The standoff between Armenia and Azerbaijan over Nagorno-Karabakh region remains a potential flashpoint, says the report issued by director of National Intelligence James Clapper.

“The standoff between Armenia and Azerbaijan over the Armenian-occupied Nagorno-Karabakh region remains a potential flashpoint. Heightened rhetoric, distrust on both sides, and recurring violence along the Line of Contact increase the risk of miscalculations that could escalate the situation with little warning,” the report says.

As regards Georgia, the report mentions that the victory of Prime Minister Bidzina Ivanishvili’s Georgian Dream party in the October 2012 parliamentary elections, offer new hope for easing bilateral Russian-Georgian tensions.

“However, after nearly a decade of President Mikheil Saakashvili’s United National Movement party rule, Georgia faces a challenging political transition and an increased risk of domestic political instability,” the report says.