Geopolitics and revenue transparency in Turkmenistan and Azerbaijan

Azerbaijan and Turkmenistan, both rich in hydrocarbons, diverge in their attitudes toward global initiatives that promote transparency in extractive industries. While Azerbaijan became a champion of the Extractive Industries Transparency Initiative in the region, Turkmenistan declined to embrace the norm of revenue transparency. This paper analyzes the reasons for this outcome by evaluating the impact of external influences on the management of extractive industries in Turkmenistan and Azerbaijan since 1992. In particular, it questions the role of geopolitical and economic factors in making oil and gas revenues more transparent. The paper argues that in comparison with the leadership in Azerbaijan, the Turkmen elite had few incentives to cooperate with international organizations that promote transparency due to Turkmenistans dependency on Russian and Chinese pipelines and limited foreign investment from Western countries.