Armenia’s Prime Minister Nikol Pashinyan said he hopes to sign a peace agreement with Azerbaijan will "successfully conclude in the coming months."
This comes weeks after Baku recaptured Nagorno-Karabakh after a decades-long conflict between Armenia and Azerbaijan for control of the region.
Baku took control of the mountainous region in September in a lightning 24-hour offensive that ended decades of pro-Armenian separatist rule, causing the vast majority of the 120,000 Armenians living in the region to flee to Armenia.
The ethnic Armenian government in Nagorno-Karabakh agreed at the time to disband itself by the end of the year, but Azerbaijani authorities immediately moved to reassert control of the region and arrested several top former officials.
Pashinyan said in an address to an international economic forum in the Georgian capital Tbilisi on Thursday that his government was working on a draft agreement "on peace and the normalisation of relations."
"I hope this process will successfully conclude in the coming months."
He said the future peace treaty will be based on the mutual recognition of the Caucasus neighbours' Soviet-era borders.
Azerbaijani President Ilham Aliyev has said previously that a peace treaty with Yerevan could be signed by the end of the year.
Pashinyan also said on Thursday he hoped the border between Armenia and Turkey could be opened for citizens of third countries and diplomats.
Ankara closed its border with Armenia in the 1990s in solidarity with ally Azerbaijan.
In 2020 and in the 1990s, Armenia and Azerbaijan fought two wars for control of Nagorno-Karabakh, which is internationally recognised as part of Azerbaijan but home to a majority ethnic-Armenian population.
Internationally mediated peace talks between the ex-Soviet republics have so far failed to produce a breakthrough.
Almost all of Nagorno-Karabakh's ethnic Armenian population -- some 100,000 people -- fled for Armenia after Baku's offensive, sparking a refugee crisis.