Last week review (March 11 - 16)

Analysis Materials 19 March 2013 12:13 (UTC +04:00)

March 11

Land buy-out for new Shah-Deniz gas pipeline to start next year

The decision of the Cabinet of Ministers of Azerbaijan on the final allocation of lands for the enlargement of South Caucasian gas pipeline will be taken in 2014 as was planned by the partners of the "Shah Deniz" project, the manager of BP for land affairs Chingiz Safiguliyev said during public hearings on the enlargement project. According to him, the process of issuing compensations to about 4000 land owners will start in 2014. Compensations will be paid to residents of 11 regions situated in the pipeline zone. The contract will come into effect in 2018 and will remain valid for 60 years, Safiguliyev said.

SOCAR head opens new gas pipeline section and several facilities in Georgia

Georgian Energy Minister Kakha Kaladze and SOCAR president Rovnag Abdullayev opened a new gas pipeline in the village of Fakhrali, in the Bolnisi region (Kvemo Kartli, eastern Georgia). A 53 kilometre section of the gas pipeline was built in the direction of Kharagauli (Imereti region, Western Georgia) at the first stage. As a result, some 1229 families in the Azerbaijani village of Fakhrali will receive natural gas from Azerbaijan. Members of the Georgian government and SOCAR president laid the foundation of a refrigeration facility in Marneuli and opened a bridge, a central road and a square in Bolnisi.

Azerbaijan, Croatia sign Zagreb Declaration on strategic partnership and friendly relations

After an expanded meeting involving presidents Ilham Aliyev of Azerbaijan and Ivo Josipovic of Croatia, the Zagreb Declaration on strategic partnership and friendly relations was signed between the two countries. The Declaration was signed by presidents Ilham Aliyev and Ivo Josipovic.

IMF recommends that Azerbaijan use statistics to move to more flexible exchange rate policy

The International Monetary Fund (IMF) recommended that the Azerbaijani State Statistics Committee deliver more detailed data to the Azerbaijani Central Bank (CBA) to help attain a more flexible exchange rate policy, adviser for the department of the Middle East and Central Asia of the International Monetary Fund (IMF) Raja Al Marzouqi said at a meeting with chairman of the State Statistics Committee, the committee said. The main purpose of visit of IMF mission is to conduct consultations on Article IV of the Articles of Agreement on an IMF establishment with the Azerbaijani government. While speaking about joint efforts with the CBA on the country's transition to a more flexible exchange rate policy, Raja Al Marzouqi stressed that not only general indices, but also sublevel data is required.

March 12

Azerbaijan ready to invest in Libyan petrochemical sector

Azerbaijan is interested in investing in the oil and gas sector of Libya, Azerbaijani Ambassador to the country Agaselim Shukurov said at a meeting with Libyan National Oil Company Chairman Nuri Berruien, the company's official website reported. According to the report, Shukurov expressed the desire of Azerbaijani companies to participate in the drilling activities in Libyan hydrocarbon fields. As the report says, in addition, Azerbaijan is going to invest in the modernization of the methanol producing plant, as well as in the construction of new plants. In turn, Berruien invited representatives of Azerbaijani companies to visit Libya next month to get acquainted with the situation in the country's energy sector.

Azerbaijani banks have to increase lending to economy's real sector

The Central Bank of Azerbaijan (CBA) should affect an increase in the activity of banks in granting direct loans to the real sector of the country's economy. This was stated by the IMF's departmental adviser on the Middle East and Central Asia (MCD), Raja Al Marzouqi at a press conference on the outcome of the IMF mission's visit to Baku. "The Central Bank should continue undertaking prudential measures to prevent the growing recovery in issuing consumer loans. Additionally, the CBA has to play a certain role in direct lending to the real sector," Marzouqi said. According to the CBA, the growth rate of credits granted by banks to households last year has almost doubled the pace of lending to the corporate sector. In 2012, loans granted to households increased by 30.1 per cent to 4.014 billion manat. According to the IMF representative, in the case of deepening of tensions in the economy caused by a demand, the monetary policy of the country should acquire a more neutral position in the near future and be strengthened. "A more flexible exchange rate will increase the economy's ability to withstand shocks in the long term," Marzouqi said.

Montenegro, Azerbaijan sign bilateral documents

After an expanded meeting involving presidents Ilham Aliyev of Azerbaijan and Filip Vujanovic of Montenegro the two countries signed bilateral documents. Presidents Ilham Aliyev and Filip Vujanovic signed "The Declaration on Friendly Relations and Partnership between the Republic of Azerbaijan and the Government of Montenegro". Azerbaijan`s Foreign Minister Elmar Mammadyarov and Montenegrin Deputy Prime Minister and Minister of Foreign Affairs and European Integration Igor Luksic signed "The Agreement on International Combined Transportations between the Republic of Azerbaijan and the Government of Montenegro". Azerbaijan`s Foreign Minister Elmar Mammadyarov and Montenegrin Deputy Prime Minister and Minister of Foreign Affairs and European Integration Igor Luksic signed "The Memorandum of Understanding between the Civil Service Commission under the President of the Republic of Azerbaijan and the Department for Human Resources Management of Montenegro". Azerbaijan`s Foreign Minister Elmar Mammadyarov and Montenegrin Minister of Finance Radoe Jugic signed "The Convention on Evasion of Double Taxation in Relation to Profit and Income Taxes and Prevention of Tax Evasion between the Republic of Azerbaijan and the Government of Montenegro".

March 13

SOCAR signs contract for carbamide plant construction in Azerbaijan

The State Oil Company of Azerbaijan (SOCAR) signed a contract with the Korean Samsung Engineering Co Ltd in Baku for designing, procurement and construction of a carbamide plant in Sumgait. The contract was signed by SOCAR head Rovnag Abdullayev and President and Chief Executive Officer of Samsung Engineering Co Ltd, Ki-Seok Park. Samsung Engineering won the open tender for the construction of a carbamide plant. The plant will be on the balance sheet at "Azerikimya" production association. It is part of SOCAR. The new plant will be located in Azerikimya's industrial area in Sumgait. The annual design capacity of the plant will be about 600,000 carbamide per year (2,000 tons per day) and 1,200 tons of ammonia per day. The plant is to be commissioned in late 2014 - early 2015. Around 3,000 seasonal workers are expected to be provided with jobs during the construction work. After the plant is commissioned, around 500 people will get jobs.

Fitch assigns SOCAR's USD notes 'BBB-' final senior unsecured rating

Fitch Ratings has assigned State Oil Company of the Azerbaijan Republic's (SOCAR) USD-denominated senior unsecured notes a final foreign currency senior unsecured rating of 'BBB-', the Agency's press release says.

Azerbaijan, Hungary determine cooperation areas in agrarian sphere

The Azerbaijani-Hungarian business forum has been held with the support of the Economic Development Ministry and organized by Azerbaijan Export and Investment Promotion Foundation (AZPROMO) today. A protocol of the meeting of the Subcommittee on Agriculture, established within the Azerbaijani-Hungarian Intergovernmental Commission was signed, the ministry said. Besides officials, representatives of the companies from both sides, representing the areas of agriculture, construction, food industry, ICT, etc. attended the event.

Azerbaijan and Saudi Arabia sign memorandum of understanding on tourism

A delegation headed by the Minister of Culture and Tourism Abulfas Garayev took part in a ceremony held in the city of Medina (Saudi Arabia) in connection with announcement of the city as the capital of Islamic culture for 2013. Garayev met with the president of the Saudi Commission for Tourism and Antiquities Sultan bin Salman bin Abdulaziz Al-Saud. The parties signed a memorandum of understanding on cooperation in tourism. It was agreed to establish a working group for the implementation of the memorandum.

March 14

Minister: Romania ready to create business environment for Azerbaijani companies

Romania is ready to create the necessary conditions for the business development of Azerbaijani companies in the country, Minister Delegate for Infrastructure Projects of National Interest and Foreign Investment of Romania Dan Sova said. He took part in an Azerbaijani-Romanian business forum. According to him, the Romanian side is ready to consider bringing Azerbaijani companies into projects of national importance undertaken in the country. These relate to the energy field, road construction and agriculture, he said. "Currently, SOCAR (State Oil Company of Azerbaijan) is active in Romania and we think its activities will be further developed in the framework of projects such as Nabucco West and AGRI (Azerbaijan-Georgia-Romania Interconnector). Today we met with Azerbaijan's leadership informing them of these projects. As it was noted at the meeting, they will be considered by the Azerbaijani side," Sova said.

Romanian company intends to cooperate with Azerbaijan in ICT

Minister of Communications and Information Technologies of Azerbaijan Ali Abbasov met with a delegation of one of the leading companies in the field of ICT in Romania - SIVECO headed by President and CEO Irina Sokol, the press service of the ministry said. She said SIVECO is interested in cooperation with Azerbaijan in implementation of the e-government project. Sokol said the company could provide useful suggestions on 'e-education', 'e-health', 'e-business', 'e-agriculture', 'e-customs' and other electronic solutions with ISO certificates in the future.

March 15

Azerbaijani parliament passes government's report as of 2012

The Azerbaijani parliament passed a government report as of the activity in 2012. This decision was supported by 104 MPs. Azerbaijani Prime Minister Artur Rasizade submitted a report to the Parliament and said that the main feature of the Azerbaijani economic life in 2012 was to accelerate the diversification of the country's economy. "Previously, the GDP growth was ensured through the mining industry, but now the economy is growing at the expense of the non-oil sector," he said. "In 2012, GDP increased by 2.2 percent, non-oil GDP - 9.7 percent." He said that around $25.8 billion were invested in the Azerbaijani economy from all sources last year, 75 percent of which were invested in the non-oil sector.

March 16

Iranian Businessmen's Association may be established in Azerbaijan

Iranian businessmen and entrepreneurs based in Azerbaijan met with Iranian Ambassador to Azerbaijan Mohsen Pak Ayin, spokesman for the embassy Mohammed Ayatollahi said. According to him, the meeting focused on the expansion of cooperation between Iran and Azerbaijan in the sphere of economy and solving of the existing problems in this area. Iranian Ambassador to Azerbaijan Mohsen Pak Ayin urged businessmen and entrepreneurs to develop economic relations between the two countries using the existing potential, the spokesman said. "The embassy is working on simplification and expansion of activities of Iranian businessmen in Azerbaijan. Some work needs to be done for establishment of the Iranian Businessmen's Association in Azerbaijan," he said.