BACKGROUND: The talks in Key West marked a continuation of the Azerbaijani and Armenian presidents’ direct dialogue aimed at developing a common ground on general principles of the settlement of the Nagorno-Karabakh conflict. The two presidents started the dialogue in April 1999 and have met several times ever since. Their most recent encounters were in January 26 and March 4-5 in Paris and, with personal mediating efforts by President Jacques Chirac registered insignificant progress. At the same time, the Minsk Group co-chairs – the U.S., Russia, and France -- have worked separately with the presidents to facilitate their dialogue and to expand the range of confidence-building measures.

The status of Nagorno-Karabakh and of a corridor connecting the region to Armenia are the thorniest issues in the long-running negotiating process. In an attempt to find a mutually acceptable agreement on these issues, the Minsk Group’s previous proposal, drafted in late 1998, called for the creation of a ‘common state’ -- a loose confederation between Azerbaijan and Nagorno-Karabakh. Armenia had overall approved the ‘common state’ idea, and maintained that it would not agree to any major concessions beyond those envisaged by the proposal. Azerbaijan, on the other hand, had declined the mediators’ idea, claiming that the proposal deprived Azerbaijan from a part of its territory and actually legitimized the present status quo.

The extent of differences between the disputants came to light following the Paris negotiations, when official Baku toughened its position. Azerbaijan accused Armenia of taking a tough position in the peace talks and criticized the Minsk Group co-chairs for making insufficient efforts to hammer out a peaceful settlement which would re-impose Baku’s authority over Nagorno-Karabakh. Having rejected the ‘common state’ proposal, Azerbaijan demanded a new one. President Aliyev’s impatience has been reflected in a number of bellicose statements in which he threatened to use military means to restore Baku’s control over Nagorno-Karabakh. However, the possibility for a renewed fighting, periodically threatened by Azerbaijan, is highly unlikely. While Armenia does not show an intention to resume the war, it has the sufficient capacity to strike back if attacked.

IMPLICATIONS: It may be assumed that by making such statements before the Key West talks President Aliyev tried to enhance his negotiating positions, or even secure himself a safe retreat in the case the talks fail. Aliyev is likely to run into trouble at home if he fails to find a negotiated settlement of the conflict, as the plight of several hundred thousand refugees is of great concern to the Azerbaijani public. Despite attempts by the mediators, Aliyev will also have to combine his own and Azerbaijani interests into a unified position. On the one hand, official Baku speaks about the establishment of NATO bases in Azerbaijan, and on the other, it makes statements about the leading role of Russia in settling the conflict. This may suggest that at the current stage of the negotiating process Azerbaijan attempts to attract the support of both Washington and Moscow.

The toughest obstacle for President Aliyev and President Kocharian is to persuade people whose lives have been torn apart by war to accept the painful compromise needed to end a 13-year old conflict. Most people in Azerbaijan and Armenia realize that the conflict has hurt their chances for economic recovery and political stability. Nevertheless, it will still be difficult to sell a compromise. The biggest challenge that faces the two presidents is to convince the people that this price is the suitable one for the future that comes with peace. This strenuous task is further complicated by the fact that a settlement must also be tailored to the ambitions of the international mediators.

The high-level US activity on the settlement issue in Key West played a significant role to pave the way for a long-awaited breakthrough. The US administration has stated that peace and stability in the south Caucasus region, a crossroads between Europe and Asia, is in the interest of the international community and the cause of world peace. President Bush received the two presidents in Washington after the talks to show the US support for their efforts. It may be presumed that President Bush would not have agreed to receive the two presidents without a major movement forward in the negotiations.

CONCLUSIONS: The Key West talks introduced a unique, effective format by having the two presidents meet separately with the co-chair mediators in a proximity format over the course of several days. As is often the case in protracted disputes, one of the major obstacles in the search for a solution is the issue of timing or sequencing. The timing, sequencing, as well as the format of the Key West talks were favorable. For the first time in the negotiating process the parties were familiar with the general content of a settlement that was proposed by the mediators. While it was unrealistic for the disputants to reach a fundamental agreement in four days, the summit has been a bold step forward.

Key West talks showed such a narrowing of differences between the positions of the Armenian and Azerbaijani presidents, that more negotiations have been scheduled for Geneva in June 2001. The possibility of continuing the negotiations just two months after Key West shows that the presidents and the mediators are trying to reach substantial results. The co-chairs are likely to prepare a new comprehensive proposal that addresses the problems and needs identified by the presidents during the talks. Although no peace agreement was signed and no significant breakthrough was announced in Florida, there are some indications that a document on the principles of settlement may be signed in Switzerland, based on the agreements reached in Key West.

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