The president said that his country is now moving away from a strictly energy-based economy to one that embraces a more diverse make-up.
Speaking at a World Economic Forum conference on strategic dialogue on the future of the south Caucusus and central Asia, which took place on 7-8 April in Baku, Azerbaijan, , Aliyev said the region needs to cultivate “predictability and stability in the region to expand our economic and political ties.”
The region has been expanding economically over the past decade, and contains promising reserves of a variety of natural resources.
The key discussions of the Baku debate focussed on how suppliers of oil and gas can meet growing global demand in the context of untapped production potential, as well as overcoming the problem of incomplete distribution networks within the region.
Such success “requires strengthened regional co-operation, in which each country must determine its own level of engagement,” Aliyev told delegates.
According to president Aliyev, the main focus of his country, and that of the wiser region, should be to diversify the economy.
“To do that, we have to assert ourselves in the international business community,” he said. “Not only as a country with an important geographical location and natural resources, but also as a country committed to reform, transformation and diversification.”
“Our country is relatively young, our independence is 21 years old, but Azerbaijan is a country with a great history, customs, traditions and culture.”
Despite this great cultural history, as well as its prime geographical location, the country is still underperforming to an extent, owing to much-needed infrastructural changes and upgrades.
While the post-Soviet era saw an influx of foreign direct investment into the country, which has allowed Azerbaijan to diversify from being an economy based largely on its energy sector, to a broader-based economy, however, infrastructural problems remain. Following the break-up of the USSR, Azerbaijan stabilised after a couple of years; “We launched very serious, fundamental political and economic reforms, and Azerbaijan introduced itself to the international community,” he said. “It was a period of transition from a planned economy to a market one, from a one-party rule to a multiparty system, from totalitarianism to democracy.”
“I can say that from a historical point of view 21 years is, of course, a short period of time. But at the same time, it was a period of real change. At the initial stage of reforms Azerbaijan managed to attract major investment to its energy sector. We are grateful to foreign investors and major energy companies for investing in Azerbaijan.”
Following that initial period, he said, the country diversified it economic base while simultaneously introducing political reforms.
That diversification of the economy, he said, has “been the main goal” of the past decade.
Furthermore, he says, the gross domestic poverty of Azerbaijan has grown by about 300%. In the past decade, while industrial production is 2.5 times what it was ten years ago. Unemployment has also been reduced, to around 5%, while those living in poverty now stand at 6%, although budget measures to correct this are underway, he says.
“We are currently converting oil revenues into human capital, and one of our main forward-looking objectives is education,” he says.
Education is “the most important factor in the success of any country,” he says, adding that Azerbaijan is also investing heavily in new technologies, where “the sphere of information and communication technologies is becoming a priority.” The county is also investing in aerospace technology.
“In other words,” said Aliyev, “the years of independence have not only been those of the transformation of the political and economic systems. It was a period when investment was made that would bring revenues in the coming years.”
President Aliyev said that Azerbaijan’s’ political and economic reforms will continue to pay a part in shaping the region as a whole. “I am very proud to say that we are playing a major role in this project not only with our financial resources, but also with our commitments and political will. Of course, as far as our government is concerned, the energy factor is no longer a top priority. But our energy potential has played and will play an even greater role in the energy security of the region and Europe,” he said.
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