Washington: The peace framework agreement between Armenia and Azerbaijan has been identified as a positive step towards a comprehensive peace deal. This development significantly reduces the risk of renewed hostilities, as reported by Fitch Ratings.

According to Azeri-Press News Agency, the agreement is unlikely to immediately affect the credit ratings of either Armenia (BB-/Stable) or Azerbaijan (BBB-/Stable). However, it holds the potential to support positive medium-term credit trends. The prospect of expanded trade between the two nations could potentially boost economic growth, although the exact impact remains difficult to quantify.

The joint declaration, which was mediated by the United States and signed in Washington on August 8, commits both nations to adopting Soviet-era borders and renouncing the use of armed force. It also includes provisions for 'unimpeded connectivity' between Azerbaijan and its exclave of Nakhchivan through Armenian territory.