Land of Fire - How Does It Develop? | Eurasia Diary - ednews.net

17 December, Monday


Land of Fire - How Does It Develop?

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Since Azerbaijan declared its independency from Soviet Union, it has been developing in several spheres. Azerbaijani portal (2010) divides the years after independency into 2 main periods; 1991-1995 is considered as regression and conflict years, and after 1996 is known as flourishing years because of economic development in macro level. Improvement of several sectors increases the image of this country and necessitates that Azerbaijan can be considered as a developmental state.

One of the main achievements of Azerbaijan is the export of natural resources – oil and gas to other countries, particularly to European. Index Mundi statistics indicate that Azerbaijan is the 22nd in oil production ranking with 833.500 bbl/day and the 26th in natural gas production with 29.369.999.360 cubic meters. This is result of Heydar Aliyev’s oil strategy - on 1994 September 20, Azerbaijan signed “The Contract of the Century” agreement on the Joint Development and Production Sharing for the Azeri, Gunashli and Chirag Fields with 11 international oil companies (AMOCO, BP, McDermott, UNOCAL, SOCAR, Lukoil, Statoil, TPAO, Pennzoil, Ramco, Delta) in the Azerbaijan Sector of Caspian Sea (Official page of Azerbaijani president, n.d.). The Contract of the Century allowed to sign of another 26 contracts with 41 oil companies from 19 countries - in 1997 Heydar Aliyev signed a contract which stimulated oil exports via Baku-Novorossiysk (2010, n.a.). In 1999 President Aliyev adopted the decree allocating gas and oil endowment with international companies during Istanbul conference and the State Oil Fund was established (2010, n.a.). Country partnership Strategy (n.d, 2) informs that rapid increase in oil production triggered GDP growth to surge between 2006 and 2007 with 29.8 % annual growth. Only in 2014 Azerbaijan produced 41.9 million tonnes of oil and approximately 30 billion cubic meters of natural gas (Vorotnikov, 2015) In her research Mammadova (8) states that the transit gas agreement signed between Azerbaijan and Turkey on the construction of TANAP (Trans-Anatolian-Pipeline) made Azerbaijan both natural gas producing and exporting country. Official page of Azerbaijani president informs that in 1996 a consortium established by SOCAR and international oil companies discovered large reserves in the Shah Deniz gas field. Moreover, after the discovery of Shah Deniz project Baku and Ankara signed a purchase and sale agreement for the delivery of 6.6 bcm of natural gas per year to Turkey via SCP starting from 2007 (Mammadova, 8-9). All projects take Azerbaijan gas to the European market, providing the European energy.

Further, tourism sector plays a great role in the improvement of Azerbaijan. One reason why tourists flow to Azerbaijan is hosting several international contests and sport competitions. Since Azerbaijan won Eurovision Song contest in 2011, the contest was held in Azerbaijan in 2012. Winning the Eurovision Song Contest paved the way for hosting other international sport organizations as well. Undoubtedly, this meant rising profile for the country - Azerbaijan which declared its independency several years ago. Besides Azerbaijan’s image, government budget increased by a high amount - supply and demand for products and services went up, hotels were reserved by tourists, touristic places earned a lot of money. In short, after hosting Eurovision (2012), European Games (2015), Formula 1 (2016), and Islamic Games (2017), Azerbaijan gained reputation and faced with economic boost.  By the same token, the number of visits by foreigners is increasing day by day because of ancient cities, fortresses, mausoleums, and towels. Azerbaijan has always been famous for its Ateshgah, a site of eternal flame, located in Surakhani. According to Orexca news (n.d.), there are more than 6 thousand historical monuments in Azerbaijan. Shahdag Mountain Resort, the first and largest winter resort of Azerbaijan, including 10-12 3 and 4star hotels, 160-180 cottages is one of the most visited touristic place. (Travel Baku, 2016). According to State Statistical Committee, the hotel revenue in 2014 amounted to $ 118.082.045 – 64.7% coming from room reserves and the rest coming from purchase of products and services (2016). Findings report that in 2014 the number of travelers reached to 2.5 billion, including 800.000 Russians (2016). STAN tours estimate that about 25.000-30.000 leisure tourists visit Azerbaijan every year (2016). Since the contribution of tourism sphere is great, it is one of the dominant features of development.

Last, non-aligned policy of Azerbaijan promotes its improvement since Azerbaijan’s standing shows open neutrality and disinclination to any block, coalition, and alliance (Non-aligned Studies). As a NAM (Non-aligned Movement) member, Azerbaijan is open to following independent foreign policy by setting bilateral relations. In the article Swift (2015) claims that Azerbaijan is Israel’s secret Muslim friend. Azerbaijan exports oil to Israel and trades with weaponry regardless of conflict between Turkey and Israel. Reynold (2012) writes that Azerbaijani Foreign Ministry Spokesman, Elman Abdullayev tells, “"Azerbaijan has always been famous for its modernistic approach - for its secularism.", and "You know we have been first secular state in the Muslim East. So, we develop our relations with different countries based on our national interest - be it Israel, be it Muslim countries." Israel and Azerbaijan have had tied relations since 1992 April. From the secularistic view, Azerbaijan and Israel share the same goal to check spread of political Islam and Iran in particular (Reynold, 2012). In 2012 Israel sold 1.3bn of euros of sophisticated weapons to Azerbaijan (2012). Another example which shows neutrality of Azerbaijan is trade of fruit and vegetable with Russia. According to Aljazeera news (2015), Putin banned fruit and vegetable import from Turkey because of poor relations. Instead of Turkey, Russia trade Siberian wood and clothes with vegetables and fruits from Azerbaijan.

Gunay Ismayilzadeh

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