Investments in economy in Azerbaijan (I Quarter 2013)

According to the Azerbaijani State Statistics Committee, 2.902.2 billion manat was invested in the economy of Azerbaijan in the first-quarter of 2013 from all financial sources, increasing by 36.1 percent compared to the figures of the same period of 2012, which indicates sustained investment activity in the country. In particular, 1.222.1 billion manta was invested in the Azerbaijani economy in March 2012, which is 35.3 percent higher than investments in the ficed capital in March 2012. Prior to 2015, we will observe a steady increase in investment in capital construction because of the growth of building, rehabilitation and reconstruction work in preparation for the first European Olympic Games-2015 in Azerbaijan.

The main sources of investments in January-March 2013 are as follows:

• funds of enterprises and organizations - 1.254.2 billion manat (an increase of 17.7 percent compared to January-March 2012);
• budgetary funds - 1.338.9 billion manat (an increase in 55.4 percent);
• off-budgetary funds - 58.3 million manat (an increase of 51.2 percent);
• bank loans - 177.9 million manat (an increase of 72.0 percent);
• funds of population - 66.1 million manat (an increase of 12.2 percent).

Apparently, increased investments in January-March 2013 are due to increased investment activity of all financial sources. In general, an increase in investment in March 2013 was due to investment activity at the expense of the budget funds, most of which are directed at infrastructure construction.

According to the State Statistics Committee, private enterprises and organizations invested 1.024.4 billion manat (35.3 percent of total investments) in Azerbaijan's economy and public enterprises and organizations - 1.877.8 billion manat (64.7 percent).

Investments in construction work grew by 48.9 per cent. Investments of 1.636.0 billion manat were made in construction of production facilities and 1.266.2 billion manat - in non-production-related facilities.

Around 62.8 per cent (1.823 billion manat) was directed to the development of the non-oil sector, including 12.6 per cent (364.5 million manat) - non-oil industrial sector. Some 1.078 billion manat was invested in the oil sector. Investments in the non oil sector increased by 34 per cent. Investments in the oil sector grew by 39.9 per cent.

The total investments in the industry totaled 1.443.4 billion manat with an increase of 66.9 percent. Some 110.0 million manat was invested in the processing industry (increased by 2.8 times). During the reporting period, the investments in the extractive sector hit 1.077.6 billion manat, which is 41.1 percent more than investments in January-March 2012. Totally, 49.7 percent of investments fell to the industrial sector.

Around 68.2 per cent of the total volume was domestic investment which grew by 27.4 percent within a month. It is considered a positive indicator, primarily due to the fact that it shows increasing financial capacity of the country. Most (86.8 per cent) internal investments were made in state enterprises and organizations with only 13.2 per cent in private enterprises.

Investment indices in the first quarter of 2013:

Source: State Statistics Committee and calculations by Trend

The total volume of foreign investments in Azerbaijan's economy in the first quarter of 2013 totalled 924.1 million manat, increasing by 62.1 percent compared to the figure for the same period last year. The amount of foreign investment in the country shows that Azerbaijan is a reliable partner and a very attractive country for foreign investors

In January-March 2013, 88.8 percent (820.9 million 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 and France. France left this list, giving way to Czech Republic.

As before, the UK continues to retain its leading position in this list. Its share in total foreign investments hit 46.2 percent, while its investments amounted to 427.1 million manat.

Of the international financial institutions, the biggest amount of investments was allocated by WB in amount of 25.1 million manat with special weight of 4.3 percent. WB projects cover different spheres of the country's economic life.