The peace framework agreement between Armenia (BB-/Stable) and Azerbaijan (BBB-/Stable) is a positive step towards a comprehensive deal and reduces the risk of renewed hostilities, although obstacles remain, Fitch Ratings says, APA reports.
Achieving a peace agreement is unlikely to immediately affect either country’s ratings, but could support positive medium-term credit trends, notably via expanded trade that may boost growth, although this is difficult to quantify.
The joint declaration, mediated by the US and signed in Washington on 8 August, commits both countries to adopt Soviet-era borders, renounce the use of armed force, and envisages “unimpeded connectivity” between Azerbaijan and its exclave of Nakhchivan through Armenian territory.
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