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Books on Azerbaijan
REPUBLICAN REFERENCE
Area (sq.km)
86,600
Population
7,868,385
Principal ethnic
groups
Azeri 90%
Russian 2.5%
Armenian 2%
Dagestani 3.2%
other 2.3
Capital
Baku
Currency
Azeri Manat
President
Ilham Aliyev
President
Ilham Aliyev
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Update No: 300- (01/01/06)
A chip off the old block
The Azeri regime is a tight dictatorship, which has staged the farce of several
elections, first presidential in October, 2004, and then parliamentary late last
year. Quite why it has to go through this ritual is the interesting thing. It is
an obeisance to the zeitgeist, the obligatory tribute of dictatorial vice to
democratic virtue.
The regime has no real legitimacy. The president is simply the son of his
father- period.
Ilham Aliyev has taken over from his father, Heidar, as Azerbaijan's president,
promising to keep the policies of his parent intact. Following his inauguration,
Ilham expressed willingness to engage opposition leaders in a political
dialogue. In fact, a crackdown on opposition activists has been prosecuted from
the start.
When will there be a finish?
The regime is obviously disconcerted at the downfall of President Eduard
Shevardnadze in neighbouring Georgia, where a genuine presidential election took
place in 2004, after the fiasco of parliamentary elections in late 2003 were
exposed by a vocal opposition. This was a procreant force in the events in
Ukraine, and then Kyrgyzstan. Why not Azerbaijan next?
But the Azeri clique in power has never made the mistake of allowing a free
press and giving opposition forces rights of free speech and assembly, as
Shevardnadze did, and Kuchma and Akayev too, which created the possibility to
demonstrate for their removal. No such luck for the Azeris, whose opposition is
tightly repressed.
The oil factor
The Azeri regime has the advantage of an abundance of oil revenues and a
plenitude of foreign friends, including the US.
It is not just that it has a munificence of oil reserves itself, 31bn barrels at
the last count. It is strategically the only way for Kazak oil to reach the
world market, so long as the alternative Iranian and Russian routes are ruled
out.
The Baku-Tbilisi-Ceyhan pipeline is meanwhile in place, transporting Kazak as
well as Azeri oil to world markets. So long as the black gold flows, the Aliyev
regime is assured.
A spanner in the works
Azerbaijan has angered EU member state, Cyprus, by allowing commercial flights
to the internationally unrecognised Northern Cyprus. The tussle has thrown a
spanner into EU preparations to extend neighbourhood policy "action
plans" to the region.
The problems between Azerbaijan and EU-member Cyprus come as a very unwelcome
development for Armenia and Georgia, for instance.
The EU is in the habit of preferring to deal with entire regions, not single
countries at a time. As a result, both Armenia and Georgia have discovered that
their EU neighbourhood "action plans" -- paving the way for closer
political cooperation and greater economic aid -- are held hostage to the spat
between Baku and Nicosia.
Initial hopes that the "action plans" could be negotiated and signed
by the end of the year have begun to recede. "It would be strange if the
start of the planned talks between the [European] Commission and Armenia on the
draft action plan remained blocked by the dispute between Cyprus and Azerbaijan
over flights to Northern Cyprus, since that dispute does not concern
Armenia."
EU foreign policy chief Javier Solana offered solace, but no guarantees of a
quick breakthrough. "I hope very much that the neighbourhood policy that we
have established in the European Union will be a constructive and positive help
for Armenia in their relations with the European Union," he said. "As
you know still we have not completely started the negotiations, but we hope very
much that will be done in the foreseeable future."
EU member states retain full sovereignty in the area of external relations and a
single country can theoretically block any decision. The Greek government of
Cyprus held out for a long time before giving its consent to EU membership talks
with Turkey. Nicosia is likely to face far lesser pressure in the EU in its
dealings with Turkey's more remote ally, Azerbaijan.
It remains to be seen in 2006 whether there will be any progress in dealing with
the Nagorno-Karabakh enclave now occupied by Armenia, along with a 'corridor'
connecting to it, but comprising some 20% of Azerbaijan's territory. Various
outside agencies have sought to mediate this long-standing dispute, but so far
without success. Until Azerbaijan recovers its territory - not withstanding
Nagorno-Karabakh 'proper,' the hostility of Turkey to Armenia, (as Azerbaijan's
'big brother') will continue, thus restricting Armenian trade with the outside
world. This quarrel is long overdue for resolution.
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ENERGY
Azerbaijan to up gas output 14% in 2006
Azerbaijan expects to produce 6.46 billion cubic metres of gas in 2006, up 13.7
per cent on the forecast figure for this year, a source in the government said,
Interfax News Agency reported.
The source said the launch of production at the Shah Deniz field, where 856.4
million cubic metres of gas is expected in 2006, will enable the overall
increase. Production at the Shah Deniz will play a determining role in
increasing Azerbaijan's gas production. Azerbaijan plans to produce 11.055
billion cubic metres of gas in 2007, 14.054 billion in 2008 and 16.030 billion
in 2009. Exports from Shah Deniz are due to start in 2006 and will total 542.4
million cubic metres. Exports should grow to 7.04 billion cubic metres in 2009.
Condensate production is also due to start at Shah Deniz in 2006. Production
volumes will grow from 200,000 tonnes in 2006 to 2.2 million in 2009. All the
condensate will be exported. Azerbaijan produced 5.06 billion cubic metres of
gas in 2004, down 3.1 per cent.
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FOREIGN LOANS
Azerbaijan, ADB sign loans agreement
The Asian Development Bank (ADB) and Azerbaijan signed on November 29th two
loans totalling US$30 million to help improve water supply and sanitation in the
regional towns of Agdash, Goychay and Nakhchivan, Interfax News Agency reported.
The loans will also finance institutional reform and capacity building
activities, including the establishment of new utilities in the form of joint
stock companies with modern managerial skills and providing efficient and
financially viable long-term operations.
ADB will also grant 500,000 Euro from its Japan Special Fund, funded by the
government of Japan, to help support sector-wide reforms and address legal,
regulatory, administrative and institutional frameworks. ADB will cover 75 per
cent of the project's total cost of 39.9 million Euro through two loans. ADB's
Asian Development Fund provides a 20 million Euro loan, carrying a 32-year term
including a grace period of eight year. Interest charges are 1.0 per cent per
annum during the grace period and 1.5 per cent per annum thereafter.
Matthew Westfall, country director of the ADB Azerbaijan resident mission, said
that the ADB grant is not only a financial aid but also acts as a source of
knowledge for policy and structural reforms, strategy implementation, innovative
project design, and sound implementation. The water supply project will give
help to maintain the water supply and sanitation sector, reduce poverty and
bring clean water and health to the people in the regions.
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