Azerbaijan Country Presentation - AIC

Azerbaijan Export and 

Investment Promotion 

Foundation 

Azerbaijan Country Presentation



Foundation 

I Establishment: 28 May 1918 

I Independence: 18 October 1991 

I Official Language: Azerbaijanian 

I Political system: Presidential 

Republic 

I Area: 86.6 ths. sq. km. 

I Population: 9 million 

I Capital: Baku 

I Autonomous Republic: 

Nakhchivan 

I Currency: Manat * 

* (0.79 AZN=1 USD) 

Basic information

I First Baku ‘oil boom’ 



Foundation 

I Nobel’s first Kerosene 

factory 

Interesting facts 

I 50% of world oil production in XIX century 

I 80% of total Soviet oil production during World War II 

I 1846–first hand-dug oil 

wells 

I First Baku-Batumi Pipeline I Nobel’s distribution system I First rail tank cars



Foundation 

2010 

GDP growth rate 5 % 

GDP per capita ($) 5,697 

Investments ($) 17.3 bln 

FDI ($) 3.3 bln 

Inflation 5.7 % 

Unemployment rate 5.6% 

Poverty level 9.1% 

Average monthly salary ($) 406 

Macroeconomic figures 

GDP growth 

5 % 

12.1 bln $ 

2010 

Income growth rate of population 

Non-oil investments 

12.3% 

Total investments 

17.3 bln $ 

Strategic currency reserves 

29 bln $

2010 

2009 

2008 

2007 

2006 

2005 

2004 

2003 

1048 

888 



Foundation 

I GDP growth rate (%) 

I GDP per capita ($) 

1579 

2471 

3841 

Macroeconomic figures 

11.2 10.1 

4874 

26.4 

5631 

5603 

34.5 

25 

10.8 9.3 

(%) 

2003 2004 2005 2006 2007 2008 2009 2010 

5



Foundation 

I GDP share in the South Caucasus (%) 

GDP share in the region 

productivity



Foundation 

State Programs 

I State Program on socio-economic development of regions of 

the Republic of Azerbaijan in 2009-2013 

I State Program on Food Security in 2008-2015 

I State Program on the development of tourism in the Republic 

of Azerbaijan in the years of 2010-2014 

I State Program on use of alternative and renewable energy 

sources in the Republic of Azerbaijan



Foundation 

Poverty reduction 

I State Program on Poverty Reduction and Sustainable 

Development of the Republic of Azerbaijan in 2008-2015 

45% 

40% 

29% 

21% 

Poverty reduction dynamics 

16% 13% 11% 9% 

2003 2004 2005 2006 2007 2008 2009 2010

Methodology 

Starting a business 

Employing workers 

Registering Property 

Protecting investors 

Enforcing contracts 



Foundation 

Economic reforms 

97 

33 

• T h e b i g g e s t 

j u m p e v e r 

r e c o r d e d b y 

D o i n g 

B u s i n e s s 

R e p o r t 

The Doing Business project 

provides objective measures of business regulations and 

their enforcement across 183 economies and selected 

cities at the subnational and regional level.



Foundation 

2011 

Country Ratings 

I Long term credit rating: ‘BBB –’ 

(Investment Grade*, positive) 

I Short-term credit rating: ‘F3’ 

I UNDP Human Development Report – 69 

I WEF Global Competitiveness Report 2011-2012 

– 55 among 142 countries and 1 st among CIS countries



Foundation 

Type of legal entity: Duty: 

I Banks, stock exchanges, insurance 

companies, branches of foreign 

legal entities 220 AZN 

I Agricultural business 3 AZN 

I Other legal entities 11 AZN 

One-stop-shop 

Statistical 

Committee 

Effective 01.01.2008



Foundation 

I Corporate Tax 20% 

I Value Added Tax 18% 

I Simplified Tax 4% and 2% 

Taxation 

I Agriculture Tax 

I No limits on the Repatriation of profits 

I Inheritance and Gift Tax 

I No customs duties on non-oil production 

imports (specified agricultural products)* 

I No VAT on non-oil production imports 

(specified agricultural products)* 

*Effective 01.03.2011

Ukraine 

8% 

Germany 

9% 

China 

8% 

Turkey 

15% 



Foundation 

2010 

Import 

Other 

42% 

France 

2% 

Russia 

18% 

I More than 40 Trade Agreements 

I 147 trade partners 

I GSP, GSP + (Generalized system of preferences) 

I WTO negotiations process 

Foreign Trade (import) 

I Trade turnover 27.9 bln US dollars 

I Import 6.5 bln US dollars 

■ Machinery, equipment 

■ Vehicles and spare parts 

■ Foodstuffs 

■ Non-ferrous metals and products 

■ Pharmaceuticals 

■ Wood and products 

■ Other

Russia 

5% 

France 

9% 

Israel 

8% 

USA 

12% 



Foundation 

2010 

Export 

Other 

40% 

Italy 

26% 

Foreign Trade (export) 

I Trade turnover 27.9 bln US dollars 

I Export 21.3 bln US dollars 

■ Raw oil and petrochemicals 

■ Fruit and vegetables 

■ Plant and animal oil 

■ Ferrous metals and products 

■ Chemical industry products 

■ Cotton 

■ Aluminum and products 

■ Alcoholic and non-alcoholic beverages 

■ Tobacco and products 

■ Other

FDI 

37 bln USD 

Oil sector 

42.5 bln USD 



Foundation 

Foreign 

54.5 bln USD 

Total 

Investments 

97 bln USD 

Investments 

Domestic 

42.5 bln USD 

Non-oil sector 

54.5 bln USD 

*1995-2010

FDI 

3.3 bln USD 

Oil sector 

5.2 bln USD 



Foundation 

Foreign 

8.2 bln USD 

Total 

Investments 

17.3 bln USD 

Investments 

Domestic 

9.1 bln USD 

Non-oil sector 

12.1 bln USD 

*2010



Foundation 

Why invest in Azerbaijan? 

POLITICAL & FINANCIAL STABILITY 

Abundant resources 

Good climate and 

welcoming culture 

Well-developed 

infrastructure



Foundation 

Favorable location 

Azerbaijan is the country on the crossroads of Eurasia



Foundation 

I Rich mineral and climatic resources 

I Ferrous and non-ferrous metals 

I Raw construction materials 

Abundant resources 

I 9 out of 11 climatic zones 

I Mild winters and hot summers



Foundation 

I Logistical hub for Asia – Europe, Middle East – CIS 

I 2 nd largest port in the Caspian Sea 

I Developed rail infrastructure 

I Easy access to the Black Sea 

region 

I Baku – Tbilisi – Kars railroad 

(The Iron Silkway) 

Well-developed infrastructure

ISTANBUL 



Foundation 

AHALKALAKI 

KARS 

Europe – Caucasus – Asia 

Transport Corridor 

I Baku – Tbilisi – Kars railroad (The Iron Silkway) 

ALYAT 

SEA PORT



Foundation 

I Destination to major cities: 

Tbilisi – 1 hour 

Moscow – 2.5 hours 

Dubai – 2.5 hours 

Istanbul – 2.5 hours 

Riga – 3 hours 

Vienna – 4 hours 

Frankfurt – 5 hours 

Paris – 5 hours 

London – 6 hours 

Well-developed infrastructure 

I Best passenger and freight airport in the Caucasus and Caspian 

region 

Nakhchivan 

Ganja 

Zagatala 

Lankaran 

Baku

Tourism 

Agriculture/ 

food industry 



Foundation 

Where to invest in Azerbaijan? 

Alternative energy 

Construction

Chemical industry 

Transportation and 

logistics 



Foundation 

Light industry 

Where to invest in Azerbaijan? 

ICT



Foundation 

Forms of Foreign Investments 

Investing in Azerbaijan 

I Participation in enterprises and organizations established in cooperation 

with Azerbaijani companies and individuals 

I Enterprise fully-owned by foreign investors 

I Purchase of enterprises, property, buildings, shares, securities and other 

property, which according to legislation may belong to foreign investors 

I Acquisition of rights to use land and other natural resources, and also 

proprietary rights 

I Other forms not prohibited by the legislation

Action plan within 

the framework of 

the European 

Neighborhood 

Policy (ENP) 

adopted 

November 2006 



Foundation 

2010-2012 

Action Plan on 

approximation to 

April 1996 

the EU’s legislation 

(came into force in (AP) prepared 

July, 1999) 

The Partnership and 

Cooperation Agreement 

(PCA) signed 

State Commission 

on Integration to 

EU and 9 WGs 

Established 

Azerbaijan and EU 

TACIS Program 

(humanitarian, technical, food 

aids) 

Twinning, TAIEX and SIGMA 

(European Neighborhood and 

Partnership Instrument (ENPI)) 

EU’s assistance 

productivity 

Joint projects: 

“Eastern Partnership” initiative 

Association Agreement with EU 

Comprehensive Institution 

Building Program (CIB)



Foundation 

Living and visiting Azerbaijan 

Enjoy local hospitality in 477 hotels over Azerbaijan



Foundation 

Find out more about history and 

culture in: 

I 233 Museums 

I 29 Theatres 

Taste traditional food in: 

I Variety of local restaurants 

Must-see: 

UNESCO Heritage 

Maiden Tower – 7-6 cent. 

BC 

Qobustan rock carvings 

Living and visiting Azerbaijan



Foundation 

Take part in the international cultural 

and sporting events in 2012: 

Eurovision Song Contest Baku 

FIFA Women's U17 World Championship 

Baku International Jazz Festival 

International events in 

Azerbaijan



Foundation 

I In 1989 – 1993 20% of 

territories of the Republic of 

Azerbaijan were occupied by 

Armenia 

I The cease-fire has been in force 

since 1994 

I Total refugees and IDPs – 

1,010,000 

I Economic losses of more than 60 

bln US dollars 

Nagorno-Karabakh conflict



Foundation 

I Azerbaijan Export and Investment Promotion Foundation (AZPROMO) was 

established by the Ministry of Economic Development in 2003 

I AZPROMO Vision: Balanced growth of economy 

About AZPROMO 

I AZPROMO Mission: To sustain economic growth by maximizing the 

flow of non-oil extraction FDI and development of export oriented sectors 

I Main directions of activities: Investment and Export Promotion

Policy 

advocacy 

+ strategy 

direction 

Investor 

servicing + 

aftercare 

Image 

building 



Foundation 

Investment 

facilitation 

Investment 

generation 


I Image building 

marketing campaigns (perception=reality), 

communication strategy 

I Investment generation 

Identification of potential investors, marketing 

campaigns, presentations, seminars, road shows 

I Investment facilitation 

Investment information, site visits, organisation 

and providing information 

I Investor servicing + aftercare 

Helping investors get established and be 

operational, expansion and re-invest 

I Advocacy+strategy formulation 

Advocating for investment friendly business 

climate, inputs to national FDI policy

Image 

building / 

Individual 

assistance 

Policy 

advocacy 

New 

exporters 



Foundation 

Looking for 

new 

customers 

Entering a 

new market 

Export Promotion 

I New exporters 

Consultancy, assessment of export 

capabilities, training and guidance 

I Entering a new market 

Market information, legal analysis, price 

research, trade shows/fairs research 

I Looking for new customers 

Search for new business contacts, matchmaking 

and sector/product events, trade missions 

I Image building 

Trade shows/fairs, PR activities abroad, outward 

foreign investment, international relations 

I Policy advocacy 

Advice in foreign trade policies and input on 

export regulations



Foundation 

Foreign Network 

I AZPROMO Georgia 

Mission: Support in development of economic and business relations 

between Azerbaijan and Georgia 

I Main activities 

Market researches and analyses 

Legal framework in Georgia 

Business consultancy 

Public relations, country promotion 

I Partners and proxies 

Membership in the World Association of Investment Promotion Agencies 

(WAIPA) Steering Committee and Regional office for Central Asia and 

South Caucasus 

Diplomatic/Trade missions and Chambers of Commerce



Foundation 

Thank you for the attention! 

Azerbaijan Export and Investment Promotion Foundation 

(AZPROMO) 

11, H. Abdullayev str., Baku, Azerbaijan 

www.azpromo.az 

Tel.: (+99412) 598 01 47/48; 

Fax: (+99412) 598 01 52 

office@azpromo.az

Azerbaijan Country Presentation - AIC

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