Executive Summary
This report examines the peace agreement signed at the White House between Armenia and Azerbaijan, brokered by US President Donald Trump.
This agreement gives the United States the right to develop the Zangezur corridor, renamed Trump Route for International Peace and Prosperity, for 99 years, a move that could significantly impact the South Caucasus both strategically and economically.
The report assesses the impact on the United States, Armenia, Azerbaijan, Russia, and Iran, focusing on economic opportunities, political consequences, and security risks.
Key Takeaways
- Washington secures long-term strategic and commercial access to the South Caucasus through control of the Zangezur corridor/ the Trump Route for International Peace and Prosperity.
- Armenia seeks security guarantees and economic support from the United States but faces sovereignty concerns and regional isolation risks.
- Azerbaijan merges its military and diplomatic gains, using the corridor to strengthen regional trade connectivity and political leverage.
Background Information
On Friday, August 8, 2025, US President Donald Trump hosted Armenian Prime Minister Nikol Pashinyan and Azerbaijani President Ilham Aliyev at the White House for the signing of a peace agreement to normalise relations after decades of armed conflict.
The agreement gives the United States the right to develop the Zangezur corridor, renamed the Trump Route for International Peace and Prosperity, which connects Azerbaijan to its Nakhchivan exclave and is part of the Middle Corridor trade route linking China and Central Asia to Turkey.
This agreement follows Azerbaijan’s successful military operation in 2023 to take back Nagorno-Karabakh, resulting in the displacement of 100,000 ethnic Armenians. Moscow’s inaction undermined Armenia’s reliance on Russia for security during the conflict, pushing Yerevan towards Western partners.
The agreement also entails US military participation in peacekeeping operations and a joint request from Armenia and Azerbaijan to disband the OSCE Minsk Group. Connecting its territory to Azerbaijan would benefit Turkey, strengthening its position in regional trade and logistics. Iran cautioned against involvement from outside the region in the corridor, vowing a “harsh response” if the project goes forward. Although Russia’s influence in the region is declining, it maintains military and economic leverage through its presence in Armenia and trade connections.
Geopolitical Scenario
United States. Washington secures a strategic foothold in the South Caucasus for 99 years through exclusive corridor development rights. This move strengthens US influence on east-west trade routes, weakens Moscow and Tehran’s regional power, and backs Ankara, a NATO ally. This peace deal strengthens the US regional commercial portfolio through energy and transport projects, positioning Washington as an arbiter in post-Soviet disputes.
Armenia. Pashinyan presents the deal as a security and stability guarantee after three decades of conflict. This agreement signals a strategic shift toward the West, fuelled by a loss of faith in Russia’s security assurances. However, this agreement could compromise Armenia’s sovereignty by giving the US control over some of its land, and it also carries the risk of damaging relations with Iran, a key trading partner and neighbour to the south. Within Armenia, Pashinyan faces political challenges because of the loss of Nagorno-Karabakh, the imprisonment of church leaders and opposition members, and the tightening of internal controls. The agreement is facing criticism from members of the Armenian diaspora and opposition figures in Yerevan because of its neglect of the future of Armenian POWs held in Azerbaijan and the right of Armenians to return to their homeland in Nagorno-Karabakh. The agreement will shape his legacy ahead of the 2026 elections, where a future Armenian government would face high political and military costs if it withdrew from the deal.
Azerbaijan. Baku portrays this as a total triumph, having achieved formal recognition of its territorial acquisitions and compelling Armenia to accept a definitive agreement from which it cannot easily withdraw. The Zangezur corridor/the Trump Route for International Peace and Prosperity enhances Azerbaijan’s standing in regional commerce and its political alliance with Turkey. Azerbaijan could use the agreement to pressure Armenia into making constitutional changes and cite possible treaty breaches as justification for further military intervention. While still having some control over its strategic path, it profits from Turkey’s logistical aspirations.
Russia. Moscow is facing significant challenges in the South Caucasus after this peace agreement and recent confrontation with Azerbaijan. Despite this, Russia’s leverage remains, stemming from its military base in Gyumri, border control with Turkey and Iran, trade reliance, remittance flows, and sway over Armenian politics and media. Russia could collaborate with Iran to hinder the corridor’s progress and remains capable of disrupting the region.
Iran. Tehran opposes the corridor as a geopolitical threat that could weaken its position in the Caucasus, block its trade access to the north, and encourage separatist sentiment within its borders. Iranian officials cautioned they would meet any changes to regional borders with a “harsh response” and denounced outside interference. The Iranian President’s visit to Armenia in the next two weeks could be Tehran’s response to this peace agreement. To counter gains by the US and Turkey, Iran could increase its military signaling in the vicinity of the Aras River, bolster bilateral relations with Armenia, and coordinate actions with Russia.
Indicators to Monitor
- Armenian constitutional review and potential amendments following the peace agreement’s ratification.
- Protests in Armenia against Pashinyan and the peace deal.
- Iranian military movements and exercises near the Armenian–Iranian border.
- Russian political and economic pressure on Armenia and Azerbaijan.
- Turkish commercial and infrastructure developments linked to the Middle Corridor.
- Parliamentary and presidential rhetoric in Armenia and Azerbaijan ahead of 2026 Armenian parliamentary elections.
- Upcoming meeting between Trump and Putin in Alaska to discuss the peace deal of the Ukraine conflict.
Conclusion
The US-brokered agreement alters the power dynamic in the South Caucasus, solidifying Washington’s influence along a key transportation corridor while reducing Moscow’s authority. Armenia seeks security guarantees and economic gains but risks sovereignty concessions and strained ties with Iran.
Azerbaijan consolidates its territorial and diplomatic victories, while Turkey advances its logistical and regional integration goals.
Russia and Iran risk strategic setbacks but can still hinder or delay the corridor’s progress. Should Trump and Putin broker a peace agreement at the upcoming Alaska meeting (as the White House reported on X), granting Moscow full control of Eastern Ukraine, the Kremlin could leverage this win to offset recent developments in the Caucasus. Having secured the agreement and a portion of Ukraine, Moscow could re-enter the South Caucasus by using economic and political leverage.
Ongoing observation of military operations, political discourse, and the enforcement of treaties will be vital in evaluating the Zangezur corridor’s sustainability and potential advantages.
*Cover image: US President Donald Trump, Armenian Prime Minister Nikol Pashinyan, and Azerbaijani President Ilham Aliyev signed the peace agreement in Washington (Credits: Creative Commons Attribution 3.0 License – The White House)
