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Last week review (Nov.19-23)

Analysis Materials 26 November 2012 11:34 (UTC +04:00)

Nov. 19

Azerbaijan, Kyrgyzstan establish air links

Azerbaijan and Kyrgyzstan have signed an agreement on a new air service, Azerbaijani State Civil Aviation Administration's website reported.

The parties coordinated a draft agreement between the governments of Azerbaijan and Kyrgyzstan, on air service and signed the relevant bilateral document during negotiations held in Bishkek.

'The legal framework has been set to begin carrying regular passenger and cargo flights between the two countries', the report says.

The Azerbaijani side was represented in the negotiations by representatives of Silk Way Airlines and the Azerbaijani Embassy in Kyrgyzstan.

U.S. ready to expand cooperation with Azerbaijan in field of ICT

The House of Representatives of Illinois state (USA), will provide the necessary financial support for cooperation of the state finance funds with the Azerbaijani State Fund for Development of Information and Communication Technologies, the House Speaker Michael Madigan said at a meeting with Azerbaijani Minister of Communications and Information Technologies Ali Abbasov, the ministry report stated.

Appreciating the achievements of Azerbaijan, the speaker spoke about the work implemented in the state of Illinois, including Chicago.

In turn, Abbasov informed the U.S. delegation about the main activities of the ministry, large-scale projects implemented in Azerbaijan in the field of information communication technologies (ICT), the level of ICT development in the country.

According to the minister, one of the major projects, implemented in Azerbaijan, along with the project on the launch of telecommunication satellite Azerspace-1 to orbit and the creation of an 'e-government', is a project on establishment of a State Fund for Development of Information and Communication Technologies in Azerbaijan. The fund will begin funding projects on January 1, 2013.

The initial budget of the fund is expected to reach 15 million manat. This amount was requested by the ministry from the state budget for 2013.

Two licenses for securities management suspended in Azerbaijan

The Azerbaijani State Securities Committee suspended the licenses to manage the securities of "Unicapital" and LLC "Standart Kapital" on November 19, the Committee said.

Thus, there are 15 licenses for brokerage activity, 14 for dealer activity, three for depository, one for clearing and one for activity on the stock exchange and two for keeping the register of securities holders in the Azerbaijani securities market.

Nov.20 Satellite technologies presented in Azerbaijan's oil and gas sphere

Azerkosmos under the Azerbaijani Ministry of Communications and Information Technologies has informed SOCAR's Ecology Department about the use of satellite technologies in oil and gas and solving environmental issues, the company said.

According to the report, the participants were informed about the necessary technical means, software, and functions to receive information and space data.

Azerspace-1, the launch of which is expected in early 2013, is geostationary and will be located at an altitude of 36,000 kilometres providing Azerbaijan with many channels.

In the coming days, the results of an Azerkosmos tender for launching low orbit satellites will be revealed.

The satellite will be used for remote sensing of the earth, mapping and geological studies. Its launch is expected in 2014.

SOCAR includes the Azneft production association (the companies producing oil and gas on and offshore), the Azerkimya industrial association (chemical enterprises) and Azerigaz industrial association (gas distribution).

Power station under construction on Chilov island in Azerbaijani sector of Caspian Sea

A gas turbine power station with a capacity of 1.5 megawatts is being built on the Chilov island where there is an oil field of the same name, SOCAR's "Azneft" production association said.

According to the report, the power station is being built to provide the island with uninterrupted power supply in case of accidents, as well as reducing the need for diesel fuel.

"At present, around 80 percent of the work has been completed," the report said. "The balancing and commissioning operations are underway."

SOCAR includes the Azneft production association (the companies producing oil and gas on and offshore), the Azerkimya industrial association (chemical enterprises) and Azerigaz industrial association (gas distribution).

Azerbaijani parliament ratifies agreement on TANAP gas pipeline

The Azerbaijani parliament ratified an agreement on the construction of a separate gas pipeline to transport gas to Turkey through its territory, as well as an agreement on the Trans-Anatolian gas pipeline system (TANAP) between the governments of Azerbaijan and Turkey last week.

As the deputy speaker of the Azerbaijani parliament, Valeh Alesgerov said during discussions, Azerbaijan, which previously had no access beyond its borders, currently transports its hydrocarbons to the world market using seven pipelines.

"There is a need for new projects to transport Azerbaijani gas to the European market. A new gas pipeline will be constructed based on already held negotiations," he said.
According to Alesgerov, there is a need to construct a gas pipeline that will allow the transportation of Azerbaijani gas and that of other Caspian countries in the future, the volume of which will be increased as a result of discovering new reserves.

"Many projects, which envisage supplies of gas to Europe, have been discussed, but no one had the courage to implement any of these projects. However, Azerbaijan has made such a decision. It has begun implementing a project that will ensure connection to Europe's gas pipelines," Alesgerov said.

Azerbaijan and Turkey signed an intergovernmental agreement on June 26 on the project Trans-Anatolian pipeline (TANAP).

IMF recommends Azerbaijan not to allow non-oil budget deficit to exceed 40 percent of GDP

The International Monetary Fund (IMF) recommends Azerbaijan not to allow the non-oil budget deficit to exceed a level of 40 percent of GDP, head of the IMF completed mission on Azerbaijan Raja Al Marzugi, who is also advisor to the IMF director on Middle East and Central Asia said at a press conference in Baku.

"IMF worries about a high level of non-oil budget deficit in Azerbaijan," he said. "Non-oil deficit reduction in 2013 in relation to the expected results of executing the state budget in 2012 by establishing the priorities in capital investments will help to curb the risks for macroeconomic stability and strengthen the buffer reserves to take actions in case of potential aggravating the state of the global economy."

Azerbaijan introduces centralized water infrastructure governance system

"Azersu" company (Azerbaijani national water operator) starts implementing a geographic information system to assess the current state of the sewerage systems and the design of water supply systems, head of the Department of Information and Communication Technologies of the company Samir Ganili said at a press conference.

The project of governing the underground infrastructure - "Azersu CIS" has been presented there.

"The geographic information system allows analyzing the network and modeling the infrastructure of drinking and sewage water, conducting geographical inventory of water infrastructure," he said.

The system will also manage the infrastructures of drinking water, wastewater and rain water and conduct work on the areas.

Nov.21 Azerbaijani President meets Singaporean Premier

President of Azerbaijan Ilham Aliyev has met Singapore`s Prime Minister Lee Hsien Loong, as part of his state visit to this country.

The sides explored prospects for overall development of the bilateral cooperation at the expanded meeting.

The issue of mutual investment between Azerbaijan and Singapore was discussed, and both sides stressed that the two countries have already done certain work on this front.

State Oil Company of Azerbaijan (SOCAR) built business contacts in Singapore, and several Singaporean companies are operating in Azerbaijan.

The sides also exchanged views on issues of mutual interest, and stressed the importance of reciprocal visits in terms of development of the bilateral cooperation.

Development of alternative energy sources to save up to one million tons of fuel in Azerbaijan

By 2015, the production of electricity from alternative and renewable energy sources in Azerbaijan could reach 2.6 billion kilowatt / hours per year, department head at the Azerbaijani Ministry of Industry and Energy Tahir Jafarov said on Wednesday at a conference on 'Energy Efficiency: economic and institutional aspects and perspectives'.

"That means the fuel saved will amount to one million tons," Jafarov said.

According to him, most power losses occur in power plants and work on their reduction is currently underway.

He said that in particular, the second gas turbine power installation with a capacity of 400 megawatts is currently being constructed at the Shimal power plant. Also, the construction of the Cenub new modern power plant with a capacity of 780 MW is in process.

Jafarov's added that the construction of storage plants which will prevent the loss of electricity at night is planned in Azerbaijan as part of increasing energy efficiency and reducing losses during electricity generation.

He said significant losses are being observed during the transmission and distribution of electricity.

According to him, the losses are much higher in Azerbaijan than in Europe. In particular, losses amount to 4.4 per cent during transmission and to 16 per cent in distribution.

In total, the volume of losses in transmission and distribution of electricity reaches 20-21 per cent.

Second largest gold producer in Azerbaijan launches production

Azerbaijan International Mineral Resources Operating Co.Ltd - AIMROC began production of gold, Director for Sustainable Development and Strategic Planning of the company Mustafa Mammadov said.

"First bar of gold from Chovdar mine deposit was ready at the end of September - beginning of October. At the moment the commissioning work is being held. We will reach full production in a month. There are about 40 tones of gold in the deposit and we are planning to mine it during 8-10 years. Annual production depends on many factors, there is no clear prediction," Mammadov said.

Nov.22

EU prepares 10 new twinning projects for Azerbaijan

The European Union (EU) and Azerbaijan are preparing 10 new twinning projects. This was announced today by charge d'affaires of the EU delegation in Azerbaijan Toralf Pilz at a presentation of the twinning project 'Bringing Azerbaijani legislation in the field of securities in accordance with European Union legislation and institutional development'.

"The European Union has been annually allocating 7.6 million euros to implement twinning projects in Azerbaijan since 2006," he said. "Seven twinning projects have been successfully implemented. Ten projects are currently underway with another 10 being prepared."

He said that the EU is cooperating with the Ministry of Taxes, Ministry of Agriculture and Ministry of Education, the Ombudsman's office and other Azerbaijani state bodies within the EU twinning projects.

"Twinning projects are not only about transmitting knowledge, but strengthening relations between Azerbaijan and the EU which creates a guarantee for developing further reforms," he said.

He said that using the new law on the securities market in Azerbaijan will lead to further development of this area and expanding the use of banking and other financial services.

"EU recommendations will be taken into account during its preparation to coordinate national legislation with the international one," he said. "Several technical assistance projects were implemented. However, additional assistance is required. The project will be launched with the State Securities Committee."

The project's budget is 999,950 euros. The project implementation started in October 2012 and will continue until May 31, 2014. The state Securities Committee is a partner of the beneficiary and the Polish Agency for Financial Supervision from EU member state's side.

CIS countries discuss joint activities in geodesy, cartography and cadastre field in Baku

The 23rd session of the CIS Interstate Council of Geodesy, Cartography, Cadastre and Remote Sensing was held in Baku.

"We are looking forward to the results of joint work in the fields of geodesy, cartography and cadastre," chairman of the Azerbaijani State Committee of Land and Cartography Garib Mammadov said at the opening session.

The introduction and use of common technology for the early implementation of work on topography, geodesy, gravimetry, photogrammetry and cartography, the use of coordinate systems and certain heights, preparation and implementation of technologies and methods on delimitation, demarcation and re-demarcation of borders, exchange of materials and information, joint seminars and conferences, and other regional projects were discussed at the event.

Working groups were created within the session for the implementation of specific projects.

The event is being held in Baku for the third time and previously the session was held in Azerbaijan in 1998 and 2004.

The event is being attended by representatives from Azerbaijan, Belarus, Ukraine, Moldova, Russia, Kazakhstan, Uzbekistan and Tajikistan.

Azerbaijani Ministry of Taxes prepares activities in frame of national plan on promotion of open government

The action plan of the Ministry of Taxes of Azerbaijan in the framework of the implementation of national plans of action to promote open government and combat corruption will soon be approved, advisor to the Tax Minister Gunay Jafarli told media in the frame of the Open Day, organized by the Department for preliminary investigation of tax crimes.

She noted that the ministry is carrying out all the necessary work in order to ensure transparency, cooperation with the media, to inform the public about the activities of tax authorities, as well as about the fight against corruption.

Work to minimize personal contact between tax officials and taxpayers was carried out in order to ensure transparency and anti-corruption.

Media representatives were briefed with the work of various divisions of the department on the event.

SOCAR: European integration - strategic goal of Azerbaijan

The head of State Oil Company of Azerbaijan (SOCAR) Rovnag Abdullayev visited the UK and met Lord Rizbi, the company said.

Abdullayev said that there is a close cooperation between major oil companies of Azerbaijan and the UK, which are oil-producing countries.

"Integration into Europe is our strategic goal and we will not deviate from this path," he said.

Lord Rizbi, in turn, noted that SOCAR is one of the most successful companies in the world.

At the end Lord Rizbi expressed hope that that the speech of Rovnag Abdullayev in in the House of Lords will interest the MPs.

Nov.23

Appraisal chamber to be established in Azerbaijan

The Parliamentary Committee on Economic Policy has submitted a bill on 'Appraisal activity' for discussion.

This document is intended to play a crucial role in economic development and the regulation of market relations and property issues, committee chairman Ziyad Samadzade said.

"Despite the fact that the law regulating this sphere was adopted in 1998, today it does not meet the current requirements," he said. "Therefore, it is necessary to adopt a new law."

The bill has been prepared taking into account international experience and modern market relations, one of the project's developers MP Khanhuseyn Kazimli said.

It envisages an independent assessment of property and property rights of the state, municipalities, physical and legal entities, evaluation activity and the legal basis of using the results of this activity.

The document envisages establishing the Evaluation Chamber, determine its goals and objectives and the mechanism of the evaluation activity.

Discussions on the bill are underway.

SOCAR becomes partner in EVite electric charging project in Switzerland

SOCAR Energy Switzerland has agreed to become one of the main partners of the EVite project of the Swiss Association eMobility, the official website of SOCAR's Swiss office said.

The EVite project involves creating a charging infrastructure for electric vehicles throughout Switzerland and accelerating the electric mobility market development in that country. The project was launched in Bern on November 21.

According to the information, as one of the main partners of the EVite project, SOCAR Energy will actively support the construction and operation of the stations for the fast charging of electric vehicles in Switzerland.

SOCAR signed an agreement with Exxon Mobil in November last year to acquire its Swiss branch called Esso Schweiz GmbH. The total cost of the assets acquired by SOCAR in Switzerland is $330 million.

SOCAR has also taken over the Wangen-Olten gas station group and a number of others as well as joint ventures specialising in aircraft refuelling at Geneva and Zurich airports and the Swiss Provision and Supply Company that controls joint ventures managing terminals and pipelines.

Azerbaijan, Kazakhstan, Georgia and Turkey plans to involve China into joint transport project

Azerbaijan, Kazakhstan, Georgia and Turkey plan to involve China into joint transport project Silk Wind, the Kazakh Transport and Communication Ministry said.
"China plays a key role in the successful implementation of the project, taking into account the dynamic growth of its western regions for the last years (Go West program), which testifies China's need to deliver a large amount of different goods to the world market," the Ministry said.

The project Silk Wind was initiated within TRACECA.

According to the Kazakh Transport and Communications Ministry, the project objective is to create a multimodal transport route trains (container / ro-ro) with the preliminary exchange of information between customs authorities and rail operators of participating countries.

The Silk Wind will ensure the shortest connection between the major freight traffic countries such as China, Turkey, simplify customs and border procedures, reduce transit time and travel time and environmental impact, the Ministry said.

Currently the project participants are working to make the route competitive and attractive, the Ministry said.

"Following signing the memorandum on the agreed issues, we will start a dialogue with the Chinese manufacturers, focused on Central Asian and European markets, business community, forwarders of international and national companies, and in the future try to attract China to join the project," the Kazakh Ministry said.

The project members plan to sign "Memorandum on the principles of joint activities for transport network development and goods transportation" by late 2013, the Ministry said.

Economic measures to combat informal employment developed in Azerbaijan

The Azerbaijani State Social Protection Fund has tightened combat with informal employment, Chairman Salim Muslimov said.

"There are administrative and economic ways of dealing with the avoidance of employers to register employees and wages," Muslimov said.

According to the official, the fund has proposed changes to the legislation as an economic method for resolving this problem.

"The fund has proposed changes to the law on social insurance, which provide for implementation of a minimum level requirement ratio of payroll to sales in various areas of the economy. And depending on this level, the minimum amount of contributions for mandatory state social insurance paid by employers can be calculated," Muslimov said.

Such experience has been successfully introduced in various countries, such as Turkey, he stressed.

"The implementation of this method in Azerbaijan will intensify employee registration and the legalization of workers wages," Muslimov said.

Roughly 25 percent of wages in Azerbaijan are directed toward social security payments.

The total number of those insured in the fund and having individual accounts is 2.150 million.

Rules of installing and using POS-terminals discussed in Azerbaijan

The Azerbaijani Central Bank and the Ministry of Taxes have discussed applying the rules of installing and using POS-terminals in the country with representatives of commercial banks and processing organizations.

These rules were approved by the Azerbaijani Cabinet of Ministers on Oct. 4, 2012, the central bank said.

They have exchanged the views on the software for the electronic registration of POS-terminals and their decommissioning, an acquiring bank's failure procedures to establish POS-terminals.

The sides have also discussed the ways to solve the problems that may arise while applying the new rules and other issues.

According to the rules, the process of installing POS-terminals in Baku, Ganja and Sumgait must be completed in 2012, in Absheron, Mingachevir, Shirvan, Sheki, Lankaran, Yevlakh, Barda, Nakhchivan, Guba, Khachmaz, Masalli, Goychay, Shamakhi, Zagatala, Shemkir, Tovuz, Salyan, Sabirabad regions and cities (with the exception of villages and settlements) - in 2013, in other regional centers (except for villages and settlements) - in 2014.

POS-terminals will be installed by late 2015 in all villages and towns of the country.

"Regardless of the area, POS-terminals will be installed by late 2013 in all public bodies receiving taxes, state duties and fees," the message said.

EPEG cable main line constructed

The construction of Europe Persia Express Gateway fiber-optic cable line (EPEG) has been fully completed, a source close to the project said. A decision was made to begin testing the cable line within the recent meeting of members of the consortium in Iran. EPEG participants are Iranian Telecommunication Infrastructure Company (TIC), Omani Omantel, Russian Rostelecom and international Cable & Wireless (C & W). EPEG cable route, connecting Oman and Frankfurt, passes through three countries (Azerbaijan, Poland, and Ukraine). These routes are organized at rented capacities in each of the three countries.

A launch date of EPEG cable line has been repeatedly postponed because the maritime segment of cable line, to be laid between Iran and Oman, was not prepared. At present, the work on laying the offshore segment has been fully completed.

The capacity will reach about 3.2 Tbps, and its length will extend to 6,000 kilometres. The preliminary project cost is $200 million. "EPEG line is expected to be commissioned in the near future," the source said.

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