Normalization of Baku-Yerevan relations to strengthen regional stability - Moody's

A sustained normalization of relations between Azerbaijan and Armenia will create new conditions for trade and strengthen stability in the South Caucasus, according to Moody's.

Analysts at the rating agency say a long‑term settlement will support regional stability, improve transport connectivity, and open new trade opportunities across the Caucasus.

The report notes that the Middle Corridor serves as an additional source of growth, with increased freight traffic directly stimulating development in Azerbaijan, Georgia, and Kazakhstan, while also benefiting Kyrgyzstan and Uzbekistan.

Large‑scale investment in transport, logistics, energy, and digital infrastructure will help the states of Central Asia and the Caucasus diversify their economies.