Stronger Azerbaijan-Armenia ties force questions over Georgia's position as a transit hub

By Nini Nikoleishvili
January 23, 2026 14:56 Updated 70d ago
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The recent peace process between Armenia and Azerbaijan has reignited a sensitive debate in Georgia: does regional normalisation strengthen Georgia’s position or threaten its long-standing role as the South Caucasus’ key transit hub?

The discussion intensified after Azerbaijani President Ilham Aliyev said at the World Economic Forum in Davos that Armenia had requested the possibility of transit to Russia via Azerbaijan, suggesting that direct routes could emerge in the future. While the statement did not mention replacing Georgia, reactions in Tbilisi were immediate and sharply divided.

This division reflects not only differing political positions, but deeper anxieties about Georgia’s geopolitical relevance in a rapidly-changing regional order.

Representatives of the ruling Georgian Dream Party argue that peace in the South Caucasus is a strategic opportunity rather than a threat. Parliamentary Committee Chairmen Irakli Kadagishvili and Davit Matikashvili both emphasised that Georgia’s transit function has never depended on conflict between its neighbours. Instead, they point to existing infrastructure, such as pipelines, railways, ports, and energy corridors, which anchor Georgia firmly into East-West trade routes.

Their argument aligns with established transit economics: major corridors are not solely built around geography, but also around infrastructure density access to sea routes and international financing.
The opposition, however, frames the situation differently. Leaders from “Lelo - Strong Georgia” warn that Georgia risks losing a geopolitical advantage it has pursued since independence, accusing the government of alienating Western partners and allowing Armenia to reposition itself as a more reliable regional interlocutor.

This framing turns a technical transit discussion into a broader political question: is Georgia losing relevance due to infrastructure changes, or due to diplomatic credibility?

What academic research says about transit corridors

Studies by the World Bank, Organisation for Economic Co-operation and Development (OECD) and the Asian Development Bank consistently show that new transport routes rarely replace existing ones in the short or medium term. Instead, they tend to diversify flows, reduce bottlenecks, and increase overall regional trade volumes.

Georgia’s transit role is embedded in several structural advantages:

     ·     direct access to the Black Sea;

     ·     integration into European Union (EU)-backed initiatives such as the Trans-Caspian International Transport Route;

     ·     existing oil and gas pipelines linking Azerbaijan to European markets;

     ·     long-standing logistics infrastructure built over decades.

By contrast, Armenia’s transport network has been historically constrained by closed borders and limited maritime access. While normalisation with Azerbaijan could unlock new routes, building competitive capacity requires time, capital, and political stability.

Georgia’s diplomacy: isolation or selective engagement?

Despite claims of international isolation, Georgia has maintained active high-level engagement with both Armenia and Azerbaijan in recent months. Bilateral visits, trilateral formats, and economic cooperation discussions indicate an attempt to remain relevant in a post-conflict regional architecture.

This aligns with the concept of “middle power adaptation” - smaller states adjusting their diplomacy to avoid marginalisation during systemic shifts.

Narratives versus structural realities

The current debate in Georgia is less about immediate transit losses and more about future positioning. Structurally, Georgia’s transit role remains intact. Politically, uncertainty fuels competing narratives: one emphasising resilience; the other warning of decline.
 

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Georgia Azerbaijan Armenia South Caucasus
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