Azerbaijan Develops Aghdam Industrial Park: First Investors Sign Up

Aghdam, the mythical Caucasian tenth century trading hub wrecked by successive battles between Muslims and Christians on the Armenia/Azerbaijan border, passed back into Azerbaijan hands after the 2020 Nagorno-Karabakh war between the two.

With much of the Nagorno-Karabakh region cut off for the past thirty years from Armenia, investment and redevelopment had been slow. Now reconnected with Azerbaijan, investment has once again been flowing into the region as Baku wishes to make a political point and illustrate how better off residents are under Islam.

Aghdam city is being redeveloped from what are essentially ruins, and an industrial park is being developed.  Five Azeri businesses have already been registered as the park residents.

Dadash-N LLC, which will manufacture a variety of synthetic carpets as part of a project to be implemented in the Industrial Park, will build a factory on an area of two hectares. Within the project with the investment cost of 9.5 million manat (US$5.6 million) it plans to manufacture 700,000 square meters of carpets a year and provide 60 permanent jobs.

Local raw materials such as polypropylene, polyethylene and polyacryl, as well as Belgian and Chinese technologies will be used to produce the carpets. Along with the sale of manufactured products on the domestic market, it’s planned to export them to fellow CIS countries – Armenia, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan.

Veliyev LLC will implement a project for the manufacturing of precast concrete products. Within the project worth 2.5 million manat (US$1.4 million), it’s planned to manufacture 200,000 square meters of reinforced concrete products per year. The enterprise will provide permanent jobs for 80 people, and use Turkish and local technologies for the production.

Smartpoint LLC will organize the production of light poles and other devices powered by alternative and renewable energy sources (mainly solar energy) as part of another project to be implemented in the park. The investment cost of the project is 9.1 million manat (US$5.6 million), will create 80 permanent jobs and produce 21,000 light poles and other devices with a capacity of 40 megawatts per year. Along with the provision of the domestic market, it’s planned to export the manufactured products to European and CIS countries.

Ram International Transport and Trade LLC will manufacture polymer products as part of a project with the investment cost of 10 million manat (US$5.8 million), to be implemented in the park. The enterprise will be built on three hectares and create 500 permanent jobs. Along with provision of the domestic market, the manufactured products are planned to be exported to the countries of Europe and the CIS.

Ag Tekstil LLC will produce uniforms and overalls. The investment cost of the project is 5.5 million manat (US$3.2 million). The enterprise, which will be built on one hectare, is expected to create 110 permanent jobs, with products directed to meet domestic demand. Azerbaijan has been very active in developing infrastructure and industrial processing zones as its strategic position along the Belt and Road Initiative serves as a focal point between East and West. It is connected to Central Asia and China by maritime routes across the Caspian Sea Port at Baku, and to Russia, Iran, the Gulf, East Africa and India by the INSTC multimodal network. It can access Turkey and markets in the EU to the west by rail links heading to the Black Sea.

It be be awhile before Aghdam is able to fully access these corridors with 100% effectiveness, but the Belt & Road Initiative maxim in Azerbaijan is well underway: construct, manufacture, and trade, creating sustainable operational cashflow and profitability. A key mantra for all developing countries, which is why China has been so successful in its BRI promotion.

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