Azerbaijan Striving to Get Access to US Trade Preferential Treatment: Interview with Economic Development Minister

Azerbaijan, Baku, 27 June / Trend corr I. Khalilova/ Since 2008, Norway has been applying trade preferential treatment to Azerbaijan, which became possible in result of Azerbaijan's joining Generalized System of Preferences (GSP). Azerbaijan hopes the United States will do the same. A relevant application has been already sent for this purpose. Azerbaijan's Economic Minister Heydar Babayev spoke to Trend of these and other plans:

Question: Could you speak of the Generalized System Preferences. What are its advantages to Azerbaijan?

Answer: GSP is a preference system given mainly to developing countries by the developed ones. The system enables a country to export definite goods to developed countries free of duty and with low duties. Membership of GSP plays a great role for development of bilateral trade relations, since all trade impacting factors are taken into consideration. Given the fact the Azerbaijan, like many other countries, is not a WTO member, GSP has exclusive importance for the country.

Non-oil development is very important for Azerbaijan. One of the key conditions for development of non-oil sector is simplification of export of the goods manufactured in Azerbaijan to outer markets. Azerbaijan's joining GSP is a main means to for integration of country's economy with world economy.

Question: Which countries are applying GSP? In which of them Azerbaijan has the status of beneficiary?

Answer: Generally, besides for EU, there are ten countries providing GSP. Azerbaijan is included only in the preference system of the European Union, Canada, Japan, Turkey, Norway and Switzerland. But presently Azerbaijan cannot use the GSP of Australia, New Zeeland and the United States. At the same time, such CIS countries as Russia and Belarus also provide GSP. But since free trade is applied to these countries, there is no need for preferences.

Question: Which obstacles is Azerbaijan facing for joining US GSP?

Answer: One of the criteria for joining US GSP regards intellectual property right. By the way, US Trade Representation annually publicizes lists on protection of intellectual property right. The lists reflect three categories: observation list, priority observation list and priority country. They are also called 'black lists'. Obviously, no country wants to be included in the list. Although Azerbaijan like Kazakhstan was removed from the 'observation list' after joining several international agreements in 2005-2006, but unlike Kazakhstan, Azerbaijan was not included in the US GSP.

The other requirement for joining GSP is connected with the attitude to the international terrorism. The Azerbaijani government has carried out significant work in a war on terror which is reflected in the annual report of the State Department Report on Situation in War on Terror All over the World in 2007. I should mention that Azerbaijan is subject to the Armenian terror after USSR demise and Azerbaijan realizes the significance of the international cooperation in a war on terror.

One of the key requirements is the membership in IMF and WTO. Azerbaijan has been member of IMF since 18 September 1992 and it is effectively cooperating with this organization. Moreover, Azerbaijan as other CIS countries (Kazakhstan and Russia) included in GSP program of the United States is making efforts to gain WTO membership. Azerbaijan is taking measures to liberalize its economy and it holds bilateral talks with the US to become WTO member.

Question: To what extent does Azerbaijan's joining this program seem real after the abolishment of the Jackson-Venik Amendment?

Answer: According to the amendment made to the Independence Act during the Soviet Union, US have a right to impose restrictions on the bilateral trade with Azerbaijan. Keeping this amendment intact can restrict Azerbaijan's opportunity to benefit from the WTO membership in the future. In the late January, the US senator from Indiana Richard Lugar suggested to abolish Jackson-Venik amendment for Azerbaijan and Kazakhstan. Kazakhstan, which also suffers from the Jackson-Venik amendment could join GSP program of US as a beneficiary which gives us grounds to strive for joining GSP program without waiting this amendment to be abolished. We should first of all appeal the Trade Representation of the US in order to benefit from this system. In 2004, Azerbaijan appealed the US Trade Representation to join GSP as a beneficiary, but it did not yield results. Azerbaijan could not join the US GSP program together with Belarus, Tajikistan and Turkmenistan while several CIS countries including Armenia, Georgia, Moldova, Uzbekistan, Kazakhstan, Kyrgyzstan, Russia and Ukraine could join it.

In April 2008, the Trade Representation of the United States began studies on Azerbaijan's joining GSP program. On 30 April 2008, the Ministry of Economic Development of Azerbaijan appealed the US Trade Representation. As a rule, Trade Representation presents US President a report which includes appeals to join GSP and appeals of other countries and companies supporting or opposing country's joining GSP and remarks of the Representation as well. The final decision is made by the US President.

The level of trade and other links between Azerbaijan and US necessitates the use of the existing opportunities and I am sure that the decision to join our country to the US GSP will contribute to the further development of these relations.

The correspondent can be contacted at [email protected]

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