GLOBAL AIM

Almost all civilised countries of the world are suffering from the problem of overpopulation in major cities. The situation that was observed in Azerbaijan a couple of year ago was also distinguished by the fact that people from all over the republic went only to Baku, bypassing even other major cities. Whole regions became completely deserted and it turned out that all the country's life would be concentrated only in the capital in several years.

Meanwhile, Azerbaijan has been regarded as an agrarian country since time immemorial, and even its status as an oil-producing country did not affect the population's inclination to engage in agriculture. Everything changed with the collapse of the Soviet Union when the existing infrastructure quickly collapsed in the regions of the country and agriculture and cattle-breeding did not yield any profit that would meet the demand of villagers. For this reason, it was almost impossible to live in the village, while the capital, on the contrary, was developing quite successfully. The oil, construction and other booms and the broad development of retail sale shops made it possible to create new jobs. Those provincials who could not find a job in Baku had the chance to improve their life in neighbouring Russia, Turkey and Iran.

It was almost impossible to change the situation until the first years of the new century, because the revenues from the sale of first oil were too little and in addition, the country had the enormous problem of providing worthy living standards for more than one million of its citizens who had become refugees and displaced persons as a result of the Armenian aggression.

A sharp U-turn

In 2004 when the implementation of large-scale oil, gas and transport projects in Azerbaijan became a reality, the country's leadership dealt first of all with the socio-economic development of regions and President Ilham Aliyev approved a relevant state programme. Summarising the results of the implementation of this document today, we can confidently say that its goals and principles have not remained on paper, otherwise, there would not be such impressive statistical indicators of economic growth in the country's regions.

Let's have a look at them. So, 520,343 new jobs have been created in the last three years, of which 360,000 are permanent. In 2006 alone, about 174,000 new jobs were created, of which more than 80 per cent were created in the regions of the country. The volume of credits allocated by the National Foundation to Support Entrepreneurship totaled 155.5m manats. The fund financed 5,385 projects. In this period, 15,560 new enterprises were opened. On the whole, 407 processing, 722 construction, up to 500 agricultural and more than 1,000 trade and services enterprises were opened last year. Forty per cent of them were opened in the country's regions.

If we classify these indicators in specific economic regions, we will see that the leader among them is not the Abs heron district that is located around the capital (30,610 new jobs have been created, 849 new enterprises have been set up and the overall sum of credits sent to the district totals 21.4m manats), but the Aran zone where 149,219 new jobs have been created and 1,500 new enterprises have been set up. In the Ganja-Gazakh economic district, 56,261 new jobs have been created, 808 enterprises have been opened and credits worth 17.6m manats have been allocated. In the famous tourist centre of Azerbaijan - Guba-Khachmaz - 31,537 new jobs have been created and 352 enterprises have been set up in the last three years. In blockaded Nakhichevan which has lost transport links, except for air links, with the rest of Azerbaijani territory as a result of the Armenian-Azerbaijani conflict, they have managed to create 24,812 new jobs and set up 958 enterprises. Even in the Karabakh zone itself where shootouts regularly occur between the armed forces of Azerbaijan and separatists despite the official cease-fire, the economy is slowly but surely developing. A total of 12,198 new jobs and 330 new enterprises have been set up there, which can be regarded as a great success in the aforesaid conditions. The following information relates to the other three zones: 15,158 jobs have been created and 209 enterprises have been set up in the Mountainous Shirvan economic district; 26,426 new jobs in the Sheki-Zagatala zone; 49,519 news jobs and 602 new enterprises in the Lankaran zone. Credits worth 11.9m manats have been allocated.

Thus, the preventive task has been fulfilled; the exodus of the population from the regions of the country has slowed down. Moreover, 1,047 of those who left for Russia and other countries from Yevlakh District have now returned and been provided with jobs in the district.

New tasks

Although the figures we mentioned testify to a great breakthrough in the regions of the country, President Ilham Aliyev pointed out in his address to the conference on the third anniversary of the state programme on the development of regions in 2004-08 that the goal set three years ago was more global: to achieve Azerbaijan's comprehensive development, to establish the non-oil sector and to provide people with jobs. In this sense, it is notable that poverty in the republic has halved. In the last three years, the number of people living in poverty in Azerbaijan has fallen from 49 to 20 per cent. Moreover, the work that was carried out in the regions became one of the most important aspects of the country's overall economic growth, which totaled 26 and 35 per cent in the last two years and will probably remain at this level this year. Over the last three years, the share of the private sector in the gross domestic product increased from 73 to 81 per cent.

Minister of Economic Development Heydar Babayev has pointed out that since the adoption of the programme, the attitude to the regions has drastically changed in all government agencies, and regional development has become the main purpose of our economic policy. It is not by chance that the overall weight of the regions in programmes funded from the state budget is steadily growing. For example, in 2006 the overall number of funds allocated from state investment expenses for the implementation of projects in the regions of the country, exceeded the same indicator of 2005 by a factor of six. The multiple increase in budget expenses (from 1.4bn in 2003 to 6.5bn and more in 2007) makes it possible to implement large-scale infrastructure projects in the country, which are so important for the development of the regions. This year it is planned to build a module power station in Sangachal, an Oguz-Gabala-Baku water pipeline, an Upper Mil canal, Tovuzchay and Shamkir water reservoirs, a Yevlakh-Zagatala-Georgia road, to reconstruct Lankaran and Zagatala airports, to build health, education, sports facilities and houses for martyrs' families and disabled people and implement other projects.

All this makes it possible to set new goals within the framework of regional development. Today we can courageously say that it is possible to implement the ambitious idea of setting up a powerful tourist centre in Azerbaijan. What we are talking about are not individual tourist chains, small hotels and recreation centres set up by businessmen in picturesque parts of the country, but a deliberate and global project in the implementation of which the state will play a direct role along with the private sector. For this reason, President Ilham Aliyev, speaking on this issue, said it was necessary to employ foreign specialists to implement the project and help draw up the feasibility study and general plan of the whole tourist infrastructure.

We have to say that part of this work, specifically the development of winter tourism in the mountains of Azerbaijan, is already being implemented. The large scale of necessary infrastructure reforms is obvious here: it is planned to build new roads, power lines, water pipelines and create special conditions for winter sports. This will make it possible to increase the number of new well-paid and permanent jobs in the future. What is more, this will become another powerful impetus to the development of local production and increase the volume of agricultural produce.

Support will be increased

In principle, this is the final goal of the state programme - to replace imported food products fully with local products. Proceeding from this, in 2008 it is planned to increase sharply the sum of credits issued to business people. At the same time, it is also planned to increase the size of the credit and establish it at the level of 5m dollars and higher so that these funds can be used to build modern processing enterprises in various places. In order to strengthen the agrarian sector, a decision has also been made to allocate 80m manats to peasants for fertilizers and fuel.

As we have already said, the state programme for the development of the regions, which was endorsed three years ago, has outlined global tasks and goals in this direction. In addition to the programme, eight separate and more detailed programmes on specific regions have been adopted in this period and are being implemented right now. The large number of plans and tasks outlined in them shows that a lot of work has to be done in the near future. It is the development of the regions that is Azerbaijan's main hope to overcome the dominance of the oil sector in the economy, to which the state aspires so much. This means that this programme will always be in the centre of attention, which gives us confidence in the future success of its implementation.