Azerbaijan Country Presentation Investment Promotion Foundation - - PowerPoint PPT Presentation

Azerbaijan Country Presentation

Azerbaijan Export and Investment Promotion Foundation

Basic information

Azerbaijan Export and Investment Promotion Foundation

I Establishment: 28 May 1918 I Independence: 18 October 1991 I Official Language: Azerbaijanian I Political system: Presidential Republic I Area: 86.6 ths. sq. km. I Population: 9.2 million I Capital:

Baku

I Autonomy: Nakhchivan Republic I Significant highlights: I First democratic republic in the Islamic world I 1st Opera in the Islamic world I Women voting right in 1918; Italy -1946;

Switzerland - 1971; France - 1944

I Currency:

Manat: 1 AZN = 1.27 USD

I UN Security Council non-permanent member for 2012-2013

Interesting facts

Azerbaijan Export and Investment Promotion Foundation

I First Baku „oil boom‟ I Nobel‟s first Kerosene

factory

I 1846–first hand-dug oil

wells

I First Baku-Batumi Pipeline I Nobel‟s distribution system I First rail tank cars I 50% of world oil production in XIX century I 80% of total Soviet oil production during World War II

GDP, bln USD 63.4 GDP per capita ($) 7,003 Investments ($) 21.6 bln FDI ($) 4.4 bln Inflation 7.9% Unemployment rate 5.4% Poverty level 7.6% Average monthly salary ($) 460

2011

9.4 %

Non-oil GDP growth

19.6% 21.6 bln $ 15.6 bln $

2011

Strategic currency reserves

40 bln $

Non-oil investments Total investments Income growth rate of population

Macroeconomic figures

Azerbaijan Export and Investment Promotion Foundation

productivity

GDP share in the region I GDP share in the South Caucasus (%)

Azerbaijan Export and Investment Promotion Foundation

Macroeconomic figures

Azerbaijan Export and Investment Promotion Foundation

I Average GDP growth in 2006 - 2011 - 14.1%

2nd fastest growing economy among 179 countries for GDP per capita growth in 2001-2010

Macroeconomic figures

Azerbaijan Export and Investment Promotion Foundation

Nominal GDP, bln USD

Macroeconomic figures

Azerbaijan Export and Investment Promotion Foundation

82.5% 17.5%

Share in Economy

Private sector Public sector

State Budget

Azerbaijan Export and Investment Promotion Foundation

State Budget revenues, bln USD

1.62 2.04 2.4 4.4 7.4 18.5 20.3 29.1 40 2003 2004 2005 2006 2007 2008 2009 2010 2011

Strategic currency reserves

Azerbaijan Export and Investment Promotion Foundation

External debt in 2011 – 4.6 bln USD

bln, USD

State Programs I State Program on socio-economic development of regions of

the Republic of Azerbaijan in 2009-2013

I State Program on Food Security in 2008-2015 I State Program on the development of tourism in the Republic

• f Azerbaijan in the years of 2010-2014

I State Program on use of alternative and renewable energy

sources in the Republic of Azerbaijan

Azerbaijan Export and Investment Promotion Foundation

Poverty reduction

Azerbaijan Export and Investment Promotion Foundation

I State

Program

• n

Poverty Reduction and Sustainable Development of the Republic of Azerbaijan in 2008-2015

Poverty reduction dynamics

49% 48% 45% 40% 29% 21% 16% 13% 11% 9% 7.6%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

I

UNDP Human Development Report – 67

I WEF Global Competitiveness Report 2011-2012

– 55th among world and 1st among CIS countries

I World Economic Forum Report 2010-2011

• 1st among CIS countries for ICT

Country Ratings

Azerbaijan Export and Investment Promotion Foundation

Registering Property 9 Protecting investors 24 Enforcing contracts 25

Methodology

The Doing Business project provides objective measures of business regulations and their enforcement across 183 economies and selected cities at the subnational and regional level.

Starting a business 18

Economic reforms

Azerbaijan Export and Investment Promotion Foundation

2012 rankings report available at www.doingbusiness.org

One-stop-shop

Azerbaijan Export and Investment Promotion Foundation

Type of legal entity: Duty:

I Banks, stock exchanges, insurance

companies, branches of foreign legal entities 220 AZN

I Agricultural business

3 AZN

I Other legal entities

11 AZN

Statistical Committee Effective 01.01.2008 E-registration is now available

I Corporate Tax

20%

I Value Added Tax

18%

I Simplified Tax

4% and 2%

I Agriculture Tax I No limits on the Repatriation of profits I Inheritance and Gift Tax I No customs duties on non-oil production

imports (specified agricultural products)*

I No VAT on non-oil production imports

(specified agricultural products)*

Taxation

Azerbaijan Export and Investment Promotion Foundation

*Effective 01.03.2011

Russia 16% Turkey 13% China 6% Germany 8% Ukraine 5% Other 40% France 6% USA 6%

Foreign Trade (import)

Azerbaijan Export and Investment Promotion Foundation

I More than 10 Free Trade Agreements I 149 trade partners I GSP, GSP + (Generalized system of preferences) I WTO negotiations process

I Trade turnover

36.3 bln US dollars

I Import

9.7 bln US dollars

■ Machinery, equipment ■ Vehicles and spare parts ■ Foodstuffs ■ Non-ferrous metals and products ■ Pharmaceuticals ■ Wood and products ■ Other

2011

Italy 35% USA 7% Israel 3% Russia 4% France 15% Other 33% Ukraine 3%

Foreign Trade (export)

Azerbaijan Export and Investment Promotion Foundation

I Trade turnover

36.3 bln US dollars

I Export

26.6 bln US dollars

■ Raw oil and petrochemicals ■ Fruit and vegetables ■ Plant and animal oil ■ Ferrous metals and products ■ Chemical industry products ■ Cotton ■ Aluminum and products ■ Alcoholic and non-alcoholic beverages ■ Tobacco and products ■ Other

2011

Total Investments 118.6 bln USD

Oil sector 48.5 bln USD Foreign 63.1bln USD Domestic 55.5 bln USD Non-oil sector 70.1 bln USD FDI 41.4 bln USD

*1995-2011

Investments

Azerbaijan Export and Investment Promotion Foundation

Total Investments 21.6 bln USD

Oil sector 6 bln USD Foreign 8.6 bln USD Domestic 13 bln USD Non-oil sector 15.6 bln USD FDI 4.4 bln USD

*2011

Investments

Azerbaijan Export and Investment Promotion Foundation

Why invest in Azerbaijan?

Azerbaijan Export and Investment Promotion Foundation

Abundant resources Well-developed infrastructure Good climate and welcoming culture POLITICAL & FINANCIAL STABILITY

Favorable location

Azerbaijan Export and Investment Promotion Foundation

Azerbaijan is the country on the crossroads of Eurasia

Abundant resources

Azerbaijan Export and Investment Promotion Foundation

I Rich mineral and climatic resources I Ferrous and non-ferrous metals I Raw construction materials I 9 out of 11 climatic zones I Mild winters and hot summers

Well-developed infrastructure

Azerbaijan Export and Investment Promotion Foundation

I Logistical hub for Asia – Europe, Middle East – CIS I Largest port in the Caspian Sea is being

constructed

I Developed rail infrastructure I Easy access to the Black Sea

region

I Baku – Tbilisi – Kars railroad

(The Iron Silkway)

ALYAT SEA PORT KARS AHALKALAKI ISTANBUL

Europe – Caucasus – Asia Transport Corridor

Azerbaijan Export and Investment Promotion Foundation

I Baku – Tbilisi – Kars railroad (The Iron Silkway)

Well-developed infrastructure

Azerbaijan Export and Investment Promotion Foundation

I “HAPPINESS IS MULTIPLE PIPELINES”

Well-developed infrastructure

Azerbaijan Export and Investment Promotion Foundation

I Destination to major cities:

Tbilisi – 1 hour Moscow – 2.5 hours Dubai – 2.5 hours Istanbul – 2.5 hours Riga – 3 hours Vienna – 4 hours Frankfurt – 5 hours Paris – 5 hours London – 6 hours

I Best passenger and freight airport in the Caucasus and Caspian

region

Baku Lankaran Nakhchivan Ganja Zagatala Gabala

* Source: The State Statistical Committee

Competitive and skilled labor force

Azerbaijan Export and Investment Promotion Foundation

I Entrepreneurial culture I High literacy level (99.6%) I Excellent IT and foreign languages skills I Human resources development strategy/

State Program on education abroad (2007-2015)

• Converting black gold into human gold
• funded by the Government of Azerbaijan
• 5000 students studied by completion
• Sectors: economics & management, ICT,

engineering- industry, construction, services, agriculture, medicine, law, education, science

Where to invest in Azerbaijan?

Azerbaijan Export and Investment Promotion Foundation

Agriculture/ food industry Alternative energy Tourism Construction

Where to invest in Azerbaijan?

Azerbaijan Export and Investment Promotion Foundation

Chemical industry ICT Transportation and logistics Light industry

Agri-food industry

Azerbaijan Export and Investment Promotion Foundation

I Climatic zones/types – 9 out of 11 and fertile land I 47% of population reside in rural areas I Largest employer with up to 40% of the total workforce I Tax breaks and subsidies I Traditional CIS markets of around 300 million population I Strong comparative advantage in exporting fresh fruits and vegetables I Easy access to the regional markets – hub to supply I GSP, GSP+, FTA with the CIS countries

I The power sector has a leading role in the economy of Azerbaijan I Increased demand for electricity by 4.7% each year until 2015 I Renewable Energy Sources - solar, wind, water, sea-energy, waste, bio-energy I Number of windy days in a year - 245-280 I Average annual wind speed: 5.8 – 8.0 m/sec I Average number of sunny days in a year – 250 I First in the world 5 MW hybrid (solar, biogas, wind, thermal) Experimental

Polygon in Gobustan

Alternative and Renewable Energy

Azerbaijan Export and Investment Promotion Foundation

I Fastest -growing non-oil sector increasing revenues I First satellite to be launched in late 2012 I 65 out of 100 persons are Internet users I New Regional Innovation Zone – production of IT equipment and software,

establishment of regional Data Centre

I Trans-Eurasian Information Super Highway - to bridge the digital divide in

Eurasia through constructing a regional internet backbone

ICT

Azerbaijan Export and Investment Promotion Foundation

I Unique geografic and climatic conditions I Tourism is on the high agenda of the Government, 2011 - a year of tourism I Number of visitors increased by 14.1% in comparison with 2010 and reached 2.2

mln in 2011

I Well-known international hotels: Hilton, Four Seasons, JW Marriot, Jumeirah,

Fairmont and Kempinski

I Winter-summer tourism complex in Shahdag – to be completed in 2016 and able

to welcome 10 000 tourists

I Construction of tourism complexes and infrastructure

Tourism

Azerbaijan Export and Investment Promotion Foundation

I 65 km south from Baku, with 400-hectare area to be built in three stages (by

Holland’s Royal Haskoning)

I The multimodal port complex will be completed in 3 years and host a free

economic zone and a logistic hub

I Will become a transportation hub and tremendously increase transportation from

China to Central Asia and Europe

I In 2015 the port will be able to serve up to 20 million tons of cargo and 1 mln.

containers a year

Baku International Sea Trade Port (in Alat)

Azerbaijan Export and Investment Promotion Foundation

I Total area: 168 ha I Administration: “Sumgait Chemical Industrial Park” LLC established within the

Ministry of Economic Development

I Infrastructure:

Offices, training centers, laboratory, etc. with electricity, heating, water supply and other communications will be established

I Key benefits: A number of tax and customs incentives as well as concessional

loans are considered to be granted in the Park

I Production: Petro-chemical derivatives and other priority industrial products

will dominate overall production

Sumgait Chemical Industrial Park

Azerbaijan Export and Investment Promotion Foundation

I Goal: To support and promote recycling businesses, attract foreign investments I Area size: 7 ha I Key benefits I Provide an integrated infrastructure in one location I Reusable and cheap raw material market I Reduction of the environmental impact of the industrial

uses by establishing of recycling/reuse and production facilities

I Market access for the sale of the obtained raw material or produced goods

Balakhani Eco-Industrial Park

Azerbaijan Export and Investment Promotion Foundation

Living and visiting Azerbaijan

Azerbaijan Export and Investment Promotion Foundation

Enjoy local hospitality in 508 hotels over Azerbaijan

Living and visiting Azerbaijan

Azerbaijan Export and Investment Promotion Foundation

Find out more about history and culture in:

I 233 Museums I 29 Theatres

Taste traditional food in:

I Variety of local restaurants

Must-see: UNESCO Heritage Maiden Tower – 7-6 cent. BC Qobustan rock carvings

International events in Azerbaijan

Azerbaijan Export and Investment Promotion Foundation

Take part in the international cultural and sporting events in 2012: Eurovision Song Contest Baku FIFA Women's U17 World Championship Baku International Jazz Festival

Nagorno-Karabakh conflict

I In 1989 – 1993 20% of

territories of the Republic of Azerbaijan were occupied by Armenia

I The cease-fire has been in force

since 1994

I Total refugees and IDPs –

1,010,000

I Economic losses of more than 60

bln US dollars

Azerbaijan Export and Investment Promotion Foundation

Investment Project

Azerbaijan Export and Investment Promotion Foundation

Investment Project

Azerbaijan Export and Investment Promotion Foundation

www.bakuwhitecity.com

Investment Project

Azerbaijan Export and Investment Promotion Foundation

Investment Project

Azerbaijan Export and Investment Promotion Foundation

I Azerbaijan Export and Investment Promotion Foundation (AZPROMO) was

established by the Ministry of Economic Development in 2003

I AZPROMO Vision: Balanced growth of economy I AZPROMO Mission: To sustain economic growth by maximizing the flow of

non-oil extraction FDI and development of export oriented sectors

I Main directions of activities: Investment and Export Promotion About AZPROMO

Azerbaijan Export and Investment Promotion Foundation

Image building Investment generation Investment facilitation Investor servicing + aftercare Policy advocacy + strategy direction

Investment Promotion

Azerbaijan Export and Investment Promotion Foundation

I Image building

marketing campaigns (perception=reality), communication strategy

I Investment generation

Identification of potential investors, marketing campaigns, presentations, seminars, road shows

I Investment facilitation

Investment information, site visits, organisation and providing information

I Investor servicing + aftercare

Helping investors get established and be

• perational, expansion and re-invest

I Advocacy+strategy formulation

Advocating for investment friendly business climate, inputs to national FDI policy

New exporters Entering a new market Looking for new customers Policy advocacy Image building / Individual assistance

Export Promotion

Azerbaijan Export and Investment 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 business contacts, matchmaking and sector/product events, trade missions

I Image building

Trade shows/fairs, PR activities abroad, outward foreign investment, international relations

I Policy advocacy

Advice in foreign trade policies and input on export regulations

Foreign Network

Azerbaijan Export and Investment Promotion Foundation

I AZPROMO Georgia /AZPROMO Austria

Mission: Support in development of economic and business relations between Azerbaijan and Georgia as well as European countries through Austrian office

I Main activities

Market researches and analyses Legal framework Business consultancy Public relations, country promotion

I 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

Thank you for the attention!

Azerbaijan Export and Investment Promotion Foundation (AZPROMO) 11, H. Abdullayev str., Baku, Azerbaijan www.azpromo.az

Tel.: (+99412) 598 01 47/48; Fax: (+99412) 598 01 52

• ffice@azpromo.az

Azerbaijan Export and Investment Promotion Foundation