The United States and Armenia have agreed on an implementation framework to develop a trade corridor that is the centerpiece of the provisional Armenian-Azerbaijani peace deal signed last summer in Washington. According to the document, the United States will have a majority stake in developing infrastructure for what is known as the Trump Route for International Peace and Prosperity (TRIPP).
US Secretary of State Marco Rubio and his Armenian counterpart, Ararat Mirzoyan, announced the memorandum of understanding following a January 13 meeting in Washington. The document does not contain a proposed implementation timeline.
“The Framework outlines a concrete path to operationalize the TRIPP, which is intended to establish unimpeded, multimodal transit connectivity on the territory of Armenia, while connecting the main part of Azerbaijan and its Nakhchivan Autonomous Republic and creating a vital link in the Trans-Caspian Trade Route,” according to a State Department news release.
Under the framework agreement, a joint venture, dubbed the TRIPP Development Co., will be created, with the United States holding a 74 percent stake and Armenia holding the remainder. The entity will enjoy exclusive development and operational rights for 49 years. After that initial term, the two partners will have a mutual option to extend the exclusivity arrangement for an additional 50 years, with Armenia increasing its stake to 49 percent.
The memo indicates that no US public or private entity will enjoy extraterritorial rights along TRIPP, stating that Armenia will retain “legislative, regulatory, and judicial authority due to full sovereignty and territorial integrity over all TRIPP areas within Armenia’s sovereign territory, including the ability to enforce laws and regulations in line with Armenia’s domestic laws and international agreements.”
Once TRIPP becomes operational, the joint venture intends to establish what it describes as “a ‘front office – back office’ model, using digital tools to facilitate unimpeded connectivity,” according to the framework. The model is intended to create the impression of unimpeded transit along the route while enabling Armenia to retain sovereign rights associated with frontier management.
The front-office aspect would be run by “third-party operators” responsible for facilitating TRIPP services, including compiling needed documentation, handling payments and maintenance. Armenian state agencies would comprise the “back office” with full authority over normal border-control procedures, such as “final customs decisions and clearances,” “security screening and enforcement” and “immigration control.”
The framework allows for a public-private corporate structure, while specifying that the US and Armenian governments will have final say in “key decisions and issues related to the operation of the multimodal transit route.” The document also notes that a strategic objective for the entity will be ensuring “financial return to the U.S. for its initial contribution, or other economic benefits to the U.S. government or for U.S. companies.”
The TRIPP Development Co. will be able to develop several revenue streams, including infrastructure access and service fees, property rental, commercial activities and “revenue shares from Special Purpose Vehicles.”
The document retains a sense of strategic ambiguity on the sensitive issue of security provision. It states that “Armenia retains full authority in Armenian sovereign territory,” but leaves open the possibility that private contractors may shoulder responsibility for providing day-to-day security along TRIPP. “Private operational security personnel may be employed subject to Armenian licensing,” it notes.
In comments to Armenian media outlets on January 14, Mirzoyan described the agreement as a significant achievement, while adding that many details remain to be fleshed out.
It is worth noting the framework document’s preamble emphasizes that none of the outlined arrangements are written in stone. “This framework does not impose, nor does it intend to impose, any legal commitments or obligations on the United States or Armenia,” it states.
By Eurasianet
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