Azerbaijan

While still struggling to assert its independence after the collapse of the Soviet Union, the Asian nation of Azerbaijan became involved with its neighbor Armenia in an armed territorial dispute over the area of Nagorno-Karabakh that continued from 1988–94. By the time a tenuous truce was declared, Azerbaijan had lost 16 percent of its territory and was forced to deal with the internal displacement of 571,000 Azerbaijanis. Economic problems and widespread corruption have plagued the country. However, Azerbaijan's generally untapped petroleum resources have improved economic prospects since a consortium of Western oil companies began pumping a million barrels a day from Azerbaijan in 2006. Other natural resources include natural gas, iron ore, nonferrous metals, and alumina.

Approximately one-fifth of Azerbaijan is arable, and 41 percent of the population is engaged in the agricultural sector. The population of 7,911,974 has an annual per capita income of $4,600, and the country is ranked 140th in world incomes. Nearly half of Azerbaijanis live below the national poverty line. Around 23 percent of the population has no sustained access to safe drinking water, and 45 percent lack access to improved sanitation. The United Nations Development Program (UNDP) Human Development Reports rank Azerbaijan 101st in the world on general quality-of-life issues.

Although Azerbaijan borders the Caspian Sea for approximately 800 kilometers, the country is landlocked. Rivers tend to be fast flowing and are generally not navigable. The climate is dry, semiarid steppe, and the terrain is diverse. The flat areas of the Kura-Araks Lowland are mostly below sea level. The Great Caucasus Mountains cover the northern section of Azerbaijan, while the Karabakh Upland is located in the west. The capital city of Baku is part of the Apsheron Peninsula that juts into the Caspian Sea. Azerbaijan is subject to severe droughts.