Last week review (Jan. 14-18)

Analysis Materials 22 January 2013 16:08 (UTC +04:00)


Next mortgage bond placement announced in Azerbaijan

The second part of the new issue of interest-bearing book-entry secured bonds worth 3 million Manat of the Azerbaijan Mortgage Fund (AMF) under the Azerbaijani Central Bank will be placed on the Baku Stock Exchange (BSE) on January 15, the fund said. The bonds will be offered for sale at a price of 100.15%. The Azerbaijani Central Bank is participating in the bond's initial public offering. The process of placing the sixth issue of AMF percent secured bonds registered by the Azerbaijani State Securities Committee last month to the amount of 40 million Manat with a nominal value of each bond worth 1,000 Manat and an annual rate of 3% started on December 28. At present, the bonds were placed to the amount of 3 million Manat.

Project of another rail line between Azerbaijan and Turkey under development

Construction of a new railway line from the Azerbaijani-Turkish border to the Turkish city of Kars can be launched after completion of the Baku-Tbilisi-Kars railway's construction, head of the press service of Azerbaijan Railways JSC Nadir Azmammadov said. He said planning for a new railway, which will connect the Nakhchivan AR and Kars, is underway."The implementation of the new railway project will most likely begin after completion of the Baku-Tbilisi-Kars railway's construction, as this is more reasonable", Azmammadov said. The Baku-Tbilisi-Kars railway will be commissioned in 2014. Earlier, the deputy head of the company Gurban Nazirov said that construction of the railway from the Azerbaijani-Turkish border to Kars could cost one billion dollars. At present, there is no railway line at this site. A 240 kilometers long railroad has to be constructed.

Azerbaijan negotiating with ITU on orbital position for second satellite

The Azerbaijani Communications and Information Technologies Ministry is negotiating with the International Telecommunication Union (ITU) on receipt of an orbital position for the second telecommunications satellite, the ministry said. The position at 62 degrees of eastern longitude is being considered for the second satellite Azersat C, application for which has previously been proposed by Azerbaijan. Development of a feasibility study for a project on the second telecommunications satellite's launch is currently being carried out within the second satellite programme.


Azerbaijani President chairs meeting of Cabinet of Ministers

Azerbaijani President Ilham Aliyev has today presided over a meeting of the Cabinet of Ministers to discuss the outcomes of the country's socio-economic development in 2012, and outline priorities for 2013. President Aliyev made an opening speech. Economic Development Minister Shahin Mustafayev, Chairman of the State Committee for Work with Refugees and IDPs Ali Hasanov and Minister of Communications and IT Ali Abbasov made speeches on the work done by the ministries in 2012. President Aliyev made closing speech at the meeting.

Over $ 131 mn allocated to the development of broadband internet in Azerbaijan

The Communications and IT Ministry and the Oil Fund has allocated around 103 million Manat to implement a project for developing broadband Internet on the "Fiber to Home" model in 2013, Azerbaijani Communications and IT Minister Ali Abbasov said at a meeting of the Cabinet of Ministers chaired by Azerbaijani President Ilham Aliyev dedicated to the results of socio-economic development during 2012 and the country's upcoming challenges.

The project is profitable and will be implemented in three phases, he said. Beginning in 2014, around 30-35% of the total project cost will be backed by reinvestment. The main goal of the project is to provide remote regions of the country with broadband Internet (at a speed of 10 to 100 Mbit/s) and expand the number of users up to 85%. Thus, according to this index, Azerbaijan will reach the level of developed countries by 2017.

SOCAR, Statoil to further enhance cooperation in 2013

This year is of great importance in terms of enhancing cooperation on many projects between the State Oil Company of Azerbaijan (SOCAR) and Norway's Statoil. SOCAR head Rovnag Abdullayev made this statement at the meeting with Vice President of the Norwegian company, Lars Christian Bacher. According to the report disseminated by SOCAR, during the meeting Abdullayev informed the guest about the situation within the first and second phases of the development of the Azerbaijani offshore gas condensate field "Shah Deniz". Abdullayev also said that at present consideration of projects proposed within the "Southern Gas Corridor", continues. During the meeting, Bacher expressed confidence that in 2013 successes will be achieved not only within implementation of projects on development of "Azeri-Chirag-Guneshli" oil and gas fields' blocks and "Shah Deniz" gas condensate field, but also in projects implemented by SOCAR in Azerbaijan and abroad.

Azerbaijani banks fully pass to international IBAN system

All bank accounts used for interbank settlements in Azerbaijan have been transferred to IBAN standard account numbers (international bank account number). This took place on Jan. 7, 2013. Using a new form of account, Azerbaijan has already started in real time, the Azerbaijani Central Bank (CBA) reported. "This action was taken to improve bank customer identification in the area of electronic payments, to increase the level of automation while processing payments and to eliminate fragmentation in the bank account structure", the CBA said.

AIC successfully sells its interest in two projects

Azerbaijan Investment Company (AIC) has sold its stake in two major projects, the Ministry of Economic Development said. AIC has successfully sold its shares to the major shareholders of the Production Association "Azerduz" and the "Sangachal-Garadagh" oil and gas terminal. "These projects became profitable and shareholders were satisfied with their implementation, they wanted to acquire the AIC's stake in two projects in non-oil sector, meaning the factory for the production of salt and the terminal complex in Garadagh", Economic Development Minister and head of Supervisory Board of the company Shahin Mustafayev told Trend. According to him, the main purpose of the AIC is the successful participation in projects in priority areas of the non-oil sector, along with local and foreign investors.


Azerbaijan, Slovenia sign five documents

Azerbaijan Export and Investment Promotion Foundation (AZPROMO) and the Slovenian State Agency for Entrepreneurship, Innovation, Development, Investment and Tourism (SPIRIT) signed a memorandum of understanding of cooperation in Baku. The document was signed by AZPROMO head Rufat Mammadov from the Azerbaijani side and SPIRIT acting director Boshtian Skalar from the Slovenian side. The signing ceremony took place within the Azerbaijani-Slovenian business forum in Baku. The memorandums of understanding were signed between the Baku State University and the University of Ljubljana, Azerbaijan Technical University and the Slovenian company Iskratel, Oguz region executive authorities and the Slovenian town of Nova Gorica, Azerbaijani company Azerinshaatservis and Slovenian company DUOL. The business forum is a part of the Slovenian Prime Minister Janez Janša's visit to Azerbaijan. The business forum was organised by AZPROMO. Along with officials, entrepreneurs working in the fields of industry, energy, tourism, health, education and consulting services attend the forum.

E-insurance company founded in Azerbaijan

New insurance agent on Azerbaijani insurance market, Golden Insurance Company, will be offering e-insurance services, the GoldenPay Company said. As reported by the company, receipt of a licence for agency activities of Golden Insurance from the Ministry of Finance is expected in the coming days. Ateshgah Sigorta is the company's partner within this project. A module of 'remote insurance' online payment will be available from February. Beta testing of the system will begin in the last 10 days of January. Insurance services not requiring personal involvement of insurers will be available at the initial stage. Car insurance will be the first of this type of service offered. Travel and other types of insurance will follow later.


Azerbaijan completes negotiations on WTO accession with another country

Azerbaijan has completed bilateral negotiations on its accession to the World Trade Organization (WTO) with China, Azerbaijani Deputy Foreign Minister, Chief Negotiator Mahmoud Mammadguliyev said. "We have already agreed with China and perhaps we will sign a protocol with it in the near future," Mammadguliyev said. He did not rule out the possibility of signing these protocols with other countries. Today, Azerbaijan is in the process of bilateral negotiations with the U.S., Japan, Brazil, Ecuador, Sri Lanka, the European Union, Norway, India, South Korea, the Taiwanese Province of China, Canada, Switzerland and Honduras. Azerbaijan started negotiations in 2004. Negotiations have been completed and protocols were signed with Turkey, Oman, the United Arab Emirates, Georgia and Kyrgyzstan. The signing of protocol with Moldova is underway; the country is still considering documents.

Azerbaijan Airlines to expand air fleet in 2013

Azerbaijan Airlines (AZAL) has received its first A-340 passenger aircraft manufactured by Airbus, a source at AZAL said. The source said that at present, the staff is being trained and the aircraft will soon enter service. "Another plane of the same model will arrive in the country by April 2013", the source said. Azerbaijan's water operator invites Hungarian Water Business Cluster to participate in projects. Azerbaijan's national water operator Azersu JSC invited the Hungarian company Water Business Cluster to participate in tenders held in the country within the reconstruction of water supply and sanitation, the statement released by operator said.

In particular, during the meeting with the head of the Urban Water Management of Budapest, Secretary General of Water Business Cluster, Csaba Haranghy, Chairman of Azersu Gorkhmaz Huseynov invited the company to participate in tenders for construction of sewage collector of tunnel type with length of 200 kilometers in the Absheron Peninsula and more than 45 water treatment plants in regions.

"At present, most of the projects implemented in the country for reconstruction of potable water systems and systems of sewerage services, management of rainwater are funded through state investments, "Huseynov said. "Alongside, more than 10 projects are implemented by the loans taken from international financial institutions ".According to him, Azersu is researching the experience of water companies that have implemented reforms and rebuilt the infrastructure. "Given that both Azerbaijan and Hungary were parts of the socialist system, the experience of the Hungarian company is of interest to Azerbaijan. That is why we are interested in cooperation with the Water Business Cluster," Huseynov said. In turn, the head of water management in Hungary said that the company has set a goal to participate in projects in Azerbaijan.


Inflation in Azerbaijan expected at 3-5 percent in 2013

Inflation in Azerbaijan is forecasted at 3-5 percent in 2013.

Chairman of the State Statistics Committee of Azerbaijan, Arif Veliyev made this statement at a press conference on the results of last year.

Period of state registration of real estate rights to be reduced in Azerbaijan

The Azerbaijani State Property Committee plans to automate the process of mortgage deal registration, cancellation and recognition of rights, the State Committee said. The committee's proposals on transferring these services to e-format were submitted to the State Agency for Public Services and Social Innovation. As of 2012, the State Committee carried out a number of activities according to the national plan for open government development and the national action plan on combating corruption approved by the president on September 5, 2012. The plans, covering 2012-2015, aim at ensuring the continuity of measures in combating corruption and governance, increasing transparency in the activity of public bodies, management in accordance with modern standards and supporting the principles of open government. The State Committee approved the work plan for 2013 to implement the national plan.

Third WB loan may be called for modernization of Azerbaijan's judicial system

The mission of the World Bank (WB), headed by Amitabha Mukherjee, is on a visit to Baku with the goal of clarifying the possibilities of attracting additional funding within the project on modernization of the judicial system in Azerbaijan, the government said. "The new World Bank loan may be attracted within a separate project or in the form of additional funding for the ongoing project that has been in place since 2006 in order to accelerate the approval procedure," the government said. "According to optimistic expectations, its assertion is expected by the end of June 2013." Although the government has not formally appealed to the bank for additional funding, components of the project are to be discussed during Mukherjee's visit. This will be followed by the assessment of the project.

EBRD improves forecasts on economic growth of Azerbaijan

The European Bank for Reconstruction and Development (EBRD) has improved its forecast for GDP growth in Azerbaijan in 2013. This is stated in bank's report titled "Regional economic prospects in EBRD countries of operations" released on Friday. If in October 2012, the bank projected GDP growth of the country by three percent, the new report forecasts four percent growth. During 2012, Azerbaijan's GDP grew by 2.2 percent compared to the year before, amounting to 53.9 billion manat in current prices

Azerbaijan and Russia look into border queues problem

Representatives of the customs services of Azerbaijan and Russia met to discuss the ways to reduce queues at the border, RIA Dagestan reported. A working meeting of representatives of the border services of Russia and Azerbaijan was recently held at the Yarag-Kazmalyar border checkpoint. The meeting was attended by Dagestan customs officers as well. The parties developed a number of measures aimed at eliminating delays in admission of citizens and vehicles passing through the border checkpoint, Dagestan customs representative informed RIA Dagestan. Participants of the meeting addressed issues of improvement of interaction between the state control bodies of Russia and Azerbaijan.


Azerbaijan, Lithuania sign agricultural agreement

Lithuania and Azerbaijan have signed an agreement to create a legal framework for cooperation in the field of agriculture, the Azerbaijani Ministry of Agriculture said on Saturday. The document was signed in Berlin by Azerbaijani and Lithuanian Ministers of Agriculture Ismet Abbasov and Vigilijus Jukna. According to the report, the signing ceremony was held within the 78th International Exhibition-Fair Green Week-2013, Grüne Woche. The Azerbaijani minister attended the national pavilion opening ceremony. Up to 250 varieties of agricultural and food products of 30 Azerbaijani companies have been represented at the exhibition this year. Abbasov has also taken part in the presentation of Azerbaijani business and investment opportunities held within the exhibition with the participation of Azerbaijani and German businessmen. He spoke about the possible directions of cooperation between Azerbaijan and Germany in the field of agriculture.