Kosovo: Current Issues and U.S. Policy

Steven Woehrel
Specialist in European Affairs

On February 17, 2008, Kosovo declared its independence from Serbia. The United States and 22 of the 27 European Union countries have recognized Kosovo’s independence. The Kosovo government claims that 98 countries in all have extended diplomatic recognition to it. EULEX, a European Union-led law-and-order mission, is tasked with improving the rule of law in Kosovo. KFOR, a NATO-led peacekeeping force that includes more than 700 U.S. soldiers, has the mission of providing a secure environment.

Serbia strongly objects to Kosovo’s declaration of independence. It has used diplomatic means to try to persuade countries to not recognize Kosovo. It has retained parallel governing institutions in Serb-majority areas in Kosovo. Since March 2011, the EU has mediated negotiations between Serbia and Kosovo. The agreements reached include ones on free movement of persons, customs stamps, recognition of university diplomas, cadastre (real estate) records, civil registries (which record births, deaths, marriages, etc. for legal purposes), integrated border/boundary management, and on regional cooperation. However, the accords have not been implemented or only partly implemented.

On April 19, 2013, Kosovo and Serbia reached a key agreement on normalizing relations. The agreement calls for the abolishing of the parallel institutions and the establishment of an “Association/Community” of Serb-majority municipalities within Kosovo, which would function according to Kosovo’s laws. Most Kosovo Serb leaders are strongly against the agreement, and its implementation is uncertain.

Kosovo faces other daunting challenges, aside from those posed by its struggle for international recognition and the status of its ethnic minorities. According to reports by the European Commission, the country suffers from weak institutions, including the judiciary and law enforcement. Kosovo has high levels of government corruption and powerful organized crime networks. Many Kosovars are poor and reported unemployment is very high.

The United States has supported the EU-brokered talks between Serbia and Kosovo, but has stressed that it is an observer, not a participant in them. On September 10, 2012, the White House issued a statement by President Obama hailing the end of international supervision of Kosovo. He said Kosovo has made “significant progress” in “building the institutions of a modern, multiethnic, inclusive and democratic state.” He added Kosovo had more work to do in ensuring that the rights enshrined in the country’s constitution are realized for every citizen. President Obama also called on Kosovo to continue to work to resolve outstanding issues with its neighbors, especially Serbia. U.S. officials hailed the April 19, 2013, agreement between Serbia and Kosovo on normalizing relations.

Since U.S. recognition of Kosovo’s independence in 2008, congressional action on Kosovo has focused largely on foreign aid appropriations legislation. For FY2013, the Administration requested a total of $57.669 million for Kosovo. Of this amount, $42.544 million is aid for political and economic reforms from the Economic Support Fund, $10.674 million from the International Narcotics Control and Law Enforcement account, $0.7 million in IMET military training aid, $3 million in Foreign Military Financing, and $0.75 million in NADR aid to assist non-proliferation and anti-terrorism efforts. In its FY2014 budget, the Administration aid request for Kosovo includes $41 million in ESF funding, $10.7 million from the INCLE account, $0.75 million in IMET aid, and $4 million in FMF.


Date of Report: May 7, 2013
Number of Pages: 15
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Armenia, Azerbaijan, and Georgia: Political Developments and Implications for U.S. Interests

Jim Nichol
Specialist in Russian and Eurasian Affairs

The United States recognized the independence of Armenia, Azerbaijan, and Georgia when the former Soviet Union broke up at the end of 1991. The United States has fostered these states’ ties with the West in part to end their dependence on Russia for trade, security, and other relations. The United States has pursued close ties with Armenia to encourage its democratization and because of concerns by Armenian Americans and others over its fate. Close ties with Georgia have evolved from U.S. contacts with its pro-Western leadership. Successive Administrations have supported U.S. private investment in Azerbaijan’s energy sector as a means of increasing the diversity of world energy suppliers. The United States has been active in diplomatic efforts to resolve regional conflicts in the region. As part of U.S. global counter-terrorism efforts, the U.S. military in 2002 began providing equipment and training for Georgia’s military and security forces. Troops from all three regional states have participated in stabilization efforts in Afghanistan and Iraq. The regional states also have granted transit privileges for U.S. military personnel and equipment bound to and from Afghanistan.

Beginning on August 7, 2008, Russia and Georgia warred over Georgia’s breakaway regions of Abkhazia and South Ossetia. Russian troops quickly swept into Georgia, destroyed infrastructure, and tightened their de facto control over the breakaway regions before a ceasefire was concluded on August 15. The conflict has had long-term effects on security dynamics in the region and beyond. Russia recognized the independence of Abkhazia and South Ossetia, but the United States and nearly all other nations have refused to follow suit. Russia established bases in Abkhazia and South Ossetia—in violation of the ceasefire accords—that buttress its long-time military presence in Armenia. Although there were some concerns that the South Caucasus had become less stable as a source and transit area for oil and gas, Kazakhstan and Turkmenistan are barging oil across the Caspian Sea for transit westward. Also, the United States and the European Union still support building more east-west pipelines through Turkey to bring Azerbaijani and other gas to European markets.

Issues of concern in the 113th Congress regarding the South Caucasus may include Armenia’s independence and economic development; Azerbaijan’s energy development; and Georgia’s recovery from Russia’s August 2008 military incursion. At the same time, concerns have been raised about the status of human rights and democratization in the countries; the ongoing Armenia-Azerbaijan conflict over the breakaway Nagorno Karabakh region; and ongoing threats posed to Georgia and the international order by Russia’s 2008 incursion and its diplomatic recognition of South Ossetia and Abkhazia. Congress has continued to oversee the region’s role as part of the Northern Distribution Network for the transit of U.S. and NATO military supplies to and from Afghanistan. Georgia’s aspirations for NATO membership have received ongoing Congressional support. Many Members of Congress have raised concerns about recent political trends in Georgia following the peaceful transfer of party control in the October 2012 legislative election.

Some Members of Congress and other policymakers believe that the United States should provide greater support for the region’s increasing role as an east-west trade and security corridor linking the Black Sea and Caspian Sea regions, and for Armenia’s inclusion in such links. They urge greater U.S. aid and conflict resolution efforts to contain warfare, crime, smuggling, and terrorism, and to bolster the independence of the states. Others urge caution in adopting policies that will increase U.S. involvement in a region beset by ethnic and civil conflicts. . Armenia, Azerbaijan


Date of Report: May 1, 2013
Number of Pages: 66
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Russian Political, Economic, and Security Issues and U.S. Interests

Jim Nichol, Coordinator
Specialist in Russian and Eurasian Affairs

Russia made uneven progress in democratization during the 1990s, but this limited progress was reversed after Vladimir Putin rose to power in 1999-2000, according to many observers. During this period, the State Duma (lower legislative chamber) became dominated by governmentapproved parties, gubernatorial elections were abolished, and the government consolidated ownership or control over major media and industries, including the energy sector. The Putin government showed low regard for the rule of law and human rights in suppressing insurgency in the North Caucasus, according to critics. Dmitriy Medvedev, Putin’s longtime protégé, was elected president in 2008; President Medvedev immediately designated Putin as prime minister and continued Putin’s policies. In August 2008, the Medvedev-Putin “tandem” directed military operations against Georgia and recognized the independence of Georgia’s separatist South Ossetia and Abkhazia, actions condemned by most of the international community. In late 2011, Putin announced that he would return to the presidency and that Medvedev would become prime minister. This announcement, and flawed Duma elections at the end of the year, spurred popular protests, which the government addressed by launching some reforms and holding pro-Putin rallies. In March 2012, Putin was (re)elected president by a wide margin. The day after Putin’s inauguration on May 7, the legislature confirmed Medvedev as prime minister. Since then, Putin appears to be tightening restrictions on freedom of assembly and other human rights. 

Russia’s Economy 

Russia’s economy began to recover from the Soviet collapse in 1999, led mainly by oil and gas exports, but the decline in oil and gas prices and other aspects of the global economic downturn beginning in 2008 contributed to an 8% drop in gross domestic product in 2009. Since then, rising world oil prices have bolstered the economy. Russian economic growth continues to be dependent on oil and gas exports. The economy is also plagued by an unreformed healthcare system and unhealthy lifestyles; low domestic and foreign investment; and high rates of crime, corruption, capital flight, and unemployment. 

Russia’s Armed Forces 

Russia’s armed forces now number less than 1 million, down from 4.3 million Soviet troops in 1986. Troop readiness, training, morale, and discipline have suffered, and much of the arms industry has become antiquated. Russia’s economic growth during most of the 2000s allowed it to increase defense spending to begin addressing these problems. Stepped-up efforts have begun to restructure the armed forces and improve their quality. Opposition from some in the armed forces, mismanagement, and corruption seemingly have slowed this restructuring. 

U.S. – Russia Relations 

After the Soviet Union’s collapse, the United States sought a cooperative relationship with Moscow and supplied almost $19 billion in aid for Russia from FY1992 through FY2010 to encourage democracy and market reforms and in particular to prevent the proliferation of weapons of mass destruction (WMD). In the past, U.S.-Russia tensions on issues such as NATO enlargement and proposed U.S. missile defenses in Eastern Europe were accompanied by some cooperation between the two countries on anti-terrorism and nonproliferation. Russia’s 2008 conflict with Georgia, however, threatened such cooperation. The Obama Administration has worked to “re-set” relations with Russia and has hailed such steps as the signing of a new Strategic Arms Reduction Treaty in April 2010; the approval of new sanctions against Iran by Russia and other members of the U.N. Security Council in June 2010; the accession of Russia to the World Trade Organization on August 22, 2012; and the cooperation of Russia in Afghanistan as signifying the “re-set” of bilateral relations. However, in late 2012, Russia ousted the U.S. Agency for International Development (USAID) from the country, and criticized the help that USAID had provided over the years as unnecessary or intrusive. H.R. 6156 (Camp), authorizing permanent normal trade relations for Russia, was signed into law on December 14, 2012 (P.L. 112-108). The bill includes provisions sanctioning those responsible for the detention and death of lawyer Sergey Magnitsky and for other gross human rights abuses in Russia.


Date of Report: April 29, 2013
Number of Pages: 88
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Cyprus: Reunification Proving Elusive

Vincent Morelli
Section Research Manager

As 2013 opened, the Republic of Cyprus had just concluded what many agreed was a highly successful six-month presidency of the Council of the European Union (EU) that began on July 1, 2012. During that same six-month period, the republic continued to experience banking and fiscal crises not unlike what was taking place in Greece and elsewhere throughout Europe, resulting in the beginning of a prolonged negotiation with the EU for financial assistance and the implementation of a tough economic austerity program. The republic, at the beginning of 2013, also entered a period of national elections for a new government.

Lost in the conduct of the EU presidency, the trauma of the fiscal crisis, and the beginning of the electoral season was the negotiations with the Turkish Cypriots to try to resolve the political division of Cyprus and set reunification into motion. By May 2012, the U.N.-sponsored talks, which had endured two years (2010-2012) of intense negotiations including regular leadership meetings, technical level discussions, and five meetings with U.N. Secretary-General Ban Kimoon, had essentially reached a stalemate and were suspended. Republic of Cyprus President Demetris Christofias and Turkish Cypriot leader Dervis Eroglu were simply unable to find common ground or make enough necessary concessions on the difficult issues of governance, security, property rights, territory, and citizenship (mostly involving mainland Turks who had “settled” in the north), to craft a final settlement.

On February 27, 2013, Nicos Anastasiades of the DISY party, was sworn in as the new president of the Republic of Cyprus after having won office in a February 24 second-round presidential vote. Anastasiades, who himself had supported the 2004 Annan Plan for reunification, had partnered during the election cycle with the center-right DIKO party, which had expressed strong opposition to many of the positions reportedly taken by former President Christofias in the negotiations with the Turkish Cypriots.

With the election over, and Anastasiades committed to first addressing the government’s fiscal crisis, questions have been raised about how, when, and under what conditions the talks would restart. The Turkish Cypriots saw an opportunity to hopefully start over, under different conditions, with a newly elected government in the republic. However, Mr. Eroglu recently stated that “while there is a Greek Cypriot administration in the South, there is the TRNC state in the North. The Cyprus Republic was a state based on the partnership of Turkish and Greek Cypriots. We were ousted from this republic in 1963 and [now] we are seeking a bicommunal state based on bizonality, political equality and two founding states.” This view, which seems to set a new condition for resuming the talks, will not likely be shared by the Anastasiades government. Eroglu has also restated his belief that if the talks resume they must come with a deadline for conclusion, a demand previously rejected by the Christofias administration.

Legislation (H.Res. 676 and S.Con.Res. 47) had been introduced during the 112th Congress calling for support for the republic. The Congress will likely continue to maintain its interest in a resolution of the Cyprus issue during the 113th Congress. This report provides a brief overview of the history of the negotiations, a more detailed review of the negotiations since 2008, and a description of some of the issues involved in the talks.


Date of Report: March 5, 2013
Number of Pages: 27
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Azerbaijan: Recent Developments and U.S. Interests

Jim Nichol
Specialist in Russian and Eurasian Affairs

Azerbaijan is an important power in the South Caucasus by reason of its geographic location and ample energy resources, but it faces challenges to its stability, including the unresolved separatist conflict involving Nagorno Karabakh (NK). Azerbaijan enjoyed a brief period of independence in 1918-1920, after the collapse of the Tsarist Russian Empire. However, it was re-conquered by Red Army forces and thereafter incorporated into the Soviet Union. It re-gained independence when the Soviet Union collapsed at the end of 1991. Upon independence, Azerbaijan continued to be ruled for a while by its Soviet-era leader, but in May 1992 he was overthrown and Popular Front head Abulfaz Elchibey was soon elected president. Military setbacks in suppressing separatism in the breakaway NK region contributed to Elchibey’s rise to power, and in turn to his downfall just over a year later, when he was replaced by Heydar Aliyev, the leader of Azerbaijan’s Nakhichevan region and a former communist party head of Azerbaijan. In July 1994, a ceasefire agreement was signed in the NK conflict. Heydar Aliyev served until October 2003, when under worsening health he stepped down. His son Ilkham Aliyev was elected president a few days later.

According to the Obama Administration, U.S. assistance for Azerbaijan aims to develop democratic institutions and civil society, support the growth of the non-oil sectors of the economy, strengthen the interoperability of the armed forces with NATO, increase maritime border security, and bolster the country’s ability to combat terrorism, corruption, narcotics trafficking, and other transnational crime. Cumulative U.S. assistance budgeted for Azerbaijan from FY1992 through FY2010 was $976 million (all agencies and programs). Almost one-half of the aid was humanitarian, and another one-fifth supported democratic reforms. Budgeted aid to Azerbaijan was $26.4 million in FY2011 and an estimated $20.9 million in FY2012 (including “Function 150” foreign aid and excluding Defense and Energy Department funds). Under the Continuing Appropriations Resolution for FY2013, signed into law on September 28, 2012 (P.L. 112-175), regular foreign aid accounts are funded until late March 2013 at the same level as in FY2012 plus .612%, and most country allocations may be adjusted at agency discretion.

After the terrorist attacks on the United States on September 11, 2001, Azerbaijan granted overflight rights and approved numerous landings and refueling operations at Baku’s civilian airport in support of U.S. and coalition military operations in Afghanistan. More recently, the country is a major land, air, and sea conduit of the Northern Distribution Network for supplies entering and leaving Afghanistan to support U.S. and International Security Assistance Force (ISAF) stabilization operations. Azerbaijan has contributed troops for the ISAF since 2003. The country increased its contingent from 45 to 90 personnel in 2009, including medical and civil affairs specialists. From 2003 to 2008, about 150 Azerbaijani troops participated in the coalition stabilization force for Iraq.


Date of Report: February 22, 2013
Number of Pages: 33
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