Azerbaijan, Baku, Oct. 19 / Trend /
Trend Agency analytic center head Ellada Khankishiyeva
Foreign investors have been showing interest in creating free economic zones in Azerbaijan seeing it as the most important direction of expansion. The added bonus is these areas carry special incentive and benefits not applicable in other parts of the country.
A grant agreement was signed between the Azerbaijani government and the Agency for International Cooperation of Korea (KOICA) in Baku this week. This was under the banner of the Development of Special Economic Zones and Industrial Areas project in Azerbaijan with KOICA providing a $1 million grant to run over 18 months.
Korean companies have a lot of experience in developing special business and economic zones which will benefit Azerbaijan.
The main objectives of the project are to prepare strategies and policy to improve the development and management of industrial towns, to allot lands for industrial enterprises and to encourage the involvement of local and foreign investments.
The first industrial park in Sumgait was created in 2009. It was the first step to creating free economic zones in Azerbaijan. Sumgait's industrial site covering 46 hectares of which 14 hectares are industrial buildings, was the result of a state and business initiative.
The plants and production lines mainly manufacture products for the country's power industry and currently the industrial park's quality output is ready for export.
Another industrial chemical park will soon be built in Sumgait. Azerkimya production association plans to begin constructing a plant to produce carbamide and a dozen small mobile plants.
Whilst it is necessary to construct the out of city industrial towns in Azerbaijan, to protect tourism interests, industrial developments must not damage the environment. Turkey may be mentioned as a real example of this policy. Along with tourism, the industry became one of the first major export sectors after industrial towns were established.
Azerbaijan's key objective while creating an industrial town is to increase the competitiveness of the national economy and its effective integration into the global one, to ensure the duration of the dynamic socio-economic development in the long-term prospect by accelerating the development of the non-oil sector.
The establishment of industrial towns is also aimed at realization of state policy for the balanced development of regions, industrial entrepreneurship and its innovative direction.