Vusal Gasimli: "Zangezur corridor will connect Turkey with Russia through Azerbaijan"

Vusal Gasimli: "Zangezur corridor will connect Turkey with Russia through Azerbaijan"

These days, Baku is hosting the 25th International Business Forum, which is attended by representatives of international organizations, investors, entrepreneurs and business associations from three dozen countries of the world. The forum is intended to acquaint foreign investors with the investment climate of Azerbaijan, to strengthen ties in the field of investment and business. Executive Director of the Center for Analysis of Economic Reforms and Communications of Azerbaijan, Doctor of Economics, Professor Vusal Gasimli spoke about the prospects for the development of international business contacts to Vestnik Kavkaza.

- What results do you expect from the forum in terms of attracting foreign investments to Azerbaijan?

- The International Business Forum, being an influential platform for the development of economic relations between the countries, is being held in Azerbaijan for the first time. The 25th forum, held under the slogan "Azerbaijan: the pearl of Asia", creates ample opportunities for promoting a favorable investment climate in our country, strengthening business cooperation, new initiatives and projects.

- How attractive is Azerbaijan for international investors now?

- First of all, it should be noted that the growth of indicators of the non-oil industrial sector consistently exceeds the global average. At the end of this year, we expect it to rise by 20%, which means a steady increase in the share of the non-oil industry in GDP. Analysis of trends in the value chain is very important for Azerbaijan. To get the desired positions, it is necessary to segment the market, analyze value chains, determine the level of demand in the market and identify the demand for Azerbaijani goods.The Center for Analysis of Economic Reforms and Communications of Azerbaijan continues research to ensure the country's successful entry into regional and further global chains. As the world practice has confirmed, connecting to networks is not enough. It is also necessary to carry out work in the field of services, marketing and the development of new technologies.

The Azerbaijani government has implemented measures to improve the business and investment environment in the country (simplifying the licening and permit process), and also extended the moratorium on inspections of entrepreneurial activity until 2021 in order to attract investments, create industrial parks, maintain domestic production and protect the domestic market, support export of non-oil products, the application of progressive mechanisms for import and export operations (green channel, electronic declaration, etc.) and the provision of subsidies for some agricultural products. According to the Central Bank, the total investments attracted to Azerbaijan in the form of direct investments from abroad in 2020 amounted to $ 4.5 billion (this is an increase of 5.9%). Over the years of independence, about $ 300 billion has been invested in the economy of Azerbaijan.

- What, in your opinion, are the prospects for attracting investments in the economy of the Karabakh region?

- Attraction of government and non-government investments in the restoration of Karabakh lays the foundation for sustainable economic growth. In 2021, $ 1.3 billion in government investment in Karabakh will boost the potential non-oil gross domestic product. The results will be clear: new fixed assets - roads, electricity, gas and other infrastructure - will drive the economy as well as potential growth.

Government investments in Karabakh will become a catalyst that will create the basis for non-government investments. There is already a flow of investments from Turkey, Italy, Great Britain, Pakistan, Uzbekistan and Israel in the restoration of Karabakh. This Azerbaijani region has outstanding potential for the development of mining, metallurgy, food and knitwear industries, tourism, agriculture and green energy.

The economic role of the Zangezur corridor in the access of the Central Asian countries to new markets should be emphasized here. The economic role of the Zangezur corridor in the access of the Central Asian countries to new markets should be emphasized here. The potential of transporting goods from China - one of the major forces of the world economy - through Central Asia, as well as the formation of an alternative transport corridor to the sea transport route, make Azerbaijan and the Zangezur corridor an important transport artery.

Another important point regarding the Zangezur Corridor is new prospects for integration into Europe for the development of transport links in the Eurasian region and ensuring of cooperation with other transport corridors. These prospects are being created by the member states of the Ashgabat Agreement, which was signed by Turkmenistan, Uzbekistan, Kazakhstan, Iran, Oman, India and Pakistan. International freight traffic through these countries to the Eurasian markets through the Zangezur corridor can play a special role in increasing the economic potential of the Karabakh region.

- What spheres of cooperation with Russia does Azerbaijan intend to develop now?

- Azerbaijan is interested in expanding trade and investment relations with Russia. The role of the Azerbaijani-Russian and Russian-Azerbaijani business councils is great in stimulating business initiatives, developing cooperation between business circles and establishing new partnerships. According to the State Statistical Committee of Azerbaijan, the share of trade with Russia in 2020 accounted for 6.89 percent of Azerbaijan's total foreign trade turnover. In the reporting period, the volume of exports of Azerbaijani products to Russia amounted to $ 91.525 million (an increase of 3.14 percent). In general, 2.82 percent of Azerbaijani exports are supplied to Russia.

Russia imports from Azerbaijan mainly food products and agricultural raw materials, mineral products and textiles. Russian exports to Azerbaijan are food products and agricultural raw materials, machinery, equipment and vehicles, metals and metal products, timber and pulp and paper products, as well as chemical products and rubber. The border bridge over the Samur River (southeastern part of Azerbaijan), which opened in December 2019, also facilitates trade between Azerbaijan and Russia.

Azerbaijan is the main economic partner of Russia among the countries of the South Caucasus, and Russia remains one of the main foreign trade partners of Azerbaijan. Interregional cooperation plays an important role in the development of Russian-Azerbaijani trade and economic relations and in increasing of trade. Among other things, Russia ranks first in the export of non-oil products from Azerbaijan.

The leader of the Russian truck engineering "Kamaz" plans to build a service center in the Karabakh region of Azerbaijan. Innovations are being actively used to increase the efficiency of resource use, create added value in the production of the final product, ensure food safety and stimulate mutual investment. Innovation has a positive impact on the socio-economic and environmental aspects of small and medium-sized farms in the agricultural sector, and this trend is expected to continue. The "North-South" international transport corridor will play an important role in the development of cooperation between our countries, which will increase trade through the implementation of export-import operations on this route, as well as expand economic and trade ties in the region. Azerbaijan has focused on projects in the Zangezur Corridor, which will include highways and railways. The Zangezur Corridor will also link Turkey to Russia through Azerbaijan and will be crucial for the revival of the regional economy and China's "The Belt and Road Initiative". 

It should also be mentioned that Azerbaijan and Russia are developing cultural and humanitarian connections, as well as educational programs. It makes a significant contribution to the development of bilateral relations in the long term.

 

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