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DEMOCRACY AND OIL. THE CASE OF AZERBAIJAN Daniel Heradstveit NUPI (Norwegian Ministry of Energetics).

Preface. The topic of this book is the development of democracy and human rights in Azerbaijan, but since these virtues are inversely correlated with corruption, it is natural to raise this issue too. And since oil is the country's primary earner, the use made of the oil revenues will affect the prevalence of corruption. The attitude of the Western oil industry to Azerbaijani corruption is therefore crucial. The in-depth interviews with 20 of the leading opposition politicians in Azerbaijan constitute a very important part of the data for this study. We have gained good insight into the Azerbaijani oppositional elite's perception of the Western oil industry and its operations in their country. Some people may react to the making of allegations about the oil industry that they consider unfair or even downright false. Fair or unfair, true or untrue is not the point: perceptions are also facts, part of the Azerbaijani reality to which the oil industry must relate, and so the industry will do well to listen. The study shows how easy it is - almost without being aware of it - to become caught up in the paralysing culture of corruption and finally become a part of it. Some respondents attempt to relativise the phenomenon in terms of Azerbaijani history, to see it as normal, natural or at any rate inevitable; but it is also sharply condemned. Our data uncover a growing unease in Azerbaijan, a fear that the expected oil wealth will be squandered by the narrow and corrupt power elite that is now on top and is steadily entrenching itself further. Precedents from other oil states are frightening. There is little doubt that the only hope of eradicating the culture of corruption lies in strengthening civil society. It is therefore most encouraging to note that there is a very active political opposition advocating precisely this. That members of the national assembly and political parties are prepared openly to criticise and to work systematically for democratic development - in the full knowledge that this may lead to reprisals against themselves and their families - is a new phenomenon in Azerbaijani society. It is a major challenge to the oil industry to stimulate the forces opposed to autocracy and the culture of corruption. Passive behaviour will inevitably land the oil companies in ethical dilemmas, they will risk becoming indirect supporters of a corrupt elite that has neither the power nor the will to exercise proper stewardship of the 'people's gold', Azerbaijani oil. During my year-long work on the study a number of people and institutions have been of great help. Part of the autumn semester of 1998 I spent lecturing at Syracuse University, New York - a period that afforded ample opportunity to discuss my research design both in and out of seminars. I am particularly grateful to G. Matthew Bonham and Mehrzad Boroujerdi. I received useful feedback also in seminars hosted by the Research Council of Norway, the Norwegian Ministry of Oil and Energy and the Norwegian Foreign Ministry. Among individuals, I would like to thank Research Associate Reidar Visser at the Norwegian Institute of International Affairs and Director Willy H. Olsen of Statoil for advice and feedback; Dr Raoul Motika of the University of Heidelberg for mobilising the necessary support apparatus for the Baku fieldwork; Hikmet Hadjy-zadeh for his role as door-opener to the big names of the political opposition, which guaranteed the success of my study trip; Dr Edmund Herzig of the Royal Institute of International Affairs in London, Dr Semih Vaner of Centre d'Йtudes et de Recherches Internationales in Paris and Kari Eken Strшmmen at the University of Bergen, for help and inspiration throughout the study. Finally, my thanks to the Research Council of Norway, whose financial support made the project possible. Daniel Heradstveit CONTENTS 1 Dictatorship and Democracy in Azerbaijan Introduction The formal political system Political debate and civil society Threats Conclusion 2 The democratic-secular state The modern state project The secular-democratic state in Azerbaijan President Aliev's apologia 3 The ethnonationalist state The ethnonationalist project Ethnonationalism versus the modern state The ethnic state in the Muslim world Ethnicity in Azerbaijan The Nagorno-Karabakh conflict 4 The Islamist state The rise of Islamism - the revolt against the West Conservativism, modernity and mobilisation Islam and democracy Islam and Islamism in Azerbaijan Possible causes of a second Islamist surge 5 Elite perceptions of the Islamic threat Introduction The elite sample Sampling method Data, rhetoric and perceptions The self-identification of the elite sample The Islamic threat Azerbaijan as an Islamic Republic: the optimistic theocrats Azerbaijan as an Islamic Republic: the optimistic secularists Azerbaijan as an Islamic Republic: the somewhat nervous majority 6 Elite perceptions of the Western oil industry The oil companies, democracy and human rights The oil companies and corruption The Norwegian oil company Statoil 7 The elite's prescriptions - the 'Good' Oil Industry 'Don't be fooled by President Heidar Aliev' 'Don't act as if the oil is Aliev's to give away' 'Think in the long term - Aliev will not live forever' 'If Aliev pushes, call his bluff' 'Talk to the opposition' 'Support the free press' 'Help to develop civil society' 'Open the books' 'Publish the plans' 'Stop paying bribes' 'Support us in Nagorno-Karabakh' Appendix I Interview Schedule Appendix II List of Interviewees Bibliography 1 Dictatorship and Democracy in Azerbaijan Introduction This study aims to illuminate the struggle for democracy and human rights in Azerbaijan. On the basis of the idea that a key criterion for whether a country is democratic is how the rulers treat the opposition, we are narrowing the scope of the data in the analysis by building primarily on the perspective of the political opposition in the country. The problem set is also narrowed by our focus on the roles played by Western oil companies in the struggle for democracy and human rights. In order to give the reader some background to the analysis, however, the first part of the book will endeavour to survey the status of democratic institutions in Azerbaijan, and we will look at three alternative models of nation-building. The Soviet successor states of the Caucasus and Central Asia are generally in the hands of recycled Communist leaders. The current president of Azerbaijan, Heidar Aliev, is no exception. Former First Secretary of the Azerbaijani Communist Party, subsequently a KGB general in the same country and finally a member of the Politburo of the CPSU - there are few who can boast of a more impressive record in the service of Communism in the Caucasus than this self-same Heidar Aliev. Some of these old Communists portray themselves as converts to Western values, others scarcely bother to hide their Russian apprenticeships and Stalinist impulses. Where does Azerbaijan fit in on this spectrum? In his autocratic tendencies, Aliev may be placed somewhere between his Christian neighbours in Georgia and Armenia and his Muslim neighbours in Central Asia. This first chapter will show that the democratic political institutions preventing a president from amassing excessive power are still weak, but not without potential for development. Aliev qualifies for the label of autocrat, but because he seems willing to proceed a certain way along the democratic road, we may call him 'Autocrat Lite'. The formal political system The constitution In the same way as Atatьrk's Turkish Republic did, Azerbaijan has copied Western constitutional models. On paper its constitution looks good: it proclaims a democratic secular state and enshrines individual rights. Citizens are to be protected from the exercise of arbitrary power. The presidency is strong, but the principle of separation of powers is included. But all this is on paper; in practice, the president behaves as if the country had no constitution. It is quite likely that the next presidential election will be in one way or another unconstitutional. The width of the gulf between the principles of government enshrined in the constitution and the actual practice of politics is due to the fact that the constitution contains imported ideas while the old way of thinking is alive and well in the ruling class. In its enthusiasm for a Western geostrategic orientation, Azerbaijan has adopted political documents plucked straight out of a Western context, whose values are quite foreign to Azerbaijan politicians, not to mention the citizenry. Apart from the narrow elite mostly to be found in Baku, there is little comprehension of the ideas enshrined in the constitution; it all seems very foreign. As long as the constitution lacks popular legitimacy, the government does not need to pay any attention to it, nor will the rulers hesitate to override constitutional rules. If the constitution is ever to be taken as seriously as in Western democracies, there must be a change of mentality, a change that must necessarily come slowly. This does not, however, mean that the formal document has no value at all. On the contrary, it can be used, and is being used, by both the domestic political opposition and external players, as a crowbar with which to lever the presidency. The president finds himself obliged to pay lip-service to the ideals of the constitution, which limits his freedom of action somewhat (Auch 1999:76-80). The presidency Due to the ongoing war with Armenia and its enclave in Nagorno-Karabakh that began simultaneously with Azerbaijan's independence from the Soviet Union, the first years of 'freedom' were particularly chaotic. President Ayaz Mutalibov, first elected in 1990, in two brief years was deposed, restored and finally removed. That was in May 1992, when Abulfaz Elchibey took over. He was chairman of the Azerbaijani Popular Front, the political movement that had been the standard-bearer for independence from the Soviet Union. On 7 June 1992 he won a solid majority in a presidential election. It quickly became apparent that there was a great gulf between his brilliant eloquence - he mobilised the masses by playing the strings of their strong emotions about independence - and his ability to govern. He was therefore easy meat for coup-makers. Less than a year had passed before the revolt of General Huseynov, which was a reaction to the big Armenian offensive of 1993 that occupied large swathes of Azerbaijani territory, areas still under Armenian occupation. This great Armenian victory created internal chaos in Azerbaijan and something close to civil war. Another consequence of the fighting was over a million internally displaced persons, 12 per cent of the entire Azerbaijani population. In his dire need, Elchibey implored the aid of his political arch-rival, Heidar Aliev, who since 1990 had been developing a power base in Nakhichevan, the Azerbaijani enclave sandwiched between Armenia and Iran. This turned out to be a mistake for Elchibey, for Heidar Aliev had larger ambitions than Elchibey counted on. Aliev had not been long in Baku before he removed his political rivals - both President Elchibey and the rebellious General Huseynov. Although Aliev was brought to Baku by the Huseynov coup, he was formally elected President on 3 October 1993 with 98.3 per cent of the votes - a result highly reminiscent of Communist election results. President Aliev would argue that Azerbaijan cannot afford a weak presidency and the instability this would bring. Above all, instability would attract Russian meddling. Aliev has indeed conducted a canny policy of independence, no other state in the region has made such progress in liberating itself from the colonial power. He made his career in the Soviet security service, becoming KGB chief for Azerbaijan in 1967 and First Secretary of the Azerbaijani CP in 1969. During the 1970s and 1980s he was candidate member and later full member of the Politburo under Yury Andropov. In his 'exile' period of 1990 to 1993 he used his strong political base in Nakhichevan to lay the foundation for good relations with Iran and Turkey, the fruits of which he has enjoyed as President. His links to the Communist apparatus meant that when he took over as President in 1993, it was expected that he would ally with Russia. At the beginning, he did just that, but Russia's double game in the Nagorno-Karabakh conflict irritated him immensely, and for this and other reasons, he changed his coat completely, renounced Communism and went on the hajj (the Muslim pilgrimage to Mecca). Like Elchibey, Aliev is a passionate nationalist, but unlike him, he is also a pragmatist. He understood that account had to be taken of the powerful players in the region, Russia and Iran. His slogan was thus the same as Kemal Atatьrk's from the foundation of the Turkish Republic - 'Peace at home and peace abroad'. And indeed, the Aliev period has seen more of both. There is much more domestic consensus and solidarity than under Elchibey, and both this internal peace and the avoidance of conflict with neighbours are important preconditions for the development of democracy and human rights. On the one hand, therefore, Aliev has created a solid basis for independence and stability - an undeniable precondition for democracy. The strong links with the West that he has forged also reinforce democratic impulses. On the other hand, Aliev's personal power has grown during his presidency. Powerful rivals such as Rasul Guliev and Hasan Hasanov have been removed. Policy is created by the President and a kitchen cabinet. However, benevolent an autocrat he may be at the moment, but wise leaders may with time grow tyrannical, and the next president may lack Aliev's virtues. All things considered, we may therefore say that Aliev has laid the foundations for a future democratic Azerbaijan, but also that the over-mighty presidency is a serious obstacle to Azerbaijani democracy. Parties, elections and the opposition In democratic states, the legislature is an important check on the executive, and sets the agenda for the various departments of state. It is a real player in political life. This is not the case in Azerbaijan, where even the constitution allows it little power; and even that is rarely achieved. The presidency has extensive powers - and the present incumbent knows how to use them. Moreover, the national assembly is hampered by the inability of the parties to cooperate. This is partly due to the fact that political parties are assembled around neither ideology nor social interest groups, but strong personalities who cannot stand the sight of each another. In other words, they are not political parties in the modern sense but merely factions. Finally, most of the members of the national assembly are merely loudspeakers for the president - 'their master's voice'. Even if the Azerbaijani parties are small and weak and have minimal influence, they are definitely a beginning, and may thus come to play an important role in the country's attempt to build a democracy. Some of the parties have a national network and local organisations, such as the New Azerbaijani Party, the Azerbaijan Popular Front, the National Independence Party and the strongly pro-Turkish Musavat Party. The latter has a long and venerable tradition, being the party led by the national hero Rasulzade in the struggle that led to the independent republic of 1918-1920 (Auch 1999:87-103). A crucial criterion of the degree of democracy in a country is how the rulers treat the opposition. Under Communism, there was no such thing as a respected 'loyal opposition', only the regime and the dissidents. In present-day Azerbaijan it is by no means unusual for heavyweight opposition politicians to be removed from the political stage by arbitrary arrest and imprisonment. Arrested oppositionals are beaten up in detention, as if the horrible conditions in Azerbaijani prisons were not in themselves a violation of human rights. Some politicians have even died in custody. As well as individuals, political parties are arbitrarily treated and risk being excluded from the political process. Political mobilisation against the regime is put down by force, and political meetings may be violently interrupted and broken up. While there are elections, there is still hope. Moreover, the opposition has gradually gained easier access to electronic media. Both NGOs and independent media have acquired greater capacity to monitor elections and draw attention to misuse of power. The sitting president can no longer take it for granted that the outcome of an election is to his taste. However, it is not certain that elections have much impact on what he actually does. Moreover, elections are no guarantee of democracy in themselves, and the West has paid too much attention to elections as the be-all and end-all of democracy. In Western countries, political elections with a high turnout and no cheating are regarded as a necessary condition of democracy, but we should be aware that the act of voting may in other cultures have a quite different meaning. In the days when Azerbaijan was a part of the Soviet Union, the Communists were always holding elections, but with only one party, and in any case all the important decisions were taken in Moscow, so that the elections had little impact on daily life. Azerbaijanis' attitude to elections may therefore be a hold-over from the Communist system, when people voted out of duty (or fear) but did not expect that the result would affect their own problems. Characteristic of the whole region since the fall of the Soviet Union is 'progress' from one-party elections to rigged elections. The danger is that a formally correct election makes a favourable impression on the West and can be 'cashed in' for goodwill and assistance for the regime, but because of the different weight accorded elections in different political cultures, they are a grossly misleading tool for monitoring the progress of democratisation (Herzig 1998:31-33). When Aliev acts autocratically, this is not first and foremost because he is insensitive to his environment, it is rather because the bulk of the people see such a strong executive as the normal - or even worse, as the desirable - state of affairs. Rule by decree is considered normal; 'this is how things are'. In other words, the political elite is as yet insufficiently schooled in democratic ideas. In a political culture where democratic principles are not understood or are not internalised, the prospects of democracy will remain poor, however many nominally democratic institutions there may be...

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DEMOCRACY AND OIL. THE CASE OF AZERBAIJAN Daniel Heradstveit NUPI (Norwegian Ministry of Energetics).

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