The liberal peace models for Armenian-Azerbaijani conflict resolution have promoted inter-state institutional cooperation to reduce the risk of renewed conflict and assumed a scenario where Armenia and Azerbaijan would eventually evolve into pro-European integrating liberal democracies. This approach shaped many proposals in the 1990s and early 2000s, particularly within the framework of the OSCE Minsk Group. This vision is no longer viable in the current geopolitical context. The failure of previous initiatives highlights the necessity of adapting institutional proposals to present realities rather than replicating outdated frameworks.
After the 2023 September escalation, hopes for an inter-state peace agreement between Armenia and Azerbaijan grew both in the region and beyond. Yet there is no peace deal as of now. The ongoing cycle of mutual accusations and competing demands delays progress. This deadlock underscores a deeper issue: a purely realpolitik-driven peace agreement could provide temporary stability but hardly ensure lasting peace. For this to happen, both states must establish institutional ties that encourage cooperation, reduce hostility, and create interdependence. This was the key premise of previous settlement efforts, which primarily relied on liberal peace concepts. But their resurrection today is a problem since current realities call for a more pragmatic approach — one that recognizes the complex geopolitical landscape of the South Caucasus and the necessity of engaging both governments.
The question, then, is whether conditions allow for the creation of institutions that facilitate cooperation between Armenia and Azerbaijan. In the post-2020 period, pragmatic cooperation may still be possible in specific areas, mainly where mutual benefits are clear. Given that both governments remain the primary decision-makers in shaping peace efforts, any proposed institutions must align with state interests to be viable. Unlike previous OSCE proposals, which have gained limited traction in the current environment, a state-driven approach could lay the groundwork for long-term stability.
Specifically, “institutions” in this context refer to structured mechanisms — governmental, intergovernmental, or economic — designed to regulate interactions between Armenia and Azerbaijan. This does not imply that institutions are inherently effective. However, in deeply divided societies, they can provide predictable engagement frameworks that reduce escalation risks. The focus should be on pragmatic cooperation in areas where joint or mutually acceptable governance structures can produce tangible results, even without full reconciliation.
One of the most realistic starting points is economic cooperation. Trade and infrastructure projects between Armenia and Azerbaijan could generate mutual benefits while creating a degree of interdependence. Past examples from other post-conflict regions, such as the European Coal and Steel Community (ECSC) following World War II, demonstrate how economic institutions can contribute to peace by aligning the interests of former adversaries.
Infrastructure and connectivity initiatives can create interdependence, but their securitization sabotages their effectiveness. Azerbaijan views the “Zangezur corridor” as essential, while Armenia sees it as a threat to its sovereignty. Armenia’s Crossroads of Peace initiative aims to restore historical transport routes but faces political disputes over security aspects. For these projects to promote institutional cooperation instead of becoming geopolitical contests, they must be de-securitized. Connectivity efforts should focus on economic and infrastructural collaboration through mutual consultation and shared benefits. Establishing joint transit commissions or economic oversight bodies could ensure these initiatives function as collaborative ventures rather than tools for unilateral influence.
Beyond economic collaboration, joint environmental governance presents another feasible area for institutional cooperation. The Kura-Aras River system flows through both countries and is a critical water resource requiring shared management. Creating a bilateral environmental commission can provide a structured way for Armenia and Azerbaijan to cooperate on managing shared natural resources. For example, the Mekong River Commission in Southeast Asia facilitates collaboration among Cambodia, Laos, Thailand, and Vietnam, enabling data-sharing and joint environmental assessments to prevent conflicts over water usage. A similar commission could help address issues like water management, deforestation, and biodiversity protection, encouraging collaboration. Another relevant case is the cooperation between Azerbaijani and Armenian experts in the WWF’s Leopard Conservation Programme, which brought specialists from both countries together to protect the Caucasian leopard. Despite the involvement of an international organization, it remains evident that governments demonstrate a willingness to collaborate in areas that are non-political. Unlike politically charged negotiations, environmental cooperation often operates within a more neutral framework, making it a viable entry point for engagement.
Educational and cultural exchanges play a significant role in long-term peacebuilding; however, they present a more complex challenge due to their vulnerable positions in countries’ narratives. For example, the involvement of international organizations in developing educational initiatives may encounter resistance due to concerns about external influence. Therefore, any form of educational collaboration should be state-led or involve trusted domestic actors to maintain credibility and legitimacy. A historical example worth reflecting upon is the Turkish-Greek rapprochement in the early 2000s, during which state-supported academic collaborations helped to ease decades of enmity. As a result, small-scale pilot programs, such as joint history workshops or scholarship initiatives, could serve as preliminary confidence-building measures before advancing to more ambitious projects.
While economic and educational institutions lay the groundwork for peace, cultural and social initiatives also have the potential to promote reconciliation. However, given the current political climate where Armenia and Azerbaijan continue to dispute each other's cultural significance, state-led cooperation in this area seems unlikely. As a result, more pragmatic approaches are necessary. Instead of direct bilateral initiatives, regional and international frameworks could provide alternative space for cultural engagement.
One example of this is the “One Caucasus” festival, a regional initiative that brings together artists, musicians, and activists across the Caucasus. It offers a unique platform for cultural exchange without direct government involvement. Although these initiatives are not state-led, they demonstrate the potential for fostering dialogue through shared artistic and cultural expressions. A more structured approach could involve regional cultural programs facilitated by international organizations, ensuring that participation is voluntary yet impactful.
By collaborating on shared field challenges within a broader regional framework, Armenian and Azerbaijani stakeholders can cooperate without immediately addressing contradictory cultural narratives. These approaches acknowledge current political realities while creating opportunities for interaction and gradual trust-building.
Of course, institutional cooperation does not guarantee peace. Critics might argue that institutions can be reinforcing hostilities rather than resolving them. Furthermore, without a minimal level of political will, even well-designed institutions will struggle to function effectively. These concerns highlight the need for gradual progress rather than instant idealistic solutions. Establishing functional institutions between Armenia and Azerbaijan should be viewed as a gradual development contingent on evolving political dynamics rather than a predetermined “magic” formula for peace.
Ultimately, the goal is not to force reconciliation but to create mechanisms that make the re-emergence of conflict less likely. A pragmatic, state-driven institutional approach — focused on economic, environmental, and technical cooperation — offers a more realistic path forward. While the road to lasting peace remains uncertain, institutions encouraging structured engagement between Armenia and Azerbaijan can serve as critical stepping-stones.