Greater Caspian Region Security and Politics: Looking into 2019

Introduction

The Greater Caspian Region is an area of dynamic and rapid development. Over the past year, the region has seen structural changes and reform efforts in Azerbaijan, Kazakhstan, and Uzbekistan, increased economic interest from China, and much more. We expect that rapid change will continue to unfold. The following brief offers an overview of areas of interest and expectations in the realm of politics and security for the Greater Caspian Region in the new year.

Caspian Agreement

Undoubtedly, one of the most noteworthy developments in the region last year was the signing of the Convention on the Legal Status of the Caspian Sea on August 12. The agreement ended a decades-long dispute over whether the Caspian is a sea or a lake, granting it a special legal status. Its surface waters are now open to all five Caspian littoral states but bars any foreign military ships from entering the sea. Meanwhile, the seabed and its valuable natural resources are left to be divided according to bilateral agreements. How these bilateral agreements unfold over the next year will go a long way towards shaping interstate relations in the Greater Caspian Region. Bottom line? More clarification is needed.

U.S. Engagement

Sanctions on Russia

U.S. sanctions against Russia continued to increase in 2018. In general, these measures targeted Russia’s energy and finance industries, along with specific oligarchs and defense and arms sales. Specifically, the latest round of sanctions announced by the U.S. Treasury Department in mid-December targeted entities tied to 2016 election meddling, GRU and military intelligence officers who attempted to hack the World Anti-Doping Agency and the Organization for the Prohibition of Chemical Weapons, and Alexander Petrov and Ruslan Boshirov—the two GRU agents behind the Skripal poisonings. On the other hand, the Trump Administration has just repealed sanctions that affected Oleg Deripaska and his industries, including RUSAL, or Russian Aluminum will be alleviated. Therefore, the jury is still out on where the U.S. administration is heading.

European Union sanctions on these areas have already been extended to at least July of this year, and U.S. sanctions will likely be in place at least as long. The International Monetary Fund projects an uninspiring 1.6 percent growth for Russia in 2019, roughly the same rate it had last year.

Sanctions on Iran

The Trump Administration re-imposed sanctions on Iran’s oil, banking, and shipping sectors in the second half of 2018. The stated goal is to force Iran to abandon ballistic-missile development and withdraw its support for groups in Syria and Yemen.