Since the collapse of the Soviet Union, the South Caucasus has rarely experienced a prolonged period of stability. The region has been marked by recurring conflicts, violence, and the constant risk of sudden escalation. Two fault lines in particular have shaped its security environment. The first is the Armenia–Azerbaijan conflict, rooted in the Armenians long-term occupation of Azerbaijan’s Karabakh region and surrounding territories, which for decades remained the most serious source of instability. The second is the Russia–Georgia conflict, stemming from Russia’s occupation of Abkhazia and South Ossetia, which continues to undermine Georgia’s sovereignty and regional security. These unresolved disputes have repeatedly drawn in external actors and turned the South Caucasus into a zone of geopolitical competition rather than cooperation.
Against this background, 2025 stands out as an exceptional year. For the first time in more than three decades, the region avoided deadly military clashes. The most important factor behind this relative calm was the effective resolution of the Armenia–Azerbaijan conflict, which removed the most volatile and militarized dispute from the regional agenda. The normalization process between Baku and Yerevan significantly reduced the risk of interstate war and opened space for economic interaction, connectivity projects, and confidence-building measures. At the same time, the South Caucasus did not reach full peace, as the conflict between Georgia and Russia remains unresolved and continues to cast a shadow over regional security.
What makes the developments of 2025 particularly noteworthy is that this relative stability emerged amid intensifying global and regional geopolitical rivalries. The weakening of Russia’s traditional dominance, the growing involvement of the United States, the European Union, China, and regional powers such as Türkiye, and the spillover effects of conflicts beyond the region all created additional pressure points. Many observers expected these dynamics to trigger new crises or destabilizing competition. Instead, the South Caucasus states largely responded with pragmatic and restrained policies, seeking to manage rivalries rather than become their battleground. Tensions persisted, but they did not escalate into open conflict.
At the start of the year, Russia’s traditional dominance in the region continued to weaken. Its long and costly war in Ukraine reduced Moscow’s attention and capacity, creating space for other actors to step in. Azerbaijan entered 2025 dealing with the fallout from the downing of an Azerbaijani Airlines plane over Russian territory in late 2024, which killed 38 people. The incident caused serious diplomatic tension. Baku demanded responsibility, and although Moscow avoided a formal apology, President Vladimir Putin publicly acknowledged the issue in October during a summit in Dushanbe. This helped ease tensions enough to restore cooperation in areas of shared interest, especially transport and trade projects like the North–South Transport Corridor.
However, towards the end of the year, it became clear that the two countries have yet to overcome their disagreements. President Ilham Aliyev’s refusal to attend the informal meeting of Commonwealth of Independent States (CIS) in St. Petersburg in late December was reportedly affected by the fact that Russia has not fulfilled its commitments concerning the investigation of the airplane crash and compensation to the victims.
Armenia followed a different but equally cautious path. After the end of its occupation over Karabakh in 2023, Yerevan moved closer to the West while still maintaining ties with Russia. Prime Minister Nikol Pashinyan, under pressure at home and facing elections in 2026, strengthened relations with the United States and the European Union. In January, Armenia signed a strategic partnership charter with Washington and signed a similar document with the European Union in December.
A major moment for the region came in August, when Prime Minister Pashinyan and President Ilham Aliyev met in Washington under the mediation of U.S. President Donald Trump. They initialed a peace treaty and agreed on the so-called Trump Route for International Peace and Prosperity (TRIPP), which would connect Azerbaijan to Nakhchivan through southern Armenia and become a critical link along the Asia-Europe transportation route (Middle Corridor). While legal and constitutional issues in Armenia remain unresolved, practical steps followed. Armenia is still expected to remove territorial claims from its constitution before it can sign a peace treaty with Azerbaijan. However, the peace process was generally on positive track throughout 2025. In October, trade restrictions were lifted, allowing grain shipments from Russia and Kazakhstan through Azerbaijan to Armenia, and even the launch of Azerbaijani oil exports to Armenia. Expert exchanges and civil society contacts also increased, slowly rebuilding trust after decades of hostility.
Georgia’s situation was more complicated. Domestically, 2025 was marked by persistent political tension and protests. Contrary to the expectation of the government, the victory of Donald Trump in US presidential elections did not reverse the deterioration of the relations between Georgia and the West. Despite this, Georgia avoided total isolation. The government described its foreign policy as “sovereign and pragmatic,” quietly engaging Russia on some limited economic activities and expanding relations with the non-Western countries including China and the Arab world. Georgia continued to position itself as a key transit country in the Middle Corridor, linking Europe and China via the Caspian and Central Asia.
Across the region, a common pattern emerged: careful management of overlapping rivalries. Türkiye coordinated closely with Azerbaijan, keeping its border with Armenia closed until a full peace agreement is reached. Iran, despite concerns over alleged Israel’s presence in the region, maintained pragmatic cooperation with Azerbaijan, particularly on transport routes like the Araz corridor. The European Union also adjusted its approach, resuming engagement with Azerbaijan in April during a visit by High Representative Kaja Kallas, with a focus on energy cooperation and connectivity. China strengthened its involvement by upgrading relations with Azerbaijan to a comprehensive strategic partnership and investing in infrastructure linked to the Middle Corridor. Azerbaijan’s growing role in Central Asia was also visible, especially after joining the C6 format in November, enhancing trade and green energy cooperation.
All these developments helped regional peace, stability and prosperity in 2025. There were no large-scale military clashes. Economic links expanded, transport corridors became more active, and diplomatic meetings increased. Regional platforms like the Organization of Turkic States (OTS) gained importance without openly challenging other powers. Azerbaijan also expanded its engagement in the Middle East, including mediation efforts and energy cooperation, turning regional connections into strategic assets. In the Western direction, Baku launched the work for strategic partnership with the United States, expanded the links with European countries, and continued to play a key role in the European energy security.
However, significant risks remain for the South Caucasus in the coming year. Armenia’s 2026 elections could empower stronger nationalist forces, slowing constitutional reforms and placing the peace process at risk. Georgia’s internal political trajectory may further strain its relations with the West, thereby increasing Russian leverage. Azerbaijan’s relationship with Russia, while carefully managed, remains sensitive, with several unresolved issues that could heighten tensions. Broader geopolitical shifts also matter: tensions between Russia and Europe could escalate further; EU attention to the region may weaken; a failure of the ongoing Ukraine peace talks would likely heighten regional tensions with direct implications for the South Caucasus; and Iran’s internal instability following the war could spill over beyond its borders. Escalation in the Middle East could also indirectly affect the South Caucasus.
In short, the South Caucasus has overcome a number of intraregional disputes, but the threats posed by external actors remain persistent and potentially dangerous. Through pragmatic diplomacy and economic cooperation, the region avoided escalation in 2025 despite a highly challenging international environment. Whether this approach can hold in 2026 remains uncertain. The stability achieved so far is real – but fragile – and will require continued careful management to prevent old conflicts from resurfacing.
