SECOND CASPIAN SUMMIT IN TEHRAN YIELDS LITTLE

C O N F I D E N T I A L SECTION 01 OF 02 BAKU 001263

SIPDIS

SIPDIS

E.O. 12958: DECL: 10/17/2017
TAGS: PGOV PREL PBTS ENRG IR AJ
SUBJECT: SECOND CASPIAN SUMMIT IN TEHRAN YIELDS LITTLE

REF: BAKU 1072

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Classified By: DCM Donald Lu for reasons 1.4 (b) and (d).


1. (C) Summary: Azerbaijani Deputy Foreign Minister (DFM)
Araz Azimov downplayed the importance of the October 16
Tehran summit, indicating that the Government of Azerbaijan
(GOAJ) doubted any significant progress would be reached on
Caspian delimitation. Russian President Putin's public
statements during the summit that all five littoral states
would have to agree upon any possible trans-Caspian pipeline
and that no Caspian nation should offer its territory to a
third country for use against another littoral country made
for big headlines in Azerbaijan. Most local analysts believe
these statements and the 25-point declaration reflected a
triumph of Russian and Iranian interests. While leaders
agreed to meet again in Baku in October 2008, and with
Iranian media outlets (to include Azeri-language Sahar
Television) hailing the summit as "a turning point for
defining the legal status of the Caspian Sea," the Caspian's
legal status remains unresolved. Azerbaijani officials,
including DFM Azimov, repeated Azerbaijan's long-standing
policy that it will continue to develop its Caspian energy
resources without a five-way demarcation agreement. End
Summary.

Azerbaijani Expectations for the Summit
--------------


2. (C) Meeting in Tehran on October 16, the heads of state
of all five Caspian littoral states discussed a range of
issues to include the legal status of the Caspian, regional
security and energy issues, and Iran's nuclear program.
While expectations going into the summit were reportedly low
on the Azerbaijani side (Ahmadinejad inviting Aliyev to
the summit during his August 2007 visit to Baku - reftel),
most Azerbaijani political commentators believe Aliyev felt
compelled to attend the summit because the other heads of
state had already agreed to attend.


3. (C) Discussing his prognosis for the summit with a
visiting U.S. military delegation on October 16, DFM Araz
Azimov said that the summit would have little practical
result, and that Azerbaijan did not expect a breakthrough
on outstanding demarcation issues with Iran and Turkmenistan.
According to Azimov, the summit would provide an
opportunity for other heads of state to see Ahmadinejad
"close up" to see how serious he is about the Caspian
demarcation issue. Azimov said that Iran's position on
demarcation remains unchanged and inflexible, and that there
is no reason to believe than any deal could be made in the
foreseeable future. The Iranian stance that the Caspian
should be divided equally (each state receiving 20 percent)
would mean that the Iranian maritime border would extend to
Baku, something unacceptable to the GOAJ. Speaking generally
about the possibility of a demarcation agreement with
Turkmenistan, Azimov said that this would be "much more
possible," as the political conditions seem to be such that
a deal could be made. Azimov repeated Azerbaijan's
long-standing policy that an agreement on demarcation with
Iran and Turkmenistan was not necessarily that important as
Azerbaijan would continue to develop its Caspian energy
resources without a broader, five-way agreement. Azimov
noted, however, that the disputed gas field with Turkmenistan
remained idle.

Photo Ops and a 25-Point Declaration
--------------


4. (SBU) Leaders signed a 25-point declaration, the most
notable points including calls for the establishment of a
north-south transport corridor, a pledge that littoral states
would not allow other states to use their territories to
attack another littoral state, and pledges reaffirming the
right of Non Proliferation Treaty (NPT) members to pursue
peaceful nuclear energy programs. Beyond his strong showing
of solidarity with Iranian President Ahmadinejad, Russian
President Putin made international headlines by saying that
all five littoral states would have to agree upon any
possible trans-Caspian pipeline, that no Caspian nation
should offer its territory to a third country for use against
another littoral country, and that all aspects related to the
Caspian should be solved exclusively by the littoral states.
Azerbaijani President Aliyev's public statements were more
guarded, with Aliyev saying during the joint news conference
that the presidents of the five Caspian littoral states
expected serious results from the summit. Saying "I hope

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that the declaration signed in Tehran will be an important
step towards transforming the Caspian into a sea of
friendship and cooperation" and that discussions of security
in the Caspian Sea "inspired optimism," Aliyev's statements
were more in line with those of the Turkmen and Kazakh heads
of state.


5. (SBU) Iranian media coverage of the summit was
unsurprisingly positive and broad-based, newspapers from
across the Iranian political spectrum characterizing the
summit in terms such as a "turning point for the Caspian."
Azeri-language Sahar Television's coverage closely mirrored
this, characterizing the summit as "a turning point for
defining the legal status of the Caspian Sea." Appearing on
Sahar's live "Kompas" program, Iranian Ambassador to
Azerbaijan Hamidi-Zare played up familiar themes such as the
Caspian Sea being one of peace and prosperity and that
no littoral state should allow forces of another to use its
territory in order to launch an attack on another littoral
state.

Azerbaijani Reaction to the Summit
--------------


6. (C) While local political analysts and the media are
still digesting the substance of the visit, most discussion
has centered on two issues - the still unresolved status of
the Caspian and the notion that the summit only served
Russian and Iranian interests. Most local political
analysts, to include Rasim Musabayev, believe that Iran
continues to be the main obstacle to any agreement on the
legal status of the Caspian. Musabayev also believes that
the Tehran
declaration expressed primarily Iranian and Russian
interests, a point echoed in local media and diaspora
circles. One point in the 25-article declaration in
particular, pertaining to the threat that "international
terrorism, aggressive separatism, illegal trafficking of
drugs, arms and other illegal actions," has generated
considerable discussion on diaspora websites. For Azeri and
other ethnic diaspora groups, any provision characterizing
"aggressive separatism" as a threat can only be interpreted
as an Iranian and Russian attempt to squash the legitimate
grievances of ethnic minority groups. Concerning President
Putin's strong show of solidarity with President Ahmadinejad,
Vafa Quluzada believes that this can only be interpreted as
the Moscow government openly showing its support for Iran.

Comment
--------------


7. (C) From the Azerbaijani perspective, the summit met
local expectations, not yielding anything of substance.
Locals were also relieved that there were no apparent snubs,
such as when the Iranians displayed the Azerbaijani flag
upside down during President Aliyev's 2005 visit to Tehran.
Russian President Putin's attendance at the Second Caspian
Summit and his strong show of solidarity is viewed by many
Azerbaijanis as an important diplomatic coup for Iran. The
Iranians clearly see this the same way, having exploited this
opportunity in the media both at home and abroad.


8. (C) Concerning the summit's 25-article declaration,
little if anything could be characterized as new, to include
the highly publicized pledge that littoral states not allow
outsiders to use their territory to attack another littoral
states. All leaders, to include President Aliyev, have been
publicly clear on this point for quite some time. We are
interested in working with our GOAJ interlocutors to seek
clarification on two points made during President
Ahmadinejad's press conference statements. The first,
dealing with Ahmadinejad's assertion that the leaders agreed
to form a "Caspian Economic Cooperation Organization," to be
chaired by President Putin and held in the summer of 2008, is
of interest because any expansion of north-south energy,
economic, or transportation cooperation could be
counterproductive to U.S. interests in the region. Second,
we will seek clarification about Ahmadinejad's statement
referring to a draft "Caspian security arrangement," which,
according to Ahmadinejad, "Azerbaijani President Aliyev will
undertake management of the project." We will report the
results of our efforts on these issues septel.
DERSE