FROM THE BALTIC TO THE CASPIAN

Poland is one of Azerbaijan's partners developing their relations with this country today in the most dynamic manner. It would be relevant here to recall that Poland is one of the most active promoters of Azerbaijan's interests in matters related to integration into the European community as the main line of this country's foreign policy. This applies both to Baku's relations with NATO and EU integration (Poland together with Sweden is among the founders of Europe's Eastern Partnership programme). 

Meanwhile both states' leadership openly admit that the potential of their economic relations is still below the level achieved in their political ones. Meanwhile the two countries have long-standing traditions of mutual trade. The two state's trade and economic relations have at least 500 years' history and they are consolidated today by the two countries' significant economic potential and investment ambitions. 

A lot has been written about Azerbaijan's economy and more than once. Meanwhile Poland also has something to boast. 

It is noteworthy that Poland is Europe's only economy having registered no GDP decline during the crisis that hit practically all the rest of the continent. Last year, a very hard one for the global economy, the country registered a 1.6 per cent growth in its GDP. Poland is gathering even more momentum seeking to exceed a growth indicator of 3 per cent by the end of this year. At the same time the country has registered a record high export growth dynamics - almost 9 per cent worth a total of 152bn euros. To visually demonstrate Poland's economic strength, suffice it to say that Germany has a higher trade turnover with Poland than with Russia. 

A meeting of the Azerbaijani-Polish intergovernmental commission for economic cooperation was to be held in Baku in mid-April. However it has been decided to postpone the event to a later date in late spring or early autumn. This became known to a group of Azerbaijani journalists who visited Warsaw and Gdansk last week within the two states' preparations for that meeting. 

Yet it is not at all because the sides to not attach importance to that meeting. The event failed to be held on the fixed date because of the dramatic developments in Ukraine which is Poland's neighbour and a strategic partner both to Warsaw and Baku. Yet every cloud has a silver lining. Dramatic as they are, the developments around Crimea are expected to lead to an even greater intensification of trade and economic, financial, energy and even military relations between the two states and bring them closer together in general.  

During their meetings with Azerbaijani journalists, representatives of Poland's ministries of economics and foreign affairs, associations of businessmen and other structures were making no secret of the fact that the crisis in Russian-Ukrainian relations was forcing Warsaw to revise its export policy with regard to the markets beyond their eastern border. "The situation with Ukraine and Russia will have an impact on export of Polish products to Russia. In this context, Polish products need to enter new markets and it would be good to have Azerbaijan's market among them," said Janusz Piechocinski, Poland's deputy prime minister, minister of economy and co-chairman of the Azerbaijani-Polish intergovernmental commission for economic cooperation. He said clearly that, despite its obvious upward trend, the development of the two states' trade and economic relations does not reflect their actual potential. Thus for instance their trade turnover increased by 20 per cent last year reaching 153m dollars. Export to and import from Azerbaijan grew by 8.6 per cent and 4.5 per cent, respectively, reaching 133.5m dollars and nearly 20m dollars, respectively. "We would like your products to enter via Poland and spread throughout the EU market," said Piechocinski. 

According to the deputy prime minister, Poland views Azerbaijan as a centre of intensive economic activity in its region. Having a well-run top-level political dialogue with Baku, Warsaw suggests stepping up cooperation in a variety of economic sectors in the interests of both sides. The vice-premier expressed hope to visit Azerbaijan before Azerbaijani leader Ilham Aliyev's visit to Poland scheduled for this year during which Warsaw expects to sign "several interesting economic agreements". Apart from all other things, the Polish side is sure that the visit will be a great opportunity to open wider the doorway of Azerbaijan's market for Polish businessmen and at the same time draw Poles' attention to intentions of Azerbaijan, a country having a high cultural level, monuments of history and culture and big chances for efficient business. Just for this purpose, the sides intend to organize, prior to President Ilham Aliyev's visit to Warsaw, a meeting of the intergovernmental commission and a business forum. Entrepreneurs from Azerbaijan and Poland must specify their new spheres of interaction in order to use their bilateral cooperation potential more efficiently, said Jerzy Drozdz, director of the Foreign Relations Rapprochement of the Polish Chamber of Commerce. 

Poland is watching carefully Azerbaijan's growing economic opportunities enabling the republic to carry out item so called "investment expansion" abroad. In particular, the Polish side is interested in Azerbaijani investments in the spheres of finance, realty and health care, said Barbara Chamot, director of department at the Polish Agency for Economic Information and Foreign Investments (PAIZ). She pointed out primarily the spheres of finance, real estate and health. In addition, the purchase of Polish companies may be very lucrative for potential investors. Foreign companies are actively establishing joint ventures in Poland and her country might also be attractive for business people from Azerbaijan, she said. "The food sector is well developed in Azerbaijan. For example, as far as I know, Azerbaijan's pomegranates are the best in world and this is one of the interesting areas for cooperation," B.Chamot said. 

In general, the farming sector is one of the natural spheres for cooperation between Azerbaijan and Poland which are widely known for their farm produce. The Polish side is ready to render assistance to Azerbaijan's efforts to join in the EU common agricultural policy involving registration of farms and developing an animal identification system, Krystyna Gurbel, Poland's deputy minister of agriculture and rural development, told journalists. 

For her part, Agnieszka Bawolec representing the Ministry of Agriculture and Rural Development spoke about a recent visit to Poland of a delegation led by senior officials of the Ministry of Economics and Industry and the Foreign Ministry of Azerbaijan. During the visit, she said, the Azerbaijani side voiced its interest in cooperation in the production of farm machines and meat products. Warsaw hopes that the sides will establish relevant contacts during the next meeting of the intergovernmental commission for economic cooperation. 

Poles definitely have an interest in Azerbaijan's experience in the energy sector, especially in the context of the discussions currently under way in Europe on the energy security problem. "Having vast and successful experience in oil and gas extraction with the use of conventional methods, Azerbaijan can explore shale gas reserves in Poland. Apart from this, we also have some reserves of natural gas. Why not apply Azerbaijani specialists' vast experience in Poland as well?" J.Drozdz said. 

Poland also supports the idea to resume work on the Nabucco-West pipeline project for the Southern Gas Corridor project to be implemented as it was planned, the Polish deputy minister said. It is all the more so as Azerbaijan is next to Turkmenistan with which the EU is also discussing this subject. 

Alongside this, the Polish side not only reckons on energy minerals from Azerbaijan. It is important for Poland to have the energy minerals processed on Azerbaijani soil using Polish investments. 

In addition, Polish businessmen are interested in investing in Azerbaijan's production of buses, railway and tram carriages, tractors as well as fruit juices, confectionary and others. The Polish side also finds it promising to invest money in construction, pharmaceutics and cosmetics. Also promising for cooperation are areas such as waste water purification, sewage improvement, water pipeline construction, renewable energy and mining industry research. 

In general, Poland is set to increase its direct investments in Azerbaijan to 100m dollars and more during the next few months. Moreover, Poland suggests that Azerbaijan should act as a kind of connecting hub to intensify Polish companies' activity throughout the region. 

Among other important areas for future cooperation with Azerbaijan, the Polish side sees transport. In this context, Warsaw regards Azerbaijan as the region's central hub providing access to Central Asia, the Middle East and other neighbouring regions. Poland hopes for success in connecting Azerbaijan's railways with those of Iran. As a result, Poles will be able to establish direct contact with the Gulf States via Azerbaijan. Moreover, Poland hopes to create new transport corridors in coordination with Azerbaijan. The Ukraine crisis had its impact here too. Warsaw's concerns in connection with the Ukraine situation have urged it to hold talks with the Azerbaijani government on its grandiose plans to connect the railways of Azerbaijan, Kazakhstan and Ukraine with Europe. 

In addition, the Polish company Tines reckons to take part in building new lines for Baku's underground. The company is also showing an interest in the construction of crossings within the Baku-Tbilisi-Kars railway corridor project. Moreover, Solaris, a leading Polish bus making company, is holding talks on supplying 300 buses to Azerbaijan can be used during the 1st European Games in Baku in 2015. PESA, another company making wagons and trams, has a special offer for Azerbaijan. 

And certainly tourism attracts. Resorts of Antalya and Nice are not enticing any more to Poles who have travelled the length and breadth of Europe, the Americas and Africa. The Caucasus is selected as a priority destination, all the more so as Azerbaijan is a stable developing state which cannot be said about some of the republic's neighbours. 

This in turn encourages the Polish side to help increase EU allocations for technical aid and making travelling easier for people by removing visa barriers. Intensified mutual trips by business people and tourists will inevitably lead to opening a direct air link between Azerbaijan and Poland. 

As can be seen, many of the initiatives called to step up economic cooperation between Azerbaijan and Poland, are directly connected with Warsaw's intention to bring the European Union's mechanisms into play. Not the least in importance here is the security aspect. Official Warsaw regards the South Caucasus as an important region in terms of influence on European security, especially now that recent developments have brought to the foreground the problem of security on the European Union's eastern borders, said Katarzyna Frydrych representing the International Security Policy Department at the Polish Defence Ministry. According to her, taking into account Azerbaijan's tasks within cooperation with NATO, the Polish partners are trying to combine NATO's goals with the Azerbaijani side's priorities. In this cooperation, the Polish side is trying to emphasize military education and training. The Polish side suggests here a number of specific proposals on training including at the Military Academy of Poland. 

Thus the Russian-Ukrainian crisis is definitely going to have an impact on the South Caucasus. A high-ranking Polish diplomat has told Azeri journalists in a private talk that the latest developments near the eastern borders of Poland and the European Union have significantly increased the importance of the South Caucasus in the eyes of European strategists and the nearest future will see the West step up its economic and political activity in the region.