Speech by Ilham Aliyev at the Azerbaijani-Czech Business Forum

Dear Mr. President,

Distinguished guests,

Dear business forum participants!

I would like to welcome you to Azerbaijan once again. Mr. President and I had a very extensive discussion and exchange of views on our bilateral relations yesterday. Our bilateral relations are developing very positively and dynamically. Our ties serve the interests of both countries. Thanks to this positive development, we have signed a joint declaration on strategic partnership between the Czech Republic and the Republic of Azerbaijan, which covers all areas of cooperation, including economic relations.

Strategic partnership is the highest possible level of cooperation between countries. In my view, it represents a solid basis for a more active development of economic relations and contacts between business circles. I think that for coordinating the business activities of our business circles we have such an effective mechanism as a joint intergovernmental economic commission, which deals with important issues related to the economic sphere.

Today's event is not the first forum to be held between our business people. However, during this business forum, both presidents will encourage the business people of our countries to cooperate more actively. There are ample opportunities for the expansion of our economic partnership.

In our one-on-one meetings with Mr. and at the level of delegations, we already discussed the work done and plans for the future. We are very pleased with the participation of Czech banks in projects being implemented in Azerbaijan. These projects allow us the opportunity to modernize our infrastructure. At the same time, Azerbaijan is a reliable partner fulfills its financial obligations. I think that this is also a good indicator of our relationship, as we can trust each other. We have already passed the test.

I believe that in the coming years we will focus on the traditional areas of cooperation and identify new areas. Among traditional areas of cooperation, I would like to mention the transport sector, because in order to make the best of our geographical location, we are investing a lot in the modernization of transport infrastructure in Azerbaijan. Currently, we are at the stage of completion of the East-West railway corridor. At the same time, with the support of the banks of the Czech Republic, we are in the final stages of the Baku-Tbilisi-Kars railway project. This project will link Asia with Europe via Azerbaijan and other countries and open up a new transit corridor. This will happen parallel to the construction of the new Baku International Sea Port and related facilities on the east coast of the Caspian Sea. Thus, we will create highly reliable and cost-efficient transport routes.

Yesterday, I informed our guest also about the North-South corridor, where Azerbaijan takes an active part. The North-South corridor will enable transportation of millions tons more of cargo through Azerbaijan and neighboring countries. And this, it seems to me, would be beneficial to all players in Asia, in our region and in Europe. I urge Czech financial institutions to seriously think about investing in this project and providing financial support.

I think that another area of ​​cooperation where new steps will be taken is the energy sector. We are already working hard on this. Azerbaijan is a very reliable supplier of oil to the Czech Republic. As far as we know, about a third of oil consumption in your country is provided by Azerbaijan. We plan to continue this cooperation.

At the same time, Azerbaijan has already become an important player in the European gas market. I believe that the Southern Gas Corridor project put forward by Azerbaijan is one of the largest infrastructure projects in Europe, as investment in it will exceed $45 billion in the next few years. Azerbaijan participates in the project as an investor, contractor and organizer. Thanks to this project, we will be able to export as much gas as we produce and help European consumers to diversify their supply routes. This will benefit all parties – suppliers, transit countries, which will benefit a lot from transit fees, and consumers, who will have alternative routes. Energy security and the availability of alternatives in other fields is always good.

At present, Azerbaijan is the only new source of gas for Europe. We know all other potential suppliers, but as for other suppliers, the possibility of delivery is still not entirely clear. As for us, we have already signed an agreement to sell gas to some of your neighbors. Taking into account the vast reserves of gas in Azerbaijan, i.e. confirmed gas resources of our country of 2.6 trillion cubic meters, this project will last for decades to come.

I think that while implementing this project we can identify ways of cooperation with Czech companies and, at some point in time, address issues of supplies to the Czech Republic, as Azerbaijan can expand the geography of supplies of its natural resources.

Of course, we do want to see Czech companies as investors in Azerbaijan. Our country has a favorable investment environment, as foreign investment is securely protected by the legislation. Last year, Azerbaijan received $27 billion in investments. Of these, 30-35 per cent was direct foreign investment. Even in the most difficult years of economic crisis, we see a high level of foreign investment in the country. Foreign companies trust and have confidence in us. We are a reliable partner and always meet our obligations. The investment environment is very positive.

In addition, Azerbaijan is one of the 40 most competitive economies in the world. According to the calculations of the Davos World Economic Forum, we are in 38th place in the global competitiveness index. We achieved this result in a short time. When we gained independence, our economy was fully formed in the public sector. Today, more than 80 per cent of the economy and the gross domestic product are provided by the private sector.

I think that agriculture may appeal to your companies, as infrastructure projects implemented in our country, including the ease of access to the markets of neighboring countries, make Azerbaijan an interesting place in terms of investment in the agricultural sector and establishment of joint ventures. I think that this opportunity can also be explored.

Over the past few years, we have invested heavily in the sphere of high technology. We have created a space industry. We have two satellites. One, “Azerspace”, is used in the field of telecommunications, and the other, “Azerisky”, for observation. In short, space industry is developing in the country too. We can work together and further expand our cooperation at the level of research institutions.

As for the overall economic situation in Azerbaijan, the situation is stable. In the first eight months of this year, the economy grew by more than 4 percent. Growth in the non-energy sector exceeded 7 per cent. The level of direct foreign debt is very low - just over 10 per cent. All these are very positive elements for the attraction of investments and cooperation with various companies.

Yesterday, we also discussed the possibility of Azerbaijani companies investing in the Czech Republic. In terms of investment, your country is very attractive and developed. It has a strong industrial potential and economic stability. As we know, the difficult economic and financial situation in many European countries has not had a negative impact on your development. I want to congratulate your leadership on these achievements.

I believe our countries show in their regions that thanks to a strong political will, an independent foreign policy based only on national interests and judicious economic policies, we can achieve success and maintain economic stability even in difficult times. You can imagine that a drop in the oil prices more than in half is a huge challenge for us. When we adopted the budget for this year, the price of oil was estimated at $90 per barrel. Today or yesterday, the price was $46. It is clear that we did not receive the expected revenues. But thanks to diversification and the fact that 70 per cent of the gross domestic product is contributed by the non-energy sector, we managed to maintain stability, have implemented all social programs and still continue investing.

In other words, I am very optimistic about the cooperation between our business communities. First, there is strong political support. Today we are demonstrating that. Second, we have already gained a very positive experience in this cooperation. Third, the capacity of our economies and business people is fairly large, and we must do everything possible to identify new areas of cooperation. I am confident that this business forum will be a very important step in this direction.

Mr. President, I want to welcome you and all our guests again. I am sure you will be satisfied with the visit to Azerbaijan. Thank you.