Russia and Azerbaijan building up economic cooperation potential

Russia and Azerbaijan building up economic cooperation potential

Russia and Azerbaijan are building up the potential for economic cooperation, while the high level of political dialogue guarantees the growth of mutual investments. Both countries contribute to the formation of the Caspian economic market and the implementation of transnational projects. Logistics, trade networks and agriculture are developing at the bilateral level. Potential projects are accumulated in the areas of post and telecommunications, information security, IT education, digital banking, the development of smart cities, SME lending and other relevant areas. The question of what would be the pace and scale of interaction processes development was answered by the participants of the Moscow-Baku video conference titled 'Economic and Investment Cooperation of Azerbaijan and Russia: New Points of Growth'.

Deputy Director General of the Trend information agency Arzu Nagiyev recalled that the Russian-Azerbaijani conference entitled 'Building a common future, search for a common past and development of a common present', which was attended by representatives of the Russian and Azerbaijani parliaments and experts, was held in Baku ten days ago. "Last year, Ilham Aliyev payed three visits to Russia. Within the framework of Vladimir Putin’s official visit to Azerbaijan, Baku hosted the 19th Azerbaijan-Russia Interregional Forum, during which many areas were noted, including energy ones. Russia ranks first in non-oil imports now. About 700 joint companies with Russian capital operate in Azerbaijan. Pharmaceutical industry is developing successfully. Russian companies have invested more than $4 billion in Azerbaijan. Azerbaijani companies have invested $1 billion in Russia's non-oil sector," Arzu Nagiyev said.

According to him, the trade turnover between Azerbaijan and Russia amounted to about $170 million in January 2019, which is 3.4% more than it was in January 2018. "The trade turnover volume between Azerbaijan and Russia reached 7.3% of Azerbaijan’s total foreign trade turnover in January. The trade turnover volume between the two countries reached $2.5 billion in 2018, which is 19.1% more than in 2017. That is, there is a growth trend."

Speaking about regional cooperation, Nagiyev noted that the North-South International Transport Corridor, which passes through Azerbaijan and Russia, plays a big role. The expert also stressed that foundation of a new automobile plant has been recently laid in cooperation with the Russian company GAZ, where 1,000 cars would be produced annually.

Head of the expert council of Baku Network, Elkhan Alasgarov touched upon the cooperation in the Caspian Sea region: "The Caspian Sea is not used effectively. The development of the Volga-Don Canal would be interesting for Azerbaijan, because it's the only way that connects Azerbaijan's Caspian sector with the world. Volga-Don the channel could give more opportunities for access to the world's oceans."

Alasgarov also touched upon the cooperation in the field of nanotechnologies and space: "Azerbaijan launched the third satellite, established the Space Research Agency. Russia has enormous scientific potential in this area. In the Soviet times, every republic sent its representative to space. We all waited for the Azerbaijani national to fly into space. Today it is also a topic for discussion."

Speaking about economic projects, the expert focused on transport: "The free economic zone in the Alat settlement will enable the Russian companies to establish their representative offices in Azerbaijan. Today logistics is a very strong economic tool and it brings huge profit. Taking into account that the construction of North-South corridor is being finalized, and there is the East-West as well, I think that Russian companies could develop their participation in transport projects. Moreover, there are no language barriers in Azerbaijan: translators are not required, because the Russian language is widespread in Azerbaijan."

This year, Azerbaijani President Ilham Aliyev signed a decree establishing the Azersilah Open Joint-Stock Company. "The development of the non-oil sector, improvement of export capacity of the economy, as well as the production of competitive, import-substituting industrial products, adaptation of the defense industry, as one of the most important areas of the country's defense policy, to suit modern requirements and improvement of quality and quantity of military equipment through domestic production show a clear need for modernizing enterprises operating in this area, which have high potential for development, based on best practices and technologies, increased competitiveness in the current economic situation with the use of advanced enterprise management experience," the decree reads.

According to Elkhan Alasgarov, "Since the first days of independence Azerbaijan has been investing heavily in the development of the military industrial complex; the military-industrial complex facilities, Azercellih have been established for self-reliance; and Russia, which has rich experience in this field, can participate in the implementation of such projects."

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