BACKGROUND: The fall of the Soviet Union brought independence to the three Caucasian republics, but was also accompanied by violent conflict. Azerbaijan, Armenia and Georgia have all experienced severe political and military challenges shaking the very root of their states. Internal and external destabilizing forces in various forms have challenged the authority and the legitimacy of their political systems. Azerbaijan and Armenia have not yet settled their territorial dispute over Nagorno Karabakh, which emerged in a bloody form 13 year ago. The war that ended in a cease-fire in 1994 left 20% of Azerbaijani territory, including the disputed territory, under Armenian control. Efforts towards the settlement of this conflict have all failed. The political, economic, security and emotional significance of the issue for both sides has made a compromise hard to swallow in both countries. If the political situation has been bad in Armenia and Azerbaijan, it has been even worse in Georgia. A variety of severe political and military challenges has weakened the authority of the Georgian state. Two major secessionist movements in Abkhazia and South Ossetia in which Russia has significant influence seriously damaged the sovereignty of the Georgian state and undermined its territorial integrity. In addition to the secessionist movements, Georgia has also suffered from an internal military and political conflict. The ouster from power of then Georgian President Zviad Gamsakhurdia in 1992 initiated a civil war lasted on-and-off until to date. Despite his "suicide" or "murder" in 1993, his followers have challenged the authority of the Georgian government through various forms of military operations and political activities.

IMPLICATIONS: The three Caucasian states have survived many challenges of different natures to their authority. The major ones continue to this date and are likely to continue in the foreseeable future. Added to these, the economic deterioration of the three Caucasian countries, the worsening living standards, the increasing poverty and unemployment, the rampant corruption and the expanding authoritarianism have all contributed to a growing dissatisfaction among their peoples. This popular dissatisfaction has found its way in the internal politics of these countries in the forms of growing tension within the ruling elite and between it and political opposition. All these factors have severely damaged the authority and legitimacy of the three Caucasian states and have contributed to their chronic instability. In such a fragile political and social situation, the current no-war-no-peace situation cannot continue for a long time. For one, the Azeri and Georgian states are determined to restore their sovereignty over their lost territories. The growing frustration with the status quo among the internally displaced Azeris (over a million) and Georgians (about 300,000) have further strengthened their determination. These refugees have been living in poor conditions in Azerbaijan and Georgia since their forcible migration from their homes in the territories now under the control of separatists over a decade ago. The status quo is not viable for the separatist groups in the long term either. The current situation is a limbo for both sides, which has to be settled in one way or another. Hence they have national, political and security objectives to achieve. There are also strong economic reasons making the situation unacceptable. The unsettled ethnic and territorial disputes have seriously affected investment in the Caucasian countries by foreign investors, the only available investors for these countries that lack adequate domestic financial resources. The low investments even in energy-rich Azerbaijan have demonstrated this concern. Thus, the need for creating a suitable situation for economic activities will likely motivate all the parties to the disputes to settle them by force in absence of peaceful means. Finally, the unsettled disputes have made apparent the weaknesses of the Caucasian governments, which have also proven their inability in addressing the growing economic difficulties. The resulting dismal situation has encouraged the rise of other destabilizing forces, especially in Georgia. In July, relations between the Georgian government and the government of Ajaria, an autonomous region run by a local potentate, Aslan Abashidze, grew increasingly hostile. The hostility reflected itself in the Ajarian government’s refusal to transfer collected taxes to the Georgian government, which it described as "fascist". In the same month, the supporters of ex-President Gamsakhurdia demanded autonomy for their region creating a new headache for their government.

CONCLUSIONS: The current uncertain situation in the Caucasus cannot continue indefinitely. The failure of the three Caucasian governments to settle their ethnic and territorial disputes has created a downward spiral, which may prove conducive to the resumption of violence at any moment. The worsening economic situation has further exacerbated this situation. Unless the parties to the Azeri-Armenian and Georgian ethnic and territorial conflicts settle their conflicts peacefully, a highly unrealistic scenario in the near future, the entire Caucasus may experience a new round of wars. Such wars could be more destructive than those of the early 1990s as certain factors could lead to their expansion and escalation. Among other factors, three regional (Iran, Turkey and Russia) and a non-regional power (USA) with long-term interest in the Caucasus could become involved in them intentionally or unintentionally in different forms and extents.

AUTHOR BIO: Dr. Hooman Peimani works as an independent consultant with United Nations agencies in Geneva, Switzerland, and does research in International Relations. His writing has centred on the Caucasus, Central Asia, the Indian subcontinent, and the Persian Gulf.