FM/OSCE Chairman Bakoyannis Heads to Azerbaijan and Armenia

C O N F I D E N T I A L ATHENS 001139 SENSITIVE SIPDIS DEPT FOR EUR/SE, EUR/RPM, EUR/CARC, EUR/ERA, EUR/FO FOR MBRYZA, S/EEE AMEMBASSY YEREVAN AMEMBASSY BAKU USMISSION USOSCE E.O. 12958: DECL: 2019/07/02 TAGS: PREL PGOV GR TU AM AJ OSCE ENRG SUBJECT: FM/OSCE Chairman Bakoyannis Heads to Azerbaijan and Armenia to discuss Nagorno-Karabakh and Gas CLASSIFIED BY: Daniel V. Speckhard, Ambassador; REASON: 1.4(B),(D) ¶1. (SBU) Foreign Minister Bakoyannis is traveling to Azerbaijan and Armenia to discuss the Nagorno-Karabakh (NK) conflict in her capacity as OSCE Chairman, as well as Greek- Caucasus air communication and energy issues. FM Bakoyannis departed Greece for Azerbaijan on July 1, will continue on to Armenia July2 and return to Greece on July 3. In both Baku and Yerevan, Bakoyannis is expected to visit the OSCE missions and meet each country's President, Foreign Minister, head of Parliament and representatives from political parties. ¶2. (C) According to the MFA, FM Bakoyannis has wanted to visit Azerbaijan and Armenia since February 2009 but the trip had been postponed in the past. (Note: No mention of the Foreign Minister's impending trip was made to PolOff during a June 26 meeting with the MFA Caucasus desk but our contact did provide some details when questioned on July 1. End Note) ¶3. (C) In her capacity as Chairman of the OSCE, Bakoyannis will discuss the NK conflict with both sides. She is expected to echo support for the efforts of the Minsk Group and encourage both sides to accept previously agreed upon basic principles. She will urge all parties to avoid heightened tensions and maintain a continued and uninterrupted dialogue. (Note: Although the MFA said that Bakoyannis would be emphasizing the work of the Minsk Group, the co-chairs of the group apparently were not consulted prior to her departure for the region. End Note) ¶4. (SBU) MFA officials espoused hopes that a warming of Turkish-Armenian relations could kick-start a course that would eventually facilitate agreement on NK. ¶5. (SBU) Bilaterally, the Caucasus desk said that Greek relations with Azerbaijan have "never been better." They also characterized Greece's relations with Armenia as historically good, but noted that the Armenians may be concerned about Greece's upgraded relations with Azerbaijan. ¶6. (C) While in Azerbaijan, Bakoyannis is also set to discuss energy and gas issues, including the Turkey-Greece-Italy (TGI) gas pipeline that will be supplied by Azerbaijan. The MFA continues to view Turkey's stance on an Azerbaijan-Turkey transit agreement as an obstruction to the progress of the project. Greece wants a multilateral agreement between Azerbaijan, Turkey, Greece and Italy that would underscore the parties' wish to conclude construction and negotiation on the project and to "accomplish its goals." ¶7. (C) The FM also wants to broker a gas supply deal between Greek public gas company DEPA and Azerbaijan's public gas arm SOCAR. They would like the agreement to specify an Azerbaijani commitment to supply Greece with 1/ BCM of gas per year. SOCAR has already signed a similar deal with Russia's Gazprom, whereby SOCAR will export 500/MCM of gas from Azerbaijan to Russian in 2010. The Greek Ministry of Development is encouraging the Azerbaijan government to sign an agreement with Greece and work out an Azerbaijani transit agreement with Turkey separately. (Comment: We are note quite certain what the Greeks hope to get from a gas supply deal without an Azerbaijan-Turkey transit agreement for the line already in place. The FM may simply want to keep the momentum going toward completion of the TGI project. End Comment) ¶8. (SBU) In Armenia, the FM is set to sign a bilateral Greece-Armenian agreement on air communication and the sharing of air services. Bakoyannis will also encourage continued interaction and dialogue between Armenia and Turkey. SPECKHARD