Bsef2012 session1 investment_climate_madatov


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NATIG MADATOV, Director, Investment Promotion Department, Azerbaijan Export and Investment Promotion Foundation (AZPROMO) - Azerbaijan Country Presentation

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  • A glimpse into the sectors with wide investment opportunities. Since Azerbaijan is rich of natural resources, in particular with favourable environmental conditions, fertile lands and climatic diversity, agriculture has always been a strong point for the country. We produce a huge variety of agricultural products and are one of the major exporters of agriproducts to CIS market. Agriculture accounts for 5.4% of GDP but employs almost 40% of labour force. Agricultural lands make over 50% of total territory of Azerbaijan. Food processing is closely linked to agriculture and makes up to 34% of manufacturing industry. Governmental subsidies provided for foreign investors as well, tax exemption, customs privileges for imported agri-food production related commodities and many other advantages create great opportunities for starting business in agriculture. Alternative and renewable energy is new for us, but has huge potential. We have 3200 sunny hours a year, 250 windy days with average wind speed of 8 m/s, where one needs some 3 m/s to start producing electricity. At present, pilot projects on production of solar and wind energy are being implemented successfully. Moreover, last year, Azerbaijan constructed a hybrid power plant on the use of alternative energy sources and solar panel plant was put into operation recently. It means that development of the sector is highly important for Azerbaijani government. Hydropower generation is already traditional for us with still huge opportunities for small and medium size hydropower plants. Tourism is another important and very promising part of economy. Last year was declared a year of tourism in Azerbaijan. It means new projects, reforms and opportunities. Just as an example, new 5 star brand hotels were opened last year in the capital city of Baku and this positive trend will continue this year as well. At the same time we implement big projects in other regions of Azerbaijan. For instance, there is a huge winter resort complex being built in the north part of Azerbaijan. Many other projects in almost all types and forms of tourism industry are under implementation. Telecommunications is one the main economic areas. It is the fastest growing non-oil sector in terms of increasing revenues. Azerbaijan is the number one among CIS countries and ranks 61 st place in the world for ICT according to the World Economic Forum. The number of consumers is growing rapidly with expansion of services to all the parts of the country. Azerbaijan is in the process of establishing its space industry and will launch its first satellite this year. Azerbaijan has begun creating Regional Innovation Zone, where regime of privileges for entrepreneurship will be applied. It will encourage investments and lead to a significant increase in IT production. Moreover, Trans-Eurasian Information Super Highway Project is being negotiated at present between major telecommunications companies of Azerbaijan, Kazakhstan, China, Turkey and Russia. This Super Highway is expected to provide 20 countries of the region with high speed internet, telecommunication systems, e-information resources and e-economies. Industry is the largest sector of our economy. It accounts for up to 53% of GDP and this sector is the major recipient of foreign investments. The most important industrial sectors being in the process of development are chemical industry, machinery, light industry and waste management. As Azerbaijan has rich oil resources, there are great opportunities for establishing high technology based chemical industry. Of course, chemical industry is not new for us, but the current situation requires different approach to the matter in terms of privileges provided for entrepreneurs and attracting modern equipments. Exactly for this purpose, significant decision on establishing new chemical industrial park was recently made by the government. In order to support and promote recycling business which will cause first of all reduction of environmental impact of industrial waste, works on establishing eco-industrial park have been already started. Considering reusable and cheap raw material market in our country, this business has promising perspectives in terms of attracting foreign investments as well. All these facts show that Azerbaijani government strongly supports improvement of business environment in non-oil sectors of economy.
  • Bsef2012 session1 investment_climate_madatov

    1. 1. Azerbaijan Export andInvestment Promotion Azerbaijan Country Presentation Foundation
    2. 2. Azerbaijan Export and Investment Promotion Basic information Foundation I UN Security Council non-permanent member for 2012-2013I Establishment: 28 May 1918I Independence: 18 October 1991I Official Language: AzerbaijanianI Political system: Presidential RepublicI Area: 86.6 thsd sq. km.I Population: 9 millionI Capital: BakuI Autonomy: Nakhchivan RepublicI Significant highlights: I 1st democratic republic in the Islamic world I 1st Opera in the Islamic I Women world voting right in 1918 Italy - 1946; Switzerland - 1971; France - 1944I Currency: Manat: 1 AZN = 1.27 USD
    3. 3. Azerbaijan Export and Investment Promotion Macroeconomic figures Foundation 2011 2011GDP, bln USD 63.4 Non-oil GDP growth 9.4 %GDP per capita ($) 7,003 Income growth rate of populationInvestments ($) 20 bln 19.6%FDI ($) 4.4 bln Total investmentsInflation 7.9 % 21.6 bln $Unemployment rate 5.4% Non-oil investments 15.6 bln $Poverty level 7.6% Strategic currency reservesAverage monthly salary ($) 460 40 bln $
    4. 4. Azerbaijan Export andInvestment Promotion Macroeconomic figures Foundation
    5. 5. Azerbaijan Export andInvestment Promotion GDP share in the region Foundation productivity
    6. 6. Country Ratings Azerbaijan Export and Investment Promotion Foundation IUNDP Human Development Report – 67 IWEF Global Competitiveness Report 2012-2013I World Economic Forum Reportamong world and 1 st among CIS – 46 th 2011-2012 - 61 st in the world countries for ICT
    7. 7. Azerbaijan Export and Investment Promotion Investments Foundation FDI FDI41.4 bln41.4 bln USD USD *1995-2011
    8. 8. Azerbaijan Export and Investment Promotion Investments Foundation FDI FDI4.4 bln4.4 bln USD USD *2011
    9. 9. Azerbaijan Export andInvestment Promotion Why invest in Azerbaijan? Foundation POLITICAL & FINANCIAL STABILITY Good climate and welcoming culture Well-developed infrastructure Abundant
    10. 10. Azerbaijan Export and Investment Promotion Why invest in Azerbaijan? Foundation Favorable location Well-developed infrastructure IAzerbaijan is the country on the I Logistical hub for Asia – Europe, Middle East – crossroads of Eurasia CIS I Developed rail infrastructure (Baku – Tbilisi –Abundant resources & Kars railroad - The Iron Silkway)Good climate I Best passenger and freight airport in the Caucasus and Caspian regionI 9 out of 11 climatic zones I Baku International Sea Trade Port (in Alat) Competitive and skilled laborI Mild winters and hot summers forceI Rich mineral and climatic resources IEntrepreneurial cultureI Ferrous and non-ferrous metals IHigh literacy level (99.6%)I Raw construction materials IExcellent IT and foreign languages skills IHuman resources development strategy
    11. 11. Azerbaijan Export and Investment Promotion Priority sectors for investment FoundationI Agriculture and food industryI Alternative and Renewable EnergyI TourismI Information & Communication Technologies
    12. 12. Azerbaijan Export and Investment Promotion About AZPROMO FoundationI Established by the Ministry of Economic Development in 2003, public- private partnership modalityI Vision: Balanced growth of economyI Mission: To sustain economic growth by maximizing the flow of non-oil extraction FDI and development of export oriented sectorsI Main activities : I Country promotion and image building I Investment promotion I Export Promotion
    13. 13. Azerbaijan Export andInvestment Promotion Investment Promotion Foundation I Image building marketing campaigns (perception=reality), communication strategy I Investment generation Identification of potential investors, marketing campaigns, presentations, road shows I Investment facilitation Investment information, site visits, organisation and providing information I Investor servicing + aftercare Helping investors get established and be operational, expansion and re-invest I Advocacy+strategy formulation Advocating for investment friendly business climate, inputs to national FDI policy
    14. 14. Azerbaijan Export andInvestment Promotion Export Promotion Foundation I New exporters Consultancy, assessment of export capabilities, training and guidance I Entering a new market Market information, legal analysis, price research, trade shows/fairs research I Looking for new customers Search for new contacts, matchmaking and sector/product events, trade missions I Image building Trade shows/fairs, PR activities abroad I Policy advocacy Advice in foreign trade policies and input on export regulations
    15. 15. Azerbaijan Export and Investment Promotion Foundation Foreign NetworkI AZPROMO Georgia /AZPROMO Austria as well as representatives in Germany, USA, UK, Switzerland, Turkey, Romania, Ukraine and Kazakhstan. Mission: Support in development of economic and business relations between Azerbaijan and Georgia as well as European countries through Austrian officeI Main activities Market researches and analyses I Legal framework I Business consultancy I Public relations, country promotionI Partners and proxies Membership in the World Association of Investment Promotion Agencies (WAIPA) Steering Committee and Regional office for Central Asia and South Caucasus Diplomatic/Trade missions and Chambers of Commerce
    16. 16. Azerbaijan Export and Cooperation in investment Investment Promotion Foundation promotionI What is WAIPA?I The World Association of Investment Promotion Agencies (WAIPA) was created in 1995. WAIPA is de facto international organization, established as a non-profit, under Swiss law. It has its head offices in Geneva, Switzerland.I From its very inception, in 1995, WAIPA has represented an ever growing number of Member agencies. WAIPA Members include approximately 180 national and sub-national agencies from over 160 different countries.I WAIPA is seeking to enlarge the membership for the region under AZPROMO’s responsibility. While Eastern Europe has a very large representation, there are currently 6 national IPAs and 4 sub-national IPAs from the South Caucasus and Central Asia as part of WAIPA.
    17. 17. Azerbaijan Export and Cooperation in investment Investment Promotion Foundation promotion IStill WAIPA is the organization, worldwide with mostLEGITIMACY &Representativeness in what relates to long-term, productive investments worldwide
    18. 18. Azerbaijan Export and Cooperation in investment Investment Promotion Foundation promotionI Its non-governmental status allows WAIPA the flexibility to interface between IPAs and their Governments and between those two and the Private Sector.I For other international organizations – involved in FDI (Foreign Direct Investment) – investment is only part of their mandate, foreign trade is always their predominant focus. WAIPA is dedicated exclusively to helping IPAs and their governments enhance their FDI levels, through…
    19. 19. Azerbaijan Export and Cooperation in investment Investment Promotion Foundation promotionI TrainingsI information gathering and dissemination (e.g. an Investment Sentiment survey conducted in September 2011, and a survey on marketing efforts of IPAs / and their governments that is being conducted now)I advocacy for the IPAs before their government and coordination with other instances of world decision-making (e.g. G-20 Meetings which the WAIPA Presidency of Apex-Brasil and the WAIPA Permanent Secretariat often participate. In Mexico City, on November 5-6, there will be a meeting scheduled for head of G-20 IPAs and TPOs)
    20. 20. Azerbaijan Export and Investment Promotion Thank you for the attention! Foundation Azerbaijan Export and Investment Promotion Foundation (AZPROMO) Baku, Azerbaijan Tel.: (+99412) 598 01 47/48; Fax: (+99412) 598 01 52 office@azpromo.azThe World Association of Investment Promotion Agencies (WAIPA)