1) The geostrategic importance of the South Caucasus has grown significantly since the war in Ukraine broke out.
The South Caucasus, situated along the Black and Caspian Seas, has always been a crossroads of civilizations and frontier of empires with an enormous strategic importance—a link between East and West, North and South. In recent years, it has emerged as a global transportation hub, key to stable supply chains in Europe. The Russo-Ukrainian war shocked global markets and disrupted traditional trade routes, such as the so-called Iron Silk Road running through Russia, resulting in the emergence of alternative routes between Eastern industries and Western markets, and vice versa. The alternative to the Northern Corridor emerged in the Turkic world—the Middle Corridor runs from China through Central Asia and the Caspian Sea, and hits the ports of the Black Sea through Azerbaijan and Georgia. Russia and the Global South, too, sought an alternative to traditional trade routes dominated by Western rivals. This became the International North-South Transport Corridor linking Russia to India and the Indo-Pacific through the South Caucasus and Iran. Key pipelines are also running through the region, connecting Europe to the rich energy resources of Azerbaijan.
2) Azerbaijan is a crucial and reliable energy supplier of the European Union.
Since the mid-’90s Azerbaijan has evolved into a major supplier of hydrocarbons to Europe. Initially Baku was reliant on the Russian pipe systems, but after the completion of the Baku-Tbilisi-Ceyhan pipeline and the Trans Anatolian Gas Pipelines, Azeri fossil fuels started to flow uninterruptedly to Türkiye and towards European markets. Since the disruption of the Russian oil and gas supplies the importance of the Caspian hydrocarbons increased significantly, which is evidenced by regional initiatives such as the Solidarity Ring of gas companies of Hungary, Slovakia, Romania and Bulgaria. Energy supplies from Azerbaijan, however, benefit not only Baku. The transit pipelines running through Georgia contribute significantly to the economy of Tbilisi as well. Not only are fossil fuels produced and exported by Azerbaijan, but green energy too, making it a potential partner for Europe in its quest to decarbonize its economy. In December 2022, leaders of Azerbaijan, Georgia, Hungary and Romania, in the presence of the president of the European Commission in Bucharest, signed an agreement to build an 1195- km-long underwater electric cable under the Black Sea, transporting green energy from
Azerbaijan through Georgia to Romania and Hungary. It will also include an optic cable capable of high-speed internet data transmission. Armenia has since requested to connect to the cable system.
3) The reestablishment of diplomatic relations between Armenia and Hungary holds great potential for bilateral cooperation.
Interstate relation between Hungary and Armenia stretch back across eight hundred years of history. The Armenian diaspora has enriched Hungary since the Middle Ages. Diplomatic ties had been, however, cut off between Yerevan and Budapest for over a decade in 2012 by the Armenian side, in answer to Hungary’s extradition of Ramil Safarov, a convicted murderer of an Armenian officer, to Azerbaijan. Nevertheless, diplomatic relations have recently been reestablished and bilateral ties have begun developing rapidly, promising significant potential for economic cooperation. WizzAir is already the second largest airline in Armenia, while Hungarian companies export around 8.5 million euros worth of medicine to the South Caucasian country annually. The Hungary Helps program of the Foreign Ministry also offers grants for thirty Armenian students annually to study in Hungary.
4) Hungary is a key ally of Georgia in its aspirations toward Euro-Atlantic integration.
Hungary is an outspoken supporter of Georgia’s aspirations of becoming a full member of the European Union and the North Atlantic Treaty Organization, and backs the territorial integrity of the Caucasian state. Hungary is actively involved in conflict management and peacemaking in Georgia. Hungary contributed servicemen, both police and military personnel, to the United Nations Observer Mission in Georgia up until its dissolution in 2009. Today it is a key contributor to the European Union Monitoring Mission in Georgia. Since December 2023 a Hungarian national, Tibor Kozma, is the head of the mission, while 15 of its 220 servicemen are from Hungary, which makes it the fifth largest contributor to the mission. The Hungarian Armed Forces provide trainings for Georgian officers in preparation for NATO missions and ministerial-level talks are in place for a defense industrial cooperation.
5) The Hungarian strategy of connectivity could play a key role in confidence building in the South Caucasus.
War has devastated the South Caucasus neighbourhood for the past three decades. Since the deadly conflict in Nagorno Karabakh was violently ended in 2023, the opposing sides failed to agree on terms of a peace settlement. Several powers from Russia to the EU attempted to claim the role of mediator and failed due to their unbalanced relationship with the conflicting parties. Thanks to the Hungarian strategy of connectivity, being a beacon of peace and pragmatic dialogue in the era of a new Cold War, Hungary maintains friendly ties to both Armenia and Azerbaijan and may therefore contribute to confidence building or even peacemaking in the South Caucasus.
Written by Péter Pál Kránitz & Sándor Seremet