SAMAXI - THE GATEWAY TO THE NON-OIL SECTOR OF AZERBAIJAN

Rapid economic development stimulated by the implementation of major regional projects has put Azerbaijan in the leading place in world economic rankings. As a result of the policy of the country's leadership to improve the business climate, investments in the Azerbaijani economy from all sources totaled about 50 billion dollars in 1993-2007. It is pleasing that the amount of investments in the country's non-oil sector is increasing year by year. If in 2006 such investments totaled 2.6 billion manats and in 2007 - 3.3 billion manats, in 2008 they are expected to reach 4.2 billion manats.

The implementation of the state programme on the socioeconomic development of regions in 2004-2008 made it possible not only to channel money from international financial institutions into the country's non-oil sector, but also to draw the attention of a greater number of foreign investors to our republic.

The high pace of growth and the favourable foreign economic situation made it possible to establish closer relations between local and foreign companies.

In the centre of a 300 million market

The first Azerbaijani international business conference held in Samaxi on 25-27 May was a remarkable event in the economic life of the country. The conference was held jointly by the Evsen group of companies and the Azerbaijan Export & Investment Promotion Foundation (AZPROMO). The scale of the event could be judged by the number of participants in the conference. It was attended by more than 450 representatives of companies and enterprises from 32 countries - Turkey, China, Iran, Baltic countries, Germany, Russia, Saudi Arabia, Ukraine, Pakistan, Georgia, Uzbekistan and others.

The president of the Evsen group of companies, Ali Evsen, said that the conference was meant to boost Azerbaijani businessmen's access to the world market. Evsen pointed out that Azerbaijan is in the centre of a large market with a population of 300 million. This is the first time that the country has been visited by representatives of companies that have already created hundreds of thousands of jobs in the world, while the overall level of their capital investment exceeds 1,000 billion dollars, he said. Azerbaijan has turned into the locomotive of economic development for the whole of the South Caucasus mainly due to state support for private businesses, he said.

In turn, Azerbaijan's Deputy Minister of Economic Development Niyazi Safarov said that the economic reforms which are successfully being implemented in the country have turned Azerbaijan into a leading country in the region. In recent years, economic development has doubled. In four months of 2008 alone, our GDP increased by 15 per cent. The deputy minister also said that in 2007, investments in the Azerbaijani economy totaled 7.8 billion dollars, of which 5 billion came from abroad. Talking about the special attention the country is paying to the socioeconomic development of regions, he said that if in 2007, 700 million manats were allocated for the financing of regional economic projects, in 2008 this indicator has already exceeded one billion manats.

According to the deputy minister, 822 construction institutions, 600 agricultural institutions, 1,700 service and other institutions, and more than 400 processing enterprises were put into operation in 2007. Nine hundred businesses were given 90 million manats as privileged loans. The Ministry of Economic Development has forecast that in 2008, the country's GDP will grow by 11.6 per cent in the non-oil sector, whereas the initial forecast was only 10 per cent.

In turn, the chairman of the permanent parliamentary commission for economic policy, Ziyad Samadzada, called on foreign investors to be more active in investing their capital in Azerbaijan's non-oil sector, which he said will yield large revenues in the medium-term. The head of the parliamentary commission drew the attention of participants in the conference to the successful implementation of major regional projects and to new packages of economic laws, which he thinks allows Azerbaijan to create a favourable business environment in all spheres of the country's economy.

Ziyad Samadzada said that the Azerbaijani leadership has set itself the task of turning the country out of an importer into a major player on the global export market. He said that to this end, it is necessary to stake on the importation of production equipment into the country, which will make it possible to expand the assortment of our products.

Incentive to direct investments

The Turkish ambassador to Azerbaijan, Hulusi Kilic, drew the attention of participants in the conference to the fact that the trade turnover between Azerbaijan and Turkey in 2007 totaled 1.68 billion dollars. As a result, Turkey takes first place in Azerbaijan's foreign trade, the ambassador said. Currently, there are about 600 Turkish companies operating in the country, and they have invested 3 billion dollars in Azerbaijan's energy and non-oil sectors. About 50,000 Azerbaijani citizens are working for these companies. The potential of economic cooperation between the two countries has not run out yet.

Saying that Samaxi and Turkey's Igdir are twin cities, the ambassador stressed that relations between regions make it possible to expand the volume of bilateral relations. For this reason, the ambassador urged Turkish investors to implement new projects in fraternal Azerbaijan.

The director of the Iranian Trade Promotion Organization, Mehdi Ghazanfari, told the conference about the development and prospects of Azerbaijani-Iranian relations. He said that in recent years, relations between the two fraternal countries have been rapidly developing and the volume of trans-border trade has been increasing.

The representative of China - the president of the China-Europe Association for Technical & Economic Cooperation, Hu Bing Jin, said that cooperation between China and Azerbaijan is a requirement of time. Chinese businessmen are interested in relations with Azerbaijan and will cooperate even more closely in the future, he said.

Analyzing the results of the international business conference in Samaxi, the head of the Evsen group of companies, Ali Evsen, stressed that such events make it possible to bring more foreign companies to Azerbaijan, and their managers can see the country's market for themselves.

He also recalled that on the sidelines of the conference, companies and organizations from Azerbaijan, Turkey, China, Iran, Baltic countries, Germany, Russia, Turkmenistan, Kazakhstan, Belarus and other countries held business negotiations. Foreign companies and organizations were introduced, and meetings were held in Azerbaijani government circles, for example, in the country's Chamber of Commerce and Industry.

"Business conferences in regions of the country are a real incentive to increase direct investments in the Azerbaijani economy," Ali Evsen said.

He said that in Azerbaijan, all the conditions are right for entrepreneurship to develop. The establishment of direct contacts between local and foreign businessmen will increase the country's economic potential and strengthen the republic's leadership in the whole region.

It was noted that in the long-term, it is planned to make the conference traditional and hold it in the form of an exhibition.