Investments in Azerbaijan's economy (2012)

High investment activity continues in Azerbaijan. According to the State Statistics Committee, 15.338.5 billion manat was invested in the economy of Azerbaijan in 2012 from all financial sources, increasing by 18.0 percent compared to the figures of the same period of 2011.

High investment activity continues in Azerbaijan.

The main sources of investments in 2012 are as follows:

• funds of enterprises and organizations - - 6.836.0 billion manat (an increase of 16.8 percent compared to 2011);
• budgetary funds - 6.716.5 billion manat (an increase of 21.0 percent compared to 2011);
• off-budgetary funds - 563.9 million manat (an increase of 42.1 percent);
• bank loans - 756.1 million manat (a decrease of 8.0 percent);
• funds of population - 396.6 million manat (an increase of 13.1 percent).

Apparently, increased investments in 2012 are due to increased investment activity of all funding sources, except bank loans, share of which in total investments made up 4.9 percent. Investment of enterprises and organizations rank first on active investing in the development of the economy.

According to the State Statistics Committee, private enterprises and organizations invested 6.239.6 billion manat (40.7 percent of total investments) in Azerbaijan's economy and public enterprises and organizations - 9.098.9 billion manat (59.3 percent).

The increase in the investments is mainly connected with an increase in the amount of state investments allocated from the state budget to the economy. Public investments are spent within the Azerbaijani state investment program. At present, large infrastructure projects funded by the state are being implemented in all regions of the country. These projects include laying of trunk roads, water and sewer projects, gasification, construction of transmission lines, rural roads.

In 2012 Azerbaijan started work within 18 projects on repair and construction of rural roads. Completion of these works is scheduled for 2013. As a result, construction and repair of 634 kilometers of rural roads and 42 bridges, which link 400 settlements with total population of 450,000 people in 18 regions of the country, will be completed. Along with this, implementation of projects on reconstruction of water supply and sanitation systems in 61 urban and regional centers is underway. As a whole, more than 410 companies in the field of industry, agriculture, services and trade started its work in 2012 in the regions of the country. At the same time construction of more than 400 enterprises continued

Volume of investments in construction and assembly work grew by 17.5 percent, or 60.2 percent of the total investments.

Investments worth 6.655.2 billion manat were used for the construction of production facilities, while non-production facilities - 8.683.3 billion manat.

Some 23.8 percent of investments in fixed capital (3.648.0 billion manat) was directed at the development of the country's oil sector, 76.2 percent (11.690.5 billion manat) - non-oil sector. Capital investments in the oil sector increased by 17.0 percent, non-oil - by 18.3 percent.

The total investments in the industry totaled 5.615.4 billion manat with an increase of 3.0 percent. Some 705.0 million manat was invested in the processing industry (decreased by 18.1 percent). During the reported period, the investments in the extractive sector hit 3.651.4 billion manat, which is 10.8 percent more than investments in 2011. Totally, 36.6 percent of investments fell to the industrial sector.

Around 78.7 per cent of the total volume fell to domestic investment. The main part (71 per cent) of domestic investments was made in state enterprises and organisations with only 29 per cent in private enterprises.

Investment indices in 2012:

(Source: State Statistics Committee and calculations by Trend")

The total volume of foreign investments in Azerbaijan's economy in 2012 amounted to 3.258.9 billion manat, which is 23.4 percent more than the same period of 2011. The increased amount of foreign investments in the country once again proves the fact that foreign investors are interested in Azerbaijan's economy and their investments are protected at the proper level.

In 2012, 90.0 percent (2.933.0 billion manat) of investments in Azerbaijan's economy made by foreign countries and international organizations fell to investors from the UK, U.S., Japan, Norway, Turkey, Czech Republic and France.

As before, the UK continues to retain its leading position in this list. Its share in total foreign investments hit 51.7 percent, while its investments amounted to 1.683.2 billion manat.

Of the international financial institutions, the biggest amount of investments was allocated by WB in amount of 168.9 million manat with weight of 5.2 percent. WB projects cover different spheres of the country's economic life.