However, President of Azerbaijan Ilham Aliyev transformed this issue into one of the core issues to be considered by the participants of the World Economic Forum in Davos.
Speaking at the Eurasia’s Middle Corridor: From Pathway to Highway plenary meeting of the forum, the head of state stressed that Azerbaijan has excellent good-neighborly relations with its neighbors to the West—Georgia and Turkey and to the East—Central Asia.
“Being a natural geographical bridge between East and West, we have mainly invested in transportation infrastructure in the previous years,” President Aliyev told the participants of the forum. “All the necessary infrastructure facilities in Azerbaijan are ready to receive more cargo. The budget has already been allocated because we expect a growth in cargo for particular reasons, including the difficulties of transportation through the traditional northern route…”
As we know, until recently the East-West route running through the territory of the Russian Federation was considered to be almost entirely a Chinese route. However, the Azerbaijani leader’s speech became a call to Europeans to think about the prospects of full-scale cargo transportation through Azerbaijan not only from East to West, but also in the opposite direction, from West to East.
This is how President Ilham Aliyev outlined the priority of his country during the discussion of the prospects of one of the most important global routes at the Eurasia’s Middle Corridor: From Pathway to Highway panel. The leaders of a number of European states and the world’s largest companies will certainly draw their conclusions.
It is no secret that even in the past President Ilham Aliyev believed that Azerbaijan’s transit revenues could eventually surpass the country’s oil revenues. And although many experts refused to trust this forecast, as the “oil needle” seemed too attractive and irreplaceable, the Azerbaijani leader’s strategy turned out to be not only realistic, but also balanced.
Nevertheless, today the country’s leader is looking at the growing transit revenues in a new way. According to him, from the perspective of current realities, the strategy of turning Azerbaijan into a transit country remains unchanged. However, creation of jobs and increase of local production are even more important for the state, and relevant large-scale and purposeful work on diversification of the national economy is being carried out.
At the same time, the increase in the traffic volume will allow Baku not only to diversify its exports, but also to export its services. And the geographical location of the country both in the “Middle Corridor” and on the North-South route creates additional opportunities for business development in Azerbaijan.
It is impossible to argue with the latter conclusion, because any road, as we know, attracts the attention of entrepreneurs. Suffice it to recall how recently, when building the Baku-Ganja highway, builders bypassed dozens of towns and villages for obvious reasons. But at first, the entrepreneurs of the nearby settlements opened dozens of cafes, tea-houses, workshops, stores, gas stations along this road… And soon their families moved to these locations, building houses on both sides of the road.
To the reasonable objection of cargo companies that all roads across Azerbaijan from west to east and back run into a natural obstacle, the Caspian Sea, President Ilham Aliyev responded with a comprehensive argument: the capacity of the Baku international seaport, which is currently 15 million tons of cargo per year, will be expanded to 25 million. Moreover, since the cargo flow is expected to increase due to transportation problems on traditional routes, the state has already allocated a budget for this purpose.
And in the near future there will be a grand opening of a tax-free zone near the port of Baku. It will be a Dubai on the Caspian Sea, a new industrial center and, at the same time, the focus of domestic and foreign investments.
A dynamic improvement of the business climate is one of the key success factors in President Aliyev’s strategy. In this case, the business climate being created in the country is strengthened with friendly regional ties between Azerbaijan and Georgia, Azerbaijan and Turkey, Georgia and Turkey, as well as traditionally close trilateral relations.
But then, as enthusiastic as President Aliyev may be about the ideas of developing transit and transport corridors, he could not but remind the Davos forum participants that Azerbaijan’s potential in the Middle Corridor also applies to hydrocarbons supplies.
It is well known that oil transit from Kazakhstan begins this year (oil transit from Turkmenistan has been carried out for a long time). In this case, there is no doubt that Azerbaijan, with the largest merchant fleet in the Caspian Sea, will not have much difficulty handling maritime traffic as well.
Clearly, transit via Azerbaijan should become attractive for the states of Europe, Central Asia, and the Caucasus, not only because of the lack of alternative routes, but also, above all, from a commercial point of view. And this requires close cooperation in addressing customs administration, tariff policy, the “single window” system… Not to mention the need to establish close ties between the relevant agencies of these countries along the entire route.
This is the work that President Ilham Aliyev urged to intensify.
Elnur Mammadov
Translated from Haqqin.az
