Azerbaijan's Cabinet of Ministers on import duties reduction

  19 December 2019    Read: 1707

Some duties on imports and exports of the commodity nomenclature of foreign economic activities have been changed in Azerbaijan, in accordance with the resolution of the country's Cabinet of Ministers dated Dec. 17, 2019, reports citing the Cabinet.

The resolution consists of two parts.

According to the first part of the resolution, the import duty on raw materials and materials used in domestic production has been reduced from 15 to 0 percent.

After analyzing the raw materials used by 500 enterprises of the country, a list of raw materials that are not used and will not be used in the near future in Azerbaijan is established. It has been established that products mainly related to the metallurgical, chemical, rubber, plastic and food industries are imported into the country in the form of raw materials. Moreover, imports of finished products, which require raw materials to be manufactured, to the country listed above are gradually growing.

Therefore, the duty on the import of raw materials has been reduced to 0 percent in order to create conditions for import substitution, support for domestic support, stimulate exports, expand production and open new jobs.

If the local producer is provided with cheap raw materials, then the produced goods will cost 15 percent cheaper; as a result, the production primary cost will be reduced, which in turn will help to reduce the products' price in the domestic market and increase competitiveness in the foreign market.

As a result, these two indicators will stimulate sales growth in both the domestic and foreign markets, creating opportunities to expand production. The expansion of production means new jobs, employment growth, improving the welfare of citizens working in this area.

Finally, this decision will lead to further reduction of certain products' imports into the country, and, conversely, help the growth of exports, which will ensure the inflow of additional foreign currency into the country.

As for the second part of the resolution, it is intended to stimulate the country's ferroalloy exports. In accordance with the resolution, the export duty on ferroalloys, the production of which has begun in the country, is reduced from 5 to 0 percent. This step has been taken in order to increase competitiveness in the foreign market and stimulate exports. The existing duty was applied due to the high demand for these products by local manufacturers.

In November 2018, President Ilham Aliyev attended the opening of a ferroalloy plant, in which $51 million was invested, at the Sumgayit Chemical Industrial Park.

More about: Cabinet-of-ministers