Ilham Aliyev: Foreign companies can only win from investing in construction sector
The German delegation led by chairman of Germany’s Committee on Eastern European Economic Relations, Wolfgang Buechele, paid an official visit to Baku on February 13 to exchanged views on economic relations between the two sides.
The German delegation led by chairman of Germany’s Committee on Eastern European Economic Relations, Wolfgang Buechele, paid an official visit to Baku on February 13 to exchanged views on economic relations between the two sides.
The delegation which included representatives of such German companies as GP Gunter Papenburg AG, Herrenknecht AG, Uniper Global Commodities SE, Airbus Group International, CLAAS Global Sales GmbH was received by President Ilham Aliyev.
The main focus of discussions were development of underground system and modernization of the railway infrastructure, investment opportunities in the construction industry, as well as cooperation in the agricultural projects and finance sector in Azerbaijan.
There was highlighted that the German economy can contribute to the diversification of Azerbaijan’s economy by offering its expertise in consulting services and machinery and equipment industry.
Noting that important international events are taking place in Azerbaijan with the participation of representatives from near and far abroad, President Aliyev stressed that the country is becoming an important energy center of the region.
Multi-billion investments have been put in global energy projects implemented at the initiative of Azerbaijan, he said.
Foreign companies can only win from investing in construction sector in Azerbaijan, President Aliyev, stressing that one of the upcoming tasks is to fully meet the country’s need in construction materials.
The head of state further said that Azerbaijan will continue implementing reforms to create very strong economy based on knowledge, technologies, good governance and human capital.
The President noted that the reforms carried out in the economic sphere, in particular in the institutional, structural, fiscal and other spheres, have already yielded successful results and these reforms will be continued.
Despite that these investments were mainly directed to the oil sector, attraction of big investments to the non-oil sector at the same time made it possible to ensure diversification of economy and regional development, Ilham Aliyev said.
He noted that the energy projects will bring additional income for a long period and added that the macroeconomic situation in Azerbaijan is very positive, the volume of international foreign exchange reserves is equal to GDP, and the country’s external debt is at a very low level - about 20 percent (of GDP).
President Aliyev said that Azerbaijan’s energy projects are not limited to only Shah Deniz-2.
The head of state voiced his satisfaction with the activity of Uniper Global Commodities in Azerbaijan, expressing hope that the company will continue successful cooperation in the future.
“Azerbaijan’s energy projects are not limited to Shah Deniz-2 ,” he said, adding that talks are in the active phase with a number of world’s leading companies on new fields.
Speaking of the importance of extending the contract on development of the Azeri-Chirag-Gunashli fields by 2050, the head of state said this shows that Azerbaijan together with the world’s leading companies will be able to jointly develop these giant fields at least for 30 years from now on.
German energy companies keen to cooperate with Azerbaijan
As part of the visit, the delegation met with Azerbaijani Energy Minister Parviz Shahbazov, who noted that the economic relations in the non-oil sector are developing and stressed that a large share of Germany’s trade with the countries of the South Caucasus accounts for Azerbaijan.
At the meeting, the German companies engaged in production of drilling equipment and laying underground gas pipelines expressed interest in cooperation with Azerbaijan.
Buechele, in turn, stressed the need to create favorable conditions for expanding cooperation in the economy, and in particular in the energy sector.
Further, the country’s Economy Minister Shahin Mustafayev received the delegation.
Addressing the meeting he said that operation of German companies in the occupied territories of Azerbaijan is unacceptable. Azerbaijan informed the German side about the companies that illegally operate in the occupied Nagorno-Karabakh region.
In turn, Buechele noted that he will study this issue and will inform the Azerbaijani side about this.
The conflict between the two South Caucasus countries began in 1988 when Armenia made territorial claims against Azerbaijan. As a result of the ensuing war, in 1992 Armenian armed forces occupied 20 percent of Azerbaijan, including the Nagorno-Karabakh region and seven surrounding districts.
Further, the Azerbaijani Economy Minister suggested German companies to create a joint venture within the framework of the petrochemical project SOCAR Polymer.
At the first stage, the production capacity of SOCAR Polymer will be 120,000 tons of polyethylene and 180,000 tons of polypropylene.
By 2021, the total capacity can reach 570,000 tons of products. It is expected that around SOCAR Polymer an industrial cluster will be formed and additional enterprises will be created which will produce their products on the basis of SOCAR Polymer products.
Speaking of bilateral cooperation, the minister noted that to date, Germany’s investments in the Azerbaijani economy have reached $555.8 million. More than 200 companies with German capital work in Azerbaijan.
Germany ranks the 5th among Azerbaijan’s partners in trade turnover.
The minister went on to say that both countries have ample opportunities for cooperation in pharmaceuticals, engineering, petrochemicals, transport, transit transport, as well as joint production of electrical equipment and agricultural machinery.
To date, 70 documents on the promotion and protection of investment in the economic sphere and the elimination of double taxation have been signed between the countries.
Mustafayev invited German companies to invest in industrial zones in Azerbaijan, take advantage of the country’s transit possibilities and invest in the Free Trade Zone (FTZ) in the settlement of Alat in the Garadagh district of Baku.
Moreover, during the meeting it was noted that representative offices of German hospitals may appear in Azerbaijan.