A peace treaty on the Nagorno Karabakh conflict failed due to the reluctance of officials close to former Azerbaijani President Heydar Aliyev to share territories,ex-director of the Russian Foreign Intelligence Service Vyacheslav Trubnikov said.

"I have been involved in the Minsk Group of the Organization for Security and Cooperation in Europe, which is tasked to settle conflicts in Transnistria and Karabakh," Trubnikov said.

"It was very difficult. But I was positive about Karabakh. Late Aliyev and Robert Kocharyan (Armenia's ex-President), as well as authorities in Nagorno Karabakh perceived the situation correctly. We met in Key West, Florida in April, 2000."

"We found a formula: money from the International Monetary Fund could be used to build a corridor from Azerbaijan to the south (most probably to Nakhijevan - editor's note), and from Armenia to Stepanakert, the capital of Karabakh," he added.

According to Trubnikov, Aliyev was at first reluctant to divulge the proposal to anybody, but once he told his colleagues about it, they protested: "Why, are we going to surrender pieces of our territories?" Trubnikov cited the Azeri officials as saying.

In early April, 2000, the United States hosted a nearly week-long meeting in Key West, Florida bringing together President Robert Kocharian of Armenia and President Heydar Aliev of Azerbaijan. This meeting was part of a continuing attempt to settle the conflict between the two countries over Karabakh.Kocharyan and Aliyev had reportedly warlier touched upon the proposal of the conflict settlement by exchange of territories near Meghri, a city in the south of Armenia, and Karabakh.