Transport strategy - quintessential policy of Azerbaijan

Economy Materials 11 January 2023 14:56 (UTC +04:00)
Transport strategy - quintessential policy of Azerbaijan
Emin Sevdimaliyev
Emin Sevdimaliyev
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BAKU, Azerbaijan, January 11. The interview of the President of Azerbaijan Ilham Aliyev given to the local TV channels yesterday offered unique insights into how Azerbaijan will proceed in many economic and political aspects in the next years.

The Head of State covered numerous topics, which ranged from post-conflict peacebuilding to the future energy policy of Azerbaijan.

The topic of the transport policy of Azerbaijan, however, deserves a significantly higher degree of attention for practical and theoretical reasons. The interview with President Aliyev offers a specific understanding of how Azerbaijan perceives transport cooperation, and how it fits into the national policy of the country.

Finally, the answers offered by President Ilham Aliyev enable us to conclude on some of the steps taken during the previous years in the context of transport policy, in addition to understanding the reasons that turned the strategy of the Head of State into reality.

Why is it relevant?

Azerbaijan is located at the crossroads of the two major routes, the Middle Corridor and the North-South Corridor, which offer several unique opportunities to boost the transportation and logistics potential of Azerbaijan, in addition to creating opportunities in other fields.

In his interview, President Aliyev noted that the key work to implement the above-mentioned routes is complete.

“Thus, all of the main activities related to the Middle Corridor and the North-South transport corridor in the territory of Azerbaijan have been completed”, the Head of State added.

The conclusion of the activities related to infrastructure construction and modernization means that Baku is a part of two major projects, which cater to the interests of different sides. From the political and economic perspective, Azerbaijan’s role and position in these projects is unquestionably advantageous.

First, Azerbaijan will retain its key transportation role despite any regional or global geopolitical turbulence. Should any geopolitical issue with one of the transport routes appear, the other route will become more attractive. Consequently, the demand for the transit opportunities offered by Baku will always be present, due to the integrated nature of the global trade and supply chain.

Second, Baku would be able to leverage its global transport role in its foreign policy. Being the centerpiece of two significantly important trade routes will offer Azerbaijan additional opportunities for exploring avenues for mutually beneficial political relations both with regional and global players.

Third, Azerbaijan will generate a very diverse infrastructure and specialists in the field of transport. Baku will be able to generate specific know-how, which may be offered to partners from other countries.

The above-mentioned elements are not the only benefits, however. It is obvious that Azerbaijan will enjoy certain economic advantages. The individual contribution of these routes to the national economy, however, is a bit challenging to forecast because several factors may impact the degree of their profitability. It is, however, important to remember that these transportation corridors are set up with a long timeframe in mind. Therefore, from an economic standpoint, time is on the side of the countries implementing the transport routes.

The success of the transport policy is a key to understanding the national policy approach

Two major takeaways in this context are the following.

The first takeaway from President Aliyev’s interview is that Azerbaijan is a fervent believer in liberal peace-induced economic relations. Consequently, Azerbaijan utilizes friendly relations with regional states to generate trade, as a way to further improve political relations with them. While this may seem trivial, or even irrelevant, this argument is rather flimsy. After all, a country like Armenia is excluded from regional projects due to its inability to have meaningful relations with Azerbaijan. This gives us valid grounds to conclude that Baku’s ability to build and sustain solid relations with its neighbors transformed the country into a regional transportation hub.

Second, the seeds of the national policy, which have been planted many years ago, start to bear fruit. For the last thirty years, Baku purposefully carried out policies and projects aimed at establishing vital transport connections and building the necessary infrastructure to become integrated into global trade. Now we start seeing Azerbaijan realizing this vision on a larger scale. And looking at the global situation, the transit capabilities of the country will improve significantly in the future, as both North-South and Middle Corridor routes gain traction.

“We believe that 15 million to 30 million tons of cargo can be transported from the territory of Azerbaijan through the North-South transport corridor alone. This is a very high figure. Currently, all of Azerbaijan’s transit opportunities make up a small percentage of that. Therefore, the North-South transport corridor is a project that can compete with the Middle Corridor”, President Aliyev said.

True, Azerbaijan was able to leverage its advantageous geographical location to become the cornerstone of these routes. However, it became possible because of the lasting friendly relationship between Azerbaijan and other nations involved in these projects, as well as Baku’s conviction and understanding of the fundamental value of the future role of developing transport networks.

“We have been implementing projects in the field of transport for many years. The Russia-Ukraine war has enhanced the importance of our work. However, I want to say again that we have been investing in this area for many years”, the Head of State noted.

The interview of President Ilham Aliyev suggests that the vision of Azerbaijan is being realized entirely, and the future would be bright for the national transportation sector.