Azerbaijan Moves To Develop As Caucasian-Eurasian Transport Hub

Op/Ed by Chris Devonshire-Ellis

Azerbaijan Developing As A Hub For The Belt & Road, European Union & Eurasian Economic Union

Shahin Mustafayev, Azerbaijan’s Economic Minister, has stated that bilateral trade between Azerbaijan and Russia saw a 23 percent growth in the first seven months of this year. He pointed out further potential for expanding the bilateral trade, describing it as one of the key priorities of Azerbaijan-Russia cooperation.

“Russia is one of the main trade partners of Azerbaijan, and is the largest importer of the non-oil products from Azerbaijan,” the minister added.

Russia-Azeri trade is on an upward swing as it increased by 13.8% last year, hitting US$2.4 billion. The new upsurge suggests 2019 bilateral trade will reach close to US$3 billion for the year. Over 750 joint companies run operations on Azerbaijan’s market, of which around 300 are 100% Russian capitalized and another 450 are in joint-ventures with local partners.

Russian exports to Azerbaijan account for about 2/3 of the total trade volume and include agricultural and food items, machinery, equipment and transport vehicles, metals, timber, pulp and paper products in addition to chemical products and rubber.

Azerbaijan exports to Russia include agricultural produce, minerals, textiles, clothing and footwear.

Russia-Azeri trade and transit volumes are likely to increase, with Azerbaijan also soon to become a trade corridor to Russia through the development of the North-South International Transport Corridor, which will transit through Azerbaijan and connect with Russia to the North, having previously transited through Iran and India. It links Mumbai and Chabahar Ports to the Caucasus and into the Eurasian Economic Union  and Trans-Siberian Railway through to Moscow. Azerbaijan is also on the Baku-Tbilisi-Kars railine which links goods from China and Kazakhstan through to the Azeri Port of Baku and onto Turkey and theoretically to the EU.

Azerbaijan would be a contender country to join the Eurasian Economic Union itself, but for the fact that Armenia is a member state and the two countries have an on-going border dispute. Nonetheless, it is at the centre of three major integration initiatives – the European Union, the Eurasian Economic Union, and the Belt and Road Initiative, and is developing as a regional hub. If Azerbaijan can develop an added value aspect to its regional trade volumes, the future for the countries position as a Eurasian hub will be considerably enhanced.

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