Azerbaijan

MARKET OF AZERBAIJAN

AZERBAIJAN'S MARKET OVERVIEW

Azerbaijan is the largest country among the three countries of the West Asia. Islam is the main religion of Azerbaijan and Azerbaijani (Azeri Turkish) is official language. Azerbaijan has made diversification in the economic sectors and strengthening of the non-oil sector as the main priorities in the development strategy. Azerbaijan is one of the largest importers in the region from Turkey, Russia, China, Iran, Germany, and other European countries. Import restrictions:‎ An entry permit is required for food products of animal origin.

Geographical location and population of Azerbaijan

Azerbaijan is the largest country among the three countries of the West Asia
Azerbaijan is the largest country among the three countries of the West Asia

The Republic of Azerbaijan is located in the Caucasus region of the Eurasian supercontinent. It covers three major physical areas: First, the Caspian Sea, whose coastline forms a natural border in the east of the country. Second, the Greater Caucasus Mountains in the north; and third, the plains and lowlands of the center of the country.

The country covers an area of about 86,000 square kilometers; more or less the size of Portugal and slightly larger than Yazd Province, and less than 1% of the former Soviet Union. The Republic of Azerbaijan is the largest country among the three countries of the South Caucasus.

The Republic of Azerbaijan is located in the south of the Caucasus Mountains and borders the Caspian Sea to the east, Russia and Georgia to the north, Iran to the south, and Azerbaijan to the west and southwest. A small part of northwestern Nakhchivan is also bordered by Turkey.

The Republic of Azerbaijan is located in the Caucasus region of the Eurasian supercontinent. It covers three major physical areas: First, the Caspian Sea, whose coastline forms a natural border in the east of the country. Second, the Greater Caucasus Mountains in the north; And third, the plains and lowlands of the center of the country.

The Republic of Azerbaijan is located in the south of the Caucasus Mountains and borders the Caspian Sea to the east, Russia and Georgia to the north, Iran to the south, and Azerbaijan to the west and southwest. A small part of northwestern Nakhchivan is also bordered by Turkey.

The Republic of Azerbaijan is located in the south of the Caucasus Mountains and north of the Aras River and along the Caspian Sea. The Greater Caucasus Mountains in the North of the Lesser Caucasus in the west and the Talesh Mountains in the south surround the country with an area of 86,000 square meters. Km of coastline with the Caspian Sea has made Azerbaijan more beautiful and more biodiversity. Also, the mountains of this country usually have a unique climate. 

In parts of Azerbaijan, including outside its capital Baku, lands with reserves of oil and gas are distributed, these are areas from which oil and gas can be extracted, and some volcanoes have formed on top of some reserves, but instead of spraying lava, a muddy mixture of water, sand, gas and sometimes oil erupt, according to the latest statistics, the population of this country has reached 10 million people.
 

Religion and language of the people of Azerbaijan

Islam is the main religion of Azerbaijan and Azerbaijani (Azeri Turkish) is official language
Islam is the main religion of Azerbaijan and Azerbaijani (Azeri Turkish) is official language

Islam is the main religion of the Republic of Azerbaijan and 99.2% of the population of this country are Muslims and about 85% of Azerbaijani Muslims recognize the Shiite religion, while 15% are Sunni Muslims. The official language of Azerbaijan is Azerbaijani (Azeri Turkish), which is close to modern Turkish and is related and fully understood. 

It is also a language, along with Turkmen and Gagoz, an Azerbaijani member of the Oghuz branch of the Southwestern Turkish family, it also speaks Russian, Azerbaijan, Lezgi, Talysh, and Tati.

Culture and customs of the people of Azerbaijan
One of the reasons why Iranians are interested in the Baku tour is the proximity of Azerbaijani culture to Iran. The traditions of Azerbaijan cover all stages of life, from birth to death, as well as annual holidays and other public works. 

These traditions show how to meet guests, get married, spend time, etc., although some traditions Over time, have disappeared and some of them are performed only in big programs or on holidays, but all of them are still important for the people and in their lives. 

Azerbaijani culture is influenced by Iranian, Turkish, Caucasian heritage as well as influences. Russia has developed because of its former position as a Russian colony, and today Western influences, including a culture of globalization and consumerism, are well visible.

Currency of Azerbaijan
Manat is the currency of the Republic of Azerbaijan, which is displayed in international markets with the symbol "AZN" and each manat is equal to 100 qəpik. Manat in Russian means coin and means 1, 5, 10, 20, 50, 50, 100, 200, and 500 banknotes and 1, 3, 5, 10, 20, 50 Qapik coins are divided and every 100 kopecks forms one manat.
 

How is Economy of Azerbaijan?

Azerbaijan has made diversification in the economic sectors and strengthening of the non-oil sector as the main priorities in the development strategy
Azerbaijan has made diversification in the economic sectors and strengthening of the non-oil sector as the main priorities in the development strategy

Although the Government of the Republic of Azerbaijan has made diversification in the economic sectors and strengthening of the non-oil sector as the main priorities in the development strategy for this year, many of the investments of this country are still due to the continued dominance of oil and gas in the country's economy.

The oil-rich Republic of Azerbaijan, as a country in South-Central Asia and the Caspian Sea, located between countries such as Iran, Russia, and a small part of Europe, is of special importance in the Caucasus region, which has economic relations with neighboring countries. It is of special importance.

Looking at the reliance of the country's economy over the years, we find that the country's first export product was oil, which, with the conclusion of foreign contracts and the entry of powerful foreign companies, invested more than $ 60 million in the long term in the oil-rich regions of the country. According to Trend, petroleum products account for more than 90 percent of the country's exports, as well as the oil and gas industry based on oil price fluctuations, in the range of 33 to 50 percent of its gross domestic product.

In recent years, the country's authorities have significantly improved the investment climate by strengthening the regulatory and operational environment for corporate activities, ranking 25th last year in terms of ease of doing business. It is ranked 57th in 2018.
Recently, Reuters reported that the stated goal of the Republic of Azerbaijan is to make foreign direct investment, except for coal, oil, and natural gas (50% of foreign direct investment between 2003 and 2017), towards infrastructure and Industry including mining, metallurgy, and cement is gone.

Reuters added: "While Azerbaijan's infrastructure is of high quality compared to other Eurasian and middle-income countries, it ranks poorly in the World Bank's logistics performance index, ranked 123rd out of 167 countries, because Soft commercial infrastructure, including the performance of transport operators, the customs sector and the quality of logistics services in the country is poor. Therefore, railway networks need to be modernized and maintenance costs increased.

While Azerbaijan's infrastructure is of high quality compared to other Eurasian and middle-income countries, it ranks poorly in the World Bank's 123rd out of 167 countries.

The trend also said that border crossing projects are the government's top priorities and make up most of Azerbaijan's transport investments, but that more focus on secondary and local roads could improve internal communication and reduce costs of travel.
Although the Government of the Republic of Azerbaijan, as an oil-producing country, has made economic diversification and strengthening of the non-oil sector the main priorities in its development strategy for this year, many of its investments continue to dominate oil and gas. The energy and economy sectors are more widely supported, for example, current plans to invest in wind projects, although significant, are being ignored compared to oil and gas projects.

Looking at the reliance of the country's economy over the years, we find that the country's first export product was oil, which, with the conclusion of foreign contracts and the entry of powerful foreign companies, invested more than $ 60 million in the long term in the oil-rich regions of the country. 

According to Trend, petroleum products account for more than 90 percent of the country's exports, as well as the oil and gas industry based on oil price fluctuations, in the range of 33 to 50 percent of its gross domestic product.

In recent years, the country's authorities have significantly improved the investment climate by strengthening the regulatory and operational environment for corporate activities, ranking 25th last year in terms of ease of doing business. It is ranked 57th in 2018.
Recently, Reuters reported that the stated goal of the Republic of Azerbaijan is to make foreign direct investment, except for coal, oil, and natural gas (50% of foreign direct investment between 2003 and 2017), towards infrastructure and industry including mining, metallurgy, and cement is gone.

Reuters added: "While Azerbaijan's infrastructure is of high quality compared to other Eurasian and middle-income countries, it ranks poorly in the World Bank's logistics performance index, ranked 123rd out of 167 countries, because soft commercial infrastructure, including the performance of transport operators, the customs sector and the quality of logistics services in the country is poor. Therefore, railway networks need to be modernized and maintenance costs increased.

While Azerbaijan's infrastructure is of high quality compared to other Eurasian and middle-income countries, it ranks poorly in the World Bank's 123rd out of 167 countries. Border crossing projects are the government's top priorities and make up most of Azerbaijan's transport investments, but that more focus on secondary and local roads could improve internal communication and reduce costs of travel.

Although the Government of the Republic of Azerbaijan, as an oil-producing country, has made economic diversification and strengthening of the non-oil sector the main priorities in its development strategy for this year, many of its investments continue to dominate oil and gas. The energy and economy sectors are more widely supported, for example, current plans to invest in wind projects, although significant, are being ignored compared to oil and gas projects.

Over the past few years, Azerbaijan has lacked a coherent strategy for a strong focus on the environment and, most importantly, a sufficient time horizon to assess the synergies and trade exchanges associated with various infrastructure investments.

Institutional changes of the Republic of Azerbaijan in connection with the merger of the Ministry of Transport with the Ministry of Communications and High Technologies in 2017 and the dissolution of the State Agency for Alternative and Renewable Energy Resources in 2019, the situation of transport and energy in this country (Which are the main parts of the infrastructure) has weakened.
Overall, the energy sector is of better quality in terms of infrastructure than other strategic sectors, but the country's power transmission and distribution systems have performed poorly compared to neighbors such as Georgia.

The energy sector is better in terms of infrastructure than other strategic sectors, but the country's power transmission and distribution systems have performed poorly compared to neighbors such as Georgia.

According to the report of the Nordea trade site, according to the updated forecasts of the International Monetary Fund from mid-April 2020, while the GDP of Azerbaijan amounted to 2.3% in 2019, it is expected to decline by 2.2% by the end of this year due to the current corona crisis and to grow by 0.7% in 2021.

According to the report, despite issues such as government debt, which is expected to reach 18.6 percent in 2020 compared to 19.7 percent in 2019, as well as high reliance on hydrocarbons, reduced oil production (25 percent less For the past six years), and a weak banking system that refuses to lend in local currency to avoid exchange rate risk, in addition to the problem of corruption that remains unresolved and may be an obstacle to the country's development, a strong government fund The development of the Caspian gas field, the increase in exports to Turkey and Europe, the geographical connection between China and Europe and the positive public business environment are among the positive points of this country located in the South Caucasus.

With the help of dozens of foreign companies, including the British BP, Azerbaijan is developing its oil and gas resources in the Caspian Sea and alone produces more than five times as much oil from the Caspian Sea as other coastal countries.

The office of the ruling party of New Azerbaijan announced in 2019 that the oil reserves in the Caspian Sea and its land resources are equivalent to 4 billion tons and natural gas is 2.6 trillion cubic meters.

Public investment in the country is generally focused on projects such as the Shah Deniz gas field in the Caspian Sea (the National Iranian Oil Company is a shareholder in the Shah Deniz gas field development project) and the TANAP Trans-Anatolian pipeline, while economic diversity is also seen in industries such as cotton, tourism, fruits and vegetables, and vehicles.

According to SOFAZ, oil and gas exports accounted for more than 95% of the revenues of the Republic of Azerbaijan in 2018, and the revenue of the State Oil Fund of the Republic of Azerbaijan from the management of oil and gas revenues amounted to six billion and 300 million dollars per year. The past has been reported. Also, the total revenue of oil and gas projects in the Caspian Sea in 2019 is equal to 154 billion and 600 million dollars.

However, in recent years, the development of non-oil sectors has been followed by the liberation from high dependence on revenues from the energy sector and the diversification of various sectors of the economy through the development of infrastructure for the development of entrepreneurship and business. But sometimes he also thinks about the huge revenues that come from the implementation of oil and gas projects and prioritizes the implementation of these projects.

Among them, the contract for the development of the Azeri, Cheragh, and Gunshli oil fields between the Republic of Azerbaijan and foreign oil companies has been extended until 2050.

The 2019 budget shows that not only has the dependence on oil revenues not been reduced but also that Elham Aliyev has provided for the country's financial needs through the export of natural gas.
 

Imports of the Republic of Azerbaijan

Azerbaijan is one of the largest importers in the region from Turkey, Russia, China, Iran, Germany, and other European countries
Azerbaijan is one of the largest importers in the region from Turkey, Russia, China, Iran, Germany, and other European countries

The Republic of Azerbaijan is one of the largest importers in the region. Most of the imports of the Republic of Azerbaijan are from Turkey, Russia, China, Iran, Germany, and other European countries.

The following is a list of imports of the Republic of Azerbaijan together with exporting countries:

Import of salt, sulfur, soil, stone, gypsum to the Republic of Azerbaijan from Iran, Georgia, Russia, Turkey, Kazakhstan, Morocco.

Plastics and their products are imported to the Republic of Azerbaijan from Iran, Turkey, Germany, South Korea, Saudi Arabia, Turkmenistan, China, Russia, and the UAE.

Import of edible fruits and nuts to the Republic of Azerbaijan from Iran, Turkey, Ukraine, Ecuador, South Africa, Egypt, Belgium, Thailand, Uzbekistan.

Vegetables, plants, and roots are imported to the Republic of Azerbaijan from Iran, Turkey, Russia, Georgia, China, Uzbekistan, and India.

Glass and glass products are imported to the Republic of Azerbaijan from Iran, UAE, Russia, Turkey, Ukraine, China, Italy, and Germany.

Ceramic products are imported to the Republic of Azerbaijan from Iran, Turkey, China, Ukraine, Italy, Spain, Russia, Germany, Belarus, and Poland.

Iron and steel are imported to the Republic of Azerbaijan from Iran, Turkey, China, Ukraine, Kazakhstan, Georgia, Russia, Germany, and the United Kingdom.

Organic chemical products are imported to the Republic of Azerbaijan from Iran, Turkey, China, Russia, Switzerland, the USA, UAE, Britain, and Germany.

Stone, cement, and gypsum are imported to the Republic of Azerbaijan from Iran, Turkey, Russia, China, Italy, Germany, Ukraine, Georgia, and Belarus.

Land vehicles are imported to the Republic of Azerbaijan from Iran, Germany, South Korea, Japan, Russia, Turkey, the USA, Czech Republic, and Italy.

Imports and machines, water heaters to the Republic of Azerbaijan from Iran, Turkey, China, Britain, USA, Germany, Italy, Russia, South Korea.

Shoes are imported to the Republic of Azerbaijan from Iran, Turkey, China, Italy, the USA, and Spain.

Business Information of Azerbaijan

Import restrictions:‎ An entry permit is required for food products of animal origin
Import restrictions:‎ An entry permit is required for food products of animal origin

The State Veterinary Committee ‎of Azerbaijan issues these permits. The import of special radioactivity equipment for use in the ‎oil industry requires a special permit.‎

Preparation of documents for import and export in Azerbaijan:‎
Importers of Azerbaijan must submit the following documents to the customs of that country: ‎‎

  1. Signed import contract
  2. Customs declaration specifying the imported goods.
  3. List of ‎goods
  4. Import permit from the relevant ministry if the consignment includes pesticides and ‎drugs
  5. Certificate of Origin
  6. Certificate of Origin
  7. Certificate of Quality of Goods.

‎Exporters of goods in Azerbaijan must also submit the following documents to the customs of ‎that country: 

  1. Document indicating the legal status of the issuing company
  2. Legal code of ‎the company determined by the State Statistics Committee
  3. The provisions of the contract
  4. ‎Certificate of origin of goods
  5. Document issued by a reputable bank indicating advance ‎payment or opening of documentary credit 6- License from the Cabinet of Azerbaijan if the ‎exported goods contain nuclear technology or explosives and also a license from relevant ‎ministries if the goods contain animal bones, medicinal raw materials, and precious stones, as ‎well as in the field of information transfer in the field of natural resources and inventions, a ‎license from the relevant ministry is required.
  6. Customs declaration. According to a ‎presidential decree issued in June 1996, the Ministry of Foreign Economic Relations is legally ‎responsible for imports and exports. It is worth mentioning that the possibility of changes in the ‎export and import regulations of that republic is high.‎

Export controls in Azerbaijan:‎
The export of radioactive materials, some medicines for the mentally ill, and old traditional ‎carpets are prohibited. There are also restrictions on the export of new carpets. The government ‎also has a regulatory role for the export of strategic goods such as oil and petroleum products, ‎cotton, electricity, and non-ferrous metals, and buyers of such goods must obtain a permit from ‎the State Commission for the Supervision of Foreign Economic Relation of Exporters of goods ‎in Azerbaijan are obliged to sell 30% of their foreign exchange earnings to the bank.‎

Major exported items from Azerbaijan:‎
Oil and gas, chemical industry, oil equipment, textiles, cotton

Major imported items to Azerbaijan:‎
Machinery and parts, food and textile industries

Free Trade Zones and Warehouses:‎
Free trade zones or customs warehouses have not yet been established in Azerbaijan, but a ‎special economic zone is being established in the country's second industrial city, Sumgit (25 ‎km north of Baku), and Nakhchivan.‎

Subscribe to trade agreements:‎
Azerbaijan is a signatory to the Tariff and Trade Agreement (GATT) and is considering joining ‎the World Trade Organization. Trade liberalization agreements have also been signed with ‎other CIS countries. Azerbaijan is trying to join the European Union.‎

Exemption from customs fees:‎
The following items are exempt from customs duties on imports of Azerbaijan: Property imported by foreign ‎employees of companies for the personal use of imported goods, materials, and technology ‎under agreements between countries, assets, and imported materials as the property of a foreign ‎investor to participate in joint ventures. Raw materials, spare parts, and equipment imported by ‎economic institutions for use in their products and humanitarian aid are distributed free of ‎charge.‎

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