AGP Executive Report

Iran Funeral Diplomacy: Iran’s farewell for Ayatollah Ali Khamenei drew huge global attendance in Tehran, with Iranian Parliament Speaker Mohammad Bagher Ghalibaf and FM Abbas Araghchi reportedly breaking down in tears; Azerbaijan’s Speaker Sahiba Gafarova led an official delegation to the ceremony, meeting top Iranian leaders. South Caucasus Connectivity: Azerbaijan’s transport push stays in focus as EU leaders propose tariff-free access for 80% of Armenia’s exports while also backing South Caucasus transport and energy links; meanwhile, Azerbaijan Railways (ADY) held talks with Russia and Iran on expanding the North–South corridor and boosting freight via Astara. Trade & Economy: Azerbaijan exported $1.397bn in goods to Türkiye in Jan–May 2026 (10% of total exports), while a new ITF bulletin ranks Azerbaijan first for transport infrastructure investment at 3.5% of GDP. Regional Security & Justice: Azerbaijan’s appeals court continued hearings in high-profile war-crimes cases involving Armenian nationals. Azerbaijan in Global Tech/Defense: A Geopolitical Monitor piece says Azerbaijan is the most advanced drone operator in the South Caucasus, citing domestic UAV development and expanded training/maintenance.

EU Connectivity Push: EU leaders Ursula von der Leyen and Commissioner Marta Kos say South Caucasus connectivity is entering a “new phase,” with up to €200mn for transport, energy and digital links in Azerbaijan and a €20mn “peace dividends” program near the border, while Brussels also proposes tariff-free access for about 80% of Armenian exports to the EU. Rail and Transit Links: Azerbaijan Railways (ADY) held bilateral and trilateral talks with Russia and Iran on expanding the North–South corridor, including digitalisation and Astara Terminal growth, and another shipment of Russian wheat (976 tons) reportedly moved to Armenia via Azerbaijan. Azerbaijan–Iran/Economy Diplomacy: Hikmat Hajiyev met economist Jeffrey Sachs in Baku, discussing sustainable development, geopolitics and Azerbaijan’s peace agenda. Aviation Connectivity: AZAL announced direct flights from Baku to Atyrau (from Aug 16) and Aktobe (from Sep 16). Legal/Detention Update: Baku Appeals Court continued hearings in a high-profile war crimes case involving Armenian nationals. Human Rights: Azerbaijani Jewish leaders urged Israeli lawmakers to reject Armenian Genocide recognition, warning it could harm Baku–Jerusalem ties. Opposition/Politics in Armenia: Armenia’s ruling Civil Contract drafted a bill that would strip voting rights from citizens with less than half-time residency in the two years before elections or referendums, drawing opposition claims it violates the constitution.

EU Connectivity Boost: European Commission President Ursula von der Leyen announced up to EUR 200 million in grants for Azerbaijan to expand transport, energy, and digital links across the South Caucasus, framing it as support for regional peace and “peace on paper into peace in practice.” Energy & Infrastructure: SOCAR officially took over operatorship of the Baku–Tbilisi–Ceyhan (BTC) pipeline from bp, marking a major step in Azerbaijan’s control of key export routes. Regional Peace Diplomacy: Azerbaijan’s president said de facto peace with Armenia has been achieved, while EU officials linked normalization to wider economic gains. Digital Push: Azerbaijan is accelerating its digital agenda under a 2026–2028 digital development plan, aiming to strengthen governance and tech capacity. Human Rights at Home: Trade union activist Elvin Mustafaev has launched a hunger strike after being placed in a punishment cell, with relatives alleging efforts to extend his sentence. Security on the Borders: Iran’s IRGC reported killing Kurdish fighters in the northwest, as clashes and tensions continue to ripple across the region.

EU-Armenia Trade Push: EU plans to make about 80% of Armenian exports duty-free, with €52m support, as Brussels tries to help Yerevan redirect trade away from Russia. Middle Corridor & Connectivity: Azerbaijan’s Finance Minister says the Middle Corridor is growing in strategic importance as it links Asia-Europe and runs through Azerbaijan; BSTDB’s Baku Business Forum also spotlights Azerbaijan as a regional hub. Energy Links with Türkiye: Azerbaijan and Türkiye discussed electricity transmission opportunities to strengthen regional energy security. BTC Operatorship Transfer: SOCAR officially took over BTC operatorship, marking another milestone in Azerbaijan’s energy strategy. Liberated Territories Infrastructure: The Asgaran–Khojaly–Khankendi highway is 86% complete, with earthworks done and pavement base/asphalt-concrete underway. Missing Persons Digital Platform: Azerbaijan launched an Online Inquiry Center to manage missing persons cases electronically. Peacekeeping Report: Azerbaijan presented a report on its Armed Forces’ peacekeeping operations, stressing the country’s “middle power” role. Local Community Projects: Leyla Aliyeva backed Yevlakh initiatives including the “Young Beekeeper” project, a modernized neighborhood, and a Stray Animal Care Center.

EU-Azerbaijan Partnership: EU Commission President Ursula von der Leyen met President Ilham Aliyev in Baku, praising Azerbaijan as a reliable energy partner and unveiling a “Peace through Connectivity Package” with up to €200 million in grants (plus up to €2 billion in investment potential) for transport, energy and digital links, alongside a €20 million peace-fostering program for border communities in Armenia and Azerbaijan. Energy & Trade: Aliyev said half of Azerbaijan’s gas exports go to EU member states and stressed the Southern Gas Corridor’s role in Europe’s energy security, while von der Leyen highlighted Azerbaijan’s clean-energy ambitions and plans for a green energy corridor. Connectivity Conference in Baku: Von der Leyen said the EU wants to hold a Regional Connectivity Investment Conference in Baku to link Europe, the South Caucasus and Central Asia. Border Peace Process: The two leaders also discussed normalization between Azerbaijan and Armenia and EU support for turning peace “on paper into peace in practice.” Economy & Finance: Azerbaijan’s Central Bank FX reserves topped $13.1 billion as of June 30. Azerbaijan in Europe: AZAL announced a new Baku–Brussels direct route starting May 8, 2027. Security/Justice: Lawyers say the Meydan TV case may have to restart after the court panel was fully reshuffled. Oil Markets: Azeri Light crude fell below $73 to about $72.46 per barrel amid global price decline.

EU-Azerbaijan Peace & Connectivity: European Commission President Ursula von der Leyen unveiled a “Peace through Connectivity” package in Baku: €200 million for South Caucasus connectivity (with potential to mobilize up to €2 billion) plus €20 million for peace-focused community programs across Armenia and Azerbaijan, including healthcare, mine clearance, training, and local business support. EU Energy & Trade: In joint statements, President Ilham Aliyev said Azerbaijan is the EU’s main trading partner in the South Caucasus, with over 40% of trade tied to EU member states, and noted gas exports to EU countries are up nearly 65%. Missing Persons Talks: A Baku conference on missing persons heard Azerbaijan has returned over 2,000 Armenian soldiers’ remains and urged a joint DNA database, while officials said Armenia has not reciprocated. Azerbaijan–Israel Genocide Row: Azerbaijan’s Jewish community leaders appealed to Israel’s Knesset not to advance recognition of the “Armenian genocide,” warning it could harm peace and stability. Aviation & Travel Links: AZAL announced direct flights from Baku to Brussels starting May 8, 2027, and new direct routes to Atyrau and Aktobe in 2026. Regional Finance & Trade: Azerbaijan chaired the BSTDB board meeting in Baku, with a business forum positioning the country as a regional hub for connecting markets and diversifying economies.

Missing Persons Update: Azerbaijan says 4,010 people are registered as missing due to Armenia’s military aggression, with 327 identified through genetic work by the SSS Military Medical Department; officials also say citizens of Azerbaijan and Armenia will be able to confidentially report missing persons and burial sites via an ICMP-linked system. Budget & Agriculture: The Milli Majlis approved the 2025 state budget execution in third reading, showing a 580 million manat surplus, while nearly 2 billion manats are earmarked for the agriculture state program through 2030. Regional Religious Cooperation: Turkic States Organization religious affairs chiefs held their first heads-of-state-body meeting in Shusha, launching a new cooperation mechanism. Energy & Environment: The World Bank plans $410 million for the “Livable Baku” project to improve waste management and climate resilience. Legal & Security: Opposition figure Vugar Gadirli was sentenced to two years over alleged illegal arms trafficking, which his party calls fabricated. Transport Safety: A fuel tanker truck collision with a locomotive near Sumgayit left one injured and triggered an investigation.

Missing Persons & Forensics: Azerbaijan says 32 more mass graves have been found in Karabakh since 2023, with remains of 893 people discovered so far; 327 have been identified via DNA/forensics and 226 returned to families, while 3,683 still remain missing. Azerbaijan-Armenia Cooperation: ICMP director-general Kathryne Bomberger says a joint missing-persons database between Baku and Yerevan will be built on the former Yugoslavia model to speed information exchange and support peace efforts. Armenian Genocide Recognition Row: Azerbaijan’s Foreign Ministry condemned Israel’s recognition of the 1915 events as genocide, calling it an unacceptable distortion of history and urging Israel to reconsider; Armenia’s PM Nikol Pashinyan said Yerevan sees no need to respond to avoid “weaponization.” Energy & Trade: TANAP has reached a major milestone with 99.6 bcm of Azerbaijani gas transported; ferrous metal exports rose 27% in Jan-May to 41.88m tons amid strong demand. Agriculture: Average grain yields reached 35 quintals per hectare as harvesting progresses. Domestic Policy: Azerbaijan plans to start production of its first domestically developed veterinary rabies vaccine by year-end. Regional Environment: Azerbaijan backs a regional framework to monitor the rapidly shrinking Caspian Sea.

Armenian Genocide Recognition Row: Azerbaijan condemned Israel’s unanimous decision to recognize the 1915 Armenian genocide, calling it a serious concern that distorts history and harms reconciliation, while Armenia’s leadership chose not to respond publicly, saying the issue is being used as a political weapon. Turkic Cultural Diplomacy: Turkey and Azerbaijan submitted a joint UNESCO bid for baklava and Azerbaijani pakhlava, framing it as a cultural-defense move ahead of the committee’s November session. Regional Connectivity & Trade: Turkey and Saudi Arabia signed a joint action plan to ease bilateral trade, including road transit corridor work and faster customs processes, with Azerbaijan also discussed in customs talks. Middle Corridor Focus: A new analysis argues the Middle Corridor’s future will be decided less by maps and more by operational efficiency—speed, cost, reliability, and capacity. Private Sector Finance in Baku: At IsDB Group meetings, ICD signed 13 agreements to boost private-sector growth, including a managed Shariah-compliant SME financing line with Azerbaijan’s ABDF. UFC Baku Buzz: Fighters and fans reacted to UFC Fight Night 280 in Baku, highlighted by Abdul Rakhman Yakhyaev’s eight-second KO and wider debate over match officiating and next matchups.

Armenian Genocide Recognition Fallout: Azerbaijan’s Foreign Ministry and leadership voiced “serious concern” and urged Israel to reconsider its unanimous cabinet decision to recognize the Armenian Genocide, saying it distorts history and undermines reconciliation, as Turkey also condemned the move. EU Diplomacy in the Region: European Commission President Ursula von der Leyen is set to visit Armenia on July 2 and Azerbaijan as part of transport-corridor talks, while Azerbaijani émigrés urged the EU to put political prisoners and media freedom on the agenda. Middle Corridor / TRIPP: Russia’s deputy foreign minister said the TRIPP route would need to account for Russian and EAEU positions, including rail gauge alignment, adding pressure on Armenia’s transit stance. Trade & Transport Upgrades: Azerbaijan submitted bids for ITU Council and the Radio Regulations Board; Kazakhstan and Azerbaijan agreed to shift road freight permits to an e-permit system from 2027. Energy & Logistics: APM Terminals Poti will buy a new mobile harbour crane to boost capacity, while Azerbaijan and Russia said issues after the AZAL plane crash have been resolved. Culture & Regional Ties: Turkic World Week opened in Baku marking the 100th anniversary of the First Turkological Congress, with events planned for Shusha, Khankendi and Aghdam.

UFC Baku 280: Rafael Fiziev delivered a homecoming highlight with a second-round TKO over Manuel Torres, earning a $100,000 Performance bonus as UFC handed out four $100,000 bonuses and several finish awards across the card. Sports Controversy: The event also sparked fresh debate over officiating, with critics pointing to fouls not penalized in key moments. Public Safety: Azerbaijan’s Emergency Ministry says a climber fell near Mount Bazarduzu in Guba, was rescued by the Special Risk Rescue Service, and handed to doctors after serious injuries. Energy & Trade: Azerbaijan presented Turkmenistan with a new oil tanker, “Dostlug,” built in Baku, as regional transport links keep expanding. Transit to Armenia: Reports say another shipment of Russian wheat moved to Armenia via Azerbaijan, adding to a steady flow of grain and fuel through Azerbaijani routes. Culture & Heritage: Turkey and Azerbaijan jointly submitted a UNESCO bid to list baklava as intangible heritage, aiming for “baklava” and “pakhlava” recognition. Diplomacy: EU Commission President Ursula von der Leyen is set to visit Armenia and Azerbaijan July 1-2 to push the idea of a Central Asia-to-Europe transport corridor.

Chess Spotlight: Azerbaijan’s Aydin Suleymanli beat world icon Magnus Carlsen at the FIDE World Team Rapid and Blitz in Hong Kong, saying the win will “never” be forgotten and boosted his confidence for future opponents. UFC Baku Aftermath: Abdul-Rakhman Yakhyaev sparked Julius Walker in just eight seconds, while Rafael Fiziev delivered a second-round knockout over Manuel Torres and earned a $100,000 Performance bonus; the event also drew fresh criticism of referee Herb Dean after alleged missed fouls. Tourism & Nature: Shahdag Tourism Center officially opened its 2026 summer season, pushing year-round mountain and eco-tourism with new activities; meanwhile, researchers studied the Shirvan Plain’s rare plants and faster vegetation change across semi-deserts, tugay forests and wetlands. EU Connectivity: European Commission President Ursula von der Leyen will visit Armenia and Azerbaijan on July 1-2 to discuss turning the region into a transport corridor from Central Asia to Europe. Regional Economy: Azerbaijan and Kazakhstan are moving fully to electronic freight permits, ending paper-based procedures next year.

UFC Baku Wrap: Rafael Fiziev sent the home crowd into a frenzy with a second-round spinning wheel kick TKO of Manuel Torres, snapping a rough run and immediately calling for a BMF title shot; the card also delivered four $100,000 Performance bonuses, including Abdul-Rakhman Yakhyaev’s eight-second knockout and Asu Almabayev’s rare Suloev stretch submission. Armed Forces Day: Azerbaijan’s Defense Ministry said a series of events marked 26 June across troops, units and military education institutions, starting with a minute’s silence for Heydar Aliyev and the martyrs. Energy & Transit: Azerbaijan Railways reported another Russian wheat shipment to Armenia via Azerbaijani territory, underscoring continued cargo transit links. Regional Diplomacy: Foreign Minister Jeyhun Bayramov held a phone call with Turkey’s Hakan Fidan on alliance ties, regional security and post-conflict stability. Military Cooperation: Egypt and Turkey signed a military cooperation agreement as “Anatolian Eagle 2026” began, with reports noting Azerbaijan’s participation in the drill.

Azerbaijan–Türkiye Diplomacy: Foreign Minister Jeyhun Bayramov spoke by phone with Turkish FM Hakan Fidan, stressing the Azerbaijan–Türkiye alliance, regional security, and post-conflict efforts to keep peace and stability moving. UFC Baku Spotlight: UFC Fight Night 280 is underway in Baku with Rafael Fiziev vs. Manuel Torres as the main event, while Abdul-Rakhman Yakhyaev crushed Julius Walker in eight seconds and Daniil Donchenko knocked out Theodor Berggren with a head kick. Public Safety & Weather: Heavy rain and thunderstorms are expected to ease, but Baku–Nakhchivan flights were cancelled due to conditions at Nakhchivan Airport. Defense Policy: Azerbaijan’s conscription age limit was lowered from 35 to 30, with officials saying it reduced state expenses. Trade & Agriculture: Azerbaijan reported strong export figures, including $119.8m in tomato exports and 10,285 tons of vegetable and animal oils worth $15.2m in the first five months. Maritime Environment: Azerbaijan acceded to the Anti-Fouling Convention to curb harmful ship hull coatings and better align with global environmental standards.

Armed Forces Day & NATO ties: Azerbaijan marked the 108th anniversary of its Armed Forces with military marches and a joint concert in Baku featuring the Heydar Aliyev Military Institute orchestra and the Turkish Armed Forces Harmony Band, while Azerbaijan’s Mission to NATO hosted an official reception attended by NATO’s Caucasus and Central Asia representative Kevin Hamilton, highlighting interoperability and the Azerbaijan-Armenia peace process. EU diplomacy: European Commission President Ursula von der Leyen is set to visit Azerbaijan and Armenia on July 1-2, with talks focused on peace, connectivity and turning the region into a Central Asia-to-Europe transport corridor. Energy & regional connectivity: Azerbaijan and partners continue pushing the Middle Corridor, including work on a unified long-term tariff model involving Kazakhstan, Azerbaijan and Georgia, plus ongoing logistics cooperation. UFC in Baku: UFC Fight Night 280 lands Saturday at the National Gymnastics Arena with Rafael Fiziev vs Manuel Torres as the main event and Nazim Sadykhov vs Matheus Camilo in the spotlight, as the UFC continues its multi-year Baku deal. Islamic finance push: The Islamic Development Bank is backing Azerbaijan to build an Islamic finance ecosystem, including technical support for a debut sukuk issuance.

EU-Azerbaijan Diplomacy: European Commission President Ursula von der Leyen is set to visit Azerbaijan on July 1, with peace, transport connectivity and energy cooperation on the agenda as Brussels pushes a Central Asia-to-Europe corridor vision. Armed Forces Day: Azerbaijan marked June 26 with official ceremonies and military marches across Baku and other cities, including visits to Heydar Aliyev’s grave and Victory Park. Aviation Upgrade: Azerbaijan Airlines took delivery of its first Airbus A321neo, part of a plan to modernize and expand the fleet to 50 aircraft by 2032. Energy Exports: Azerbaijan increased gas supplies to Greece in early 2026, shipping 342.7 million cubic meters in January–April. Regional Trade Facilitation: Azerbaijan and Türkiye are advancing a simplified customs corridor under the Middle Corridor, aiming for a “Single Window” system and better information exchange. Sports Spotlight (UFC Baku): Rafael Fiziev returns in Baku against Manuel Torres, while Shara Magomedov faces Michel Pereira after a heated weigh-in face-off.