Trump Suspends Controversial US Law Restricting Aid to Azerbaijan, Enhancing Strategic Cooperation in the South Caucasus Region.

US President Donald Trump is set to suspend Section 907 of the Freedom Support Act, a law that prohibited direct US government assistance to Azerbaijan for over three decades. The move is seen as a major shift in US foreign policy and could reshape dynamics in the South Caucasus region. The suspension will allow for direct aid, defense deals, and investment to Azerbaijan, and enhance cooperation on energy, digital infrastructure, and security.

US President Donald Trump is set to suspend Section 907 of the Freedom Support Act, a law that prohibited direct US government assistance to Azerbaijan for over three decades. This move, expected to take place during Azerbaijani President Ilham Aliyev's visit to Washington on August 8, 2025, marks a significant shift in US foreign policy and could reshape dynamics in the South Caucasus region.

Section 907, a provision of the 1992 Freedom Support Act, was passed in response to allegations that Azerbaijan had imposed a blockade on Armenia during the Nagorno-Karabakh conflict. While intended to protect Armenia, critics have long argued that the law was one-sided and outdated, especially given the evolving geopolitical landscape [1].

The suspension of Section 907 is being seen as a symbolic and strategic gesture, aligning with broader US efforts to strengthen ties with Azerbaijan amid shifting alliances in the region [1]. This move will open doors for direct aid, defense deals, and investment to Azerbaijan, boosting its international standing and signaling a new phase of strategic cooperation.

The new strategic partnership will include collaboration on energy, trade, and regional transit; investment in tech and digital infrastructure; and security cooperation, including defense sales and counter-terrorism [1]. These efforts aim to secure energy corridors from the Caspian to Europe, counter Russian and Iranian influence in the Caucasus, and enhance cooperation on digital infrastructure and artificial intelligence.

Several major developments accompanied President Aliyev's visit to Washington. A Memorandum of Cooperation between SOCAR (Azerbaijan's state oil company) and ExxonMobil was signed, and a Joint Declaration is expected between Azerbaijan and Armenia, with US President Donald Trump in attendance. Additionally, a Strategic Working Group was established between Washington and Baku to draft a Charter on Strategic Partnership [1].

The visit also marked the initialling of a peace agreement between Armenia and Azerbaijan, signaling that both parties have agreed on its content. Though not a final signing, initialling marks the end of the negotiation phase and a step toward a legally binding treaty. However, Armenia plans a national referendum in 2026 to amend its constitution—an essential condition for the treaty to be finalized [1].

The peace framework includes provisions for the Zangezur Corridor, a transport route connecting mainland Azerbaijan with its exclave Nakhchivan through southern Armenia. This corridor is a top priority for Baku and has now reportedly been accepted by Yerevan [1]. With the suspension of Section 907 and the initialling of a peace deal, the region is poised for transformation. The final peace treaty will likely follow the 2026 Armenian referendum, while US and Azerbaijani officials will continue working on their strategic partnership charter, focusing on long-term economic and security cooperation.

References:
[1] https://m.economictimes.com/news/international/us/everything-you-need-to-know-about-trumps-suspension-of-section-907-what-it-means-for-us-azerbaijan-relations-and-regional-power-shifts/articleshow/123183918.cms