The EU suffered a major loss in Nagorno-Karabakh

Earlier this month Russian President Vladimir Putin huddled with Armenian Prime Minister Nikol Pashinyan and Azerbaijani President Ilham Aliyev, and in a few hours hammered out a peace agreement to stop the month-long Armenia-Azerbaijan conflict over Nagorno-Karabakh. The peace deal is incredibly short, explicit and to the point. Armenia was spared a total defeat. Azerbaijan did well. And Russia won.

Armenia agreed to a full retreat. Pashinyan sent an emotional message to his nation on Facebook, where he expressed sadness and regret over ending the war, but said this was the best logical choice. Naturally so. The Armenian forces were losing multiple villages a day and were pushed out of Shusha, a strategic town along the corridor connecting Stepanakert, the Nagorno-Karabakh capital, to Armenia.

Less obvious are President Aliyev’s calculations. Backed by Turkey, and on good terms with Moscow, Azerbaijan’s army was advancing fast. From a military standpoint, Azerbaijan could have gone for a total military victory, which would have avoided a messy post-war peace wrangling. But Aliyev is no warmonger. He is a realist and a political pragmatist.

Liberating some of the occupied territories through military advancement was enough to give Aliyev the upper hand in future peace process, and secure him a place in the history books of his nation as a leader who unified the country. He probably also knows Russia would never allow a total defeat of Armenia, and that Putin has his own red lines.

The bottom line is that Aliyev played his cards well, and pushed with his military to the limit without collapsing the strategic regional equilibrium. Azerbaijan managed to get a binding commitment from Armenia to a full military withdrawal from all its territories and the right to return of displaced Azerbaijanis to Nagorno-Karabakah, which for the time being will be under Russian peacekeepers’ watch. It also secured a corridor to its enclave, the Nakchivan Autonomous Republic, running through Armenian territory.

Baku demonstrated its military superiority to Yerevan and scored victories which came as a vindication of sorts for the brutal defeat Azerbaijan suffered at the hands of Armenian forces in the 1992-1994 war when it lost Nagorno-Karabakh. And it also managed to make its close ally, Turkey, a party to any future final settlement.

Although Armenia was the defeated side in this conflict, the biggest loser is actually the European Union. It failed, yet again, and in a spectacular fashion, to be a relevant player and a peace broker on its eastern periphery.

Having helplessly looked on as Russia invaded Georgia in 2008 and diced up Ukraine in 2014, the EU once again sat on the sidelines, as Putin scored yet another geostrategic victory in the region. With Russian troops now in Nagorno-Karabakh, Putin has made himself the de-facto custodian of the South Caucasus corridor, which links Europe to Central Asia and Iran and is an important transit point for Caspian oil and gas to European and world markets.

The corridor has always been a relevant trading throughway for goods coming and going between Europe and Asia. Alexander the Great understood this. So did the Ottomans. Putin took note of history and played his cards well.

After the fighting broke out, European foreign policy managed no more than a few statements urging all sides to lay down weapons and return to the negotiating table. The EU foreign policy chief, Josep Borrell, talked obsessively about the need to resume the peace process under the umbrella of the Organization for Security and Cooperation in Europe, which has failed to resolve the conflict over the past three decades. French President Emmanuel Macron could not get past a bicker-fest with Turkey over its backing of Azerbaijan, while German Chancellor Angela Merkel made calls to Baku and Yerevan that led to nothing.

And nobody, nobody heard what Aliyev was saying from the very start of the war: that Azerbaijan was not going back to the negotiating table until it had its land back, or at the very least a timetable from Armenia for a full withdrawal of its forces. The EU underestimated Aliyev’s resolve and the Azerbaijani army’s readiness: a spectacular failure of intel.

By refusing to play a more direct and hands-on role in the South Caucasus, the EU is also missing out on the opportunity to confront China’s growing influence deep in Central Asia. But not all is lost, and the EU still has a chance to regain a foothold in the South Caucasus through Georgia.

Brussels should reach out to Tbilisi and upgrade its existing economic and military partnership with Georgia. There is obviously the Russian factor to take into account, which makes it an urgent priority for the EU to begin working on the final status talks for the disputed regions of Abkhazia and South Ossetia.

As long as the legal status of these regions remains in limbo, and under the Russian dictate, any deepening of relations with Georgia would remain difficult. By resolving these frozen conflicts, however, the EU would remove Russia’s leverage, not only in Georgia, but also further afield in Armenia and Azerbaijan.

Europe should also insist on playing a role in the future talks on Nagorno-Karabakh’s status. Brussels could jump the gun on this point, and begin consultations with Azerbaijan and Armenia, as well as offer Baku the option of an EU-led interim administration for Nagorno-Karabakh.

Anything short of a grand ambition at this point is synonymous with the EU’s capitulation to Russia once again. This is not the first time it has failed to act strategically, but how many more chances will the union get before its brand becomes a symbol for irrelevance the world over?

The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial stance.