Hello, dear group members. I am Altay Jafarov from Azerbaijan. I would like to inform you about business and investment opportunities in Azerbaijan.


Brief history:

Azerbaijan - a nation with a majority-Turkic and majority-Muslim population - was briefly independent from 1918 to 1920; it regained its independence after the collapse of the Soviet Union in 1991.


Location:

Location:
Southwestern Asia, bordering the Caspian Sea, between Iran and Russia, with a small European portion north of the Caucasus range

Geographic coordinates:
40 30 N, 47 30 E

Area:
total: 86,600 sq km
land: 86,100 sq km
water: 500 sq km

Economic Overview:

According to Doing Business 2009 report compiled by World Bank and IFC, Azerbaijan was announced the Top Global Reformer among 181 economies overall.

Azerbaijan's high economic growth during 2006-08 is attributable to large and growing oil exports, but the non-energy sector also featured double-digit growth in 2008, spurred by growth in the construction, banking, and real estate sectors.

Why Azerbaijan?

- Fastest growing economy

Now the country is one of the most rapidly recovering economies in the world. The GDP annual surplus in 2005 was 26.4%. A record growth in 2006 was at 34.5% (highest growth indicator globally for the year) and 24.7% in 2007.

The country was 3rd for its GDP real growth rate in 2008 ( see https://www.cia.gov/library/publications/the-world-factbook/...)


- Abundant resources

Azerbaijan is rich in mineral and climatic resources. The Caspian Sea oil & gas reserves are one of the major deposits globally. Azerbaijani proper has also substantial explored deposits of precious metals (including gold and silver), ferrous and non-ferrous metals, various construction raw materials deposits etc.

One of the major resources the country has is its natural diversity. Despite relatively small size, the Azerbaijani territory due to complex terrain and geography has a number of distinct climatic zones ranging from humid subtropical climate to semi-arctic. This creates unique opportunities in agriculture and tourism.

- Favourable location
Azerbaijan is located on the very south-eastern border of the European continent and serves as the natural bridge between Europe and Central Asia as well as it is the most convenient route from the north-east of Europe to the Middle East. The country is the logistics hub for the Caspian region. Excellent infrastructure of Baku (including largest regional sea and air terminal) is the best choice for any business entering the markets of the Caspian Sea region.

- Competitive cost of production

Azerbaijan has long lasting industrial and trade traditions. The industrial revolution has taken place here in the late XIX century due to expanding and advanced oil production and processing sector. Further industrial development led to growing R&D base. A large R&D centre, Academy of Sciences with circa 7,000 research studies, exists in Azerbaijan in parallel with a number of universities and colleges.
The country is rich in engineering skills yet the wages are still very competitive. Azerbaijani government’s policies in respect of utilities tariffs are manufacturer friendly.

- Bilateral Investment Treaties
Azerbaijan has 39 bilateral treaties on the mutual protection of investments. Several more treaties are currently being negotiated. Azerbaijan is also a party to a number of multilateral treaties concerning foreign investment.



INVESTMENT OPPORTUNITIES

FRAMEWORK AND FDI REGIME


The Republic of Azerbaijan is the leading FDI destination in the region. In the last decade the total FDI stock in Azerbaijan exceeded 25 billion USD. Azerbaijan has achieved gradual improvement in the overall legal framework for the investment activities in the country for last several years with a number of practical regulations liberalising conduct of business and reducing red tape. It carried out a revolutionary legal reform several years ago with adoption of new Tax code, Civil and Civil Procedure Codes, Land Code, Labour Code, Customs Code, Foreign Exchange Law as well as Law on International Arbitration made the system significantly more transparent and friendly for local and foreign businesses.
The 2005 UNCTAD Trade & Investment publication quotes Azerbaijan as the No 1 globally as per the FDI Inflow Performance Index. Azerbaijan is also in top 20 in equity capital attraction in absolute terms. This is mainly due to the favourable environment created in the lead sector of the economy.

The Government managed to open up economy for the international business and introduce investments friendly laws and regulations. Generally, the Azerbaijani legislation establishes a very open national regime for FDI (which means that FDI are welcome in any sectors where the local investor is allowed to invest). Such a regime also applies to the privatization of the state owned property. There are no special permissions or specific registration requirements for foreign investment. The licensing was substantially simplified with foreign investors' interests in mind.