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An escalation of the conflict between Armenia and Azerbaijan is not predicted. Fitch
Armenia is negotiating a peace agreement with Azerbaijan following the complete loss of territorial control over Nagorno-Karabakh in 2023. A comprehensive peace agreement will be complex due to Azerbaijan's demand to create a transit corridor from Armenia and changes to the constitution, the agreement of which will be politically difficult. However, the escalation of the conflict has yet to be predicted.
This is stated in the report published by Fitch Ratings international rating agency.
"Our base case does not include escalation of the conflict, although Azerbaijani troops continue to have a presence on the territory of Armenia, and skirmishes have occurred from time to time," the agency notes.
"Relations with Russia appear to have deteriorated when Armenia suspended participation and budget contributions to the Russian-led Collective Security Treaty Organization while conducting military exercises with the United States. However, trade ties with Russia remain strong, and dependence on Russia for energy security is very high. "Fitch does not expect the secondary sanctions of the USA, Great Britain or the EU against Armenia, and expects that the financial sector of Armenia will comply with the sanctions against Russia," the publication said.
