A Step Toward An Economic Zone In The Caucasus

Source: Eurasia Daily Monitor “Former Soviet Republics and Turkey Back Economic Zone In Caucasus”

Turkey is making progress towards creating an economic zone in the Caucasus. The latest evidence is the November 21 launch of the Baku-Tbilisi-Kars (BTK) railroad project that will link Azerbaijan and Georgia with Turkey. However, obstacles remain. The biggest obstacle is the dispute with Armenia and Azerbaijan. Many international financial institutions have not supported the proposed economic zone because of the aforementioned dispute. As a result, Azerbaijan, Georgia, and Turkey have financed the $420 million project.

The recently completed railway, which will eventually connect Far Asia with Europe, is also open to other countries. Turkish President Abdullah Gul said, “This project is very important for the regional peace, stability, and prosperity.” The Turkish President added, “we are in fact taking a step toward the realization of a big project that will change history.” The idea for a railroad began in 1993. However, disputes and blame between the region’s countries prevented the idea from coming to fruition.

The railroad is important to the bigger picture as it demonstrates the necessary road, air, and railroad connections the joint economic zone will require. Turkish President Gul conveys Turkey’s optimism about the project and the larger economic zone. On a related note, bilateral trade between Georgia and Turkey is planned to reach to $1 billion by the end of this year, as the two countries negotiate a free-trade deal and an agreement to prevent double taxation.