Ilham Aliyev chaired a meeting of the Cabinet of Ministers dedicated to the results of socioeconomic development in 2013 and the objectives for 2014

President of the Republic of Azerbaijan Ilham Aliyev has chaired a meeting of the Cabinet of Ministers dedicated to the results of socioeconomic development in 2013 and the objectives for 2014.

The head of state addressed the meeting with the opening speech.

Opening speech by President Ilham Aliyev

- This meeting of the Cabinet of Ministers will discuss the results of 2013 and speak about the objectives on our agenda in 2014.

I can say that the past year as a whole was successful for our country. A great deal has been done in Azerbaijan. It would take a few hours to list everything that has been done. Today we will exchange views on major issues. But I want to say once again that the dynamic development of our country was invigorated in 2013. Major projects have been implemented in Azerbaijan and the international authority of our country has increased. We have further deepened the reforms under way in the country. In other words, we have secured a successful development of our country.

Azerbaijan’s international reputation has enhanced. There are excellent opportunities for the development of our international relations. We effectively use these opportunities. In 2013 Azerbaijan completed its mission in the UN Security Council. Over the course of two years Azerbaijan demonstrated its position. As I stated earlier, while in the UN Security Council we upheld international law and justice, demonstrated an unequivocal position and took a principled stance on every single issue. I can say that over the two years the trust and support of the international community for Azerbaijan have further increased even though Azerbaijan was supported by as many as 155 countries in the election to the UN Security Council. I think that this support has further increased now.

This suggests that the international community defends and supports the position of our state, approves our steps because Azerbaijan acts with dignity in all international organizations and a position of principle and national interests are above everything else for us. Undoubtedly, given these factors, the international community will further strengthen its support for Azerbaijan.

In early 2013, a significant event occurred in the Parliamentary Assembly of the Council of Europe. During the January session, the unfounded and biased attack on Azerbaijan, which was based on double standards, suffered a complete fiasco. The vast majority of the Assembly did not join the anti-Azerbaijan campaign, which disappointed its initiators, including backstage authors of the campaign, and protected Azerbaijan's fair position. The draft resolution motivated by political factors was not passed and Azerbaijan’s position Azerbaijan was supported. Thus, Azerbaijan has won yet another victory in the international arena.

This development also showed that justice must always get the upper hand. Azerbaijan demonstrated its principled and fair position, while the Assembly's decision dealt one of the most devastating blows to anti-Azerbaijani forces. I believe that they and the anti-Azerbaijani groups behind them will now make the right conclusions.

In 2013, Azerbaijan hosted a number of international events. Among them, I want to mention the conference to assist Palestine under the Organization of Islamic Cooperation. Azerbaijan initiated this conference, which I think reflects our position. We have demonstrated support for our Palestinian brothers again. Baku hosted a large donor conference of the Organization of Islamic Cooperation attended by ministers of member-countries, and Azerbaijan for its part provided Palestine with material assistance.

Last year we signed an important agreement with the European Union on visa facilitation. This is a manifestation of our relations with the European Union. These relations will develop further. Now, in 2014, we must certainly define the future format of the strategic relations between the European Union and Azerbaijan.

I have repeatedly stated that we want to establish effective working relations with the European Union and all other organizations we are not a member of. We have managed to achieve that. The principles of our relations with all the organizations we are not a member of are open, clear and do not go beyond international guidelines. These are principles of mutual respect, non-interference in each other's affairs, mutual support, mutual understanding and comprehensive cooperation. I am confident that we will create an even more efficient format with the European Union in the coming years.

Baku has also hosted the Third International Humanitarian Forum. It has become a wonderful tradition that attracts the world's attention. This event was joined by prominent politicians, scientists, more than 10 Nobel Prize winners. Azerbaijan already plays an important role on such issues on the global agenda as tolerance and humanitarian cooperation. Baku and Azerbaijan have become a center of multiculturalism and tolerance in the world. The international community also accepts and supports that.

The Second Forum on Intercultural Dialogue has been held. The agenda of this forum is about the same. In other words, the numerous activities held in Azerbaijan, including the meeting of the Davos World Economic Forum, the world’s top economic structure, have reinforced the importance of our country, enhanced its international authority and shown Azerbaijan to the international community as a dynamic and modern state. I have only enumerated the main international events held in Azerbaijan in a matter of one year. Look how much work has been done and how much the position of Azerbaijan has strengthened.

Our relations with other countries have also developed on a bilateral basis. My numerous visits abroad and the visits of foreign guests to Azerbaijan have further strengthened these ties. I am confident that this trend will be continued in the current year.

Unfortunately, there was no progress in the settlement of the fundamental issue of our foreign policy – the Armenian-Azerbaijani Nagorno-Karabakh conflict. During the year, the Armenian side adopted the tactics of delaying the negotiations under various pretexts. We can say that no progress has been achieved in the negotiations over the year. There was stagnation. At the end of the year there was some activity. Let's see if Armenia demonstrates a constructive approach to the settlement of the issue, so that an agreement could be reached soon. There is some hope and optimism, so in 2014 we will study that. In any case, the true intentions of Armenia will be fully clarified in 2014. Frankly, the past period does not give grounds for optimism, because Armenia has demonstrated an unconstructive position throughout the talks, adopted the delaying tactic and thus led the talks to a paralyzed state.

But if realistic approaches prevail in Armenia, then I think progress can be achieved in the conflict settlement in a short time. A realistic approach must be based on reality and on the balance of powers. The growing power of Azerbaijan also plays and will continue to play a role here. If we draw a comparison between Armenia and Azerbaijan, our advantage is obvious in all areas. Our state budget is 10 times bigger than that of Armenia. Our gross domestic product is eight times and the population six times bigger. Our potential is growing and strengthening, while Armenia is experiencing an extremely difficult situation both economically and demographically. I can even say that it is experiencing a demographic disaster, which is confirmed by the authorities of Armenia. Therefore, if Armenian leaders approach the issue with all seriousness and give preference to the interests of the Armenian state, they will clearly understand that they have neither the capacity nor the potential to compete with Azerbaijan.

I consider that relying solely on foreign aid doesn’t do any country a lot of honor. Every country should always seek to protect its independence, its choice and think about the future of the state. In any case, the balance of power has very seriously changed in favor of Azerbaijan. I expressed my thoughts about that five to six years ago. We have achieved this, and the Azerbaijani state will undoubtedly further strengthen its advantage in the coming years.

We hope that there will be positive changes in the negotiating process. International mediators are trying to make some headway. But I have to note that their activity has not produced any results. This is also a reality. We are hearing positive statements from mediators and the heads of their states. It should also be noted that the joint statements of the heads of OSCE Minsk Group co-chair countries point to the unacceptability of the status quo. This is a very positive thing. At the same time, they constantly repeat that there is no alternative to negotiations. You know, in today's world there are many alternatives in any field.

We simply want this issue to be resolved peacefully. Azerbaijan demonstrates a constructive approach, and I hope that the mediators will play an even more active role in the negotiating process. Armenia should simply fulfill four UN Security Council resolutions and withdraw from the occupied territories, and the territorial integrity of Azerbaijan must be restored. These are the principles of the agreement.

Azerbaijan will never tolerate a second Armenian state on its historical lands. The issue should and will be resolved within the territorial integrity of Azerbaijan. I have no doubt about that, and in order to achieve that we will continue the talks, but we will also step up our strength.

Our military power is growing. In 2013, significant steps were taken in terms of army building. We have started very serious reforms. These reforms are producing results. Our combat capability is increasing, and in 2014 it will significantly increase. I should note that our military potential, army reforms, new principles and new approaches related to combat tactics are promoting a completely new situation. If we consider that in recent years Azerbaijan has purchased a large amount of weapons, ammunition and hardware – the most modern hardware – our combat capability will significantly increase, which will have only a positive impact on the negotiating process.

Sometimes the organizations not dealing with this issue or politicians bringing grist to the mill of Armenia try to criticize us for increasing our military budget. In fact, this is said by representatives of the countries whose military budget is sky rocketing. It is our natural right. We are increasing and will continue to increase our military capability. Our military capacity will play a crucial role in a fair settlement of the Nagorno-Karabakh conflict in accordance with international standards. Today we are building a powerful army. Our army is one of the strongest armies of the world. Of course, army building will be continued.

Last year we also addressed the problems of our compatriots affected by the Armenian occupation, as 20,000 persons were resettled to new homes and apartments. This year we also plan to resettle at least 20,000 people to new homes. Thus, we practically build a whole city every year and will continue this policy, because there are still quite a lot of displaced persons living in harsh conditions in schools, kindergartens, military units and dorms. This process has already begun and will be continued.

Of course, the biggest momentum for the development of our country is provided by economic power. Azerbaijan has made great strides in deepening the economic reform. If we had not created such a strong economy, I am sure we could not achieve any of these successes in the international arena or in the region. In 2013 our economy continued to develop. The gross domestic product grew by almost 6 per cent. This is a very high indicator.

If we consider that GDP growth in most countries of the world constitutes half a per cent, 1 per cent and 1.5 per cent these days, the increase of the gross domestic product by about 6 per cent is a great result. It is particularly gratifying that our non-oil sector grew by 9.8 per cent. In other words, it has increased by almost 10 per cent, which is a result of the reforms carried out in recent years. The reforms have provided that. Currently we are implementing major programs to ensure further development of the non-oil sector. They will be implemented in the coming years too. I am sure that we will keep this momentum. Cash incomes of the population grew by 8 per cent and inflation was only 2.4 per cent. This is also a great indicator. Population incomes exceed the inflation more than three times. This gives grounds to say that the welfare of citizens is improving and the positive dynamics is manifested here as well.

During the year, a total of $28 billion was invested in the country’s economy. This is a record indicator. Never before has such an amount been invested in the course of one year. In the past few years the volume of investment averaged around $20-21-22 billion. Today we have a figure of $28 billion. Of these, $17.5 billion worth of investment is domestic. This trend has also been ongoing for several years. Domestic investment exceeds foreign investment. I think this is a positive development as well. Of course, the bulk of domestic investment is made up of public funds, but the private sector also invests heavily in the Azerbaijani economy.

Our foreign exchange reserves have also reached record highs. I have repeatedly said this but I want to reiterate that our foreign exchange reserves should increase every year, and this is the case. Over the past few years has there hasn’t been a single year when our foreign exchange reserves declined. Even though numerous investment projects are under way, they grew last year as well. Currently, Azerbaijan's currency reserves constitute $50 billion. This accounts for 70 per cent of the gross domestic product. According to this index, Azerbaijan is in one of the most advanced places in the world. This has been created by us, by our policy and by our strength. This is a great advantage of Azerbaijan, which makes us confident, gives us faith and the opportunity to continue the implementation of large-scale projects contributing to the development of our country.

Last year we also addressed the problem of unemployment, created 110,000 new jobs, of which 80,000 are permanent. The unemployment rate dropped to 5 per cent. The level of poverty has also decreased and now constitutes 5.3 per cent. Our foreign debt accounts for 8 per cent of the gross domestic product. This is also one of the best indicators in the world. It is no coincidence that the Davos World Economic Forum ranks the Azerbaijani economy in 39th place in terms of competitiveness.
There are our main economic indicators. I have no doubt that we will achieve economic development in the coming years too. We will talk about that a little later, so that 2014 also becomes successful for our country.

Important steps were taken in addressing social issues last year. First of all, we have completed the repayment the deposits left over from the Soviet era, more precisely, their payment to the population in the form of compensation. I can say that Azerbaijan's experience in the payment of these funds in the form of compensation is in first place in the CIS. We have paid this money to the population in the shortest possible time – in a matter of two years. We have paid this money to the population with the highest coefficient even though the independent state of Azerbaijan did not bear any responsibility in this issue – neither legal nor moral. But we have done that because our policy is focused on the citizens of Azerbaijan. We have allocated significant funds and have been able to resolve this issue in a short time.

Salaries and pensions were increased last year. This is also a positive development. We are well aware that some countries are cutting pensions, wages, axing jobs and costs. Meanwhile, not a single social program has been reversed in Azerbaijan. On the contrary, we have taken additional measures to improve the well-being of the people – measures of both social and investment nature. Of course, this is manifested in real life as well.

In 2013, we took very serious steps to develop the non-oil sector, and this is confirmed by statistical data. Among them I want to mention the creation of the space industry. 2013 will go down in history as the year when space industry was established in Azerbaijan. It is no coincidence that at the beginning of the year we declared 2013 the year of the information and communication technologies. We launched the first Azerbaijani satellite Azerspace-1 into orbit. This is a great historic achievement of our people and our state. We have joined the club of space-faring nations.

Major steps have been taken to develop tourism. In particular, we have opened several five-star hotels in the regions. New travel destinations are opening up. Azerbaijan's tourism potential is already contributing to the development of our country and the well-being of our people. I am confident that citizens of Azerbaijan will gradually give preference to spending their vacation in the country because the opportunities available in Azerbaijan correspond to global standards. This is acknowledged by both our citizens and foreign tourists. Therefore, this direction is also very important for the development of the non-oil sector.

Of course, the development of agriculture is perhaps one of the main contributors to non-oil sector development. Last year growth in agriculture amounted to almost 5 per cent, but the potential is far greater. I believe that even more will be done for the development of agriculture in 2014 and subsequent years. We have great programs and plans. Structural reforms must be continued and management improved. New proposals involving subsidies are being discussed at the moment. Of course, public investment, infrastructure projects, in particular the projects related to irrigation, will give a new impetus to the development of agriculture. The biggest funds from the National Fund on Entrepreneurship Support are provided to farmers. This trend will be continued in the current year. In other words, the development of the non-oil sector remains our top priority in the economic sphere this year as well.

But, of course, we must not forget about the oil sector and the transport sector. A great job has been done in the transport sector. We have laid 500 kilometers of roads, built both highways and rural roads linking 400 settlements. This has been financed both from the state budget and the Contingency Fund of the President. In other words, great importance is attached to this area too. We are implementing global transport projects. The construction of the Baku-Tbilisi-Kars railway is under way. Most of this work will be completed this year. I do hope that we will be able to celebrate the opening of the road in 2015. The shipyard has been opened as well. It will also serve to strengthen the industrial, non-oil and transport sectors. A new trade seaport is under construction in Alat. This year we expect to open its first phase. The process of renewal is under way in the railway and air transport spheres. In other words, the entire transport sector is developing.

Of course, 2013 will also go down in the history of the oil and gas sector. In 2013, we signed historic agreements for the development and strengthening of Azerbaijan’s oil and gas potential. The signing in 2012 of the agreement on the TANAP project contributed to the fact that in June 2013 the Trans-Adriatic Pipeline was selected as the primary route. After that, relevant contracts were signed. All contracts related to the sale of Azerbaijani gas to Europe beyond 2018 have already been signed. This was also a very important event. Finally, at the end of the year, on 17 December, the "Shah Deniz-2" investment agreement was signed in Baku. This is a historic achievement and our historic victory. This is a project of the 21st century.

This project will bring Azerbaijan huge dividends – both economic and political. The authority of our country will increase, as will our economic strength. Major investments will be made in our country. According to preliminary estimates, "Shah Deniz-2", TANAP and TAP, i.e. the implementation of all projects related to this issue, will pave the way for $45 billion in investment. If we consider that Azerbaijan already has public and private institutions and companies that have accumulated extensive experience in the construction sector, in the implementation of infrastructure projects and oil and gas operations, these companies will receive large orders of course. Thus, our non-oil sector will acquire new business opportunities. Of course, as we have already stated, we will try to make sure, wherever possible and where our work is carried out in accordance with existing standards, that all the contracts are awarded to Azerbaijani companies and they have favorable conditions. So this project will introduce Azerbaijan to the world as an indispensible exporter of gas.

You are well aware that this project has also received great support from the international community. Azerbaijan hosted a grand ceremony attended by senior officials from leading countries. Azerbaijan, as the initiator of the Southern Gas Corridor, has played a decisive role in this as well. I can say with full confidence that if Azerbaijan hadn’t assumed historic responsibility and shown its courage, foresight and principled position at the crucial moment, this project would not have been realized. We had been involved in various activities related to the Southern Gas Corridor for about 10 years. I personally attended almost 10 international conferences, events and meetings. But we saw that this issue was not developing, was standing still and was not moving forward. Therefore, we assumed responsibility again. It was clear to us that this project required a leader, and we assumed the leadership function. It is a big responsibility – both political and financial responsibility. But the strong economy we have created over the past years has allowed the opportunity to demonstrate leadership both in these projects and in projects of global nature.

Today, some of the issues of European energy security will be resolved thanks to the projects put forward by Azerbaijan. The importance of this project is enormous, and the coming years will confirm my words once again.

Finally, 2013 saw an important event in the public and political life of our country, as presidential elections were held in Azerbaijan. The people of Azerbaijan have again given their votes for our policy, for real policies. Our people have given preference to real policies and real work over chatter and empty promises. I want to express my appreciation to my people again for giving a high assessment to 10 years of my activities and showing great confidence in me. As you know, all of the authoritative organizations observing the election gave it a very positive assessment. The Council of Europe, the European Union, the OSCE Parliamentary Assembly, the Organization of Islamic Cooperation, the CIS and other reputable organizations, i.e. all global organizations, have unequivocally praised the way the election was held and expressed official opinions in their statements saying that the election was conducted in a free, fair and transparent manner. But I would like to say once again that the main opinion was expressed by the people of Azerbaijan. The atmosphere that prevailed in society on voting day and in the post-election period confirmed again that the election was held in a transparent and fair environment. Of course, such confidence should and does encourage all of us to work even harder in the future. We must continue to work hard to strengthen our country and ensure the well-being of the Azerbaijani people.

Closing speech by President Ilham Aliyev

- In 2014, the dynamic development of our country must be secured. I think that the decisions made in previous years and the work upcoming in 2014 will enable us to successfully complete the current year as well.

The investment program will be fairly large. The investment program reflects the main infrastructure projects. There is still a great need for the implementation of infrastructure projects. Although a great deal has been done in recent years, much still remains to be done. It is not ruled out that the investment to be made in Azerbaijan in 2014 will be at the level of last year. Under such circumstances, the stability of the macroeconomic situation, of course, is the fundamental condition. Azerbaijan has accumulated extensive experience in carrying out economic reforms. Even the increase in wages, the repayment of deposits and the investments worth billions of dollars have had no adverse impacts on the macroeconomic stability. This is evidenced by the fact that inflation was only at 2.4 per cent last year. This is a very positive indicator.

We must strive to ensure that inflation stays at an appropriate level this year too. We always say that inflation should be measured by single digits. But nine is also a single digit. Last year, inflation in the country stood at 2.4 per cent, which, of course, makes us very happy. We must do our best to keep it at about this level this year as well. In this case, of course, we will have even better opportunities to improve people’s well-being. Thus, the implementation of the investment program, the attraction of foreign investment, the macroeconomic stability and its protection – all these factors will facilitate the successful development of our country. I am sure that our statistics, the gross domestic product and the development of the non-oil sector will be at a high level in 2014.

We will continue to support entrepreneurs. Some figures have been voiced here, suggesting that business people received favorable loans amounting to 275 million manats last year. This is also additional investment made in the real economy because these loans are provided only to be invested in the real economy. At the same time, it means a lot of support for the development of local entrepreneurship. There are these funds and the recommendation programs prepared by the Ministry of Economy and Industry, which are effectively used by entrepreneurs. There are plans to allocate funds only for profitable areas and projects that can generate income. It is as a result of this that all the loans are being repaid in a timely manner. Today, the repaid loans make up a significant proportion of the portfolio of the National Fund on Entrepreneurship Support. This year we will adopt a third program on the development of districts. Last year the second program was fulfilled. Its implementation has been completed. I can say that the adoption of these two programs and their implementation has brought about a serious turnaround in the regions. We can clearly see this both in the statistics and in real life. The regions have been revived, have improved and a modern infrastructure has been created in them. In addition, the construction of social infrastructure facilities has become widespread.

We have created jobs in the countryside. Over the past 10 years, 1.2 million new jobs have been created in Azerbaijan. Most of them are in the regions. This is having a positive impact on the process of recovery ongoing in the regions, prevents migration to cities, contributes to the growth of local production and reduces our dependence on imports. In other words, work in this area will be continued in the current year too. There are specific projects, and government assistance to entrepreneurs will be continued.

Of course, we will also approve the first year plan of the state program on the socioeconomic development of districts which will be adopted. When the investment program was approved as a whole, the regional program was taken into account as well, of course.

At the same time, we will adopt a new program on the development of Baku and suburban settlements this year, perhaps in the next few days. In 2013, this program was completed and a new one is being prepared. I believe that as a result of the implementation of the next three-year program, all problems existing in the suburban settlements of Baku should be resolved. The infrastructure, the social infrastructure, schools, health centers, roads, water supply, sewage, gas, electricity – in other words, we plan to resolve all the major issues, including job creation. I do hope that in the next three years we will be able to achieve complete realization of this program.

In my opening speech I expressed my thoughts on the development of agriculture. I want to say again that it will be one of the priorities of non-oil sector development in the coming years. We are also implementing a food security program. In recent years we have taken major steps in this direction and significantly reduced our dependence on imports. Today, the bulk of basic food products are made in Azerbaijan. The production of certain goods completely meets our needs, while in some areas we are still dependent on imports. As you know, I have repeatedly expressed my thoughts on this subject. I want to say again today that Azerbaijan must be able to fully meet its needs for basic food products. In other words, the food we produce must fully meet our needs. We are getting close to that and should seek to ensure that in the next five years, perhaps even earlier, when the implementation of the third regional development program is completed, all issues related to food security have been resolved.

These issues must be addressed so that we could take into account the future. It has been indicated here and we all know that the demographic situation in Azerbaijan is very positive. For this indicator we are in first place in Europe, and Azerbaijan’s population will gradually increase further. Population growth is directly linked to economic development. If we look at the dynamics of economic development, we can see that there is a direct relationship with population growth. Therefore, our food security issues should be calculated not for the current population, but for the future. Of course, the rapid development of agriculture is a priority.

At the same time, land reclamation and irrigation projects will result in the inclusion of tens of thousands of hectares of land into circulation. The Takhtakorpu water reservoir has already been commissioned, while the construction of the Shamkirchay reservoir is under way. Therefore, we should apply the most advanced technology here. We should thoroughly study the experience of developed countries. We can see now that some farms have a yield at least twice as high as conventional standards. Therefore, if we make rational use of the existing lands, we can further improve productivity. I think that all the basic food can be produced in Azerbaijan by 100 per cent.

But in the future, of course, we will have tremendous export potential here. We must take population growth into account. As for the reforms, there is a need for structural reforms. We need to put in place an even more effective structure here.
There are issues related to the provision of subsidies. I have repeatedly expressed my thoughts about that. I believe that we will create an effective mechanism and fully ensure transparency in this area too. This will allow us to continue developing agriculture in the future too.

At the same time, we should continue the process of creating large grain production farms. We already have first experience. This is a positive experience, and we will continue our efforts in this direction.

There are specific opinions and suggestions regarding the purchase of agricultural machinery and its production in Azerbaijan. We are updating and will continue to update our technical depot. The government allocates and will continue to allocate funds. This year the construction of the Shamkirchay water reservoir should be completed. This will give a great impetus to the development of agriculture in the western region. As I said, tens of thousands of hectares of land will be irrigated. The boundaries of irrigated land must already be determined. We need to know exactly how many thousands of hectares of land will already be irrigated. Therefore, we need to carry out registration of the land fund. We need to finish this project. I want to say again that we should apply the most advanced practices existing in the world. We need to know with absolute certainty what our capabilities are and build our plans in accordance with that.

At the same time, artesian wells were drilled in more than a hundred villages in 2013. Funds were allocated from the Contingency Fund of the President. I think that artesian wells should be drilled in at least 200 villages this year. The project will also be of great importance in the provision of population with drinking water. This year, the implementation of infrastructure projects will be continued.

Key issues related to electricity have been resolved. It was noted here that we celebrated the commissioning of the “Janub” power plant last year. This power station with a capacity of nearly 800 megawatts will address the needs of the entire southern region. Currently, the construction of the “Shimal-2” power station is under way in Baku. It will probably be put into operation this year. It will generate about 400 megawatts of electricity. In recent years we have been able to significantly strengthen our energy potential, but the needs are growing. Considering the development of our economy and industry, as well as the future development as a whole, we must continue to attract investment to power generation projects. We will probably resolve the issue of building a major power plant in Baku. There is a need for that. Our energy potential must always exceed the needs. This is the case today and it must be the case in the future too.

Therefore, the attention being paid to power generation should not be reduced in the coming years. Of course, we will implement these projects. We should also work harder on creating renewable sources of energy. I have repeatedly expressed my thoughts on this subject. Of course, some projects are already being implemented, in particular hydro power plants under construction, including those in Nakhchivan. It is possible to say today that almost one hundred per cent of electricity needs in Nakhchivan is provided by hydro power plants. This is a great support and a huge contribution to the energy security of Nakhchivan. In other regions of the country, namely in Fizuli, we have built a hydro power plant with a capacity of 25 megawatts. In addition, a hydro power plant of nearly 25 megawatts has been built on the Takhtakorpu water reservoir. A hydro power plant with a similar capacity will be built on Shamkirchay. Alternative energy sources have been developed at the Balakhani waste disposal plant. Power stations are also built on small rivers. This work should go even faster. I have repeatedly said that we have a map of all our water sources and we know where and how much power we can generate. Even more funds should be invested to do that.

Work on the development of solar and wind energy should go even faster. I have expressed my thoughts about that several times. There are even companies in Azerbaijan that produce solar panels. But work on the development of solar energy is not going very fast. In 2014 we need to make the necessary adjustments here, so that the work could go faster. If we consider that there are enough sunny days in Azerbaijan, failure to use these opportunities would be a big mistake, of course.

Gasification projects are under way. I receive regular information about that. We can say that work on gasification is completed in several villages every month. It Baku it has reached 96 per cent. In the coming months, I am sure, it will reach 100 per cent. In general, the level of gasification in the country should reach 95 per cent, and we will achieve that in the coming years.

The construction of rural roads was particularly widespread last year. Large funds were allocated both from the Contingency Fund of the President and from the state budget. This year, this area will continue to receive special attention. This has a great sense and is very useful. We are creating excellent opportunities for people living in the villages, and funds are envisaged for this purpose in the current year too. First of all we should complete the ongoing projects because some projects have yet to be completed. There are new projects. We are now receiving proposals from the ground. We are doing this work on the basis of appeals from local executive authorities and citizens expressed during my trips to the regions. So I am sure that this year will also produce good results.

I can say that the most important of infrastructure projects are those on drinking water and sanitation. Last year I attended the commissioning of drinking water projects in several cities, and this process will be continued in the current year too. Overall, 55 per cent of the country’s population is provided with drinking water round the clock. Of course, it is a very low figure. It is also true that the issues of drinking water and sanitation have always been very acute in Azerbaijan. Our districts did not sewage lines at all in the past. Sewage lines in Baku have become outdated and no longer meet today's standards. Therefore, these projects require large financial and technical resources. We have already started these projects, and the work is progressing well.

Currently, 78 per cent of the population of Baku is provided with drinking water round the clock. This is a huge progress. When we started these projects, this figure was below 50 per cent, i.e. less than 50 per cent of the population received water round the clock. Today we have reached 78 per cent. This is good progress. But such a beautiful city as Baku should reach a level of 100 per cent. The population of Baku and all our cities and settlements should be provided with quality and clean water meeting the standards of the World Health Organization.

Most of the work here, of course, is carried out by the "Azersu" Open Joint Stock Company. At the same time, as I said, the "Irrigation and Water Management" Open Joint Stock Company should also carry out work involving the drilling of artesian wells. The Ministry of Ecology and Natural Resources provides for the installation of modular sewage treatment plants in villages along the rivers. Hundreds of villages are covered by these projects. The first pilot project was implemented last year. This is primarily a Caspian water desalination project which is meant for irrigation purposes. This pilot project has already been implemented. We need to expand this practice. In the future, if necessary, we will be able to use the Caspian water for drinking. So I can say that these projects are among top priority projects of social infrastructure. I call them infrastructure projects because they are purely social in nature, and funds are invested only for people’s health and comfort.

In the transport sector we will continue road construction projects this year. The list of all these projects has already been approved. The construction of motor roads is under way. I think that we need to pay special attention to the construction of the Baku-Astara highway, because this work isn’t going very fast. Work on the Baku-Gazakh-Georgian border and the Baku-Russian border highways is going faster. But we haven’t been able to achieve the required pace in the construction of the Baku-Astara-Iranian border highway. Therefore, this project should be given more attention this year.

As I mentioned, this year we should complete the first stage in the construction of the trade seaport in Alat. Thus, I believe that this year we will relocate the Baku trade port from the city center. As a result, wonderful public spaces will be made available for our people. These areas will have parks, gardens and promenades. The boulevard will be extended beyond the seaport and will be connected to the boulevard under construction in the direction of the "White City". Eventually, a beautiful boulevard covering several kilometers will be put in place.

The construction of the Baku-Tbilisi-Kars railway is progressing on schedule. I think that it will be implemented on time. We have repeatedly spoken about the importance of this railway and I think there is no need for any additions. Here, of course, we are once again seeing the cooperation among three countries. Azerbaijan, Georgia and Turkey have been cooperating successfully in both energy and transport sectors for many years. I believe that the construction of the Baku-Tbilisi-Kars railway will also be a wonderful result of this cooperation.

The construction of the underground is ongoing in Baku. Several stations are under construction. In previous years we adopted a large program associated with the underground. A total of 50 new stations will be built. The investment program will, of course, address these issues as well.

Due to the growth of industrial production the activities of industrial parks is of particular importance. There are already first results in this direction. The Sumgayit industrial park is already in operation. The new chemical technology park is beginning to operate. Industrial parks are to be established in other cities, in Mingachevir.

The process of establishment of the Balakhani industrial park is under way. This year we need to take even more serious steps in this direction. In fact, I have repeatedly said that our successful development should be achieved through the non-oil industry. The growth of our gross domestic product will also be possible through industrial production.

In 2014, we should take serious steps regarding the development of the steel industry. This is a very promising industry, especially if we consider that we have enough local raw materials and natural resources for the development of the steel industry. The construction of a modern metallurgy plant, of course, would be a huge achievement. I think that special attention should be paid to this industry this year.

Every year, the focus is on improving the environmental situation. Comprehensive measures are already taken, but we need to take even more serious measures. In particular, it is necessary to inspect the factors that pollute the air once again. Of course, we need to speed up the transition to the "Euro-3" standard. "Euro-3" is not the limit either. We need to do more work in connection with the "Euro-4" and "Euro-5" standards. Of course, a large role in these matters belongs to the refineries operating in Azerbaijan. They should also be reconstructed. The construction of a new refinery is planned in Baku. But before it is built, it is necessary to take environmental measures at the existing plants. In general, we need to seriously fight the factors that cause air pollution.

According to my information, the biggest factor is cars. Last year Azerbaijan imported more than 100,000 cars. This, of course, is something that confirms the improved well-being of our people. But at the same time, it is huge workload for our road infrastructure. We are building roads, road junctions and tunnels. Quite possibly the projects implemented in Baku and Azerbaijan are not implemented elsewhere in the world. So many roads and tunnels have been built. So much money has been allocated. But the imports of 100,000 vehicles, most of which have been brought to Baku, certainly creates the problem of traffic jams and worsens the environmental situation. Therefore, we have stopped importing cars that do not meet environmental standards or specifications. I think that this year the Ministry of Ecology and Natural Resources, other relevant agencies and the entire Cabinet of Ministers should consider this issue again. We can’t allow the imports of cars polluting the environment in Azerbaijan. The automobiles that are out of order should not be brought to the country at all. I want to receive specific proposals so that we could resolve this issue once and for all.

Serious examinations should be conducted at the enterprises polluting the air. The Ministry of Economy and Industry, the Ministry of Ecology and Natural Resources and other relevant agencies should provide me with a list of such companies. It is necessary to take serious measures there. Either the owners of these enterprises – whether public or private entities – install the necessary treatment facilities or these companies should be closed. Clearly! The enterprises polluting the air and poisoning the people are not needed. I can say that fines do not work here, because the process of fining is very complicated. In addition, the amount of fines is not big enough for anyone to cease operations now. So it is either necessary to install treatment facilities or the plants will be closed. Without any hesitation! I think that this will make a major contribution to improving the environmental situation. We are planting millions of trees, creating public areas, building drinking water and sewage lines, while companies polluting the air bring all our work to naught. So it is a very serious matter. It is a matter of health for every citizen of Azerbaijan. And health comes first.

Other environmental measures will be taken too. This year we will begin a project to clean Lake Boyukshor, and its first stage should be completed next year. The Ministry of Economy and Industry has already informed me about that. Work will begin this year, a third of Lake Boyukshor will be separated by a dam. Environmental measures will be taken there. I am sure that this experience will be successful. Then the rest of the lake will be cleaned. The total area of Lake Boyukshor exceeds 1,000 hectares. It is a huge lake. It is located in the city center and, as you know, the waste water, the produced water and the waters contaminated by oil are discharged into it, which significantly deteriorates the environmental situation in Baku. It is therefore necessary to implement these projects. It is time to seriously deal with other lakes too. Several years ago I set out my thoughts about that. I even provided the names of all these lakes. So the time has come. It is necessary to clean all the lakes. Where this is not possible, it is necessary to drain them, i.e. a plan of integrated activities must be put in place. We can also adopt a special program, and we will do so.

Information on other industries has also been provided here. With regard to the development of the space industry: the launch of the first satellite, as I said, is a great historic event. But this year we need to take concrete steps to prepare the second and third satellites. Perhaps we should open tender procedures. There are quite a few companies interested in cooperating with us. Therefore, the space industry in Azerbaijan will develop. This year specific steps should be taken for the launch of more satellites.

We will continue the construction of social facilities. All this is part of the investment program. I can say that last year repairs were carried out in almost 300 schools and more than 80 health facilities. Most of the work has been done in this direction, but much still remains to be done.

This year, as was the case in the past, very serious fight will be waged against corruption and bribery. This struggle is producing excellent results. Comprehensive measures are being taken. “ASAN xidmət” started to operate early last year, which brought about a big change in this area and introduced novelty. “ASAN xidmət” is a product of Azerbaijan, an Azerbaijani invention and an Azerbaijani brand. In a short time this service has benefited hundreds of thousands of people. I have not heard of any complaints or dissatisfaction to this day. All services are provided in a transparent and courteous manner. The number of services provided by “ASAN xidmət” must be increased. Regional centers of the service should also be established this year. Centers already exist in Ganja and Sumgayit. Mobile services are also provided. This year, we have to build at least four and maybe even five “ASAN xidmət” centers in the regions. This should be reflected in the investment program.

However, the fight against corruption is not limited to the activities of “ASAN xidmət”. All state bodies, particularly those that are in contact with citizens, must wage very serious fight against corruption and bribery. We know our sore spots. We also know what we need to do to cure these sore spots. We have the political will. It is strong enough. Persons involved in corruption on the ground, in the central executive authorities and local executive bodies should be removed from their positions and prosecuted. The anti-corruption department is already doing this work and instituting criminal proceedings. It is necessary to take more stringent measures so that we could get rid of this evil. I believe that even more impressive steps will be taken in this area in 2014.

Things are going well in the oil and gas sector. As I said in my opening remarks, the “Shah Deniz-2”, TANAP and Trans Adriatic Pipeline projects are our historic victory. It is the largest infrastructure project in Europe and its implementation has already begun. I believe that all of the work will be done in a timely manner .

We are entering a crucial year in terms of preparations for the European games. As you know, the European games will be held in 2015. We have been allowed only two and a half years to prepare for the games although preparations for Olympic Games usually take seven to eight years. However, we intend to conduct European games at the level of summer Olympic Games in two and a half years. I am confident that we will achieve that. The organizing committee has been set up and is working. All relevant agencies should pay more attention to this issue, so that we could complete most of the preparatory work this year. This year we need to complete the construction of the vast majority of sports facilities. The construction of the Olympic Stadium, the Gymnastics Center, the Aquatic Palace and the Shotgun Shooting Center is under way. The Heydar Aliyev Sports Complex, the Palace of Hand Games and other sports facilities are undergoing major overhaul.

In short, I am sure that we will not have any problems in this direction. However, preparations for these games are not limited just to the construction of Olympic facilities. Security issues are of tremendous importance as well. Very serious attention should be paid to transport, accommodation of visitors and athletes, the establishment of the Olympic village and other issues. This year, I want to say again, will be crucial in terms of preparations for the games. I am sure that we will conduct these games at the highest level. If we consider that these will be inaugural games, the standards set in Azerbaijan will be adopted as the standards for European games in general.

Last year was declared the year of the information and communication technologies in Azerbaijan. The main reason for that was the fact that we launched our first satellite into orbit last year and, in general, the ICT sector received considerable attention. I believe that this year we should pay even more attention to the industrial sector, which determines the dynamics of the further development of our country. Industrial parks, new industrial enterprises, production of export-oriented industrial goods, the establishment of processing plants and major industrial estates – all of this work will contribute to the further development of our country, further reduce our dependence on the oil and gas factor and determine the sustainable economic development of the country for years to come.

Considering all these factors, I believe that we should declare 2014 the year of industry. A relevant order will be signed shortly. A plan of specific measures on the development of industry will be drawn up and approved. These measures will be taken in the year of industry.

Year 2014 is beginning. In the first week of the year we have already opened two large facilities. The “Tufan” ski center was opened in Gabala and the largest medical facility built in the years of independence, the Baku Health Center, was opened in Baku. So we are getting off to a good start of the year. I am sure that 2014 will also be successful for our country and our people. Thank you.