7-14, 2008. This was business visit to China. The President of AR, Ilham Aliyev left for Beijing to attend the opening ceremony of the 29th Summer Olympic Games. He attended the opening ceremony of the Beijing Olympics. The Beijing Olympics have begun with a spectacular opening at the Bird’s Nest stadium packed with a large crowd of 90,000 persons. In the second day of his visit to China, he attended in the breakfast hosted by Chairman of PRC Hu Jintao for the heads of states and governments, who participated in the 2008 Beijing Summer Olympic Games. While he was in China, he gave an interview to “Top Talk” program of Chinese Central Television (CCTV) and to Chinese top newspaper “Jenmin Jibao”. Afterwards, President Ilham Aliyev visited the Beijing Olympic Village. The Azerbaijani leader was welcomed by the mayor of the Olympic Village, Chen Zhili who introduced the site to him. On the eve of Olympic Games, the ceremony of the “Day of Azerbaijan” held in Beijing. The president and his wife Mehriban Aliyeva attended the “Day of Azerbaijan” within the framework of the 29th Summer Olympic Games at the China World Hotel in Beijing. The president Ilham Aliyev watched Greco-Roman wrestling semifinals and finals at the Summer Olympics in Beijing and attended the ceremony of awarding Olympic judo medalists in the 73 kg weight category. His trip to China where he watched the Olympic Games` opening ceremony has ended on August 14, 2008.
Figure 3: Chinese President Hu Jintao (2nd R) and his wife Liu Yongqing (1st R) pose for photos with Azerbaijani President Ilham Aliyev (2nd L) and his wife before a welcoming luncheon in Beijing, China, Aug. 8, 2008
Source: www.chinaview.cn news agency 34
34 Hongjiang Wang. “Chinese President Hu Jintao hosts welcoming luncheon in honor of world dignitaries”. Xinhuanet News English. August 8, 2008. Accessed March 4, 2012.
2.4 Concluding Remarks
After the collapse of the Soviet Union, world powers rushed to increase their economic and political influence in the states that are successors of Soviet Union. The South Caucasus, with its rich natural resources and geo-strategic location in the heart of Eurasia, has become a hotbed for post-Cold War competition between Russia, the USA, Iran, and Turkey. While in the early 90s, China was not a significant regional player in the South Caucasus when compared to Russia and the USA, the rapidly growing Chinese economy has inevitably turned from the Asian neighbor into a significant emerging player worth noting in this region.35 For China, relations with South Caucasus countries have been especially important for the following reasons. 1. To limit the threats from or over the region against China. (In particular, attempts to the siege of China and China’s territorial integrity by the USA) 2. To use the relations with region as a bargaining tool in the relations with the third countries. 3. To get the new market and economic interest through becoming a global power. 4. To reach the energy sources in the region and provide diversity of resources for itself. After the establishment of the diplomatic relations, Heydar Aliyev’s visit to the PRC has been a great historic event. Because, there have never been relations in such level between Azerbaijan and China before this visit. It is true that there have been certain historic relations, “Great Silk Road” and etc. The creation of close relations between states is a great historic event. Indeed, President Aliyev’s visit opened a new chapter in Azerbaijani-Chinese relations. Trade between the two countries started flourishing and Chinese companies began to show interest in the Azerbaijani market. After the historical visit, President Ilham Aliyev paid visits to China in an effort to enhance bilateral relations, especially in the non-oil sectors. For the Azerbaijani side it was crucial to diversify the economy and develop non-oil areas such as textiles, machinery, and agriculture. The Chinese experience in these fields proved to be matchless. It is clear from the agreements between countries that there are good prospects to develop the bilateral cooperation not only in the political area, but also in the fields of economy and trade.
35 Ismailzade Fariz. “China’s Relations with Azerbaijan”. The China and Eurasia Forum Quarterly. Volume 5, No.1. 2007 P.29-34 Central Asia-Caucasus Institute & Silk Road Studies Program Publications. Accessed April 5, 2012
III. Political Dimension in Azerbaijan – China Relations
This section examines the political dimension in Azerbaijan-Chinese relations and in particular, in Armenia issue, the influence of rocket scandal to the relations and importance of conflicts in the relations. Besides, the multilateral cooperation between countries, historical importance of Silk Road and the perspective of TRACECA project has also been discussed.
3.1 Armenian Issue in Sino-Azeri Relations
After Heydar Aliyev’s visit to China, the visit of the former Chairman of National Assembly of AR Murtuz Alasgarov to the PRC, his presence in Shanghai city and his meetings with high level officials in Beijing and also in Shanghai has demonstrated that Azerbaijan is ready for future cooperation, and to develop and strengthen the relations with it. And the fact that, as stated above, it has been the first visit of Murtuz Alasgarov to abroad, has been visual proof of it. It seemed like China itself never stated that it is unsatisfied with Azerbaijan, its government and foreign policy for any time, it never objected to the position of Azerbaijan administration and the officials of China consider Azerbaijan as their friends. However, as stated above, China has never got friends or enemies in the history, it has only its concerns and China, for example, is principal in the issues of its concerns not in the issues of Nagorno-Karabakh. The visual proof of it is provided below. In spring of 1999, the PRC violating previously obtained agreements and commitments, violating the agreement signed by the Chinese Administration on friendship relations between the PRC and Azerbaijan and in fact supporting the Armenian separatism openly (it does not matter what the representatives of China in Baku say – in any case the best way of supporting the separator is giving it weapon) has given 8 “Typhoon” type rocket device, more probability they will be placed in Nagorno-Karabakh (where else they may be placed? Why Armenia needs weapon in your opinion?). As Vafa Guluzada, the former state counselor on foreign policy issues, stated in his interview to the “Turan” information agency, the agreement on delivery of “Typhoon” type rocket systems has been signed during the visit of Vazgen Sarkisyan, the Minister of Defense of Armenia to the PRC in 1998. Such fact is interesting that Vazgen Sarkisyan has been to PRC together with Igor Sergeyev, the Minister of Defense of Russia. As Vafa Guluzada considered, there are grounds to suppose that the Russia has played the role of mediator in this deal. The state counselor said that Chjan Guotsyan, the Ambassador of the PRC in Azerbaijan has been invited to the MFA of AR, he has been presented a note expressing anxiety about delivery of weapon to Armenia by China and
26
Azerbaijan side required official explanation from Beijing. But, the ambassador of the PRC stated that the government of China has not participated in delivery of weapons to Armenia, this has been done by one of Joint Ventures (JV) of Russia-China not controlled by China but cooperating with the Ministry of Defense of China.36 Moreover, the delivery of such weapons is dangerous especially for communication lines in Caucuses (mainly pipe lines). Previously Moscow created dangers for communication lines in Caucuses by arming Armenia. But now China is trying to execute this duty. Thus, Beijing wants to create obstacles to transportation of Caspian oil to the west. It is possible to aim the “Typhoons” to the areas of Azerbaijan that Baku-Supsa pipe line passes through and Baku-Jeyhan pipeline will pass through. The motives of Beijing are obvious – they want transportation of the main part of the Caspian oil through China. But, China should understand that our officials will come to serious conclusions from the situation. It should understand that if the PRC does not get back its rocket devices, Azerbaijan will review its policy in respect to China again. While touching the military points of the problem, it can be stated that through the “Typhoon” rocket devices, Armenia can make blows not only to oil pipe lines, but also border regions and cities of Azerbaijan. The issues of delivery of weapons were not kept out of attention of western countries. The ambassador of the USA in Azerbaijan, Stanley Escudero stated the followings: “Washington, touching the issues of delivery of weapons to Armenia by the Russia, declared several times that this does not help peaceful regulation of the situation in the region. If the information on delivery of the “Typhoons” is verified, we will also express our anxiety on this problem, because this makes obstacles to the process of peaceful regulation of situation in the region not depending on by whom the weapons were delivered.”37
3.2 Importance of Nagorno-Karabakh and Taiwan Conflicts in the Relations
Taiwan Issue: Taiwan, officially the Republic of China has been established in mainland China in 1912 and governed varying amounts of the mainland until 1949. At the end of World War II, Japan surrendered Taiwan and associated islands to ROC forces. When Communist forces took control of mainland China and founded the PRC (PRC) in 1949, the ROC government moved to Taiwan. Since the establishment of the PRC, international recognition of the ROC has gradually eroded as most countries switched recognition to the PRC. In 1971, the PRC assumed China's seat at the United Nations. Only 23 states now recognize the ROC as a sovereign state and maintain
36 Ahmadov Misir. The Strategy and Prospects of Azerbaijan-China Relations. Gorgud Press. Baku.1999. P.112 37 Ibid. P.117 27 formal diplomatic relations with it. Today the Chinese expression is usually used to refer to the PRC; the Republic of China is called Taiwan. Besides Taiwan, has become a member to the international organizations by the name Chinese Taipei. Although Taiwan exports most of the goods to PRC, independence and recognition efforts, requests to be UN member faced with veto and threats of the PRC. Settlement of the Taiwan issue and realization of the complete reunification of China embodies the fundamental interests of the Chinese nation. The Chinese government has worked persistently toward this goal in the past 50 years. From 1979, the Chinese government has striven for the peaceful reunification of China in the form of "one country, two systems" with the greatest sincerity and the utmost effort.38 The Azerbaijani government respects “One China” policy of the PRC and recognizes Taiwan as the integral part of China. The AR does not recognize the Taiwan state (China Republic) and has not any diplomatic or other relations with it. The AR acts only from the principle of One China in the issues that the “China Republic” (Taipei) set regarding membership for international organizations and recognizes only the organizations representing the PRC. Statement by the Foreign Ministry of AR Related to "Presidential Elections" held in Taiwan: “The AR adheres territorial integrity and unity of China, assesses the elections conducted in Taiwan as an inter-Chinese election and supports China's efforts for political resolution to the Taiwan question.”39 Nagorno-Karabakh Conflict and occupied lands of Azerbaijan by Armenia: The Conflict between the two countries in the South Caucasus started in the form of territorial claims of Armenia against Azerbaijan in 1988. In 1991-1994, Armenian army (supported by Russia) occupied the lands of Azerbaijan. At present, 20 % of the Azerbaijan territory - Nagorno-Karabakh Autonomous Region and adjoining 7 administrative regions are under the occupation of the Armenian armed forces. The ceasefire was signed between two countries on May, 1994 and the peace talks which started under the mediation of Russia, France and United States – the co chairs of Organization for Security and Cooperation in Europe (OSCE) Minsk Group still continue to be unsuccessful. The four resolutions (number 822, 853, 874, 884) adopted by the UN Security Council about the unconditional withdrawal of Armenian armed forces from the occupied territories of Azerbaijan have not been implemented by Armenia. During the war, great financial and moral damage undergone by Azerbaijan, 30 thousand people (most of them were innocent civilians) have
38“The One-China Principle and the Taiwan Issue”. Accessed March 7, 2012.
Table 1: The position of the PRC in the voting at the General Assembly of the UN on the amendment to the draft resolution on cooperation between UN and OSCE
1996 in favor 1997 in favor 1998 not present 1999 not present 2000 in favor 2001 in favor 2002 in favor
Source: The Ministry of Foreign Affairs of AR40
Note: China took a neutral position at the voting held in respect to the resolution on inclusion of the item “the situation in the occupied territories of Azerbaijan” to the agenda of General Assembly at the plenary session of the UN General Assembly on October 29, 2004. Note: China demonstrated its neutral position on inclusion of the item “Long-lasting conflicts within GUAM territory and their influence to the international peace, security and development” to the agenda of the 61st session of General Assembly, the UN on September 2006, though the negotiations carried out.
40 “The Position of the PRC in the Voting at the General Assembly of the UN on the Amendment to the Draft Resolution on Cooperation between UNO and OSCE”. Azerbaijan and China. The Ministry of Foreign Affairs of AR. Accessed March 15, 2012.
Note: China was neutral at the voting held on the resolution on “the situation in the Occupied Territories of Azerbaijan” at the 62nd plenary meeting of General Assembly, the UN held on March 14, 2008. The comment of Chinese side on the parliamentary election in Nagorno-Karabakh of Azerbaijan: “Parliamentary election was held in Nagorno-Karabakh of Azerbaijan. The Chinese Government respects the independence, sovereignty and territorial integrity of the AR. It does not recognize Nagorno-Karabakh as a sovereign state, nor the legitimacy of its parliamentary election. China supports the relevant resolutions of the UN Security Council on the conflicts in Nagorno-Karabakh of Azerbaijan. China is willing to make unremitting efforts, together with the international community, for a peaceful settlement of the conflicts in Nagorno-Karabakh.”41
3.3 Azerbaijan – Chinese Multilateral Cooperation
Multilateral cooperation between countries has very ancient history. It starts from the Silk Road and continues with TRACECA project. China and Azerbaijan plays an important role in these multilateral projects.
3.3.1 Historical Importance of the Silk Road
In ancient times, Silk Road started from Chinese territory and was stretching up to the West. They carry varnish, chinaware, brown ware and generally silk from China to Middle East and the basin of Mediterranean Sea. That’s why it was called “Silk Road”. Because Silk Road was not the only trade way, but also played the role of a road between the East and the West cultures, created possibilities for the exchange of the ancient Indian, Chinese, Arabian, Persian, Greece and Roman cultures. Silk Road that was originating from the ancient capital town Changan (now Sian) and stretching up to the Mediterranean Sea can be divided into three parts: the east part – from Changan to Gansu, the central part – Khez corridor and the west part – Xinjiang territory. Silk Road was for the first time paved 2000 years ago during the reign of the western Khan dynasty. In 138-119 B.C. a diplomat called Chyan Tsyan set out on a trip from Changan city to the western lands (present Xinjiang and Central Asia) with caravan loaded with gold and silk presents and established relations between small states located at the territory up to the Dayutchzhia in the
41 “Spokesperson on the parliamentary election in Nagorno-Karabakh of Azerbaijan”. The Ministry of Foreign Affairs of the PRC. November 15, 2000. Accessed March 2, 2012.
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3.3.2 Transport Corridor Europe-Caucasus-Asia – TRACECA
Why the Great Silk Road was restored after four centuries since it had lost its significance? The reason was the collapse of USSR in the last years of the 20th century and the end of the first years of the 21st century, military, economic and political confrontation between some countries separated from it, unions established between groups of states and problems arising out of these, the strategy and tactics of foreign countries against them (at the background of their interests). After the Russian Federation got a separate statehood, as it considered itself a successor of the former USSR, it maintained the idea to keep the new young states under its influence to rule them. For this purpose, the Commonwealth of Independent States (CIS) has been formed. As a result, RF established close relations with some states, for instant, Armenia, and alien relations with the others (such as Azerbaijan, Georgia, Ukraine, Moldova, etc.). This alienation resulted in the first serious military intervention and the economic tension. A number of countries, including Azerbaijan being a part of CIS were under the serious economic blockade. The AR living under the serious economic tension was looking for new rational solution to be relieved from economic oppression. The way out from the serious economic blockade was the idea of restoration of the Silk Road. The idea of Transport communications and commercial-economic prospects Project (TRACECA) was first proposed by the initiative of the European Commission in Brussels in May, 1993. According to this idea, the Great Silk Road should start from London, pass through Paris, Rome, Istanbul, Tbilisi, Baku, Ashkhabad, Tashkent, Almaty, Beijing and end in Tokyo. In the period of modern scientific and technical advance, the Great Silk Road is located in the central part of Europe and Asia and the fact of its passing the territories of more than 10 states and connecting them together from the economic, political and social points of view will be of an immeasurably great importance. The chairman of The State Customs Committee of the AR, Kamaladdin Heydarov noted: “More than 2/3 of the economic potential was concentrated in the countries-members of Transport communications and commercial-economic prospects Project (TRACECA); more than two billion people live in these countries (this means 1/3 part of the population of the globe); total area of these countries is 48,7 million sq. km, i.e. about 1/3 part of the total area of the globe”.42 The Great Silk Road directly facilitates the exit of Azerbaijan and Georgia from the economic blockade as well as the provision of economic development of a group of countries; as the territories of both countries (between the Black Sea and the Caspian Sea) are part of the Great Silk Way and this territory unites the relevant countries of Europe and Asia, their highways will
42 Heydarov Kamaladdin. Azerbaijan Customs on the Way of Steady Development. Ozan Press. Baku. 2005. P.37-38 32 conform to the international requirements, turn into a motor highway, the railway stations will be restored, airports will be constructed according to the international requirements; the Black Sea port of Georgia and the Caspian Sea port of Azerbaijan will be renewed and restored in accordance with the latest requirements and new ferries to carry cargoes will be built in the Black Sea and the Caspian Sea. Tourism will develop on a high level. In other words, new economic growth will start for Azerbaijan and Georgia. Baku city located on the Great Silk Road is turning into an official communication center (from the administrative point of view) in the solution of the problem. The International Conference dedicated to the restoration of the Great Silk Road became possible thanks to the constructive position of the national leader of the AR Heydar Aliyev and Eduard Shevardnadze, the ex-president of Georgia to this issue. It should also be pointed out that the fact that the conference was held in the capital of Azerbaijan and the decision on Baku to be the headquarter of a Standing Committee for the supervision over the development of Transport Corridor Europe-Caucasus-Asia is closely associated with the international reputation of Heydar Aliyev, an immortal president of Azerbaijan.43 In other words, the Great Silk Road will be new factor for the growth of the economy of Azerbaijan. Russia, being situated in the north of the Great Silk Road, will be one of the countries to participate in the performance of these ways. The restoration of the Great Silk Road will lead to the loss of economic and strategic significance of Baikal-Amur Railroad to a considerable extent the construction of which was launched by the Russian Federation (during the period of USSR). This is going to be an additional blow to the economy of Russia. The return of the Great Silk Road to the world for the second time will facilitate the interrelations and involvement in economic integration, the consolidation and growth in a new stage of cultural relations of the English, French, Spaniards, Italians, Greeks, Romans, Moldavians, Hungarians, Ukrainians, Turks, Azerbaijanis, Georgians, Turkmen, Uzbeks, Kirghiz, Kazakhs, Uigurs, Mongolians, Chinese, Koreans, Japanese and most of the other nations dwelt in Europe and Asia, the overall development of scientific and technical progress and the opening of vacancies.
43 Ibid. P 41 33
Figure 4: Transport Corridor Europe-Caucasus-Asia (TRACECA) routes
Source: TRACECA44 The international conference dedicated to the restoration of the Great Silk Road was held by the initiative of the national leader Heydar Aliyev in Baku on September 8-9, 1998. The representatives of 32 countries and 14 international organizations attended at the conference. This was an important event for the international reputation of Azerbaijan. The resulting document on the European and Asian Transport Corridor, TRACECA project was signed by nearly 30 states. The presidents of 9 states participated in the Silk Road conference held in Baku. The Great Silk Road will make Eurasian people forget the ideas of making wars or preparing to wars and provide nations with all-round support to allow them to live in peace. The location of communicational and organizational headquarter of the Silk Road in Baku is a very important historical event, as well. It is clear that Azerbaijan’s national leader Heydar Aliyev suggested proposal on establishment of a new silk way. It is interesting to know the opinions of Heydar Aliyev about concrete projects of cooperation between China and Azerbaijan in the field of restoration of Great Silk Road and its prospects. He stated: “In fact, the restoration of the Great Silk Road has been actual event for world community for recent years. I do not want to take responsibility to say that the initiator of this is Azerbaijan or any other country. The idea of restoration of the Great Silk Road has emerged in
44 “GIS Database and Maps Downloads”. Transport Corridor Europe-Caucasus-Asia (TRACECA). Accessed March 13, 2012.
3.4 Concluding Remarks
It is obvious that Beijing attempt to enter the political field in Transcaucasia as such: it deepens the instability of forces in Caucuses by delivering to Armenia the “Typhoon” type rockets; at the same time tries to weaken the democratic states that have chosen the line of building the Democracy model of the West and almost developed in this direction in the region as well as the countries (Azerbaijan and Georgia) supported by the USA. But, it does not mean that Azerbaijan has to take directly or indirect hostile measures towards China and its citizens (recognition of Taiwan, organization of mass demonstrations before the Embassy of the PRC and etc measures). China is a great state as before, even though it cannot make any direct harm to Azerbaijan in any case, its potential harms may be a lot. The “cooperation” way between Armenia and China is already open, but Azerbaijan can suspend this cooperation or
45 Azerbaijan-China: 10th Anniversary of Diplomatic Relations. Baku.2002 P. 78-79 46 Ibid. 47 Ibid. 35 make it less dangerous for it by directing the attention of the world community to this problem. Azerbaijan cannot make any military or economic influences to China, that’s why it should only find the political way of regulating this situation. Azerbaijan was committed to the “One China” policy and supported China's positions on major issues such as those relating to Taiwan, Tibet and Xinjiang. The two countries remained in good communication and coordination in the United Nations and other international organizations. China’s position on the conflict between Azerbaijan and Armenia over Nagorno-Karabakh was also clear. Beijing did not want to involve or assist any side; it maintained political neutrality and recognized the official policy of the UN. This implied that China followed recognition of Azerbaijan’s territorial integrity by the international community with Nagorno-Karabakh being under Azerbaijan’s jurisdiction. The Great Silk Road discussed above, namely TRACECA project has demonstrated the mutual cooperation between countries. Arming Armenia is not good for the future of this project. Because these rockets are direct danger for TRACECA routes as well. The only hope is that the PRC will not continue arming Armenia in future and the forces violated by the Russia will not disorder their balance. After all, the west, in response to this problem that is direct danger for transcontinental oil pipelines – the military assistance to Armenia, may take relevant measures and establish its military base in Azerbaijan or give analogous weapons to Azerbaijan, and this will make harm to concerns of China in the region in its turn and close the “door” of Azerbaijan to the face of China. The conclusion is that China, by arming Armenia, would make harm to its concerns by losing its potential geostrategic partner such as Azerbaijan and Georgia (as well as it would put the execution of the TRACECA project under blow that is profitable for the PRC).
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IV. Economic Bilateral Cooperation
The following section presents the economic bilateral cooperation between two countries in the field of energy issues and economic projects. It was observed how the economic relations contribute to strengthening of the relations between countries and the business interests of Azerbaijan in China.
4.1 Economic Relations between Two Countries and New Projects
The official visit of national leader Heydar Aliyev to PRC on March 7-10, 1994 supported the extension of economic relations between two countries and played a great role in development of economic relations. The President of AR, Mister Ilham Aliyev has made an official visit to PRC on March 17- 19, 2005. Within the visit, various bilateral documents as well as the treaties have been signed between the parties on main economic documents, commercial-economic cooperation, technical- economic cooperation, prevention of double taxation of incomes and prevention of evasion of taxes, mutual assistance in customs. Business Forum has been held in Beijing during the visit. More than 40 companies from Azerbaijan side and about 400 companies from China side have participated in the Forum. In order to establish new fields of production in the country in the result of the held meetings, 22 agreements have been signed between 15 companies of Azerbaijan and 21 companies of PRC for the purpose of extension of cooperation in the field of import of Chinese make equipments, tourism and commerce. The fields of cooperation between Azerbaijan and PRC are diversified and these relations rest on stable legal basis. More than 30 agreements, treaties and protocols have been signed with this country since 1994. The delegation led by Mister Fu Ziying, the deputy Minister of Commerce of PRC has been in visit to AR on May 26-28, 2010. Within the visit, Mister Fu Ziying has held meetings with Mister Shahin Mustafayev, the Minister of Economic Development and Mister Elchin Afandfiyev, the deputy Prime Minister of Azerbaijan. Within the visit, the Treaty, on provision of Grant to the Government of AR by the Government of PRC in the amount of 20 (twenty) million Chinese Yuan, has been signed. On May 31, 2010, the President of AR, Mister Ilham Aliyev has received Zhou Xiaochuan, the Chairman of the Central Bank of PRC.
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The delegation led by Mister Xe Gotsyanin, the Secretary of Central Commission of PRC on Discipline Inspection and the member of Standing Commission of Political Bureau of Central Committee of Communist Party of China (CCCPC) has visited to Azerbaijan on June 15, 2010. Within the visit, the Treaty, on provision of Grant to the Government of AR by the Government of PRC in the amount of 20 (twenty) million Chinese Yuan, has been signed. On July 18, 2011, the president, Mister Ilham Aliyev has received Mr. Zhong Shan, the deputy Minister of Commerce of PRC, the co-chair of commercial-economic cooperation commission between governments of Azerbaijan and China. Joint Commission: In order to extend the economic relations between Azerbaijan and PRC, to settle the problems in this field, the commission has been established between the Governments. The third meeting of the Commission has been held in Beijing on May 27, 2009. (The first meeting has been held after the Order on Establishment of the Commission). The Commission is led by Abid Sharifov, the deputy Prime Minister from Azerbaijan side. The fourth meeting of the Commission has been held in Baku on July 18 of the present year. Note: Commission was established as Working Group on Azerbaijan – China Commercial Economic Partnership in 2003. Its first meeting was held on February 19-21, 2003. It has acted as Intergovernmental Commission on Azerbaijan – China Commercial – Economic Partnership since 2009. The Working Group on commercial-economic cooperation between AR and Sinkiang- Uighur Autonomous Region of PRC: In accordance with the relevant items of the Memorandum of the third meeting of the Commission between the Governments of AR and PRC, the Working Group on commercial-economic cooperation between AR and Sinkiang-Uighur Autonomous Region of PRC has been established and the structure of it has been formed under supervision of Niyazi Safarov, the deputy minister of economic development. The group was created within the framework of the Azerbaijan-China Intergovernmental Commission for Trade and Economic Cooperation. Mister Hu Wei, the deputy chairman of People’s Government of Sinkiang-Uighur Autonomous Region, permanent member of Party Committee of Sinkiang-Uighur Autonomous Region of PRC has been on visit to Baku on July 11, 2011 in order to hold the first meeting of Working Group on commercial-economic cooperation between AR and Sinkiang-Uighur Autonomous Region of PRC. The first meeting of the Working Group has been held in Baku on July 11, 2011. As the result of the negotiations held between the delegates of both country during the meeting, relevant discussions has been held in the direction of extension of cooperation in the field of commerce,
38 banking, industry, communications, oil and gas, tourism, agriculture, transport, culture and health and the minutes has been signed on finals of the meeting. Within the visit, the delegate of China has met Abid Sharifov, the deputy Prime Minister. The co-chair of the Working Group from China side is Mr. Hu Wei, the deputy chair of People’s Government of Sinkiang-Uighur Autonomous Region, permanent member of Party Committee of Sinkiang-Uighur Autonomous Region of PRC. The co-chair of the Working Group from Azerbaijan side is Niyazi Safarov, the deputy Minister of Economic Development of AR. Azerbaijan-China business forum was held in the city of Urumqi as part of the first China- Eurasia Expo on September 3, 2011. The forum brought together 17 Azerbaijani and about 40 Chinese companies. Addressing the event, Deputy Prime Minister of Azerbaijan, co-chairman of the Azerbaijan-China intergovernmental commission on trade and economic cooperation, Abid Sharifov said his country was interested in expansion of cooperation with China in all spheres, particularly economic one. Sharifov underlined the importance of such forums, saying they would promote trade and mutual investment opportunities. Deputy Secretary of the Central Committee of the Communist Party of Xinjiang Uyghur Autonomous Region of the PRC, Siaokayti Imin stressed the importance of expansion of relations between the region and Azerbaijan. Vice-President of Azerbaijan Export & Investment Promotion Foundation (AZPROMO) Rufat Mammadov gave a briefing to the participants on the economy of Azerbaijan, favorable business and investment climate established in the country. Then an Agreement on cooperation between Chamber of Commerce & Industry of Azerbaijan and Federation of Industry & Commerce of Xinjiang Uyghur Autonomous Region of China has been signed. The signing ceremony was followed by bilateral meetings.48 During the visit, the Azerbaijani delegation led by Sharifov has met Nur Bekri, the Chairman of Sinkiang-Uighur Autonomous Region of China. Sharifov also met the Deputy Minister of Commerce of China, Zhong Shan to exchange views on prospects for development of economic cooperation between the two countries. The same day, the Azerbaijani delegation met Deputy Chairman of National Tourism Administration of China Zhu Shanzhong to discuss opportunities for bilateral cooperation in tourism sector. 49
48“Azerbaijan –China business forum held in Urumqi”. Azerbaijan State Telegraph Agency. September 3, 2009. Accessed March 11, 2012.
These agreements have been signed between the countries in economic sphere after 2005: 2008 1. The agreement on the cooperation in the technical-economical field between the Government of the AR and the Government of the PRC. Baku, February 25, 2008 2. The agreement on the cooperation in technical-economical field between the Government of the AR and the Government of the PRC. Baku, December 29, 2008 2009 1. The Memorandum on the working principles of the Intergovernmental Commission on Azerbaijan – China Commercial – Economic Partnership, Beijing, May 27, 2009 2010 1. The agreement on provision of Grant to the Government of AR by the Government of PRC in the amount of 20 (twenty) million Chinese Yuan, Baku, May 27, 2010 2. The agreement on the cooperation in technical-economical field between the Government of the AR and the Government of the PRC. Baku, June 16, 2010 2011 1. The Protocol of the Working Group on commercial-economic cooperation between AR and Sinkiang-Uighur Autonomous Region of PRC, Baku, July 11, 2011
According to the State Statistics Committee of AR, volume of foreign trade turnover between AR and PRC was accounted 667.26 million U.S.$, including volume of import 628.25 million U.S. $ and export 39.01 million U.S. $ for 2011. Foreign trade balance was accounted negative 589.24 million U.S. $ over this period. During 2011, the foreign trade turnover of the AR with PRC decreased 27.98 %, as wells export 88.49 %, but the import increased 6.91 % compared to 2010.
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Figure 5: The trade relations between the AR and PRC50
Source: The State Statistics Committee of AR51
The share of China in foreign trade turnover of Azerbaijan was 1,84 %, including 6,44 % for export and 0,15 % for import during the mentioned period.
4.2 Energy Issue in the Relations
Azerbaijan owns one of the largest oil and gas fields in the world. Country exports its oil and gas to Europe and other countries. In comparison to Azerbaijan, China is a country which has fast-growing energy markets and it imports energy from abroad. It means that Azerbaijan and China can cooperate in this sphere. Oil and gas are strategic assets in Azerbaijan's foreign policy and are used to play a crucial role in the promotion of its foreign policy goals at the regional and international level. A better understanding of Azerbaijan’s energy policy requires an overview of its foreign policy which is based on the concept of “balance”. What does this concept mean in Azerbaijan’s case? First, it
50 “The Trade Relations of AR with the PRC for 2011”. Ministry of Economic Development of AR. Accessed March 1, 2012.
52“Pirsahhat”. The State Oil Company of AR (SOCAR). Accessed March 16, 2012.
Absheron Peninsula, 12 km east of Baku. Since 1954, no exploratory operations have been conducted in the field that currently has approximately 5.6 million tons of oil reserves. In June 2004, SOCAR and Noble Sky, a joint venture founded by Chinese Shengli Oil and the United Arab Emirates' (UAE) Middle East companies, signed an agreement on developing the Garachukhur onshore oil field. The agreement envisioning production sharing, restoration and operation of the field was signed by SOCAR President, Natig Aliyev and Vice President of Shengli Oil, Ma Mingue. Natig Aliyev noted that 44 out of 121 wells in the Garachukhur field are active and that daily production totals 45 tons of oil. He said that SOCAR held a 25 % and Noble Sky a 75 % share in the contract, underlining that $ 220 million will be invested in the development operations.53 The agreement will remain in force for 25 years. However, its term may be extended for another five years by consent of the signatories. The gas to be produced from the Garachukhur field will be delivered to the state. One of the most talked news in 2009 is that Caspian gas, in particular, from Azerbaijan may turn 180 degrees around and flow to the east instead of west, toward China. The idea is to transport Azerbaijani gas to the Chinese pipeline that will run through Kazakhstan. This unexpected idea was originated in Kazakhstan. The initiator of the proposed idea was Kairgeldy Kabyldin, the president of the national oil and gas company KazMunaiGas (KMG). According to him that all Caspian resources – oil and gas - are currently west oriented. And if today some suggest that we connect through the Caspian Sea from east to west, why can’t we do it from west to east?54 The proposed idea will be implemented after the status of Caspian Sea is finally decided. "There are no parochial interests here, just for the purposes of diversification of supplies of gas producing countries," Kabyldin said. Kazakhstan may come forward with any proposal it likes, but the key is whether Azerbaijan will want to transport its gas to China rather than Europe - if the money is right. In response to the question how it could be technically possible to bring gas from Baku to Aktau by sea, he answered: "Nothing is impossible as long as there is a market and a good delivery infrastructure. Azerbaijan already has about 5,000 km of submerged gas pipelines in the Caspian Sea."55
53 “SOCAR and Noble Sky sign deal on Garachukur oil field”. June 24, 2004. Accessed March 16, 2012.
The analysts believe that Azerbaijan's decision will depend on 2 sides in this case: Kazakhstan and China. For Azerbaijan to be interested in supplying its gas to the east, China should provide commercial proposals, and Kazakhstan - transit tariffs.56 If taking into consideration that China is a fast-growing energy market and willing to pay top prices for oil and gas supplies, in this case it is quite possible that a price offer from the China may interest SOCAR, which is currently promising its gas to a different project, the EU-sponsored Nabucco. However, if we look through the actions around the Nabucco project, we can see that the European countries are rather talking about the project than taking concrete actions. Up to now there has never been any new action around this project as well. It means that Eastern countries can supply their oil and gas from other countries and if they need more energy resources in the future, maybe at this time these projects can be implemented. The State Oil Company of AR (SOCAR) and Chinese Zhen Rong signed a Memorandum of Understanding on the supply of Azerbaijani oil to China on December, 2010. The document was signed during the visit of SOCAR's delegation to China. The trade department of the State Oil Company of the AR, SOCAR Trading, plans to expand its black oil and naphtha trade in Asia next year, SOCAR Trading Vice President Arzu Azimov said earlier.57
4.3 Azeri Cooperation with Chinese Business Circles
One of the organizations having close relations with leading companies of the PRC is the National Confederation of Entrepreneur (Employers’) Organizations of AR. The economy of the PRC passed sound development stage within last 30 years. China is among the first five countries in the world for the volume of gross domestic product at present. In 2008, the gross domestic product of China was USD 4.3 billion increasing 9% in comparison with 2007. 8.3-8.5% increase of China economy was forecasted in 2009, as dramatic decrease was expected in the rate of growth of the economy of developed countries from economic point of view in respect to global financial crisis. Azerbaijan-Chinese commercial-economic relations developed after establishment of diplomatic relations between these countries in 1992. Trade turnover between these countries over past years developed increasingly. This development was faster last years. Thus, in 2008 trade turnover increased to USD 800 million and this was 3 times more in comparison with 2007.
56 Ibid. 57 “SOCAR signs several documents within expanding its activity in Southeast Asia”. Trend News. December13, 2010. Accessed March 14, 2012.
Azerbaijan-Chinese commercial relations are broad and multilateral. Commercial relations covered the import of the water, gas, power counters, construction and road equipment, computers, household appliances and electrical engineering, trucks, vehicles of special purposes, furniture etc. to Azerbaijan in 2007. In 2008, China rose to the 5th place for the import and to the 12th place for export, as it was the 7th country in the import in the foreign trade turnover of Azerbaijan and in the 34th place for export in 2007. It is worthy case that trade turnover from China to Azerbaijan increased 11.8%, from Azerbaijan to China increased 50 times (!!!). But nevertheless the positive inclinations of Azerbaijan-Chinese commercial-economic relations, current government does not highlight all potential opportunities of the parties and the following great perspectives exist in this field: - Joint production of construction materials; - Production of household appliances; - Production of furnishings; - Manufacture of furniture; - Development of tourism between two countries These five fields may be included to the perspective sectors for the development of Azerbaijan-Chinese commercial-economic relations involving China businessmen and investments. The AR is in the first place in the world for the rate of economic growth as the result of successful implementation of continuous economic growth conceptions by Mr. Ilham Aliyev, the president of the AR. To ensure the stability of this process, as well as to find new sales markets, to broaden cooperation with trade partners, especially in the non-oil sector is very important. The PRC may be considered an appropriate partner for such cooperation. National Confederation of Entrepreneurs (Employers’) Organizations of AR (AEC) is interested in the establishment of business relations of local businessmen with the PRC. AEC exhibits active policy for broadening and strengthening these relations. - AEC organized business meeting of local entrepreneurs and Chinese businessmen and helped businessmen of both countries to find partners in 2007; - The delegation of AEC participated at the International Conference on “Investment Environment in Central Asia and South Caucasus Regions” at Handjou, China on October 2007; - The delegation consisting of 15 local businessmen participated at the business forum held in Beijing, China on December 1-5, 2008. Cooperation Agreement was signed between National Confederation of Entrepreneurs (Employers’) Organizations of AR and Chinese- European Association for Technical and Economic Cooperation in the framework of the forum. The Agreement covered maintenance and establishment of mutual partnership 45
relations and development of such relations of Azerbaijani and China economy; organization and holding regular meetings, exchange of experience, educational events among businessmen represented their countries in order to develop entrepreneurship; presentation and organization of exhibition of products and services of the businessmen of both countries; participating jointly in the exhibitions and fairs; making joint efforts to represent the entrepreneurs of both countries in these exhibitions and fairs, establishment of joint ventures and etc; - The delegation consisting of AEC and local businessmen participated at the International Conference and Business Forum “Perspectives of Economic-Commercial Relations between China, Central Asia and South Caucasus” held in Vuhan city, Xubey region, China on December 8-12, 2008. Azerbaijani businessmen found business partners and signed some successful agreements in the course of this business forum. AEC established business relations with Industrialists and Merchants Association of China and protocol of intention for joint partnership has been signed. Signing of the protocol of intention will allow Azerbaijani businessmen to participate at different exhibitions, business forums, trainings organized in China; - Furthermore, AEC renders different consulting services to businessmen for dealing with business activity in China. It spreads business proposals from Embassy of Azerbaijan in China, Ministry of Foreign Affairs of the AR and Commercial-Economic Consulting Department of China in Azerbaijan among members. One of the structures cooperating with the companies of the PRC is “Elite” Group of Companies which, headed by Mr. Ali Evsen who gained authority in the business sector of Azerbaijan, engaged in business activity in the AR beginning from 1990, made vast investments to the country’s economy, creating new work places, organizing different charitable events. “Khazar” Joint-Stock Company and its president Mr. Gudrat Karimov, who has special activities in the formation of entrepreneurship environment in the Republic, carries out activities to establish cooperation with business circles of China. Some China companies hold several meetings at “Khazar” Joint-Stock Company. Mr. Gudrat Karimov, the president of “Khazar” Joint-Stock Company got acquainted with technology in some enterprises during his visit to the PRC and made concrete proposals that may help diversification of the industry.
4.4 Concluding Remarks
Multilateral business relations between Azerbaijan and China rest on sound legal bases today. Nearly 40 contracts, agreements and protocols have been signed with China since 1994. The 46 documents may indicate on incentive and protection of investments, cooperation in the scientific- technical field, air transportation and other documents covering other sectors of the economy. The issue on signing new transactions in the field of economy, tax, culture and other sectors is being reviewed at present. The total volume of investment made to the Azerbaijani economy by China investors is USD 300 million till today. The companies registered on account of Chinese investments in Azerbaijan act in the oil sector and in the field of food industry, telecommunication. Chinese oil companies participate in the processing of the oil field of Azerbaijan. Thus, two subsidiary companies of the state companies of China participate in the projects for processing of “Kursangi”, “Garabaghli”, “South-West Gobustan”, “Pirsaat” oil fields on land. One of the significant directions of this cooperation is bilateral commercial relations. Azerbaijan-China Interstate Commercial Economic Partnership Commission acts. The deputy prime minister that was appointed as the chairman for the Commission has been approved by the president of the AR. China companies, such as “Sin-pi-sin”, “Sinopek”, “Xuave”, Chinese electrical equipment production cooperation, “Szin-Szin” magnetic cards production cooperation cooperate with Azerbaijan. China supports Azerbaijan’s joining to the Worldwide Trade Organization. Overall trade turnover between the AR and PRC reached to USD 667.26 million in 2011, as it was USD 52.3 million in 2002. Export from Azerbaijan to China is USD 39.01 million. Trade turnover between two countries increased twelve times in comparison with 2002. Azerbaijan has to carry out significant activities to increase volume of export to China. Crude oil, polyethylene, parts of ground and tunnel drill vehicles has comprised the main part of the export from Azerbaijan to China lately. Industrial equipment, mechanical devices and their parts, electrical machines, and equipment, and other consumer goods are the main products imported from China to Azerbaijan. As mentioned above, economic practice of separate countries, including China surprising the entire world is very necessary for Azerbaijan. Today, one can confidently say that there is not any global development process missing in China. The most interesting point is that these processes develop not by fantastic speed characteristic for some countries, but by passing the evolution stage. For example, some countries try to join to global economy through liberalization of economy rapidly. China, which was delaying from economic point of view on the eve of reforms, achieved to determine the efficient method for realization of reforms without “shock therapy” and gained the outcome amazing the world.
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V. Future Prospects
China is the most active state that was interested in relations with Azerbaijan among the East Asian countries. Its interest in Azerbaijan and Caspian basin is natural. The main danger in national concept for development of China rapidly in the last ten years is lack of raw material and energy. This matter was estimated as most serious problem before the country in the congresses of the Communist Party of China. According to the calculations, beginning from 1993 China has been increasing its oil import rapidly and purchases about 100 million tons of oil in a year. It is worth to note that the real increase in the oil extraction in the Caspian Sea should coincide with this period. For the situation, Persian Gulf, that China has main energy sources in, becomes non stable, the Caspian basin may play the alternative energy source for Beijing. That’s why the list of the most attractive countries for China includes Azerbaijan in South Caucuses, together with Kazakhstan and Turkmenistan in Middle Asia. The Azeri-Chinese relations have developed in the increasing line in 1992-2012. Both countries, in most cases, take the same position in approaching to regional issues and international problems. About hundreds of Chinese companies perform in Azerbaijan, especially in the field of technology. The commercial turnover between two countries has arranged 667.26 million dollars in 2011. It is not accidental that Azerbaijan is considered the main economic and political partner of China in the South Caucuses. The cooperation between Beijing and Baku in the field of energetics, agriculture, transport, light industry and other fields enlarges rapidly. The Chinese companies have invested capital in the Azerbaijan economy more than 300 million dollars in last years. This country participates in oil and gas projects of Azerbaijan. Besides, it is interested in the field of machinery, agriculture for the last years. It is the result of the political relations between Azerbaijan and China that the Ex-President of AR, Heydar Aliyev has made one of his first official visits to this country on March of 1994. One of the countries that Ilham Aliyev has made his first visit to as the president is China. During the last visit, it was clear again that both countries take the same position in approach to the processes going on in the region and world. That’s why the support of official Beijing to Azerbaijan in the process of settlement of Nagorno-Karabakh conflict is of special importance. As known, China has declared several times that it supports the settlement of the conflict under the principles of border integrity and territorial integrity of Azerbaijan. In its turn, Azerbaijan also demonstrates analogous position in relation to Taiwan issue. If we take into account that China is one of the 5 members with veto right of the Security Council of the UN and it has wide influence possibilities to the
48 international issues, the coincidence of official positions of both countries in principal matters is very important for Azerbaijan. Today, China expresses special interest in several global projects in Caucasus, Caspian basin and Middle Asia. One of the main projects attracting the attention of this country is the East-West transport corridor realized within the framework of TRACECA project. The official Beijing is also interested in the project of construction of Akhalkhalaki (Georgia) – Kars (Turkey) railway and it agreed to participate in funding it. As this corridor will enable transportation of the products of China and Middle Asia to the Europe through short route and in a short period of time. China tries for realization of energy corridor named “Transkazakh oil and gas project” from Kazakhstan to its territory and for joining Azerbaijan to this project. Besides, the document was signed on construction of railway from Caspian Sea to China during the visit of the president of Kazakhstan, Nursultan Nazarbayev to Beijing. According to the forecasts, the railroad line in the length of 4 thousand km will cost 5 billion dollars. It will cross the territories of Kazakhstan, Iran and Turkmenistan. This railway will connect the west to China and Caspian basin. Washington worries about transport of Caspian oil to China and India through the “Asian route”. The rapid increase of needs for energy carrier in these countries turns them to the main competitor of the USA for Caspian oil. The approach of Russia to China’s becoming more active in the Caspian basin is uncertain. China becomes the strategic partner of Russia on one hand and turns to one of the main competitors in the zone that Moscow has geopolitical and economic interests in on the other hand. If we pay attention to the history of Chinese-Azeri relations, we can see that diplomatic relations between these two countries have been very intensive. The PRC has recognized the independence of AR on December 27, 1991 and diplomatic relations have been established between two countries on April 2, 1992. After that, on August of 1992, the PRC has opened its embassy in Azerbaijan, the first ambassador of it has been appointed on December 1, 1993. Azerbaijan has also not hidden its interest in China and Milli Mejlis (National Assembly) has adopted decision on opening the embassy of AR in PRC on September 3, 1993 and the embassy of Azerbaijan has began to perform in this country. More than 30 contracts, agreements and protocols have been signed with China since 1994. One of the most important factors influencing intensification of Azeri-Chinese relations may be considered the mutual visits of the officials of both countries and the agreements reached on the related matters during these visits. It is worth to note the official visit of the Ex-President of AR, Heydar Aliyev on March 7- 10, 1994 and the visit of the President, Ilham Aliyev on March 17-19, 2005 to China in the level of heads of state. Both visits have played important role in formation of friendship and partnership 49 relations between the countries and resulted in adoption of Chinese-Azeri joint declaration. The mutual visits between both countries in the level of government, parliament officials, ministers and other officials were rich. China does not hide that it expresses special interest in relations with AR that is the initiator and main participant of several regional and international projects implemented successfully and that became regional leading state in the region it situated in after getting independence. China knows the fields very well that Azerbaijan tries to develop the cooperation with this country in and tries to use this as ably as possible. China highly appreciates the policy of Azerbaijan on supporting it in Taiwan, Tibet and “Eastern Turkistan” issues. Though China, which closely participates in development of bilateral relations in many fields, does not hurry to participate in some regional projects, it follows all of them seriously. China, trying to demonstrate that it always implements balanced foreign policy, tries to comply with this policy in the region of South Caucuses. But, its special strategic partnership relations with the Russia do not enable China to implement balanced and neutral policy in the region that Azerbaijan is situated in. As an example, the event can be indicated that China sold 8 “Typhoon” type rocket complexes to the Republic of Armenia – which weakened the Azeri-Chinese relations on May of 1999. China approaches the efforts of Japan, which it considers its competitor, to develop the relations with Azerbaijan with jealousy and tries to fill the vacancy. The increase of needs of both countries the economies of which develop rapidly, as well as increase of the regional political and economic reputation of Azerbaijan through realization of construction of Baku-Tbilisi-Jeyhan main export oil pipeline plays a special role. The more important factor is the active cooperation that it conducted with other countries in fighting against extremism, terrorism and separatism – the three dark (bad) forces that are used frequently in foreign political terminology of China for last years. The friendship and cooperation prospects of China and Azerbaijan may be explained through several factors. The development prospects of relations between Azerbaijan developing rapidly together with having important positions from geopolitical point of view and China having decisive position in development of world economy are great and mutual relations are of a great importance for both parties. That’s why, continuation of mutual visits, dialogues and consultations in various levels in the direction of developing the cooperation and strengthening the relations between both countries in the above stated fields is necessary. The measures should be taken in respect to increase of commercial turnover between two countries, the experience of the PRC should be applied in development of infrastructure in Azerbaijan and the policy of attracting China to these projects should be forwarded. Moreover, the execution of the documents signed between two countries in last years should be ensured and the works of strengthening the agreement-law basis should be continued.
50
Conclusion After researching the relations between countries in different cases, it is decided that there are several problems which prevent countries to improve their relations closer. The problems from Azerbaijan side: The nationality of AR is the roots of Turkish nationality, although the Azerbaijan people are called Azerbaijani or Azeri, at the same time they are Turkish as well. Turkish factor played an important role in the relations too. It is clear that one of the biggest Turkish minorities lives in PRC and they are under the pressure of Chinese government. So, China always behaves cautiously in the relations. The close relations of AR with western countries. Azerbaijan is more interested in European market than Asia. Because Azerbaijan wants to be part of Europe and Europe needs its energy resources more than China. China has great energy suppliers like Kazakhstan, Turkmenistan, Russia and Iran. The problems from Chinese side: The current situation of Chinese-Armenian relations. Though PRC always states that it recognizes the territorial integrity of Azerbaijan, at the same time it develops military relations with Armenia that had occupied Azerbaijan lands and is in a war with Azerbaijan. Because China and Russia are big partners in Eurasia and it is clear that Armenia is under the control of Russia, China uses Armenia as its partner in South Caucasus region as well. According to the Armenian website “Erkramas”, China is in the first place among the countries which helped Armenia this year. According to the Ministry of Taxes of Armenia, two thousand tons of aid has been brought to Armenia within two months. The total cost of aid was 19.7 million $. This means 80 percent increase in comparison with last year. This was noted as well, China gave 250 buses to Armenia in two months.58 China expresses less interest to Caucasus region. As there are several conflicts in Caucasus region and most of these conflicts depend on Russia. Russia is considered one of the important partners of China in the world. If China comes to close relations with Azerbaijan, in this case China should lose its neutral position in approaching the solution of the problem. However, it remains unclear whether the Chinese leadership will continue to remain as a neutral observer in the Nagorno-Karabakh process, or whether the Chinese will shift their strategy towards a more active form of cooperation with one of the sides. Azerbaijan, with its active energy and transportation links to China and with its growing military budget seems as obvious choice for such a partnership.
58 “China helps Armenians much”. Polygon Analytic Information Agency. April 6, 2012. Accessed April 11, 2012.
Solutions to the problems in the relations: Both countries should increase the mutual visits. As for countries sign bilateral agreements which contribute to strengthening of the relations during the mutual visits, it is known from the history of relations that after the historical visit of Heydar Aliyev to China, the visits were frozen for a few years. The results of frozen visits let China deliver rockets to Armenia in 1999. Based on the above, my hypothesis is considered approved. Both countries should respect the joint declaration on the principles of development of friendship relations between two countries. During the visits of Azerbaijan presidents- Heydar Aliyev and Ilham Aliyev to China, in the first days of meetings there have been signed joint declaration on the principles of development of friendship relations between two countries. The Joint Declaration states that the future development of friendship relations and mutual useful cooperation between the countries meet the main concerns of the people of both states and serve to regional peace and security. For Example, in 1999 PRC broke the rules of joint declaration and delivered rockets to Armenia. Bilateral agreements, contracts and protocols between countries should be implemented. Almost nearly 40 contracts, agreements and protocols have been signed with China since 1994. But some of these agreements just remained on the paper. For example, within the visits, the Treaty, on provision of Grant to the Government of AR by the Government of PRC in the amount of 20 (twenty) million Chinese Yuan, has been signed. But still this treaty has not been implemented. To strength the implementation of TRACECA project. TRACECA project is considered multilateral cooperation between countries. This is a Silk Road between Asia and Europe. If Azerbaijan is situated in the middle of this way, China is in the beginning of it in the East. To find new and interesting projects which are attractive for the both countries. China has famous free economic zones and they have enough experience in this field. If we consider that Azerbaijan is new and rapidly developing country, it is necessary to learn the experience of China in free economic zones. Sumgait city in Azerbaijan has a good potential to be economic zone. It is assumed that this kind of cooperation may help countries to develop the relations. Eventually, the findings of this thesis are that political and economic relations between China and Azerbaijan are expected to grow on a bilateral level rather than within the framework of any regional organization, such as the Shanghai Cooperation Organization, as Azerbaijan has expressed its disinterest in membership due to the dominant role of Russia in this organization. As for China, it has not expressed any interest in joining the GUAM or the Black Sea Economic Cooperation organization, where Azerbaijan feels more comfortable. 52
Thus the research has proven that political and economic relations between countries develop year by year but still it is not satisfactory although both of the countries have high economic indicators and they are leader countries in their regions. The analysis show that relations between two countries depend on mutual visits, mutual interests and implementation of bilateral and multilateral agreements. It is expected that in the future AR and PRC will continue to maintain the exchange of high- level visits and conduct political dialogue and consultation to enhance bilateral political relations and strengthen cooperation in such fields as economy and trade, energy, agriculture, transportation, communication and infrastructure on the basis of equality, mutual benefit and common development. Azerbaijan government will encourage and support Chinese businesses to make more investment in Azerbaijan and will support companies of the two countries in expanding oil and gas cooperation and China government will welcome more Azerbaijan companies to be established in China. Both countries will also take flexible measures to facilitate various forms of cultural, educational, scientific and technological, sports and tourist exchanges as well as exchanges at the local level. It is expected that to increase friendly exchanges and deeper mutual understanding between the two peoples will further strengthen the foundation of China-Azerbaijan relations.
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List of References and Sources
1. Literature:
Books
1. Hasanov Ali. Current International Relations and Foreign Policy of Azerbaijan. Azerbaijan Press. Baku.2005 2. Samadzadeh Ziyad. China in Global World Economy. Elm & Tahsil Press. Baku.2009 3. Ahmadov Misir. The Strategy and Prospects of Azerbaijan-China Relations. Gorgud Press. Baku.1999 4. Hasanova Maryam. PRC. (Information book). Nurlan Press. Baku.2005 5. Hamidov Habil. The International Relations of Azerbaijan with Asian Countries. Gartal Press. Baku.2001 P.66-80 6. Samadzadeh Ziyad. China’s Economic Miracle. Ganclik Press. Baku.2001 7. Budagov Budag. The Great Silk (Caravan) Road. Nafta-Press. Baku 2006 8. Aslanli Araz and Hasanov Ilham. The Foreign Policy of Azerbaijan in the period of Heydar Aliyev. Barish Book Press. Ankara.2005 P. 245-254 9. Azerbaijan-China: 10th Anniversary of Diplomatic Relations. Baku.2002 10. Sayadov S. XX Century: Azerbaijan and World. Elm Press. Baku.2006 .P 92-118 11. Habibzada Elcan. Hello China. Azernashr Press. Baku.2007 12. Abdullayev Mahir. The History of International Relations. Tahsil ABU Press. Baku 2003 13. Heydarov Kamaladdin. Azerbaijan Customs on the Way of Steady Development. Ozan Press. Baku. 2005. P.35-47 14. Kenneth Waltz. Theory of International Politics. Mc Graw-Hill. 1979.
Articles in Scholarly Journals and Periodicals
15. Ismailzade Fariz. “China’s Relations with Azerbaijan”. The China and Eurasia Forum Quarterly. Volume 5, No.1. 2007 P.29-34 Central Asia-Caucasus Institute & Silk Road Studies Program Publications. Accessed April 5, 2012 < http://www.silkroadstudies.org/new/docs/CEF/Quarterly/February_2007/Ismailzade.pdf> 16. “The official visit of the president of AR Ilham Aliyev to PRC”. World of Diplomacy Journal. №10. January-March 2005. Baku. P 9-12. Journal of the Ministry of Foreign Affairs of the AR. Accessed March 28, 2012.
2. Sources:
Statistical Data
17. “The Position of the PRC in the Voting at the General Assembly of the UN on the Amendment to the Draft Resolution on Cooperation between UNO and OSCE”. Azerbaijan and China. The Ministry of Foreign Affairs of AR. Accessed March 15, 2012.
20. “External Economic Activities”. The State Statistical Committee of the AR. Accessed March1, 2012.
Electronic Media
21. “Chinese president vows to further political, economic ties with Azerbaijan”. People’s Daily Online. March 18, 2005. Accessed March 4, 2012.
Printed Media
27. “The President of Azerbaijan received the ambassador of China”. Azerbaijan Newspaper. January 12, 1995. P.3 28. “The delegation returned from China”. Azerbaijan Newspaper. July 4, 1996. P.2 29. Gayibov M. “Azerbaijan-PRC: a new phase of the cooperation”. Azerbaijan Newspaper. January 4, 1997. P.4 30. “Silk Road and Azerbaijan”. Azerbaijan Newspaper. April 7, 1998. P.6 31. Gotsfan C. and Abbasov R. “China was far from Azerbaijan the geographical point of view: Silk Road makes the distance close”. Xalg Newspaper. December 4, 1999. P.5 32. “The speech by the president of AR, Aliyev Heydar in the official reception in honor of the Chairman of the Standing Committee of the National People’s Congress, Li Peng”. Azerbaijan Newspaper. June25, 2000. P.4 33. “The meeting with the delegation of the PRC paid a visit to the country”. Azerbaijan Newspaper. June15, 2001. P.3 34. “Azerbaijan-China Friendship and Cooperation Society have been created”. Azerbaijan Newspaper. June 6, 2002. P.2 35. “The reception in the Embassy of PRC in AR about the establishment of the diplomatic relations between AR and PRC”. Azerbaijan Newspaper. April 3, 2002. P.1 36. “China appreciates friendship and cooperation relations with Azerbaijan”. Azerbaijan Newspaper. January 23, 2003. P.5 37. “The 3rd anniversary of the Azerbaijan-China Friendship and Cooperation Society was celebrated”. Azerbaijan Newspaper. July 7, 2004. P.3 38. “Azerbaijan-China relations are developing dynamically”. Azerbaijan Newspaper. April 13, 2005. P.3 39. Mehdiyev A. “The common interests combine Azerbaijan and China: The state visit of the president of AR, Ilham Aliyev to PRC gave an impetus to the expansion of the bilateral relations”. Azerbaijan Newspaper. March 25, 2005. P.1 55
40. “In honor of the national holiday of Chinese people”. Azerbaijan Newspaper. September 30, 2006. P. 4 41. “China is interested in the development of the relations with Azerbaijan”. Azerbaijan Newspaper. March 28, 2007. P.3 42. “China supports the resolution of the Nagorno-Karabakh conflict within the territorial integrity of AR”. Azerbaijan Newspaper. April 16, 2010. P.2
Data from Governmental and Quasi-Governmental Institutions
43. “China entered into diplomatic relations with independent former Soviet Republics”. The Ministry of Foreign Affairs of the PRC. November 17, 2000. Accessed March 1, 2012.
Other Sources
49. “Azerbaijan in International Scene”. Accessed March 5, 2012.
56
Appendices
57
Appendix 1
Figure 1: Political map of AR59
59 Political map of AR. Accessed April 20, 2012. < http://www.nationsonline.org/oneworld/map/azerbaijan-political-map.htm> 58
Appendix 2 Figure 2: Map of PRC60
60 Map of China. Accessed April 18, 2012
Appendix 3 Table 1: Main Economic Indicators of AR and PRC
Main Economic Indicators of AR and PRC
Indicators (2011) AR PRC
Population (in million persons) 9,1 1,33 billion
Territory (in thousand sq.km) 86,6 9597
GDP (in current prices, in billion USD) 63.4 6988
Real increase tempo of GDP ( in 0.1 9,5 percentage) GDP per a person 7003.4 5183 (in current prices, USD) Division of GDP per sectors:
Agriculture (in percentage) 5.5 9,6 Industry (in percentage) 62.2 (together with 47,1 construction) 32.3 (together with net 43,3 Services (in percentage) taxes) Inflation rate (in percentage) 7.9 5
Unemployment (in percentage) 5.4 6,5
Weight of general capital investment in 25.5 (correlation of GDP (in percentage) investment in main capital 48,4 to GDP) Budget
Income (in billion USD) 19.9 1,555 (trillion)
Expenses (in billion USD) 19.5 1,681 (trillion) Main industrial products Oil and oil products, Ferrous and non ferrous natural gas, valuable metals, fertilizer, metals and metal products, machines and construction materials, equipments, cement, cars, food stuff, alcoholic telecommunication drinks and soft drinks, equipments, chemistry fermented tobacco, products, electro cigarettes, cotton fiber, engineering, light
60
prepared cotton carpets, industry, consumer cotton yarn, carpet and products, toys, planes, carpet products, cloth ships, artificial satellites goods, leather shoes, chemistry industry goods, computer and other electronic products, machines and equipments, electric equipments, optical and electronic equipments, transport facilities, electric energy. Foreign state debts (in billion USD) 4.6 635.6
Currency and gold stock (in billion More than 40 3, 316 trillion USD) Poverty level (in percentage) 7.6 13,4
The indicators relating to the PRC have been taken from www.cia.gov61 web site, the GDP indicators and GDP per a person of this country have been taken from www.imf.org62 (6.04.2012)
63 Source: Ministry of Economic Development of AR
61 Central Intelligence Agency. Accessed April 6, 2012.
Appendix 4 General Overview of AR
AR is located in the South Caucasus region. It borders with Iran (765 km) and Turkey (15 km) on the south, Russia (390 km) on the north, Georgia (480 km) on the north-west, Armenia (1007 km) on the west and Caspian Sea on the east (955 km). The territory of the country is 86.000 sq. km. The population of AR is estimated at 9.111 million people. Azerbaijan is a secular and unitary republic; regained independence from the Soviet Union in 18 October 1991. The main legal document of the state is the Constitution of the AR, which was adopted at the referendum in 1995. The state government consists of three branches: Executive – President (head of the state), Prime Minister (head of the government), Council of Ministers (cabinet); Legislative – National Assembly (Parliament); Judicial – Supreme Court, Economic Court, Constitutional Court. The current President of the AR is Ilham Aliyev. The daily means of communication and official language of AR is Azerbaijani. The most widespread religion is Islam in the country. The currency of the country is Azerbaijani Manat (AZN). In terms of the administrative-territorial division, AR consists of 66 districts, 77 cities, and 1 autonomous republic. Besides the state government, there are local governments, which fulfill the governing functions on the local level. The system of the local government in Azerbaijan is represented in the form of municipalities. AR is a member of United Nations since 1992. On 1 January 2012, the country started a two-year term as a non-permanent member of the United Nations Security Council. Azerbaijan is an industrial and agricultural republic. Diversified economy of Azerbaijan is based on the use of the rich and varied mineral resources. In the so to say international division of labor, Azerbaijan is an area of oil production and refining, chemical and electrical engineering, petroleum engineering, ferrous and nonferrous metallurgy, construction materials, timber and food industries. In general, industry is an important part of the economy of the country. More than half of the gross national product of the republic is created by manufacturing, 70% of which concentrated on the Absheron Peninsula and consists of oil and petroleum industry, which is closely related to the development of other industries, primarily chemical, electrical, mechanical engineering, and ferrous metallurgy. However, nowadays petroleum and related
62 industries, which concentrate 50% of the industrial potential of the country and are the base for the economy are experiencing several difficulties in the production process due to the rupture of traditional technological linkages that used to exist in the former Soviet Union. At the same time they are the most promising with the growth in foreign investment aimed at developing new oil fields. The capital of the AR is Baku. Baku is located in the eastern part of the country, at the west coast of the Caspian Sea. The city is located in the region, rich in important natural resources, namely, oil and gas. Baku has been an important center for trade, economy and finance since the Middle Ages already as it was located on the Silk Way. Modern Baku is a large industrial complex with a developed extraction of oil and gas, petro-chemical, machine-engineering and metalworking industry, production of construction materials. Besides, Baku is the main administrative center; state governmental institutions are situated here. Azerbaijan protects and implements its national interests through participating in the regional initiatives and the aforementioned organizations.64
64 Azerbaijan and China. The Ministry of Foreign Affairs of AR. Accessed March 7, 2012.
Appendix 5 General Overview of PRC
Geographical location: It locates in Southeast Asia along the west coastline of the Pacific Ocean. It locates in the west of Pacific Ocean, in the east of Asia. Boxay, Yellow, North China and South China Seas wash its eaten and southeast borders. China is bordered by more than 10 countries: Mongolia and Russia from the north, Kazakhstan and Afghanistan from the west, India, Nepal, Bhutan, Burma, Thailand, Laos, Vietnam from the south-west, DPRK from east. Marine- side neighbors are Philippines and Japan. Area: 9,6 million sq.m. Population: 1, 339 billion (2010). National composition: 91.9% “Hans”, 56 nations live in the country. Administrative territorial distribution: 23 provinces (including Taiwan). 5 autonomous regions and four directly controlled municipalities (Beijing, Shanghai, Tianjin and Chongqing) Capital: Beijing Language: Putonghua Religions: 93% Buddhism, Daoism, Confucianism; 4.5% Christianity; 2.5% Islam National holiday: October 1 – Independence Day (1949) State structure: Republic. Executive body: State Council of the PRC Head of the state: Hu Jintao, chairman the PRC Head of the government: Wen Jiabao, chairman of the State Council of the PRC State Council of the PRC: Higher body of the executive power. People’s governments act in all levels of administrative territorial system. State Council and people’s governments are approved by the National People’s Congress of proper level. State Council reserves a right to accept normative acts. Legislative body: NPC is the higher body of the state power, implements legislative functions; takes decisions on significant areas of the country, appoints and elects candidates to the top posts of state machinery, elects NPC’s Standing Committee; elects the chairman and his/her deputies; approves the appointment of chairman of State Council and other members of the Council; elects the chairman of Central Military Commission (CMC) an approves other members of the CMC; elects the chairman of Higher People’s Court; elects the prosecutor-general of the Higher People’s Prosecutor’s Office. NCP is elected for five-year terms, and its sessions are convened once in a year. NCP’s functions are fulfilled by NCP’s Standing Committee during the term between sessions. The 64 chairman of the Standing Committee, National People’s Congress is Wu Bangguo. He was elected to this post in March 2003 and his appointment was approved in March 2008 again. Court authority: Higher People’s Court (Higher People’s Court reports to National People’s Congress and Chinese Communist Party. Higher People’s Court fulfills control function over local and special people’s courts including military courts.) Constitution: December 4, 1982 (as amended in 1993) Economic indicators: GDP (in current prices, billion USD) – 11.299 Real growth of GDP (in percent) – 9.5 GDP per head (in current prices, USD) – 8.382 Distribution of GDP according to the sectors (in percent): agriculture (in percent) – 9.6, industry (in percent) – 47.1, services (in percent) – 43.3 Inflation rate (in percent) – 5 Unemployment (in percent) – 6.5 Main agricultural products – rice, wheat, potato, peanut, tea, millet, barley, apple, cotton, pork, fish Main industrial products – cooper industry, iron, steel, aluminum, and other metal production, coal, engineering industry, guns, fabric and clothes, oil, cement, chemical products, fertile, consumer products, shoes, toys, electronics, food processing, transport facilities, automobile, trains, locomotives, ships and airplanes, telecommunication equipment, satellite. Total commodity circulation (billion $) – 3.236 Import (milliard USD) – 1.555 Export (billion USD) – 1.681 Main import products – machinery and equipment, oil and mineral fuel, plastics, computers, clothes, fabric, steel, mobile phones Main import countries – Japan, South Korea, Taiwan, the USA, Germany Main export products – cars, electrical products, computers, clothes, fabric, steel, mobile phones Main export countries – the USA, Hong Kong, Japan, South Korea, Germany Foreign Policy: The PRC is recognized by some leading countries in the beginning of 1970s and established diplomatic relations with Japan in 1972, the USA in 1978. As 156 countries has established diplomatic relations with China, but the number of countries having diplomatic relations with Taiwan is only 25.
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The PRC leaders visit different countries regularly. The PRC, the standing member of SC UN, endeavors active partnership in the context of international organizations. The PRC makes efforts to keep stability in the Korean Peninsula trying to decrease tension in the region. The PRC, cooperating with ASEAN countries is the member of ASEAN Regional Forum (ARF).65
65 Azerbaijan and China. The Ministry of Foreign Affairs of AR. Accessed March 7, 2012.
Appendix 6 List of the documents signed between the PRC and AR
1993 1. The memorandum on the good turnover (1993) between the Ministry of Foreign Economic Relations and Foreign Trade of the PRC and the Ministry of Foreign Economic Relations of the AR. Peking, March 13, 1993 2. The agreement on the sharing of the state credit for the exportation of the goods from the PRC to the AR between the Government of the PRC and the Government of the AR. Peking, March 13, 1993 1994 3. The agreement on the visa-free regime during the service visits between the Government of the PRC and the Government of the AR. Peking, January 4, 1994 4. The protocol on the conference between the Ministry of Foreign Affairs of the PRC and the Ministry of Foreign Affairs of the AR. Peking, January 4, 1994 5. The agreement on the visa-free visits of tourists groups between the Government of the PRC and the Government of the AR. Peking, January 4, 1994 6. The consulate convention between the Government of the PRC and the Government of the AR. Peking, January 4, 1994 7. The agreement on the cooperation in the field of tourism between the Government of the PRC and the Government of the AR. Peking, March 7, 1994 8. The agreement on the stimulation of the investment and mutual protection between the Government of the PRC and the Government of the AR. Peking, March 8, 1994 9. The agreement on the cultural cooperation between the Government of the PRC and the Government of the AR. Peking, March 7, 1994 10. The mutual declaration on the foundations of the friendship relations between the Government of the PRC and the Government of the AR. Peking, March 7, 1994 11. The protocol on the establishment of air connection between the Government of the PRC and the Government of the AR. Peking, March 7, 1994 12. The agreement on the cooperation in the field of health and medicine between the Government of the PRC and the Government of the AR. Peking, March 7, 1994 13. The protocol on the cinematography, radio and TV between the Government of the PRC and the Government of the AR. Peking, March 7, 1994 14. The agreement on the cooperation in the field of science and technology between the Government of the PRC and the Government of the AR. Peking, March 7, 1994 67
15. The agreement on the sharing of the state credit for the exportation of the goods from the PRC to the AR between the Government of the PRC and the Government of the AR. Peking, May 24, 1994 1996 16. The protocol on the exchange of ratification decrees of the consulate convention between the Government of the PRC and the Government of the AR. Baku. March 29, 1996 1998 17. The frame agreement on the submission of the deduction credit to the AR by the PRC between the Government of the PRC and the Government of the AR. Baku, June 18, 1998 1999 18. The agreement on the cooperation between the Supreme People’s public prosecutor's office of China and the public prosecutor's office of the AR. Peking. September 9, 1999 2004 19. The agreement on the cooperation between the Ministry of Public Security of the PRC and the Ministry of Internal Affairs of the AR. Peking. April 25, 2004 20. The agreement on the cooperation in technical-economical field between the Government of the PRC and the Government of the AR. Baku, October 23, 2004 2005 21. The mutual declaration between the Government of the PRC and the Government of the AR. Peking, March 17, 2005 22. The contract on delivering between the Government of the PRC and the Government of the AR. Peking, March 17, 2005 23. The agreement on the cooperation in the field of trade-economy between the Government of the PRC and the Government of the AR. Peking, March 17, 2005 24. The agreement on the mutual assistance in the field of custom matters between the Government of the PRC and the Government of the AR. Peking, March 17, 2005 25. The agreement on the prevention of the deviation from the tax levy and removal of the double tax impose on the incomes between the Government of the PRC and the Government of the AR. Peking, March 17, 2005 26. The agreement on the cooperation in technical-economical field between the Government of the PRC and the Government of the AR. Peking, March 17, 2005 27. The memorandum on the technical support of the Ministry of Foreign Affairs of the PRC to the Ministry of Foreign Affairs of the Republic of Azerbaijan. Peking, March 17, 2005
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28. The agreement on the cooperation between the Ministry of Justice of the PRC and the Ministry of Justice of the AR. Peking, March 17, 2005 29. The agreement on the cooperation in the field of affairs with Youth between the Federation of Common China Youth of China People`s Republic and the Ministry of Youth, Sport and Tourism of the AR. Peking, March 17, 2005 30. The understanding memorandum on the cooperation between the Ministry of Information Industry of China People`s Republic and the Ministry of Communication and Information Technologies of the AR. Peking, March 17, 2005 31. The protocol on the cooperation in the field of culture and artwork (2005-2009) between the Ministry of Culture of China People`s Republic and the Ministry of Culture of the AR. Peking, March 17, 2005 32. The agreement on the Technical and Sport cooperation between China Olympic Committee and National Olympic Committee of the AR. Peking, March 17, 2005 33. The cooperation agreement between China Central Television and State Television and Radio Programs Company CJSC of the AR. Peking, March 17, 2005 2008 34. The agreement on the cooperation in the technical-economical field between the Government of the AR and the Government of the PRC. Baku, February 25, 2008 35. The agreement on the cooperation in technical-economical field between the Government of the AR and the Government of the PRC. Baku, December 29, 2008 2009 36. The Memorandum on the working principles of the Intergovernmental Commission on Azerbaijan – China Commercial – Economic Partnership, Beijing, May 27, 2009 2010 37. The agreement on provision of Grant to the Government of AR by the Government of PRC in the amount of 20 (twenty) million Chinese Yuan, Baku, May 27, 2010 38. The agreement on the cooperation in technical-economical field between the Government of the AR and the Government of the PRC. Baku, June 16, 2010 2011 39. The Protocol of the Working Group on commercial-economic cooperation between AR and Sinkiang-Uighur Autonomous Region of PRC, Baku, July 11, 201166
66 “List of the documents signed between the PRC and AR”. The Ministry of Foreign Affairs of AR. Accessed February 25, 2012.
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