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AZERBAIJAN


  
  

 

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 7,124 6,090 5,600 102
         
GNI per capita
 US $ 810 710 650 146
Ranking is given out of 208 nations - (data from the World Bank)

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Update No: 321- (26/09/07)

Headache number one
Nagorno-Karabakh is an enclave inside Azerbaijan with a mostly ethnic Armenian population. Armenian forces seized control of Nagorno-Karabakh from Azerbaijan in a war in the early 1990s that claimed an estimated 30,000 lives. A cease-fire was signed in 1994, but the two countries have failed to negotiate a settlement on the region's status.

The problem is compounded by the fact that the leader of Armenia, Robert Kocharian, is a hardliner, having once been president of the enclave in question, indeed their war-lord during the hostilities no less. He regards its de facto independence as his greatest achievement. Never mind that it has involved 20% occupation of neighbouring Azeri territory and the displacement of one and a half million people.

He is due to step down in 2008, like Putin. But any successor is likely to be intransigent too (see Armenia). They would know that they could bank on Russia in the last resort.

Nevertheless, diplomatic efforts to resolve the issue continue.

Baku Says 'No Obstacle' To Aliyev-Kocharian Meeting
A foreign policy adviser to Azerbaijani President Ilham Aliyev says there are no obstacles to a meeting between Aliyev and Armenian President Robert Kocharian. But Novruz Mamedov, the adviser in question, said that every time negotiations have reached a decisive moment, the Armenian side has found a reason to prevent such a meeting from taking place.

Commenting on an upcoming visit by the co-chairs of the OSCE Minsk Group, which seeks to mediate a solution to the Nagorno-Karabakh conflict, Mamedov said that international mediators are reluctant to pass judgment on Armenia. He said that the states represented in the Minsk Group "don't want to take concrete, decisive steps towards Armenia. Maybe it's a double standard. But this position is wrong."

The French, Russian, and U.S. co-chairs of the Minsk Group were due to visit Azerbaijan and Armenia in mid-September. Armenian Foreign Minister Vartan Oskanian told RFE/RL's Armenian Service that a meeting between Kocharian and Aliyev would make sense only if the co-chairs succeed during their visit in narrowing the differences between the two sides. He said such progress hinges on unspecified "courageous steps" by Azerbaijan.

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The 'South Stream' after all?
Azerbaijan has its pluses, however. It is awash with energy resources. It has been kept waiting to become the chief supplier of gas for Europe's Nabucco pipeline. Yet it could join the rival Russian-led "South Stream" project, the country's energy minister said on September 14th.

The long-promoted 31 billion cubic-metres-a-year Nabucco project was conceived to lessen Europe's dependence on Russian gas. It has been delayed while its five partners have ironed out details.

The scheme has been rattled by the announcement of the "South Stream" plan, involving Italy's ENI, which would deliver more gas from Russian export monopoly Gazprom to Europe. Gazprom already supplies a quarter of Europe's gas.

"We can join the South Stream, we can join the Nabucco. For Azerbaijan the main goal is to produce more gas and oil, the second is to deliver it to Europe," Azerbaijan's Industry and Energy minister Natik Aliyev said.
Azerbaijan, which has gas contracts with Turkey, Greece and Georgia and plans to deliver gas to Italy, is waiting to be approached with contracts to supply gas for the Nabucco scheme. "We are waiting, but we need legal obligations, take or pay, we need legally binding obligations," Aliyev said.

Azerbaijan plans to develop 9.1 billion cubic metres (bcm) of annual gas production from its Shakh-Deniz oil field in its first phase, of which 6.6 bcm will go to Turkey, Azerbaijan will use 1 bcm and Georgia 0.5 bcm.

The second stage will see an additional 12 billion cubic metres, from which Greece will take 3 bcm and Italy 8 bcm.

The Turkey-Greece gas pipeline, expected to be open in mid-September, will then deliver Shakh-Deniz gas to the southern European countries.

Azerbaijan also plans to increase gas production from its state-owned Guneshli oil and gas fields.
"We may increase after that, but our main goal is to stabilise our output of gas," said Aliyev, "I think Azerbaijan's maximum level of production in 2025 will be 40 bcm."

Azerbaijan will also try to further improve its relations with Turkmenistan.

The two countries have been criticised for failing to agree on a common policy on the exploitation of Caspian Sea gas resources, which are claimed by both countries.

"We have improved our relations with Turkmenistan, and in the nearest future, in one or two months, we will be having meetings between Azerbaijan and Turkmenistan," Aliyev said.

Analysts have said the lack of agreement between the two states has prevented a Trans-Caspian gas pipeline that would open up Central Asian gas reserves for European consumption.

The partners in the 4.6 billion euro ($6.39 billion) Nabucco project are Austria's OMV, Hungary's MOL, Romania's Transgaz, Bulgaria's Bulgargaz and Turkey's Botas.

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