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on Confederation of Independent States |
| By: | International Monetary Fund |
| Abstract: | 2025 Selected Issues |
| Date: | 2025–12–05 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfscr:2025/324 |
| By: | Ibadoghlu, Gubad |
| Abstract: | The Information and Communication Technologies (ICT) sector holds strategic importance for Azerbaijan's ambitions to diversify beyond hydrocarbons and modernize its national economy. Yet, despite extensive public investment and infrastructure development, the sector's contribution to GDP, employment, and exports remains limited. Drawing on official statistics and policy documents for 2020-2025, this study examines the performance, structure, and constraints of Azerbaijan's ICT and digital economy. In 2024, ICT accounted for only 1.8 percent of GDP, 0.036 percent of total exports, and 1.4 percent of national employment. Research and development (R&D) expenditure remained below 0.3 percent of GDP, while Azerbaijan ranked 94th in the 2025 Global Innovation Index-well behind regional peers. The paper attributes the sector's underperformance to low innovation intensity, weak private-sector participation, and overreliance on state-led infrastructure projects such as Azercosmos, which, while symbolically important, have not produced broad technological spillovers. At the same time, Azerbaijan has made measurable progress in digital finance, with non-cash payments rising from 30 percent in 2021 to 64.2 percent in 2024. These advances, however, have not translated into a robust, innovation-driven ICT ecosystem. The findings suggest that Azerbaijan's digital transformation remains infrastructure-heavy but innovation-light, requiring a shift toward policies that promote R&D investment, entrepreneurial capacity, and integration into global digital value chains. |
| Keywords: | Azerbaijan, Digital Economy, ICT Sector, Innovation, R&D, Diversification, Azercosmos, E-Governance, Non-Cash Payments, Digital Transformation |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:333330 |
| By: | Ibadoghlu, Gubad |
| Abstract: | This article examines the structural challenges facing Azerbaijan’s agrarian sector and their implications for food security in the context of a hydrocarbon-dependent, post-oil economy. Drawing on official statistics from the State Statistical Committee and program documents from the Ministry of Agriculture, the study evaluates the outcomes of major state programs in cotton, tobacco, rice, tea, sericulture, viticulture, and sugar beet production over the period 2012–2024. The analysis reveals substantial underperformance relative to planned targets, with implementation rates for key programs ranging from only 3.9 percent in sericulture to 61.4 percent in cotton. These shortfalls reflect persistent weaknesses in planning, inter-agency coordination, monitoring and evaluation, and private-sector participation. Complementing the program assessment, the article analyzes food self-sufficiency ratios for 2020–2024 across livestock, crop, and processed food categories. The findings demonstrate a dual structure: while Azerbaijan achieves high and often surplus production in horticultural and export-oriented commodities (e.g., vegetables, fruits, nuts, and pomegranates), self-sufficiency in strategic staples such as wheat, grains, rice, and vegetable oils remains low and volatile. Livestock and processed food segments exhibit moderate but stagnant self-sufficiency, constrained by technological gaps, import-dependent inputs, and limited value-chain integration. Overall, the evidence indicates that state-led expansion strategies have not translated into broad based productivity gains, robust food security, or resilient rural development. The article concludes that a shift from politically driven, target-based interventions toward a coherent, market-oriented, and evidence-based policy framework is essential if agriculture is to become a dynamic driver of non-oil diversification and long-term food security in Azerbaijan. |
| Keywords: | Azerbaijan, Agriculture, State Programs, Food Self-Sufficiency, Structural Reform, Import Dependence, Non-Oil Diversification, Rural Development, Agro-Food Value Chains |
| JEL: | Q13 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:333325 |
| By: | Ibadoghlu, Gubad |
| Abstract: | This paper provides an empirical assessment of Azerbaijan's Strategic Roadmap for the National Economy, adopted in 2016 with targets set through 2025. Drawing on official statistics and the author's own calculations, the study evaluates performance against four core objectives: (i) raising average annual real GDP growth above 3 percent; (ii) increasing the share of foreign direct investment (FDI) in non-oil GDP to 4 percent; (iii) boosting non-oil exports per capita from USD 170 to USD 450; and (iv) reducing the state budget's dependence on transfers from the State Oil Fund of Azerbaijan (SOFAZ) to 15 percent. The analysis shows that none of these targets have been met. Average annual GDP growth over 2016-2025 is estimated at 1.46 percent, well below the planned threshold. The share of FDI in non-oil GDP declined from 6.9 percent in 2016 to 0.7 percent in 2024, while per capita non-oil exports reached only about USD 330-more than 20 percent short of the 2025 target. At the same time, SOFAZ transfers still account for more than one-third of state budget revenues and are projected to remain structurally high. Labour-market indicators reveal additional fragility, with inflated job-creation figures, substantial job closures, and persistent reliance on public sector employment. The findings point to a systematic implementation gap between strategic planning and actual outcomes, rooted in structural and institutional constraints rather than exogenous shocks alone. The paper concludes that without significant reforms in governance, investment climate, and statistical transparency, Azerbaijan's strategic planning exercises will continue to underperform as instruments of genuine diversification and structural transformation. |
| Keywords: | Azerbaijan, Strategic Roadmap, Economic Diversification, Foreign Direct Investment, Non-Oil Exports, SOFAZ, Fiscal Dependence, Labour Market, Implementation Gap, Policy Evaluation |
| JEL: | O21 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:333328 |