Since the break up of the Soviet Union, the South Caucasus has become vitally important to economic and security considerations, both regionally and globally. In fact, the world community's renewed attention has led to the region's reappearance on the international stage. Simultaneously, the contemporary fragile stability of three newly independent states of the South Caucasus - Armenia, Azerbaijan and Georgia - is arousing serious anxiety in the Western democracies. Post-communist leaders and their governments are acutely embroiled in a complex set of ethnic conflicts, which produce additional difficulties for developing a market economy, democratic institutions and an open society in the region. The three infant nations, grappling with the complexities of rapid economic and social transition are indeed searching for the keys to a new civilizational and national model of statehood. At the same time, domestic developments are taking place under the growing interference of outside geopolitical forces, which demonstrate great interest towards the natural resources and geo-strategic potential of the Caspian basin region. Consequently, the foreign influences of the major geopolitical players create immediate barriers for the newly independent states in the South Caucasus. Perhaps most importantly, the region is historically prone to internal conflict between small nations and external conflict with outside powers competing to extend their influence in this part of the world.