BAKU, Azerbaijan, March 19. The UK’s decision to leave the European Union in June 2016 has had major implications for the country’s approach to its foreign policy. As the UK, in theory at least, was to begin retaining some of the autonomy it believed to have lost to the European Union, its relationship with countries from different continents was bound to change. The Johnson government’s emphasis on a ‘Global Britain’, a policy that outlined the UK’s long-term vision for its international strategy, emphasized the importance of a foreign policy that expanded beyond the UK’s traditional allies. This included forging new economic and trade alliances, but also reviving historic partnerships with the likes of Canada, Australia, and New Zealand. However, the political instability which has characterised British politics in recent years, reflected by the frequent change in the Prime Ministerial position, cooled down the Conservative Party enthusiasm for this new approach and pointed to a more pragmatic way forward which prioritised Britain’s immediate interests. This was certainly influenced by events such as the Ukraine war but does encourage a broader consideration of whether the UK was serious about becoming a more participative actor in areas like international development and post-conflict humanitarian efforts. Most importantly, how does the UK’s relationship with Azerbaijan fit within this dynamic? Are recent actions truly indicative of a more ‘global’ UK that wants to establish a deep and persistent presence across the international system, of which Azerbaijan is an increasingly powerful part?
The relationship between Azerbaijan and the United Kingdom has historically been associated with cooperation in the oil industry. The same can be said for other European partners. The increasingly influential and participative nature of Azerbaijan’s foreign policy in confronting major global issues, including the fight against climate change and Islamophobia, is reflective of the country’s belief in multilateralism and the role of international institutions in promoting cooperation. Azerbaijan’s status as a reliable partner is not only restricted to its relationship with the UK, with several key gas deals signed in recent times between Azerbaijan and EU member states. This includes the July 2022 agreement to double the volume of gas exports from Azerbaijan to Europe by 2027, which turned out to be a starting point for further deals with countries like Bulgaria, Hungary, Romania, and Slovakia. This interconnectedness originated following the collapse of the Soviet Union. The UK’s British Petroleum (BP) was part of a group of leading oil companies that represented the first significant Western investment in a post-Soviet country. This served as an essential starting point for economic relations between the two countries, culminating in the UK’s current status as the largest foreign investor in Azerbaijan.
The Production Sharing Agreement (PSA) signed in 1994 was a ground-breaking deal between the State Oil Company of Azerbaijan Republic (SOCAR) and a consortium of 11 foreign companies that represented a total of six nations. The agreement was a key step taken by already independent Azerbaijan to open up its economy to foreign investment, enabling its oil industry to develop in a direction that allowed for much broader economic development in the country and also the neighbouring region. In 2017, the sides renewed and extended their commitment to 2050. BP is the biggest shareholder of the consortium (with a share of approximately 30%), officially formed in February 1995 after the ratification of the PSA by the Azerbaijani Parliament. In addition, BP’s active engagement in helping Azerbaijan transport oil and natural gas include the Shah-Deniz 2 project of which the company is the principal operator. This reinforces that in the UK’s strategic vision, Azerbaijan is considered a partner for the long-term with which there are ample opportunities to explore. In recent times, though, this relationship appears to have broadened and diversified. The sides are increasingly public about their willingness to work together and are making commitments that consider mutual interests. This calls for a closer assessment of the recent dynamic of the relationship.
The Azerbaijan-UK relationship is a highly institutionalized one, with numerous mechanisms in place that enhance strategic dialogue and facilitate cooperation on the most pressing issues concerning both sides. A fundamental pillar of this is the UK-Azerbaijan Joint Intergovernmental Commission, established in 2015 and which has since then had six sessions. The location of the commission alternates between Baku and London, with high profile government officials in attendance. The agendas for discussion tend to be allencompassing, highlighting the will of both sides to engage on as broad a range of topics as possible. In fact, the latest meeting noted that between 1995 and the first six months of 2023 alone, the UK invested 35 billion USD in Azerbaijan. Furthermore, the meeting resulted in the signing of an exclusive distribution agreement between Bridge Group Companies of Azerbaijan and UK’s Concrete Canvas Ltd.
Following the restoration of the country’s territorial integrity, the Azerbaijani government has pursued an intense rebuilding policy with the aim of creating adequate conditions ahead of the return of displaced Azerbaijanis that were victims of decades of Armenian aggression. Moreover, President Ilham Aliyev has repeatedly stated the importance of opening up the Karabakh region to foreign investors. This will not only assist with the restoration of the territories but also raise global awareness of the suffering endured by the native population of the restored territories. The UK, as expected given the comprehensive nature of the relationship between the countries, has been at the forefront of this. The UK has assisted the landmine clearance program, an essential and highly complex process given how challenging it has proven to engage with Armenia constructively on the matter. In fact, even those land mine maps that have been provided appear to be deliberately misleading. The 6th Session of the Joint Intergovernmental Commission between the United Kingdom and Azerbaijan, held in December 2023.
UK government has announced various packages of financial assistance, with one example being £500,000 provided in June 2022 to support the UNDP’s running of the process. Total funding is now estimated to be well-over £1 million, in addition to the £1 million provided as humanitarian assistance to the International Committee of the Red Cross (ICRC) in 2020. UK funding focuses specifically on ‘training and expert advice’, aiming to prevent the loss of civilian life as a result of land mine explosions. Given the profound damage to Azerbaijani territory as a consequence of Armenian occupation, something that is still being felt due to the widespread implantation of land mines, this support should prove crucial in eliminating what is an unprecedented threat to local populations. In fact, as per the UK government’s own conclusions, the Karabakh region can easily be considered as the most contaminated in the world when it comes to ‘unexploded ordnance’.
The UK’s efforts in this sphere are not restricted to financial assistance. Leading British companies, such as Anglo Asian Mining PLC, work closely with the British Embassy in Baku to create economic opportunities and generate growth in Azerbaijan. In fact, a fresh protocol was recently signed between Anglo Asian Mining and the Azerbaijani government to introduce fresh changes to operational methods and ensure all procedures are as up to date with international sustainability practices as possible. Once again, this illustrates the potential seen by those in the British business environment in Azerbaijan and the country’s prospects. President Ilham Aliyev, on numerous meetings with British officials, has highlighted and appreciated the leading role taken by UK companies in restoring the liberated territories.
In November 2023, the British Embassy in Baku organised a webinar focusing on investment opportunities in Azerbaijan. The rebuilding process was referred to as the “biggest commercial opportunity outside of oil and gas”, with mostly UK-based companies in attendance. A similar event focusing on architectural opportunities was also organised, with the liberated territories offering foreign investors an opportunity to expand their footprint to a South Caucasus region that possesses increasing geopolitical and economic importance. Among the attendees were representatives of Chapman Taylor, a British firm that has been involved in construction projects in Azerbaijan for many years. There are several further examples that can be mentioned, including the UK’s active de-mining efforts in the cities of Jabrayil, Fizuli and Agdam.
However, it is more important to emphasize the importance of evident political will as a facilitating factor for this cooperation. The UK has not ‘simply’ supported Azerbaijan financially and materially. Imperatively, it has been firm and clear in its rejection of baseless Armenian accusations of ethnic cleansing following the September military operation that helped Azerbaijan complete the restoration of its control over Karabakh. In regular parliamentary discussions, for example, Leo Docherty, the UK Minister for Europe, has emphasized this position. The UK recognizes the territorial integrity of both countries, prioritising the facilitation of constructive dialogue between both sides and doing this in a way that has a direct and long-lasting impact ‘on the ground’. This degree of conviction is absolutely essential, especially given the efforts of other European powers to jeopardize the peace process and damage Azerbaijan’s credibility.
Further examples stress the UK’s desire to engage with Azerbaijan on a broad range of issue areas. The upcoming COP29 to be held in November 2024 reflects Azerbaijan’s commitment to contributing towards the transition to a green economy, with the liberated territories declared as ‘green energy’ zones and an Action Plan introduced for 2022-2026. The UK government has offered to provide direct support, mainly through experience sharing given that COP26 was held in the city of Glasgow. The desire of the Azerbaijani government to institutionalize its green agenda is highly appreciated not only in the UK, with the rebuilding process viewed as a great opportunity to serve as an example of an oil-rich country working towards the common goal of tackling climate change.
Finally, given the increasingly unpredictable and diverse nature of threats facing the international community, the UK government has offered Azerbaijan assistance with modernizing its approach to cybersecurity. Russia’s actions in recent years and the rapid surge in the use of artificial intelligence necessitates an approach that ensures stability and resilience. The UK is considered to be a world leader in this regard, hence its willingness to assist countries like Azerbaijan that are developing rapidly. This has been mentioned consistently at high-profile meetings between officials.
There are numerous other instances that reflect UK-Azerbaijani cooperation. Nevertheless, the key takeaway should focus on just how apparent the UK’s desire to operate in and with Azerbaijan is. Given recent unjustifiably hostile rhetoric towards the country from institutions such as the European Parliament and individual leaders such as French President Emmanuel Macron, it is reassuring that Azerbaijan has a partner in the ‘Western’ world that it can work with to modernize itself and crucially, restore its devastated territories. The UK government, unlike other leading European states, has been supportive of the country by refusing to endorse Armenian propaganda that seeks to disinform the international community by disregarding Azerbaijan’s territorial integrity.
As Azerbaijan continues to develop and further solidifies its involvement on the international arena, the UK is likely to engage even more. The cross-disciplinary nature of this relationship suggests that these are not done merely for the sake of securing ‘political wins’ in the region in the midst of domestic uncertainty. The UK sees potential in working with Azerbaijan, and most importantly, sees it as a country that should benefit from its policy of becoming more Global. Even though the Sunak government appears to have scaled back its language on Global Britain, there is no reason to believe the UK will not continue to deepen its engagement with the ‘rest of the world’. This is likely to continue benefiting the bilateral relationship, something the Azerbaijani side would definitely welcome given the complexity of ‘undoing’ the damage inflicted on its sovereign territory.
Author: Huseyn Sultanli
Analyst - Political Risk, International Law, Conflictology, European Affairs and Azerbaijani foreign policy
MSc International Relations Graduate, LSE
London, United Kingdom