Brenda Shaffer Policy Recommendations

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Brenda Shaffer Policy Recommendations U.S. POLICY TOWARD THE CASPIAN REGION: RECOMMENDATIONS BRENDA SHAFFER U.S. Policy toward the Caspian Region: Recommendations for the Bush Administration Brenda Shaffer Dr. Brenda Shaffer is Research Director of the Caspian Studies Program at Harvard University’s John F. Kennedy School of Government. * * * EXECUTIVE SUMMARY THE CASPIAN REGION: ADVANCEMENT OF U.S. NATIONAL As the Bush Administration assesses how to INTERESTS best promote U.S. national interests through its policies toward the Caspian region, it could A number of U.S. national interests can be benefit from considering the following policy advanced through the successful articulation proposals and guidelines and taking note of a of policies in the Caspian region, which is few lessons derived from the results of the understood to encompass the Caspian littoral previous Administration’s policies.1 The states (Russia, Iran, Azerbaijan, Kazakhstan, resources of the Caspian region can make an and Turkmenistan) as well as neighboring important contribution to United States energy states that belong to the security and energy security. However, the importance of the transport picture of the sea basin (Georgia, region extends beyond energy; extensive ties Armenia, Turkey, and Uzbekistan). These with the states of the Caspian region can interests are: contribute to improvement of Washington’s relations with the Muslim world and 1. Viability and stability of global energy encourage U.S.-oriented regimes and open supplies and diversification of supply societies. In order to better advance these from areas other than the Persian Gulf. aims, the U.S., first and foremost, needs to As President Bush has noted: “Diversity conduct a comprehensive and coherent policy. is important, not only for energy security but also for national security.”2 Caspian The U.S. should continue to promote the discoveries are at least equal to and may peaceful resolution of the conflicts in the prove larger than those in the North Sea. region (in this area, the Bush Administration The Caspian’s resources are located in should be commended for its efforts to help countries possessing predominately pro- resolve the Nagorno-Karabagh conflict). The Western orientations that are not currently U.S. should continue to conduct a policy that members of OPEC. The addition of is cooperative with Russia and not allow the Caspian oil could weaken the OPEC area to become a zone for U.S.-Russian monopoly, providing greater leverage over rivalry. At the same time, the U.S. should be the pricing policies of Saudi Arabia and firm in its commitment to uphold the other OPEC countries, ultimately independence of the states of the Caspian contributing to lower world oil prices. region and resist potential Russian attempts to compromise that independence. 2. Promotion of the well being of Turkey, an important U.S. ally, now in the midst of a financial crisis. Ankara is trying to 1 The opinions in this brief are those of the author alone. She would like to acknowledge the extensive contributions of Emily Van Buskirk and Melissa Carr, 2Remarks of President George Bush to the Capital City as well as thank Graham Allison, Fiona Hill, Peter Partnership, St. Paul, Minnesota, May 17, 2001, Rutland and C. Maury Devine for their important http://www.whitehouse.gov/news/releases/2001/05/2001 comments, and Seth Jaffe for editorial assistance. 0517-2.html. JULY 2001 1 U.S. POLICY TOWARD THE CASPIAN REGION: RECOMMENDATIONS BRENDA SHAFFER build influence in and derive economic prosperous states with pro-American benefit from cooperation with the Caspian orientations would only serve to enhance region, especially in the energy sphere. U.S. security, removing potential future Turkey’s economy can profit from the trouble spots that could embroil us. transit of Caspian oil and gas through its territory, and from access to this energy HOW TO PROMOTE U.S. NATIONAL source. INTERESTS IN THE CASPIAN REGION 3. Improved relations with the Muslim The Clinton Administration recognized the world. The United States has problematic importance of the Caspian region in the relations with a large portion of states in promotion of America’s national interests and the Muslim world. With the Soviet demise, developed certain key policies targeted at a tremendous opportunity was created for advancing those interests. However, its the U.S.: the establishment of six new policies often compromised the goals they set states whose majority population is out to achieve. For instance, the previous Muslim, most of whom strive for close administration declared its support for the association with the West and increased designation of Baku-Tbilisi-Ceyhan as the cooperation with the U.S. Through strong “Main Export Pipeline” (MEP) for Caspian relations with the Muslim states in the oil, primarily as a means of reinforcing the Caucasus and Central Asia, the U.S. can independence of the states of the region. decisively signal that it is not interested in Unfortunately, maneuvers around the pipeline a conflict with the Muslim world as a and Russian-U.S. rivalry over energy politics whole. Moreover, through strengthening complicated conflict resolution efforts in the the independence of these Muslim states— Caucasus, destabilizing the region and many of which have made progress toward actually endangering the independence of democratization and have a clear certain Caspian states. Moreover, Washington separation between religion and state—the failed to invest sufficient resources in solving U.S. might encourage these trends in the regional conflicts and in developing methods broader Muslim world. to limit Russia’s opposition to the proposed pipeline. Essentially, the manner in which 4. Promotion of U.S. economic interests. Washington implemented its policies was at American companies and U.S.-based times at odds with the goals that Baku-Tbilisi- multi-national companies have invested Ceyhan was originally meant to promote. significant funds in the Caspian region, especially in the development of energy In many instances, Washington failed to resources. Good political relations with the coordinate its disparate policies and states of the region provide important consequently sent mixed signals. For support for American investments and example, the Clinton Administration publicly encourage the growth of these investments. declared the importance it attached to U.S. legislation establishing the relations with the states of the region, transparency and legality of U.S. especially Azerbaijan. Yet, in the sphere of companies’ actions abroad serves as a concrete actions, the previous administration good example for local states and also did little to waive or combat the sanctions helps to promote these practices. imposed by Congress on Azerbaijan in the form of Section 907. Baku is clearly 5. Promotion of the independence of the orientated toward the U.S. and vigorously states in the Caucasus and Central Asia; promotes U.S. policies in the region; but at their successful democratization; and the same time, the country suffers under U.S. general peace, stability and prosperity sanctions, a fact not lost on the Azerbaijani in the region. The emergence of a group people at a grassroots level. Such of independent, democratic, and contradictions create confusion and JULY 2001 2 U.S. POLICY TOWARD THE CASPIAN REGION: RECOMMENDATIONS BRENDA SHAFFER disappointment for the Caspian states, to bolster the political independence of especially since there is little popular Caspian states. The U.S. government must understanding of the dynamics of the U.S. continue to appreciate the fact that BTC is foreign policy process, the role of Congress, not solely a private economic project; there and the influence of U.S. domestic are geopolitical stakes involved as well. constituencies. Credible commitments are crucial in this region, as they are 2. Promote the establishment of everywhere. It would be better to create no arrangements and infrastructures for the expectations for U.S. involvement than to creation of regional gas supplies in the disappoint local governments and their South Caucasus . Significant new gas peoples. supplies have recently been discovered in the Caspian region, especially in Azerbaijan. RECOMMENDATIONS: With Azerbaijan’s agreement, the U.S. should promote the construction and 1. Increase diplomatic efforts and revitalization of pipelines for the utilization encourage financial investment to of some Caspian gas resources to supply the promote the flow of Caspian energy states in the South Caucasus, potentially as resources along an East-West corridor part of a Nagorno-Karabagh settlement (Baku-Tbilisi-Ceyhan). In order for package. The U.S. should also encourage the Caspian oil to make an effective World Bank to devote resources to this contribution to diversification of energy project and to facilitate investment from sources, it must flow to world markets via other states. Use of local gas supplies can multiple routes, including an east-west enhance regional security and stability by pipeline. The Baku-Tbilisi-Ceyhan pipeline lessening the region’s dependence on Iran will ensure that a large portion of Caspian and Russia for electricity and heating, oil flows through non-OPEC countries and eliminating a source of vulnerability to countries that do not have competing political dictates. interests (Russia and Iran both have extensive oil and gas supplies). As President 3. Attempt to communicate clearly with Bush pointed out, “Over dependence on any Russia about U.S. policies in the region, one source of energy, especially a foreign explaining the target of certain measures source, leaves us vulnerable to price shocks, (such as Iran), and clarifying that the supply interruptions, and, in the worse case, exclusion of Russia is not the objective of blackmail.” President Bush’s task force on American policies. The U.S. is capable of energy security, led by Vice President crafting a comprehensive policy that keeps Cheney, recommended that the U.S. step up the Caspian region from becoming a zone of efforts to develop export routes; it also U.S.-Russian rivalry, decreasing tension in specifically called on the President to direct the region.
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