NEW AZERBAIJAN PARTY

Q: The meeting of the Cabinet of Ministers has recently been held dedicated to the results of socioeconomic development in the first half of 2014 and objectives for the future. President Ilham Aliyev`s speech at the event demonstrated that this year will enter into our history as another year of success. What did pave the way for this success?

A: In his speech at the meeting of the Cabinet of Ministers, President Ilham Aliyev provided strong facts and accurate figures to highlight the country`s development in the first three quarters of the year.

The head of state said that important steps were taken in the direction of steady development of our country in the third quarter. Overall, since the beginning of the year and to the present day the Azerbaijani economy has successfully developed. “The results of nine months already indicate that this year will indeed be remembered as a successful year. And this is natural because the reforms carried out in recent years and the initiatives we have put forward facilitate the dynamic development of our country.”

“The economic indicators of the first nine months are also very positive. Our economy is growing and expanding. I should note that the financial and economic crisis is still ongoing in Europe, while Azerbaijan is registering economic development every year. In the first nine months of this year, the gross domestic product grew by 2.5 per cent. Considering the present situation in the world, we can say that this is a very positive indicator. Most importantly – and we note this with satisfaction every time – our non-oil sector has grown by 6 per cent. The non-oil sector growth, of course, is the result of our policy. The main issue for us is the development of the non-oil sector. Things in the oil and gas sector are going well. After some time I will express my views about that, but the non-oil sector is our main goal,” said the President.

The non-oil industry has grown by 6 per cent. This is also a very positive indicator. Inflation is very low – only at 1.5 per cent. Population's incomes have increased by 5.4 per cent. Thus, as in previous years, incomes exceed inflation, and this has a direct positive impact on people's living standards.

This year too our budget costs are fairly large. Wages and pensions are increasing – they have risen in the first nine months too. Despite this, inflation is low, which demonstrates the stability of the macroeconomic situation.

Major investments are made. A total of $19 billion has been invested since the beginning of the year. Of this, $11 billion is domestic investment. This is also a picture observed in recent years. Investment is growing and is dominated by domestic investment. However, most of the domestic investment is public, which is natural. Public funds should be allocated for infrastructure projects, including the implementation of projects of social infrastructure. But private investment is also made in Azerbaijan. There is a very positive investment environment in Azerbaijan, local and foreign investors have confidence in our country and believe in its future.

“By and large, Azerbaijan has developed such a large economic and financial potential that I do not believe that a decline in oil prices can greatly affect us. But in any case, we must be prepared for that and make plans in accordance with this, because the global economy has not yet recovered from the crisis. There are other factors causing a decline in oil prices. We must consider all of them and prepare our investment programs accordingly. I want to reiterate that relevant instructions have been given. In the first place, social issues will be completely resolved – social security, military spending and infrastructure projects.”

“I am sure that next year inflation will be at a low level – in single digits. This will allow us to constantly improve the well-being of our people, because rising inflation and the depreciation of the manat may, of course, have a negative impact on people's lives. Therefore, the rate of the manat is stable and inflation is very low. These factors have a direct positive impact on the living standards of people,” the head of state said.

During the first nine months all infrastructure projects were successfully implemented, and this process continues. The state program on the socioeconomic development of the regions has been successfully implemented. More than 100,000 jobs were created, of which 80,000 are permanent. Since the beginning of the program, from 2004 to the present day, 1.3 million jobs have been created. This has sharply reduced unemployment, which now stands at 5 per cent.
Our main point of support and the source of our strength is our economic independence. I can say that the reforms under way in Azerbaijan and the sound economic policies are also praised by the world’s most authoritative economic institutions. The Davos World Economic Forum ranks Azerbaijan in 38th place in the world in terms of competitiveness. We have advanced another step. It is a historic achievement to be in 38th place in the world for this indicator. In other words, we are among the world’s 40 most competitive countries. This is a historic achievement, which gives us more confidence. We already know that Azerbaijan is on the right track. Azerbaijan is developing steadily. But the assessment of influential and reputed financial and economic institutions is very important, of course.

Q: The meeting proved that diversification of economy will remain a key priority in the next years too…

A: A major role in the development of economy is also played by the implementation of the third state program on the socioeconomic development of the regions. The oil factor still accounts for a large share of our economy. Despite the fact that the share of the non-oil sector in our gross domestic product already exceeds 55 per cent, most of our export potential is linked to oil and gas. We are also well aware that it is impossible to create a large number of jobs in the oil and gas sector. Therefore, our main goal has been the non-oil sector. The creation of jobs in this sector, of course, has led to a reduction of unemployment.

“Modern processing enterprises are being established in Azerbaijan. Our agricultural products are supplied to world markets in a processed form. I want to say again that there are great opportunities for increasing our export potential now. We simply need to further enhance the export capacity by additional investments and further measures related to the development of entrepreneurship. Of course, we must provide the domestic market with products grown in Azerbaijan. Recent years have seen great progress in this area. We can say that we are providing ourselves with staple foods to the highest extent, except for grain. This, of course, is a very important factor in ensuring food security. Of course, we have to access our traditional markets with even greater volumes of products and also find ways to new markets,” said President Ilham Aliyev at the meeting.

This year is the "Year of Industry", and special attention has been paid to the development of industrial production, of course. A number of plants, factories and industrial sites have been opened.

“The establishment of industrial clusters should be continued in the future. I have repeatedly talked about industrial parks and do not want to repeat anything. The future development of Azerbaijan must be associated with the development of industry. It should also be noted that Azerbaijan currently has sufficient funds, and we need to attract public investments to the industrial sectors representing strategic importance for us. Of course, the Azerbaijan Investment Company should take on a greater part of this work, and by attracting foreign investors we will achieve even better results in this sphere.”

“Poverty reduction is directly related to our economic and social policies. I have repeatedly talked about it, this is our policy, but we shouldn’t deal with economic reforms only. We must pay great attention to the social sphere because major economic reforms in many cases lead to social problems. But in Azerbaijan we are seeing just the opposite. We have implemented major social projects. We have repaid people’s Soviet-era bank deposits in the shortest possible time and with the highest interest rate in the CIS. Wages and pensions are steadily increasing. I want to say once again that this is our approach, and it opens up new opportunities before the country,” the head of state added.

Q: What can you say of measures taken to ensure sound competition in market economy system?

A: As the result of far-sighted policy and intensive activities of the President of Azerbaijan, the national leader Heydar Aliyev, significant results were achieved in the fields of socio-economic development and integration into the global economic system within a short period of time – in spite of unfavorable initial conditions. The great achievement was that the Azerbaijani model of the state system establishment and development was established over the past period.

One of the main tasks of the country’s leadership in that period was efficient use and reallocation of the benefits from rich oil and gas endowment. In order to solve this task, in 1999 the national leader Heydar Aliyev adopted the Decree promoting cooperation with international companies in this field. Additionally, in order to channel the revenues from oil exports to the priority sectors of the economy and important social and economic projects, the State Oil Fund was established. At the current moment, international organizations evaluate positively Oil Fund’s activity and its provision of transparency.

Oil-gas sector played dominant role in developing other sectors of economy. Considered economic policy led to macroeconomic stability and sustainable economic growth, as the result, reforms started in all economic fields, new measures are taken in order to improve social welfare of population.

Implemented measures in providing diverse forms of property contributed positive effects to sustainable economic growth.

As the result of implementation of this policy, obtained successes are strengthened, macroeconomic stability was secured, diversification of the economy, development of non-oil sectors and regions accelerated, efficient usage of strategic international reserves was secured, the stability of national currency and confidence of banking system increased, conservative external debt strategy implemented, support from government to entrepreneurship intensified, social welfare of population improved sustainably.

The President of the Republic of Azerbaijan Ilham Aliyev successfully and confidently continued development strategy determined by national leader Heydar Aliyev, and made it rapid and sustainable progress.
On the basis of the Decree of the Head of the State "Azerbaijan 2020: Look into the Future" Development Concept was developed with the participation of relevant government agencies, research organizations and highly qualified specialists, as well as in cooperation with international organizations operating in the country.

This concept is a document defining the main directions of the development for the next eight years and goals set forth. The document launches a new phase of development of the country and the main purpose is to be included in the list of the world's most developed countries in all indicators. As a result of the implementation of this concept in 2020 Azerbaijan will be politically and economically advanced and competitive country.