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Investments in Azerbaijan's economy (january-september 2013)

Analysis Materials 8 November 2013 17:25 (UTC +04:00)

According to the Azerbaijani State Statistics Committee, around 11.8 billion manat was invested from all financial sources in the development of the economic and social areas of Azerbaijan in January-September 2013, which is by 19 percent more than in the same period of last year. It indicates sustainable investment activity in the country.

In particular, around 1.400 billion manat were invested in the Azerbaijani economy in September 2013, which is by 11.3 percent more than investments in fixed assets in September 2012. Until 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-September 2013 are as follows:

  • funds of enterprises and organizations - 4.769.9 billion manat (an increase of 12.3 percent compared to January-September 2012;
  • budgetary funds - 5.674.8 billion manat (an increase of 25.7 percent);
  • off-budgetary funds - 398.0 million manat (a decrease of 1.4 percent);
  • bank loans - 621.2 million manat (an increase of 41.2 percent);
  • funds of population - 355.7 million manat (an increase of 18.1 percent)

Apparently, an increase in investments in January-September 2013 is related to the increased investment activity of all financial sources. In general, an increase in investment was related to the investment activity at the expense of the budget funds, most of which are directed at infrastructure construction. The increased investment activity on bank loans must be stressed.

According to the State Statistics Committee, investments in construction work increased by 30 percent. Investments worth 5.846.4 billion manat were made in construction of production facilities and 5.980.1 billion manat - in non-production facilities.

According to the State Statistics Committee, private enterprises and organizations invested 4.294.4 billion manat (36.3 percent of total investments) in the capital stock, and public enterprises and organizations - 7.532.1 billion manat (63.7 percent).

About 66.9 percent of funds invested in capital stock, or 7.913.2 billion manat, were directed at the development of the non-oil sector. Investments in the oil sector comprised 3.913.3 billion manat (33.1 percent). Investments in non-oil sector increased by 16.4 percent, while 51.6 percent in the oil sector.

The total investments in the industry totaled 5.072.3 billion manat with an increase of 39.3 percent. About 632.8 million manat were invested in the processing industry (an increase of 62.7 percent). During the reporting period, the investments in the extractive sector hit 3.438.1 billion manat, which is 33 percent more than investments in January-September 2012. Totally, 42.9 percent of investments fell to the industrial sector.

Around 72 percent of the total capital investments accounted for domestic investments. They increased by 15 percent during the year. This is a positive index, primarily, because it shows the growing financial potential of the country.

Most (79.8 percent) of domestic investments fall to the state-owned enterprises and entities, and only 20.2 percent in private enterprises.

Investment indices in January-September 2013:

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

Amount in bln manat

Specific weight in percent

Investments in total

11,8

100,0

Foreign investments

3,3

28,0

Domestic investments

8,5

72,0

The total amount of foreign investments in Azerbaijan's economy amounted to 3.3 billion manat in January-September 2013 or by 66.2 percent more compared to January-September 2012.

The growth of foreign investments in the country shows that Azerbaijan is a very reliable partner and a very attractive country for foreign investors. The economic reforms, economic liberalization, increasing the credit rating of Azerbaijan by the world leading rating agencies, the policy of integration into the world economy contribute to the growth of foreign investments.

Around 77.2 percent (2.601.9 billion manat) of investments in Azerbaijan's economy made by foreign countries and international organisations fell to investors from the UK, USA, Japan, Norway, Turkey and the Czech Republic in January-September.

As previously, the UK continues to maintain a leading position in the list of foreign investors in Azerbaijan. Its share in the total foreign investment was 32.4 percent, while investments totalled 1.091.5 billion manat.

Countries

Jan.-Sept., 2013, thousand manat

Specific weight, %

Total international investments

3370998,6

100,0

Including:

Great Britain

1091555,4

32,4

USA

350835,5

10,4

Norway

357735,8

1,6

Japan

291918,1

8,7

Czech Republic

214215,5

6,4

Turkey

186340,4

5,5

France

109279,3

3,2

Russia

86457,2

2,6

Iran

86457,2

2,6

Singapore

15253,3

0,5

South Korea

24297,8

0,7

Germany

1327,1

0,0

Netherlands

1016,2

0,0

The biggest amount of investments of the international financial institutions was allocated by WB to the amount of 118.5 million manat in a special weight of 3.5 percent. WB projects cover different spheres of the country's economic life.

International financial organizations

Jan.-Sept., 2013, thousand manat

Specific weight, %

World Bank

118530,9

3,5

Asian Development Bank

37412,0

1,1

Islamic Development Bank

7770,6

0,2

Other countries and international organizations

390596,3

11,6

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