After Azerbaijan’s restoration of its full geographical authority, the Western powers have generally failed to effectively engage with it. Filling the gap, China has been deepening its influence in the country while extending its approach into Georgia and yet Armenia.
Beijing has increased opportunities in the country’s modern equipment and has been funding energy projects. In this crucial juncture area, nations like Turkey, Kazakhstan, and the Gulf claims have been putting their weight in the process.
American actors have only just begun to try to handle the results of their failure to adapt their local approaches after the 2020 Next Karabakh War.
In this regard, President of Azerbaijan Ilham Aliyev’s visit to Beijing on April 2025 marked a turning point for China’s relationship with the South Caucasus. This has now led to the signing of a comprehensive strategic partnership ( CSP), which is the highest level of bilateral cooperation in the Chinese diplomatic hierarchy.
This upgrade builds on momentum since 2022, when the two sides formalized a strategic partnership at a Shanghai Cooperation Organization (SCO ) summit. By 2024, bilateral trade had reached US$ 3.74 billion, up 20.7 % from the previous year, making China Azerbaijan’s fourth-largest trading partner.
The partnership, which has been elevated to a comprehensive position, shows how in line with Azerbaijan’s development programs, such as the” Silk Road Revival” and the 2030 Socio-Economic Development programs, is China’s Belt and Road Initiative. Beijing no more treats the South Caucasus as a silent hall but considers it an effective network in trans-Caspian and trans-Eurasian connectivity.
Aliyev and Xi Jinping’s joint statement emphasizes global cooperation in the fields of transportation and logistics, as well as automation, intellectual property, and aircraft.
Additionally, agreements address cooperative projects in the fields of metallurgy, automotive, and machinery. China will therefore enter key Georgian commercial sectors, complementing Baku’s drive to expand its economy beyond hydrocarbon fuels.
The West’s hesitant answer
China’s expansion in the South Caucasus was facilitated by the 2020 Minute Karabakh War’s strategic pump. After Azerbaijan’s victory over Armenia and the Russia-brokered ceasefire, the traditional Western-led peace process ( the OSCE Minsk Group ) was effectively sidelined.
Washington and Brussels attempted to resolve Armenia and Azerbaijan’s differences, which led to some fruitful achievement, but they failed to come up with a strong local vision at a time when the political landscape was changing.
Just in 2022 did the West begin to lose ground because of Russia’s redistribution of the South Caucasus. The European Union launched counseling summits in Brussels and deployed a border surveillance mission to Armenia in 2023 – which, rather than de-escalating tensions, has rarely had the same effect.
By 2023-2024, the United States had increased its focus, according to Secretary of State Antony Blinken, who convened multilateral meetings, and appointed a special minister for the area. However, these initiatives frequently lag behind local developments.
Facing no like boundaries, China pressed forward with a trained financial plan that expanded its footprints through logistics, modern equipment and power financing.
As Yerevan’s disillusion with Moscow grew, the United States and France began to adopt a more pro-Armenian position. Social support increased, and dialogues of security assistance grew more lively. France became the largest arms dealer to Armenia as Russian sales almost collapsed.
The Biden administration declined to maintain the waiver for Section 907 of the US Freedom Support Act, which prohibits direct support to Azerbaijan. Any American leadership has done this for the first time in more than 20 years.
Just days before the end of the Trump administration, Biden’s Secretary of State Antony Blinken signed a US-Armenian corporate relationship contract with Yerevan’s Foreign Minister Ararat Mirzoyan.
By 2025, the EU had begun revising the importance of the area, both as a source of energy and trade as well. Although funding for the South Caucasus Pipeline’s growth is still a mystery, Azerbaijan and its document from July 2022 aimed to increase its fuel exports to Europe by 2027.
The EU’s Global Gateway initiative today openly favors Middle Corridor growth, coordinating purchase across Central Asia. A Transport Corridor Alliance was established to support trans-Caspian routes at an EU-Central Asia summit in Samarkand in April 2024.
Although these initiatives are still in development, they indicate that South Caucasus will soon be recognized as a component of a wider Eurasian connectivity network. Still, the Western response remains fundamentally reactive.
The region is no longer dependent solely on Euro-Atlantic frameworks. The South Caucasus now has real alternatives and the means to exercise agency there because China offers extensive partnerships grounded in infrastructure, trade, and long-horizon investment.
Logistics and connectivity: the Middle Corridor in focus
China was historically cautious in the South Caucasus, interpreting it as Russia’s sphere of influence and favoring routes through Russia or Iran for its trade pacific with Europe. The original Belt and Road corridors did not even include the South Caucasus.
The twin shocks of the 2020 Second Karabakh War and especially the 2022 Russian war against Ukraine disrupted Russian transit routes and changed all that. Azerbaijan and its neighbors are now seen by Beijing as crucial components of an alternative East-West artery connecting China to Europe.
Aliyev has made it known that, after China, Azerbaijan is the second-largest investor in Belt and Road projects. Baku has spent enormously to upgrade ports, railways and highways to attract Belt and Road traffic.
China’s support for Azerbaijan as a crucial transit node linking China, Central Asia, and Europe confirms its intention to convert the Middle Corridor from a secondary fallback route to a primary conduit.
The Middle Corridor’s potential was previously hindered by shoddy infrastructure and increased competition from faster Russian rail lines. Before 2022, only 2-3 % of China-EU overland freight used the Middle Corridor.
However, this calculus was altered by the sanctions and instability brought on by Russia’s invasion of Ukraine. Kazakhstan saw a 63 % increase in freight along this route in 2023-2024 ( to 4.1 million tons ), and Azerbaijan handled 18.5 million tons of cargo, a 5.7 % increase.
In late 2023, the rail companies of Kazakhstan, Azerbaijan and Georgia formed a joint venture to integrate customs and digital tracking systems, with a view to cutting freight times between China and Europe.
Azerbaijan, for its part, upgraded the Baku-Tbilisi-Kars railway and increased the capacity of the new Port of Alat on the Caspian. Azerbaijan and China came to a consensus to simplify customs and finalize new road transportation agreements to advance direct trans-Caspian routes connecting China and Europe via Azerbaijan.
Shippers in Kazakhstan and Azerbaijan project that Middle Corridor container volume will reach 96, 000 twenty-foot equivalent units ( TEUs, a standard measure equivalent to about 33 cubic meters ). Although the volume is modest compared to Northern Corridor levels still transiting Russia, this is a significant increase.
Energy and digital footprints: China’s techno-economic statecraft
China’s expanding influence in the South Caucasus is not limited to trains and ports. As they have already done in Central Asia, particularly in Azerbaijan and Georgia, digital infrastructure and energy financing are becoming important components of Beijing’s statecraft in the region. These industries serve as a gateway to local development needs while expanding China’s footprint.
In Azerbaijan, the new partnership prioritizes the digital economy and technology cooperation. Over the past ten years, Chinese telecom companies Huawei and ZTE have provided equipment for telecom networks in each of the three countries. The two cities have now agreed to support the “digital transformation of industry” and establish joint tech R&, D platforms.
Chinese soft power accompanies these tech investments. With Beijing’s assistance, a new Chinese language school has recently been established in Yerevan. Confucius Institutes are present in Baku and Tbilisi. Although not particularly large, these initiatives foster goodwill and familiarity with Chinese standards and technology.
In Georgia, a visa-free regime with China took effect in 2024, boosting tourism and business travel. Similar a regime is currently in place between China and Azerbaijan. Beijing has subtly been shaping the information environment in this regard, presenting itself as a new development partner for the Caucasus.
Chinese companies have stepped in alongside Middle Eastern investors to finance solar and wind projects. One example is the 100-megawatt ( MW) Gobustan solar plant, which is currently supported by China’s Universal Energy.
China is now promoting a” Global Clean Energy Partnership,” which aligns with Baku’s plans to develop large renewable energy projects in its sunny plains and windy Caspian coast, aimed at both domestic electricity consumption and future exports to European markets.
In Georgia, Chinese firms have bid on hydropower plant tenders and acquired shares in the Poti Free Industrial Zone, which could include oil storage facilities. Chinese miners and investors are active in the copper and metals industry in Armenia.
Armenia sends copper concentrate to China, and it has also given money to China for energy-saving items like solar panels and transformers. These moves ensure China has a stake in the Caucasus energy landscape.
Both China and Turkey want open, stable corridors. Kazakhstan and other Central Asian nations are also stepping up their involvement. Kazakhstan, in particular, is investing heavily to make the trans-Caspian link viable by financing port upgrades and purchasing new ferries.
The Gulf Arab states have come to represent yet another group of players. The United Arab Emirates ( UAE ) and Saudi Arabia also see the region as an extension of their own bid to be Eurasian hubs.
Dubai-based logistics company DP World has provided advice on Azerbaijan’s Alat Free Economic Zone, and businesses are reportedly looking into investing in South Caucasus infrastructure. ACWA Power in Saudi Arabia and Masdar in the UAE have signed significant agreements to build solar and wind farms in Azerbaijan’s liberated territories.
The South Caucasus gains agency
The South Caucasus is acquiring autonomous agency as a result of these trends as a whole. In particular, Azerbaijan has capitalized on its geographic position to increase its strategic significance.
Georgia, long a supporter of alternative corridors, signed a free trade agreement with China in 2017 and then, in 2023, surprised many by elevating relations with Beijing to a strategic partnership. After Georgia felt a little distaste for the West and was looking for new investors, Prime Minister Irakli Garibashvili made the announcement during his visit to China.
Beijing’s interest is particularly strong in the long-planned deep-sea port on Georgia’s Black Sea coast, Anaklia. A Chinese state firm, China Harbor Engineering Company, has been contracted to develop the port, increasing Georgia’s dependence on Chinese capital.
Without significant investments, China’s economic footprint in Armenia continues to be thin. Aid is primarily symbolic, similar to a new TV tower studio and school buses.
The emerging geopolitical and geoeconomic network has made Azerbaijan, Armenia, and Georgia more transactional in engaging all outside powers.
The signing of the comprehensive strategic partnership between Azerbaijan and China and President Aliyev’s visit to Beijing in 2025 demonstrate how Beijing’s expanding footprint is changing the region’s geopolitical compass.
This trend is reinforced by Turkey, Kazakhstan, and the Gulf states ‘ involvement. Their investments and ambitions further anchor the Caucasus as a hub of trans-Caspian and trans-regional networks.
Due to the West’s lagging response, particularly from the US and EU, China has so far left a more dynamic role to play. Western countries must step beyond outdated frameworks and offer their own tangible connectivity and investment initiatives if they want to maintain their standing in the South Caucasus.
The lesson of the past five years is that the South Caucasus will not remain a geopolitical backwater or mere bridge by default. It is actively transforming itself into a central node of Eurasian connectivity, in complex-system terms autopoietic. The Beijing trip of Aliyev is a clear example of that new reality.