Opening speech by Ilham Aliyev at the meeting on private enterprise development in the sphere of agriculture in the Karabakh economic zone in Agjabadi

Today we are attending the opening of a dairy enterprise in Agjabadi District. This is a wonderful and major dairy enterprise. It holds a special place among the enterprises established in Azerbaijan’s non-oil sector in recent years.

I am very glad that the private sector is developing in Azerbaijan. Local businessmen are investing in Azerbaijani economy, the sectors that are important to the development of the non-oil sector in Azerbaijan, the sectors in which we still rely on imports. Therefore, the establishment of such major and modern facilities is a very important issue. This facility differs from others built in the region – not only in the South Caucasus but also in neighboring countries – both for its modernity and production capacity. I am very glad that such modern industrial enterprises are emerging in Azerbaijan. These enterprises will be serving the development of Azerbaijani economy for many years to come.

In general, there are positive trends in the establishment of an industrial and social infrastructure in Agjabadi District. Social facilities are built here – I have attended the opening of a village road today, important issues relating to agricultural development are being resolved. I have also attended a foundation-laying ceremony for a new modern hospital today. In other words, socioeconomic development is at the proper level here. Yesterday I examined the state of affairs in Sabirabad, Saatli and Imishli Districts. There is development in every district. 

Azerbaijani economy is developing comprehensively. We have achieved positive results in diversifying the economy. We must ensure that these positive trends are further strengthened in the years ahead and the number of modern industrial facilities in the country increases.

Specific programs on the development of the non-oil sector are being implemented. The second stage of the State Program on the socioeconomic development of districts has begun. The second state program must be completed by 2013. As a result of its implementation, the key social and economic issues our country is facing will be resolved.

About a million new jobs were created in recent years. But unemployment is still there. The establishment of such wonderful enterprises is highly important to eliminating unemployment. At the same time, we are dealing with the issue of increasing domestic production, decreasing our reliance on imports and reducing poverty.

In the years ahead we will take extra steps to develop the processing sector of agriculture. There are great opportunities for agricultural development. First of all, there is a correct state policy, support is provided for private enterprise development. Major funds are provided to entrepreneurs every year through the National Fund on the support for private enterprise. This year business people will receive 125 million manats. State capacities were to some extent used in setting up this enterprise. But I have to say that the overwhelming majority of the investment was made by business people themselves, and this is also a very positive fact which shows that entrepreneurs have great confidence in Azerbaijan’s economic development.

Both local entrepreneurs and foreign investors are taking interest in Azerbaijan. This is the result of a wise investment policy of our country. Investment amounting to hundreds of millions of dollars has been made in agriculture alone in recent years. In general, the volume of investment made in Azerbaijan is nearing 100 billion manats. It is possible to say that a little more than half of this investment is domestic.

In other words, investment projects are implemented in Azerbaijan. The state investment company has very important functions in this sphere. The state investment company provides financial support for the establishment of major infrastructure and industrial enterprises, while the National Fund on the support for private enterprise supports the establishment of agricultural, processing enterprises and those of regional importance.

The overall economic development in Azerbaijan is very positive. Our economy grew even in the years of crisis. Very important issues will be reflected in this year’s investment program. Infrastructure projects are under way. A large-scale process of gasification is ongoing in the country.

The construction of village roads is successfully ongoing. More attention should be paid in the years ahead to the issues of drinking water, sewage, irrigation and water management. A State Program on the socioeconomic development of Baku and its suburbs has recently been adopted. As a result of its implementation, all social and economic issues of Baku settlements will be resolved before 2013.

As I have mentioned, the program on the development of districts is successfully under way. It has been under way since 2004, and its second stage will be completed in 2013. Afterwards we will see what extra measures should be taken. The task was set: to resolve the key infrastructure, social and economic issues of the country in 2004-2013, i.e. over the course of 10 years. We are approaching this goal. The experience of the last eight years shows that there are great results in any sphere. Jobs are being created, poverty reduced, industrial enterprises set up, infrastructure projects implemented. We have attracted major investment to the power engineering sector and are not only providing for ourselves now but have even built up an export potential.

We must aspire to making our processing enterprises export-oriented too. However, we first need to fully address our own needs using domestic production. This is a very important issue. If we succeed in doing that, we can resolve a number of important issues soon, including those relating to unemployment. But at the next stage, due to the exports of agricultural and processing goods, we must access new markets. For that, of course, our products must be of high quality. We must not only raise our potential and export opportunities to neighboring markets, but also access European markets. This, of course, requires production of high-quality goods. I am sure that this dairy enterprise, built at such a modern level, can export products to any country of the world.

Entrepreneurs will continue to receive state support. This will be political, economic and financial support. Necessary funds will be envisaged in the years ahead through the National Fund on the support for private enterprise. Financial problems in Azerbaijan are already being resolved. Investment of 15 billion dollars was made last year alone. Amendments are to be introduced to our budget this year, certain corrections made. These corrections should cover infrastructure projects. At the same time, resources will be envisaged for the solution of social issues of our citizens. Issues of raising wages and pensions will be resolved.

In other words, the state is taking all measures necessary to develop the country. By investing in the country’s economy, entrepreneurs expand their own opportunities and, at the same time, contribute to the country’s development. I am very pleased that most entrepreneurs in Azerbaijan are responsible people. They also contribute to the solution of social issues. I am aware that entrepreneurs are also engaged in charity activities. Those who can afford this should certainly pay even more attention to this issue.

At the same time, entrepreneurs should give preference to the production of competitive goods. Speaking about production of high-quality goods capable of accessing European markets, I must say that the domestic market also needs quality goods only.

State bodies are working hard on this issue now. The process of removing poor-quality goods from the market is ongoing, there is monitoring. Very much attention should be paid to this issue. It is necessary to campaign against poor-quality products. This applies to both imported goods and those produced in Azerbaijan. Quality is a top priority issue.

I think that a very strong industrial potential, i.e. the processing industry potential will emerge in the country in the years ahead as a result of our policy. Wonderful new processing facilities, including dairy enterprises, are under construction in different regions, and this process will be continued.

At the same time, as competition becomes tougher, related issues will certainly manifest themselves more distinctly. We must ensure a fair competition in the country. This depends on both business people and, perhaps even more, on state bodies. Because unfair competition and monopolism sometimes pose major obstacles to our cause. Monopolism manifests itself in both imports and domestic production. We faced this situation on the eve of Novruz when prices on food produced in Azerbaijan were artificially increased. So very serious instructions were issued and control introduced so that prices on Azerbaijani products are not raised and, at the same time, there is transparency in imports. A fair competition is one of the important factors for improving the business environment.

Along with this, the stepped up fight against bribery and corruption is also producing positive results. This manifests itself in the social sphere too. The activities of state bodies are becoming more transparent, public oversight is strengthening. At the same time, an end to corruption and unfounded demands should be put in the business sector too. I have repeatedly spoken about this, relevant instructions have been issued. Entrepreneurs, for their part, should also fight against unfounded demands, resist any negative phenomena and inform relevant state bodies of this.

In general, we must ensure transparency in the entire financial system. We are doing this and have already made great strides. I can cite the State Oil Fund of Azerbaijan as an example. The State Oil Fund is the most transparent and effectively managed fund of this nature in the world. It is no coincidence that the Oil Fund has received good feedback of the United Nations and other international organizations. This state oil fund was established and is managed by us. This is evidence that where there is political will, prudent management and professionalism, we can achieve the best results.

Therefore, there must be transparency and integrity in all other spheres. As for business, I want to repeat that there must be a fair competition.

This meeting is also being attended by heads of district executive authorities of the region. I have repeatedly said that they should assist private businesses, not hamper them. State attention to entrepreneurs must be shown in every region, every district, every village. I can say that very positive changes have occurred in this sphere in recent years. Most of the local executive bodies understand and implement the state policy correctly. As you know, I often travel to districts, visit all regions. I meet with people, ask them, so I have sources of information. I have enough information about what is happening. Therefore, I can say that in most cases local executive authorities prove themselves quite well. But if there are mistakes and shortcomings, we are paying due attention to them. Necessary measures were and will be taken.