Zangezur Corridor is a decisive test of US ability to forge mutually  beneficial solutions in contested regions - Forbes

ArmInfo.  Zangezur Corridor is a decisive test of the US ability to forge mutually beneficial solutions in contested regions, as noted in an analytical article published by Forbes.

The publication asks whether in a world scrambling for non-Russian  energy amid escalating global tensions, could  a 43-kilometer strip  of Armenian land  America's masterstroke against  Moscow and Tehran?  The US bold bid to lease the Zangezur Corridor for a century promises   50-100 billion dollars in annual trade flows, but risks igniting a  new  Cold War flashpoint in the Caucasus.

The United States has thrust itself into the center of a high-stakes  diplomatic gamble that could fundamentally alter energy flows across  Eurasia. Through its ambitious proposal for the Zangezur Corridor, a  strategic 43-kilometer passage through Armenia's Syunik region,  Washington aims to break decades-old deadlocks, diversify Europe's  energy supplies away from Russia, and counter the growing influence  of Moscow, Beijing, and Tehran in a critical transit region. The  initiative reflects America's broader ambition to exploit a rare  power vacuum in the South Caucasus, a region historically dominated  by Russia but now ripe for  realignment following Moscow's stark  failure to protect its ally Armenia during Azerbaijan's decisive  September 2023 offensive in Nagorno-Karabakh. 

As former US Deputy Secretary of State James O'Brien noted: "The  future built around the axis of Russia and Iran as the main players  in regional security is unstable and undesirable, including for the  governments of Armenia and Azerbaijan." "This Western alignment  creates an unprecedented opening for U.S.  influence. Russian imports  to the region, which supplied 20-30% of regional trade pre- 2022, now  face sanctions constraints. Meanwhile, Louis Bono, the U.S. Senior  Adviser for Caucasus Negotiations, has advanced proposals for  international oversight of the corridor, drawing on precedents like  the Panama Canal and  Cold War Berlin corridors. The potential  economic rewards are vast enough to override political and security  concerns. World Bank modeling suggests the corridor could unlock  $50-100 billion in annual trade value by 2027. This surge would be  driven by dramatic  improvements in logistics: Bloomberg data from  May 2025 indicates the route could cut transit Europe-Asia transit  times by 12-15 days compared to existing routes. The return on  investment appears compelling. The Caspian Policy Center estimates  infrastructure costs  of $3-5 billion  over 5-10 years, while Oxford  Economics models project $20-30 billion in annual logistics savings.  For Azerbaijan, the Center for Economic Reforms Analysis and  Communication  projects  the corridor would increase total exports by  over $700 million and boost non-oil GDP by 2% annually.  In 2023,  Azerbaijan's Southern Gas Corridor delivered 12 billion cubic metres   to Europe, targeting 20 billion by 2027 under a 2022 EU memorandum.  Kazakhstan plans to transit increasing oil  volumes via Azerbaijan,  with actual flows reaching 1.2 million tones between January and  October 2024, despite technical challenges limiting capacity. For  European energy security, the implications are profound. The IEA's  2025World Energy Outlook projects  Europe  needs 20 billion cubic  meters more non-Russian gas by 2030. Normalized Armenia-Turkey border  could enhance access to Caspian reserves, potentially cutting import  costs by 10-15% for companies like BP.

However, as the article highlights, the core challenges lies in  irreconcilable positions: Azerbaijan demands an unimpeded corridor as  dividends from  its 2023 military victory, while Armenia  categorically refuses to cede sovereignty  what it views as critical  territory.. The US "lease" proposal presents a creative attempt to  use corporate legal frameworks to circumvent this deadlock, offering  Baku security guarantees while allowing Yerevan to maintain nominal  sovereignty. The approach draws inspiration from historical  precedents in which creative governance mechanisms have resolved  seemingly intractable disputes. Like the Panama Canal under US  administration from 1914 to 1999, the model promises to facilitate  global trade while addressing security concerns. Yet , critics warn  of potential neo-colonial overtones and the risk of long-term  backlash. The March 2025 peace deal drafts marked significant  progress, finalising terms on mutual territorial recognition, border  delimitation and  non-use of force. However, they stalled on  transport guarantees and enclave access - precisely where the US  proposal seeks to break through. 

The corridor's success would fundamentally alter regional power  dynamics, explaining why rival powers are recalibrating their  strategies. Iran faces the prospect of losing 20-30% of its transit  role, disrupting critical trade routes, including the 43,000 Turkish  trucks that pass annually to Central Asia.. Russia confronts  potential revenue losses of  $10-20 billion over a decade and a  10-15% erosion of its  leverage over European energy markets. China,  meanwhile, eyes $20-30 billion in  Belt and Road efficiencies by 2030  through improved connectivity. Yet Beijing must balance these gains  against the risk of reduced dependence on  Chinese-controlled routes.  The corridor could position Turkey as critical  energy hub with  direct access to Turkic states, potentially capturing $10-15 billion  in annual transit revenue  by 2030.  Energy majors are  positioning   for opportunity. SOCAR expands pipeline capacity, while ADNOC  explores hydrogen. joint ventures. BP and Chevron project $5-10  billion in upstream investment boosts from expanded export capacity.  However, political stalemates could inflate project costs  by 20%,  while regulatory delays  might push  timelines beyond viable  investment windows.

 Turkey's strategic calculus adds complexity  to the equation. Ankara  explores  Kurdish  de-escalation through PKK  conflict, signaling a  "big reset" that could stabilize borders and unlock economic  potential.  This diplomatic thaw, if successful, could complement the  Zangezur initiative by creating a more stable regional environment  for major infrastructure projects. Turkish businesses  in  Eastern  Anatolian provinces forecast a 310% increase in export capacity, from  $160 million to $500 million annually, if the corridor materializes.  This economic momentum provides strong incentives for sustained  diplomatic engagement, even amid domestic political sensitivities.  Despite compelling economics, significant risks remain.  Observers  assign a 60% probability to stalled talks, potentially delaying  implementation by 12-18 months.  Lloyd's data from June 2025 warns of  20% commodity volatility  talks fail, while insurance premiums could  spike by 20%. 

Armenia has explicitly denied discussions regarding any lease or  transfer of territorial control.  Spokesperson  Nazeli Baghdasaryan  stated firmly that "Armenia has not discussed and is not discussing  the transfer of control over its sovereign territory to any third  party." This resistance highlights the fundamental challenge facing  US mediators. The feasibility of international oversight remains  uncertain.  CSIS analysis estimate  only 40-50%  success probability  even with UN guarantees, vulnerable to Armenian vetoes over perceived  sovereignty encroachment. The success of the model depends on  addressing core security concerns while maintaining sufficient  international legitimacy. 

More than an infrastructure development project, the Zangezur  initiative  represents a broader test of American diplomatic  creativity in an increasingly multipolar world. Success would  demonstrate Washington's ability to forge solutions that counter  rival influence  while serving real economic interests.  Failure  could signal diminished US capacity to  shape  outcomes in contested  regions.