FREE GEOPOLITICAL NEWSLETTER

 

For current reports go to EASY FINDER

AZERBAIJAN


  
  

 
Key Economic Data 
 
  2002 2001 2000 Ranking(2002)
GDP
Millions of US $ 6,090 5,600 5,300 102
         
GNI per capita
 US $ 710 650 600 145
Ranking is given out of 208 nations - (data from the World Bank)

Books on Azerbaijan

REPUBLICAN REFERENCE

Area (sq.km)
86,600

Population
7,830,764

Principal ethnic
groups
Azeri 90%
Russian 2.5%
Armenian 2%
Dagestani 3.2%
other 2.3

Capital
Baku

Currency
Azeri Manat

President
Ilham Aliyev
 

Background:
Azerbaijan - a nation of Turkic Muslims - has been an independent republic since the collapse of the Soviet Union in 1991. Despite a cease-fire, in place since 1994, Azerbaijan has yet to resolve its conflict with Armenia over the Azerbaijani Nagorno-Karabakh enclave (largely Armenian populated). Azerbaijan has lost almost 20% of its territory and must support some 750,000 refugees and internally displaced persons (IDPs) as a result of the conflict. Corruption is ubiquitous and the promise of widespread wealth from Azerbaijan's undeveloped petroleum resources remains largely unfulfilled.  

Update No: 280- (29/04/04)

Aliyev in Turkey
The key country for Azerbaijan in many ways is Turkey. The Azeris are a Turkic people after all, speaking a similar language. President Ilham Aliyev of Azerbaijan made his first European trip to France earlier this year, after one to the US. But Ankara had to be high on the agenda.
Aliyev met the Prime Minister of Turkey Recep Tayyip Erdogan at his residence on 15 April.
In the course of the meeting, the focus was on the current state of bilateral relations between the two countries, including an expansion of economic co-operation, a number of regional and international issues, exchanged views on peaceful settlement of the Armenian-Azerbaijani, Nagorny Karabakh conflict. 

Postmortem on the Turkish visit
The revealing part came later on Aliyev's return to Baku, when the press gave him a grilling on the trip." 
QUESTION: "Mr. President, on the eve of your visit, the issue of the opening of the Turkey-Armenia borders was much in the media. Was the question discussed with the Turkish leaders?" 
ANSWER: "You are right as the issue was rather given attention. Certain thoughts worried the public as well. I would say the issue was not focused. It is because there is no such question on the agenda. That's why there was need of it. Turkey reaffirmed its position towards the Armenian-Azerbaijani Nagorno-Kharabakh problem. It is a fair position. Turkey once again showed that as usual, it is with Azerbaijan - in this and other questions as well."
QUESTION: "Mr. President, as you know, the political situation in Armenia is tense. Should the Armenian opposition achieve the resignation of Robert Kocharyan and resume power, what impact may it have on the settlement of the Armenian-Azerbaijani, Nagorny Karabakh conflict?" 
ANSWER: "I would not deem this question worthy of an answer. We do not interfere in Armenia's internal affairs. Our problem is with the forces pursuing the aggressive policy of Armenia. We are not going to interfere with Armenia's internal affairs. We are not interested in the processes going on there."
QUESTION: "Mr. President, the US OSCE Minsk Group co-chair has been replaced. Instead, Steven Mann was appointed. May it have a positive influence on the developments?" 
ANSWER: "I would appraise it so. On receiving this information, I was also told that Steven Mann is an experienced diplomat. He is in close touch with the regional processes. We, too, know him for a long time. As you know, he had a positive role in the issue of the legal status of the Caspian Sea and in the question of the Baku-Tbilisi-Ceyhan pipeline. Therefore, I consider that America should have an active position in this question. I consider that Mr. Steven Mann's previous activity will allow him to settle the issue fairly." 
QUESTION: "Mr. President, can we consider that this decision was adopted after the visit of Richard Armitage, assistant to Colin Powell at the State Department, to Baku, after his talks with you?" 
ANSWER: "I do not see any connection. I deem that this question was ascertained some time ago. Simply, it has been made public now." 
QUESTION: "Mr. President, the results of your meeting with President Erdogan was not disclosed. The document on expansion of economic cooperation was signed. What fields does the document stipulate? 
Can we see the names of participants of the 15-16 October events (demonstrations held by oppositionists in Baku after the dubious victory of Aliyev in presidential elections) in your future decree on giving a pardon? You have already pardoned many guilty persons who promoted these events." 
ANSWER: "I had frank and open talks with the Prime Minister of Turkey Rejep Tayyip Erdogan. We discussed all problems. Of course, one affair expressed was the intention to strengthen economic ties. Today, we have a commodity turnover at around $300 million. This is a great figure. And it does not reflect our full potential for cooperation. Turkey's successful policy in the field of economics and Azerbaijan's successful economic policy should allow us to reach a higher volume. 
Last year, the economy of Turkey increased by 5 percent. The growth rate in Azerbaijan's economy was 11 percent. That is, the stronger is the potential, the more the opportunity for favorable cooperation. We shall try to increase the volume of goods turnover. Our target is one billion dollars. We have good opportunities for this. There is political comity and there are economic links. We have the unity of the two peoples. Therefore, we shall try for concrete programmes. We shall soon have numerous delegations from Turkey. I hope we all shall see the results shortly. 
As to the second question (as regards the pardon), I count that of course. The issue needs to be focused. When and how - I would not like to tell anything right now. The issue is within my power, and in due time I shall decide upon it." 
QUESTION: "Mr. President, NATO will conduct its summit in Istanbul in June. The Caucasus countries have been invited, too. Will you have any meetings in the framework of this summit? And how can Turkey assist in this direction? The signed Declaration also shows that Turkey will increase its efforts to promote the cooperation of NATO and Azerbaijan. Of what assistance can it be?" 
ANSWER: "Of course, Azerbaijan will take part at this summit. Azerbaijan is an active member of the "Partnership For Peace" Programme. You know that Turkey, too, is a NATO member of many years' standing and the Turkish army has a leading position among the NATO member countries. Of course, the assistance and recommendations Turkey will make are very important for us. I have many times stated it in Turkey that Turkey has always been with Azerbaijan, after it regained its state independence. We feel this support today. Therefore, I am grateful to the people of Turkey. Azerbaijan, too, has been on Turkey's side on all questions and will continue to be so. Our unity and friendship are eternal and they should be so, and will be so. Thank you."
Interlarded among the cliches were some interesting revelations here. Aliyev is obviously confident that the Turks are not going to do a deal with the Armenians, at least not just yet. He must be well aware that a crisis is unfolding in Yerevan in the aftermath of the Rose Revolution in Georgia. He is sure that he can contain the consequences for his own despotic rule in Azerbaijan. The Azeris are Muslims, not Christians after all. 
There are plenty of people who want the Baku-Tbilisi-Ceyhan pipeline project to go ahead in Turkey, not just in Azerbaijan. The US administration is behind it. It will almost assuredly go ahead. But with Georgia potentially coming under Russia's power, if Moscow chose to exert the leverage it has, it is the Georgian territory that may be seen as the weak point

« Top

ENERGY

Statoil delegation checks on Azerbaijani projects


A delegation from Norway's Statoil was expected to arrive in Azerbaijan on March 17th to check on progress at the company's projects in the republic, a source in Statoil-Azerbaijan said, New Europe reported recently. 
"It is important for them to have full information on the company's activity in Azerbaijan, where it is participating in large projects such as Azeri-Chirag-Gunashli, Shakh Deniz, Baku-Tbilisi-Ceyhan and Baku-Tbilisi-Erzurum," the source said. The delegation, headed by Statoil Executive Vice President for Technology, Terje Overick, was due to meet with Statoil's partners in Azerbaijani projects and with officials from the republic during its three-day visit. Statoil began its activity in Azerbaijan in 1992 and as of December 31st, 2003 the company's total investment in the republic amounted to US$1.23bn, of which US$474m was invested in 2003. Statoil has a 25.5% share in the Azeri-Chirag-Gunashli project, 25.5% in Shah Deniz, 15% in the Araz-Alov-Sharg project, 8.71% in the Baku-Tbilisi-Ceyhan project and 25.5% in the Baku-Tbilisi-Erzurum pipeline project.

Azerbaijan, Kazakstan to sign BTC pipeline deal

Azerbaijan and Kazakstan will sign an intergovernmental agreement for the transportation of Kazak oil through the Baku-Tbilisi-Ceyhan pipeline in 2004, Azeri state oil company SOCAR President Natik Aliyev told journalists. "Talks on this issue, which began two years ago, are nearing completion and we will sign it. There is no reason for us to rush because the Baku-Tbilisi-Ceyhan has not yet been launched and Kazakstan has not yet got the volume of oil to transport through the Baku-Tbilisi-Ceyhan pipeline. We are trying to resolve all issues that may arise in the future," Interfax News Agency quoted Aliyev as saying.
He said that to fully regulate all issues it would be necessary to resolve a number of disputed areas. "Kazakstan does not want to ratify the agreement in parliament. Investors are demanding ratification, so that this law does not change in the future, even if there are changes in legislation and new regulatory acts are passed for customs and taxes," he said. "I think that this issue can also be resolved. Investors will agree to an additional document, if the intergovernmental agreement is not ratified," Aliyev said. He said that the working group for the preparation of the intergovernmental agreement would be meeting shortly.
The future pipeline will stretch 1,767km (4438km through Azerbaijan, 248km through Georgia and 1,076km through Turkey) and will have a capacity of 50m tonnes of oil per year. The project will cost US$3.6bn, of which US$2.95m will be in construction costs.

SOCAR announces tender for Azeri Light consignment

Azeri state oil company SOCAR has announced a tender for the second consignment of profitable oil to be transported through the Baku-Supsa pipeline in 2004, a source in the company's marketing department said recently. This consignment will amount to 1m barrels as usual. The results of the tender have been received and the consignment shipped from Supsa already. Italy's API Oil bought the first consignment of oil shipped this year. Azeri Light oil is produced at the Azeri-Chirag-Gunashli group of fields, in which SOCAR has a 10% share. Profitable oil is distributed among shareholders depending on their share in the contract, New Europe reported.

Embassy spokesman says Iran ready for Azeri oil transit

"Iran is ready to give its territory to transport Caspian energy resources," the head of the press service of the Iranian embassy in Azerbaijan, Lotfali Azimzadeh, said, MPA News Agency reported. 
He said that, as a friendly country, Iran will not only allow Azerbaijan to transport its oil, but will also help its neighbour in this.

Azeri leader, head of Japan's oil giant happy with cooperation

Azerbaijani President, Ilham Aliyev, received the head of the Japanese company INPEX, Kunihiko Matsuo, on 22 March, Trend News Agency reported.
The Presidential Executive Office told Trend that they had discussed the participation and expansion of the Japanese company's activities in a number of projects to develop Azerbaijan's energy resources.
Aliyev expressed his satisfaction with INPEX's efficient activities in Azerbaijan and with its involvement in the Azari-Cirag-Gunasli deposit and also in the construction of the Baku-Tbilisi-Ceyhan oil pipeline. Aliyev described the investments by the Japanese company in Azerbaijan as a positive factor.
Matsuo noted that Japanese-Azerbaijani relations had expanded following [former] President Heydar Aliyev's visit to Japan in 1998. He expressed his intention to further expand his company's involvement in various energy projects of Azerbaijan.

BP invests US$4.1bn in Azerbaijan in 2003

Investment in British Petroleum projects in Azerbaijan, including the Azeri-Chirag-Gunashli and Shah Deniz fields and the construction of the Baku-Tbilisi-Ceyhan pipeline, amounted to US$4.1bn in 2003, Azer Zeinalov, director of the BP Baku business centre, said at a meeting of the Caspian Integration Business Club recently. Of this amount, US$3.9bn was spent on orders from subcontractors, including US$350m from Azerbaijani companies. "Foreign subcontractors that do not operate in Azerbaijan carried out US$1.7bn worth of orders and foreign companies working in the republic US$1.8bn, of which US$800m was spent in the republic and US$1bn outside Azerbaijan," Zeinalov said, New Europe reported.
He said that small- and mid-sized Azeri companies carried out US$48m worth of orders, state companies - US$116m, and joint ventures - US$191m. Zeinalov also said that at the moment over 500 companies provide subcontractor services for BP projects, of which over 300 are domestic companies and 200 are foreign companies.
Participants in the project to develop the Azeri, Chirag and the deep water section of the Gunashli are as follows: BP - 34.1367%; the US companies Unocal - 10.2814, ExxonMobil - 8.0006% and Devon Energy - 5.6262%; Azerbaijan's SOCAR - 10%, Japan's Inpex - 10% and Itochu - 3.9025%, Norway's Statoil - 8.5633%, Turkey's TPAO - 6.75%, and Saudi Delta Oil - 1.68%.
Shareholders in the project to develop the Shah Deniz field include BP - 25.5%, Statoil - 25.5%, LUKAgip - 10%, TotalFinaElf - 10%, SOCAR - 10%, National Iranian Oil company - 10% and TPAO - 9.0%. Participants in the BTC project are: British petroleum (30.1%), SOCAR (25%), Unacol (8.9%), Statoil (8.71%), TPAO (6.53%), ENI (5%), Itochu (3.4%), ConocoPhillips (2.5%), Inpex (2.5%), TotalFinaElf (5%), and Amerada Hess (2.36%).

Azerbaijan to buy 4.5bcm of Kazak gas in 2004

Azerbaijan will buy 4.5bn cubic metres of gas from Kazakstan through the KazRosGaz joint venture this year, a KazRosGaz source said recently, New Europe reported. 
The contract was signed in Almaty on March 2nd. KazRosGaz began supplying gas to Azerbaijan this year, he said. Till now Azerbaijan has imported more than 850m cubic metres of gas from Kazakstan. Azerbaijan state oil company SOCAR buys gas for US$52 per 1,000 cubic metres and the contract for this year exceeds 4bn cubic metres, he said. Because Azerbaijan needs to import about 6bn cubic metres of gas the sides are in talks on additional supplies. Kazakstan's national oil and gas company KazMunaiGaz and Russia's Gazprom formed KazRosGaz in June 2002. The joint venture buys gas from Karachaganak field in western Kazakstan, processes it at the Orenburg Gas Processing Plant in Russia and has access to Gazprom pipelines to export the gas.

SOCAR oil product exports up 4% in January-February

Azerbaijani state oil company SOCAR exported 331,934 tonnes of oil products in January-February 2004, up 3.9% year-on-year, New Europe reported recently. 
The refinery Azerneftyag, which specialises in producing lubricating oil and other heavy products, exported 214,612 tonnes of oil products, up 12.1% year-on-year. SOCAR's marketing department, which exports SOCAR crude and products from the company's Azerneftyanajag refinery, exported 117,322 tonnes of oil products, which was 8.3% less than in January 2003. In the reporting period SOCAR exported 232,935 tonnes of diesel, 29,865 tonnes of gasoline, 20,170 tonnes of straight-run gasoline, 12,928 tonnes of aviation fuel, 4,624 tonnes of motor fuel, and 29,933 tonnes of fuel oil, in addition to butane, furnace oil and lubricating oil. The two refineries in the republic have a total capacity of 22m tonnes.

« Top

FOREIGN ECONOMIC COOPERATION

Azeri-British joint venture awarded for high-quality management

The Azerbaijani-British oil joint venture, Sirvanoil, has been awarded a gold medal of the International Foundation for high quality of business practice. The company was awarded the medal for the high level of corporate achievements, innovative policy and the quality of its goods and services. The award ceremony will be held in Geneva where the company's representatives will sign the charter "For high quality in business practice," MPA News Agency has reported. 
One of the achievements which brought the company the reward is its production figures. The Sirvanoil company, which is developing a deposit in Ali-Bayramli District, produced over 56,500 tonnes of oil this year. The company produces an average of 700 tonnes a day.

 

« Top

CUSTOMISED REPORTS

 

Our analysts and editorial staff have many years experience in analysing and reporting events in these nations. This knowledge is available in the form of geopolitical and/or economic country reports on any individual or grouping of countries. Such reports may be bespoke to the specification of clients or by access to one of our existing specialised reports. 
 
For further information email:
reports@newnations.com

« Top

« Back

 


 
Published by 
International Industrial Information Ltd.
PO Box 12 Monmouth 
United Kingdom NP25 3UW 
Fax: UK +44 (0)1600 890774
enquiries@newnations.com