"THE STATUS QUO OVER NK IS UNACCEPTABLE"

-Six months have passed since your arrival in Azerbaijan.  How would you characterize U.S.-Azerbaijani relations during this time?  Have you faced any problems during this time here in Azerbaijan?

- It's been a busy six months.  I have learned over that time that the U.S.-Azerbaijani relationship is strong and complex.

The United States values its strategic partnership with Azerbaijan, which is based on shared interests in security (especially a peaceful settlement of the Nagorno-Karabakh conflict, counter-terrorism, and Afghanistan), energy and commercial cooperation, and democratic and economic reform.  

We deeply appreciate Azerbaijan's contributions to international security efforts.  Azerbaijani troops have stood shoulder-to-shoulder with U.S. troops in Iraq, Kosovo, and Afghanistan, where 94 Azerbaijani troops currently serve.  Azerbaijan continues to play a key role on transportation of troops and non-lethal supplies in support of the international effort in Afghanistan.  

The U.S. also supports the development of Azerbaijan's energy sector-both for the benefit of Azerbaijan and our European allies. Azerbaijan plays a key role in advancing global energy security, given its significant non-OPEC oil and gas reserves and delivery infrastructure not subject to the geographical constraints of the Persian Gulf.  It also could play an important role in helping our European allies diversify their natural gas supplies. 

Our economic relationship with Azerbaijan now extends far beyond energy.  U.S. companies are involved here in agriculture, aerospace, civil aviation, construction, and in nearly all sectors of the economy.  We encourage Azerbaijan's accession to the World Trade Organization and think that this step will only deepen our economic ties. 

As former Secretary Clinton said while visiting Baku, our closest relationships are with democratic states that respect the full range of human rights of its citizens.  The United States believes that Azerbaijan's future prosperity and stability are best served by continued democratic and economic reform.  Azerbaijan's progress on reform is the key to strengthening our bilateral relationship and to its own stability.  

- In your previous position, you played an active role in developing Caspian energy policy.  Do you think that your current job is a continuation of your country's energy policy in this region?  Do you think that America's energy policy in the region has been successful?

- U.S. energy policy in the Caspian is based on two main goals:  diversifying Europe's energy sources and fostering the sovereignty and independence of energy producing countries like Azerbaijan.  So, in my new job, in addition to working on other important issues like regional stability and human rights, I continue to be focused on developing Azerbaijan's energy resources.  But I am more interested than ever in figuring out how those resources can be used to develop a modern, diversified economy that will ensure the well-being of Azerbaijan's people far into the future.   Everyone knows that oil doesn't last forever.  Azerbaijan has a limited window to use its oil wealth to make the kind of investments that will spur the development of other industries.  I am guardedly optimistic-I see Azerbaijan making some good investments and making some good decisions to open its economy, most importantly by joining the WTO.  But, most important, I think that Azerbaijan needs to invest in its people, in particular in its educational system.  I also think Azerbaijan needs to take some serious steps towards establishing the rule of law and reducing barriers to competition in the marketplace.  Without serious reforms, businesses outside the oil and gas sector will not want to invest here.       

So, U.S. energy policy has been successful in helping to build energy connections between Azerbaijan and the world, and I look forward to the next step, the opening of the Southern Gas Corridor.  But ultimately, the most important question is whether Azerbaijan's energy serves as the foundation for Azerbaijan's continued economic growth and improved living standards for the Azerbaijani people.  I am tremendously hopeful on that point, but the jury is still out.  

- When you were appointed as ambassador to Azerbaijan, you said that you would continue to work on the diversification of energy supplies and the protection of energy infrastructure.  Have you made any progress in these areas?

- Yes.  There has been significant progress in moving Azerbaijani gas to Europe over the past year.  I am hopeful that in the next few years, Azerbaijani gas will reach Europe in significant volumes and will contribute to the development of a competitive gas market in Europe.  The final route is not yet established, but the United States will support whichever pipeline project, TAP or Nabucco West, is chosen by the Shah Deniz Consortium.  Either project should be expandable to accommodate more gas as it becomes available.

On the protection of energy infrastructure, events in recent years have shown the importance of taking every possible step to guard against any incident, whether accident or terrorist attack, that might interrupt the flow of energy to markets.  The United States and Azerbaijan have extensive and ongoing discussions on how best to cooperate to secure Azerbaijan's energy infrastructure.  

- Russia wants to create a Eurasian Union, which many consider to be a restoration of the former Soviet Union.  Do you think that such a venture is possible?

- I think that lowering trade barriers and increasing international trade are good things, but Azerbaijan's interests will be best served through its accession to the World Trade Organization.    

Over the past five years, the government of Azerbaijan has implemented several wide-ranging economic reforms, many of which were designed to facilitate Azerbaijan's accession to the World Trade Organization (WTO).

The United States supports Azerbaijan's accession, but the pace of the negotiations is largely in Azerbaijan's hands.  Politics do not play a role in the process-the quality of offers and pace of reform does.

Most of Azerbaijan's neighbors and principal trading partners are either WTO members or are seeking membership.  WTO membership will send a strong signal to foreign investors that Azerbaijan has achieved a stable and predictable investment environment, which will attract investment and improve the competitiveness of Azerbaijani goods and services.

We encourage the rapid adoption of the outstanding WTO-related legislative and regulatory reform measures.   As President Aliyev said back in 2007, WTO accession is an important step towards diversifying the country's economy and building a strong non-oil sector.  

- How would you characterize Azerbaijan's development compared with other post-Soviet countries?

- I think that Azerbaijan can be considered a relative success story.  Azerbaijan has done a lot of things right in channeling its oil money towards the State Oil Fund and using proceeds to build the infrastructure that will allow further, diversified economic development.  However, there is still much work to be done in opening the economy to competition, addressing corruption, and ensuring that Azerbaijan's oil and gas wealth spurs economic development all over the country, and not just in Baku.    

- During Hillary Clinton's June 2012 visit to Azerbaijan, she declared that the United States would be more active in the settlement of the Nagorno-Karabakh conflict.  How do you characterize the activities of your country as an OSCE Minsk Group co-chair state?

- The United States acknowledges that the ongoing conflict over Nagorno-Karabakh is the greatest hardship that Azerbaijan has faced since re-establishing its independence. 

We appreciate how frustrating a problem this is for Azerbaijan.  

That's why the United States decided in the 1990s to take a leadership role as one of the co-chairs of the Minsk Group to try to resolve this difficult problem.

We are committed to working through the Minsk Group to assist the parties in finding a peaceful and lasting negotiated settlement to the conflict.  Only a peacefully negotiated agreement can ensure a lasting resolution to the conflict.  The status quo over NK is unacceptable. 

The United States, along with the other Minsk Group Co-Chair nations, will make every effort to help the parties find a settlement of the conflict in accord with the Helsinki principles of the non-use or threat of use of force, territorial integrity, and equal rights and self-determination of peoples. 

- Iranian MFA Spokesman Ramin Mehmanparast said that his country could serve as a mediator between Armenia and Azerbaijan.  Do you think that Iran could achieve success in this process?  

- Absolutely not.  The United States believes that the Minsk Group remains the best forum for the resolution of the Nagorno-Karabakh conflict. 

Both sides have agreed that the Minsk Group process is the most appropriate forum for negotiating a peaceful settlement to the conflict.  The international community has consistently expressed its support for the Minsk Group process as well.