(MENAFN- AzerNews)
Nazrin Abdul
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Azerbaijan's economic development model has established its
credibility on the global stage. This perspective was articulated
by President Ilham Aliyev during his speech at the economic meeting
on September 26.
"We have built a strong Economy relying on our own resources. We
have established an independent economy; we are not dependent on
anyone. Economic independence naturally provides us with great
opportunities at the international level, allowing Azerbaijan to
conduct an independent foreign policy with success, confidence,
honor, and dignity, as we have done and will continue to do.
Successful politics is intrinsically linked to a thriving
economy. These two elements are closely intertwined, with clear
economic indicators serving as a testament to effective governance
by the country's leadership. Let us examine the relevant data to
illustrate this relationship.
As noted by President Ilham Aliyev, economic growth in
Azerbaijan was 4.3 percent, which is a significant indicator,
especially considering the geopolitical situation."
The economic growth of 4.3 percent in Azerbaijan can be
considered significant for several reasons, especially in light of
its geopolitical context:
Regional instability : Azerbaijan is located in
a region with various geopolitical tensions, including conflicts
with neighboring countries. Sustaining economic growth amidst such
instability reflects resilience and effective governance.
Resource dependency : Azerbaijan's economy
heavily relies on oil and gas exports. Fluctuations in global
energy prices can dramatically impact economic performance. A
growth rate of 4.3 percent indicates effective management of
resources and diversification efforts, even when external
conditions may be challenging.
Investment climate : Positive economic growth
can attract foreign investment, which is crucial for development.
If Azerbaijan is growing despite geopolitical tensions, it signals
to investors that the country is stable enough to warrant
investment.
Economic diversification : If this growth is
happening alongside efforts to diversify the economy beyond oil and
gas, it suggests that Azerbaijan is making strides in building a
more resilient economy that can weather external shocks.
A growth rate of 4.3 percent is particularly impressive when
considering the geopolitical challenges Azerbaijan faces,
indicating both economic resilience and potential for future
stability and development.
The president also discussed growth in the non-oil sector.
"The point of particular importance is that our non-oil sector
increased by 7 percent. This shows that the steps taken to
diversify the country's economy and the well-thought-out reform
policy are bearing fruit," he said.
It should be noted that although the country primarily engages
in traditional energy trade, economic diversification is being
successfully implemented thanks to large-scale projects undertaken
in recent years.
Particularly, the use of alternative energy sources is enhancing
the country's reputation in green energy production on the global
stage. Azerbaijan's rich solar, wind, and hydro energy potential is
recognized by other countries, leading to significant investments
from global companies.
In general, it is worth noting that the lands freed from
occupation by President Ilham Aliyev have been declared a "green
energy" zone. The investment of influential companies in these
areas, particularly in renewable energy resources, indicates
successful cooperation and effective diplomacy.
Let's recall the president's speech:
"I should also state that in recent years, the production of oil
from projects implemented by foreign oil companies has been
decreasing year by year, which naturally had a negative impact on
our overall economic development. We have been compensating for
this decline with the growth of the non-oil sector. However,
through negotiations with foreign oil companies, we brought
attention to the deficiencies in oil production and requested that
they be addressed to ensure stability. Recently, very active work
has been carried out in this direction, and as a result, we have
reasonable hopes that there will be no further unwarranted decline
in oil production."
The president emphasized that government institutions and the
SOCAR company are responsible for these issues, asserting that
obstacles to Azerbaijan's economic development will be addressed
going forward.
"Stable oil production must be ensured next year. We are
currently working on several new projects in the oil and gas
sector, which will yield new production forecasts. Next year, we
will likely see new projects and new deposits producing larger
volumes of natural gas and oil condensate. I believe the outlook
for the oil and gas sector will be positive."
It should be noted that the confirmed reserves of the "Shah
Deniz" field in the Azerbaijani sector of the Caspian Sea are
estimated at approximately 1.2 trillion cubic meters. The discovery
of the "Umid" and "Babek" fields further enhances Azerbaijan's gas
potential. Currently, 3.1 million cubic meters of gas and 470 tons
of condensate are produced daily from four operational wells in the
field. Since production began in 2012, approximately 6.7 billion
cubic meters of gas and 1 million tons of condensate have been
extracted. Two additional wells are planned for drilling and
commissioning from the "Umid-1" platform. Azerbaijan's new gas
fields enable further expansion of gas exports alongside renewable
energy development.
Additionally, Azerbaijan, a key partner of the European Union in
the South Caucasus, plays a decisive role in delivering Caspian gas
resources to the EU market via the Southern Gas Corridor. The
president has indicated plans to increase gas exports to Europe by
20 billion cubic meters by 2027, noting that this is a minimal
target as Azerbaijan's energy potential exceeds this limit.
It is important to highlight that Azerbaijan cooperates with
Europe not only in traditional energy but also in alternative
energy. According to the "Agreement on Strategic Partnership in the
Development and Transmission of Green Energy," signed in Bucharest
on December 17, 2022, Azerbaijan, Georgia, Romania, and Hungary
have formed a collaborative framework. The "Caspian-Black
Sea-Europe Green Energy Corridor," or "Black Sea Cable," envisions
transporting green energy generated by Azerbaijan's wind power
plants to Romania and Europe.
Stating that the main goals are the diversification of the
country's economy and the improvement of the sustainable
development model, President Ilham Aliyev also noted the positive
indicator of inflation.
"Inflation has been slightly over 1 percent since the beginning
of the year. This is a very positive indicator. I have already
stated that the minimum wage and minimum pension will be increased
next year, even though inflation is at a very low level. The tasks
facing the country require substantial financial resources,
particularly for the development of the military, the
military-industrial complex, and the restoration of Garabagh and
Eastern Zangazur. Despite all this, we are doing our best to
improve the well-being of our vulnerable citizens."
In conclusion, Azerbaijan's economic trajectory showcases a
successful blend of political stability and strategic resource
management. With a reported growth rate of 4.3 percent and a 7
percent increase in the non-oil sector, the country is not only
addressing immediate economic challenges but also laying the
groundwork for future prosperity. As Azerbaijan continues to invest
in both traditional and renewable energy sources, it stands poised
to enhance its role as a key player in the global energy market,
while ensuring the well-being of its citizens through prudent
economic policies and initiatives.
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