PRESIDENT ALIYEV DISCUSSES AZERBAIJAN'S RELATIONS

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SIPDIS

SIPDIS

E.O. 12958: DECL: 04/09/2017
TAGS: PREL PGOV PHUM KDEM ENRG EPET RS KZ AJ
SUBJECT: PRESIDENT ALIYEV DISCUSSES AZERBAIJAN'S RELATIONS
WITH THE U.S., RUSSIA AND KAZAKHSTAN WITH USOSCE AMBASSADOR
FINLEY


Classified By: AMBASSADOR ANNE E. DERSE PER 1.4(B,D)


1. (C) SUMMARY: In a March 29 meeting with visiting USOSCE
Ambassador Julie Finley, President Aliyev praised Foreign
Minister Mammadyarov's recent trip to Washington, and said
that the signing of the energy MOU signified a "new stage"
in the bilateral relationship. He expressed satisfaction with
GOAJ-OSCE cooperation to date, and said he saw opportunities
for further work together. Clearly proud of his decision not
to buy gas from Russia, Aliyev said that Azerbaijan bases
its relationship with Russia on Azerbaijan's own national
interest; Aliyev added that his recent trip to Moscow was
intended to clarify his relationship with Russian President
Vladimir Putin who, in Aliyev's words, is preoccupied with
energy. He outlined Azerbaijan's top domestic priorities -
poverty reduction and education - and stated that
Euro-Atlantic integration will remain the top foreign policy
priority. Aliyev touched upon Azerbaijan's relationship with
Kazakhstan, highlighting a potential agreement on a gas
pipeline. He concluded that Azerbaijan would support
Kazakhstan's bid for OSCE chairmanship. END SUMMARY

ENERGY COOPERATION IS NEW PHASE IN BILATERAL RELATIONSHIP
WITH U.S.
--------------


2. (C) President Aliyev opened his March 29 meeting with
Ambassador Finley by noting that the U.S. and Azerbaijan
enjoy a strong, healthy relationship, and that he would like
this cooperation to continue. He said that Foreign Minister
Mammadyarov's recent trip to Washington was a success and
that signing the energy MOU signified a "new stage" in the
U.S.-Azerbaijan relationship. Noting that the EU had "no real
energy policy" and relied too heavily on Gazprom, Aliyev said
that it was "not by chance" that the GOAJ signed similar
energy agreements with the U.S. and the EU. According to
Aliyev, energy is the most important element of the
U.S.-Azerbaijan bilateral relationship, followed by security.
He promised that Azerbaijan would leave its troops in Iraq
as long as the U.S. wanted them there. Aliyev said that
Azerbaijan has been working for many years to bring its
natural resources to the world market. Starting with
extraction of oil, and then gas, he said the second phase had
begun with export. He said he was working with Turkey,
Kazakhstan and Turkmenistan to make Azerbaijan an energy
transport hub linking the eastern Caspian with Europe.

RUSSIA
--------------


3. (C) Turning to Azerbaijan's relationship with Russia,
Aliyev proudly recalled that last year the GOAJ had rejected
Russia's monopolistic attempt to force prices on Azerbaijan
that were higher than those charged to others. While noting
that "we don't need trouble from Russia," he said that he
expected mutual respect and non-interference from them. He
said the gas decision, along with other steps, such as
supplying Georgia with energy for the winter, had been
intended to prove Azerbaijan's independence. The President
explained that his recent trip to Moscow was primarily to
talk to Russian President Vladimir Putin in order to clarify
the relationship. According to Aliyev, Putin is preoccupied
with energy: "I can see it."


4. (C) Comparing politics in Azerbaijan with those in
Armenia, Aliyev said that Russia has not tried to set up
pro-Russian political parties in Azerbaijan and that they
were free of Russian influence. He criticized Armenia as
being nothing more than a puppet with Russian control over
its borders, military, and energy infrastructure, including
the new gas pipeline with Iran. He said that Azerbaijan's
only problem is the unresolved conflict ovr Nagorno-Karabakh
and the surrounding territorie, and noted that it is a
threat to the entire reion.

GOAJ'S TOP PRIORITYIES - USE OIL REVENUES WISELY
-------------- ---


5. (C) Asked by Ambassador Finley for his vision of
Azerbaijan ten years hence, Aliyev said Euro-Atlantic
integration will remain Azerbaijan's top foreign policy
priority, using cooperation with the OSCE and the European
Neighborhood Policy and Action Plan as a framework. His top
domestic priority for the next five (not ten) years was the
elimination of poverty because "people deserve prosperity,"
especially after their difficulties in the early years of
independence. He agreed with Ambassador Finley both that
time for action was short and that fair, honest management of
the new oil wealth was key. He highlighted recent progress,
noting that the GOAJ had decreased poverty from 49 percent to

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29 percent in three years, during which it also created more
than three and a half million jobs. Aliyev said that
diversification of the economy is critical to poverty
reduction, particularly through the use of oil revenue to
develop the non-oil sectors. He noted the importance of
education to equip the new generation, adding that the GOA
is building many schools, all equipped with comuters with
Internet access, which he hopes to expand to all schools.
Aliyev said that the GOAJ has been working hard to eliminate
all refugee tent camps in the country and to create adequate
infrastructure for Azerbaijan's IDPs and refugees. In
projecting his vision, the President did not mention
democratic development.


6. (C) Aliyev said that because of its growing economy,
Azerbaijan is becoming a donor country that can start to
repay some of the assistance it received when it had fewer
resources. Azerbaijan is the leading donor in the Caucasus,
has been supporting Georgia, and is working to help
Kazakhstan, Aliyev said.

RELATIONSHIP WITH KAZAKHSTAN
--------------


7. (C) President Aliyev said his good personal relationship
with Kazakh President Nursultan Nazarbayev helps maintain the
good relations between their two countries. He noted
particularly strong cooperation on energy, transportation,
and humanitarian issues and he said developing Kazakhstan's
ties with Azerbaijan would help "turn Kazakhstan to the
West." Aliyev highlighted the interstate agreement on the
BTC pipeline and shared plans to establish a similar
agreement on a gas pipeline. According to Aliyev, Nazarbayev
is afraid of damaging Kazakhstan's relationship with Russia
by signing a gas agreement with Azerbaijan. Aliyev said that
he had just discussed this with President Putin and came away
believing that such cooperation should not create a problem.
He said that Azerbaijan would support Kazakhstan's bid for
OSCE chairmanship.


8. (U) Ambassador Finley cleared this message.
DERSE