The U.S., French, and Russian mediators acting under the aegis of the OSCE Minsk Group hope that their prolonged efforts will at last yield fruit in the second half of 2007. They regard the months following the May 12 parliamentary elections in Armenia as another unique "window of opportunity" to end the 19-year-old conflict.

The Minsk Group's U.S. co-chair, Deputy Assistant Secretary of State Matthew Bryza, sounded optimistic about the prospects for a Karabakh peace when he spoke to RFE/RL's Armenian Service on February 7. The conflicting parties, Bryza said, agree on most of the basic principles of the settlement plan proposed by the co-chairs. Those basic principles amount to holding a referendum on self-determination in the unrecognized Nagorno-Karabakh Republic years after the liberation of at least six of the seven Azerbaijani districts surrounding the disputed enclave that are currently occupied by Armenian forces. "They don't agree 100 percent on the basic principles, but they are close, very close," Bryza said, adding that Armenia and Azerbaijan disagree only on a number of unspecified "technical issues."

Cautiously Upbeat

Bryza's comments add context to the cautiously upbeat statement issued by the three co-chairs on January 29 after their latest tour of the conflict zone. "The co-chairs urge all parties to sustain this momentum in the negotiations and to prepare their publics for the necessary compromises," that statement said, indicating their satisfaction with the results of their talks in Baku, Yerevan, and Khankendi.

International hopes for a Karabakh peace accord were similarly high when Presidents Robert Kocharian of Armenia and Ilham Aliyev of Azerbaijan met near Paris one year ago. But those two-day negotiations and a follow-up Armenian-Azerbaijani summit in Bucharest in June 2006 did not produce an agreement, however.

Following the June summit, Armenian Foreign Minister Vartan Oskanian said the two presidents failed during both rounds of talks to overcome one key sticking point that he declined to identify. But statements by Aliyev after another face-to-face meeting with Kocharian (in Minsk last November) gave ground for new optimism. Aliyev told Azerbaijan National Television on November 29 that since the so-called "Prague process" talks between the Armenian and Azerbaijani foreign ministers on approaches to resolving the Nagorno Karabakh conflict began in 2004, the negotiating process has gone through several stages, and "we are approaching the final stage."

Aliyev said the Minsk talks "were held in a constructive way," and that "we managed to find a solution to a number of problems we could not agree on before." He added, however, that "divergences remain on crucial points," and that further progress "depends on us ourselves," presumably meaning the conflict sides, as opposed to the Minsk Group.

Window Of Opportunity

Bryza implied on February 7 that the mediators expect the two presidents to take the last decisive step to peace during the period between the Armenian parliamentary elections on May 12 and the start of campaigning for the presidential ballots due in both Armenia and Azerbaijan next year. Kocharian has publicly pledged not to cut an unpopular peace deal before the May ballot.

For observers accustomed to successive setbacks in the Karabakh peace process, these encouraging signs may appear too good to be true, especially considering the diametrically opposed positions taken by Armenian and Azerbaijani leaders in public. Aliyev in particular continues to insist that Baku will never recognize Karabakh's 1988 unilateral declaration of secession from the then Azerbaijan SSR, and can only grant the Armenian-controlled territory "the highest degree of autonomy." The Minsk Group plan would clearly enable the NKR's overwhelmingly Armenian population to legitimize that secession in the proposed referendum.

The date and practical modalities of such a vote are believed to be one of the most intractable remaining sticking points, with the Armenian side saying that it should be held as early as possible, and the Azerbaijanis reportedly demanding a 15- to 20-year delay. Armenian sources privy to the peace talks say the final version of the putative peace accord may not set any date for the referendum, and instead keep Karabakh under Armenian control for an indefinite interim period. Azerbaijan would presumably be able not to formally relinquish its claim to Karabakh in the foreseeable future.

Kelbajar Withdrawal

Those same Armenian sources also say a peace settlement was also prevented in 2006 by another issue: the time frame for Armenian withdrawal from Kelbajar, one of the two Azerbaijani districts sandwiched between Karabakh and Armenia proper. At least until now, Armenia has said it will only relinquish control of Kelbajar after the holding of the referendum, a condition that Azerbaijani officials have rejected.

The Trend news agency quoted Azerbaijan's Deputy Foreign Minister Araz Azimov as saying on February 12 the parties are also divided on the return of Azerbaijani refugees to Karabakh and the status of the strategic Lachin corridor linking the enclave to Armenia. Yerevan and Karabakh's ethnic Armenian leadership insist that Lachin remain under full Armenian control.

According to Azimov, during talks on January 23 in Moscow with his Azerbaijani counterpart Elmar Mammadyarov, Armenian Foreign Minister Oskanian rejected a proposal to use the Lachin corridor jointly with Azerbaijan. But while Azimov accused Oskanian of adopting an "extremely tough" position on a number of points, Mammadyarov said on February 12 simply that he "expected more" from the Moscow talks. And while Azimov declared there is no point in continuing talks unless the Armenian side softens its stance, Mammadyarov held out the possibility that in the event of further progress, it will be possible to discuss a further meeting between the two presidents, Day.Az reported.

Whether or not the governments in Baku and Yerevan are really committed to mutual compromise is another key unanswered question. Aliyev, for example, has repeatedly predicted that Armenia will be increasingly unable to compete with his oil-rich country, which is beginning to reap the benefits of its vast hydrocarbon reserves. Kocharian and his political allies, for their part, believe that the Karabakh status quo does not preclude Armenia's development, pointing to its double-digit economic growth registered in recent years.

Still, the two leaders have at least one strong incentive to forge ahead with a compromise settlement this year. The proposed peace deal envisages a gradual resolution of the Karabakh dispute that would require a policy continuity in Baku and Yerevan, suggesting that the West would prefer to avoid regime change in either country. Aliyev will be up for reelection in late 2008, while observers believe Kocharian plans to hand over power in 2008 to his likely successor, Defense Minister Serzh Sarkisian, and remain in government in another capacity. RFE/RL