Russia and Azerbaijan to focus on non-oil sector

 Russia and Azerbaijan to focus on non-oil sector

Russia and Azerbaijan will be actively engaged in diversification of mutual investments to stimulate the real sector, the head of the Azerbaijan Export and Investment Promotion Foundation (AZPROMO), Rufat Mammadov, said at the Azerbaijan-Russia business forum being held in Baku.

Mammadov stressed that Russian experience in the diversification of the economy and direct economic ties between Russian regions and the districts of Azerbaijan, including economic and trade relations with 17 subjects of the Russian Federation, will be a great help. At the same time, 599 companies with Russian shares are currently registered in Azerbaijan.

According to the political scientist Rovshan Ibragimov, first of all Russian businesses will invest in those sectors that Azerbaijan considers as an alternative to oil revenues. "In this case these are tourism, agriculture, transport and high technology. Of course these are the high-tech, information and communication technologies sectors," Ibrahimov said.

"One should not exclude cooperation in other areas. First of all, I think that Russian business might be interested in such a direction as the creation of new satellites," he added.

Agriculture, in his estimation, should also be a priority area for ​​Russian investments. "In the first eight months of 2015 the total food exports of Azerbaijan to Russia amounted to about $280 million. There are certain restrictions imposed by Rospotrebnadzor, whose approach to granting permits to Azerbaijani companies is quite cautious, but literally at the end of August – or in early September – seven companies from Azerbaijan received permission to export various kinds of products, including meat and dairy, which will be presented on the Russian market for the first time," Rovshan Ibrahimov noted.

"In this case, Azerbaijan and Russia can cooperate not only through the federal government, but also through the federal district and the republics, that is, directly with the federal administration entities of the Russian Federation. In this case, such an experience as the opening of trade fairs to represent Azerbaijani products that can be exported to the Russian market is very useful," the expert noted.

Economist Oktay Akhverdiyev also expects that the diversification of Russian investments in Azerbaijan will begin in the agriculture sphere. "The traditional ties in the sphere of providing Russia with products have been preserved since the Soviet era. Now the volume of food supplies to Russia has declined, but as far as I know, an agreement on joint agro-industrial enterprises was reached in the course of negotiations between the Russian and Azerbaijani businessmen," he recalled.

"On the other hand, we have the KAMAZ production and they adopted a plan to expand the Azerbaijani automobile industry by the release of medium-size trucks using Russian technologies. In general, the Russian presence in the Azerbaijani economy will grow: for example, the Russian Federation has already invested about $8 billion in the project of the petrochemical complex. So, of course, the prospect for the expansion and deepening of our economic relations is real, we just have to move toward practice," Oktay Akhverdiyev noted.

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