The European Union risks falling behind the United States in shaping the South Caucasus’s strategic infrastructure, raising concerns that Brussels’s lack of leadership could weaken its long-term geopolitical position in the region, according to a new report by Carnegie Europe.

The report highlights the US-led Trump Route for International Peace and Prosperity (TRIPP), a high-profile project linking Azerbaijan’s main territory with its Nakhchivan exclave via Armenia. TRIPP, agreed in 2025, aims to develop a railway and strengthen energy and digital connections across the region. 

US Vice President JD Vance is scheduled to travel to Baku and Yerevan this month to promote the initiative through bilateral talks.

Carnegie Europe describes TRIPP as “the core geopolitical currency of the South Caucasus”, saying that railways, roads, energy corridors, and digital links are now central to regional political and economic alignments. “Whoever builds and governs these networks will shape how Armenia, Azerbaijan, and their neighbours are aligned — toward United States, or toward the EU, Russia, or China,” the report says.

The analysis contrasts US decisiveness with EU caution. Despite the bloc’s larger financial resources and expertise, it has failed to develop an equivalent strategic initiative. It cites a a senior Azerbaijani official, who told Carnegie Europe in an October 2025 interview: “Maybe we are in a hurry, or maybe Europe is simply too passive … We lost thirty years to conflict. Now we are ready to move. But the EU behaves as if there is no clock.”

The EU has invested in projects such as Armenia’s north–south highway and other connectivity initiatives, but these “lack a comparable grand strategy” to TRIPP, the report notes. Brussels has also provided limited support for post-conflict reconstruction in Azerbaijan. Apart from minor de-mining assistance, Baku has largely funded the rebuilding of its recovered territories from its own budget, at a cost of roughly €14bn since 2020.

Carnegie Europe attributes part of the EU’s slow engagement to a clash of political cultures. Brussels places strict requirements on institutional capacity and oversight, making it cautious about funding local projects. Meanwhile, some EU member states remain politically aligned toward Armenia due to lingering tensions after the 2020 six-week war and 2023 clashes, creating mutual mistrust with Azerbaijan.

The report argues that Europe’s strategic advantage lies in its financial scale, regulatory influence, and access to long-term markets. “The United States brings political leverage and diplomatic momentum, while the EU possesses financial scale, regulatory power, and long-term market access. The attributes brought by both powers could be mutually reinforcing,” the report says.

A key test case is the Nakhchivan railway. In January 2026, the EU, Azerbaijan and the European Bank for Reconstruction and Development (EBRD) agreed to launch a feasibility study under the Global Gateway programme to upgrade the line, which has been largely nonfunctional for three decades. The report suggests a funding model similar to the Western Balkans approach: “A realistic model would mirror the Western Balkans connectivity approach, with the union offering, for example, a €200mn-300mn grant for the sensitive cross‑border sections of the Nakhchivan line, leveraged with about €700mn-800mn in European Investment Bank and EBRD loans to reach roughly the project’s cost.”

Beyond railways, the report calls for broader regional infrastructure initiatives. Europe could create a South Caucasus border infrastructure fund to finance customs terminals, logistics hubs, scanners, and digital systems, as well as electricity and data corridors connecting Azerbaijan, Armenia, and Turkey to the EU. A land-based corridor could offer Ankara new transit revenues while avoiding delays in the slow-moving Black Sea submarine electricity cable project, agreed in 2022 with Romania, Hungary, Azerbaijan and Georgia.

The Carnegie Europe report also urges Brussels to reengage Georgia through a proposed quadrilateral transport connectivity format involving the EU, Armenia, Azerbaijan and Turkey. While the initiative is a step forward, the absence of Georgia leaves the regional connectivity map incomplete.