Implementation of new projects in Azerbaijan’s liberated territories to become driver of economic growth – Gazprombank

Economy Materials 17 December 2021 11:37 (UTC +04:00)
Implementation of new projects in Azerbaijan’s liberated territories to become driver of economic growth – Gazprombank

BAKU, Azerbaijan, Dec. 17

By Sadraddin Aghjayev - Trend:

The implementation of new projects in the liberated territories of Azerbaijan will become an additional driver of economic growth and diversification in the medium term, deputy head of the market analysis department of the Russian Gazprombank Gulnara Haydarshina told Trend.

According to Haydarshina, it is planning to invest about $10 billion in projects in Karabakh in the next five years.

"These projects are aimed at the reconstruction or modernization of the energy (including the construction of renewable energy sources), utilities, transport infrastructure, as well as socially significant facilities in the region in the fields of education and healthcare. Also, new industrial and economic zones will be created, focused on production and export of non-oil products," she said.

She also stressed that this year the first of the three planned airports in the liberated territories have already been built and put into operation, social and transport infrastructure facilities are being built.

"I will separately note that one of the key projects that became possible after the settlement of the situation in Karabakh is the creation of a new railway corridor. Thanks to it, Azerbaijan will receive a shorter land route to Nakhchivan, Turkey and Iran, and Armenia to Iran and Russia. This route is almost 180 kilometers shorter than the currently used Baku-Tbilisi-Kars transport corridor. Its creation involves the modernization of existing, but previously not used due to the isolation of Karabakh, railway lines and the construction of new ones. This approach will reduce construction time, and after the launch of the transport corridor, minimize logistics costs," Haydarshina said.

Also, in her opinion, favorable conditions will be created for the development of mutual trade in the region.

"It is assumed that funds from the sovereign fund, loans from infrastructure banks and private domestic and foreign investments will be directed to the implementation of these projects. In accordance with the draft state budget for 2022, the amount allocated for new projects in Karabakh will amount to 2.2 billion manats or $1.3 billion," she said.

Haydarshina noted that the implementation of new projects in Karabakh could add about one percent to GDP growth this year and at least two percent (taking into account the designated volume of investments from the budget) in 2022.

"In addition, thanks to these projects, the share of construction in the total value added in Azerbaijan's GDP by next year may increase to 11.5 percent (from 8.5 percent in 2019). As a result, construction will become the third most important component of GDP after production and transport. We believe that as the infrastructure in Karabakh develops and additional foreign and domestic investments are attracted, the share of construction in GDP will continue to grow in the medium term," she said.


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