Ilham Aliyev chaired a meeting of the Cabinet of Ministers

President Ilham Aliyev has chaired a meeting of the Cabinet of Ministers on the results of socioeconomic development in the first quarter of 2011.

The head of state opened the meeting with a speech.

Opening remarks by Azerbaijani President Ilham Aliyev

Today’s meeting of the Cabinet of Ministers is dedicated to the results of the first quarter of 2011. Our economy successfully developed in the first quarter. Of course, in order to analyze the results achieved at the beginning of this year correctly, we must take into consideration Azerbaijan’s economic development in previous years. In recent years our economy has been growing steadily. In the last seven years, our gross domestic product has increased almost three times. Even in the years of crisis, 2009 and 2010, our economy developed by 14 per cent. Therefore, the growth in the first quarter based on this solid foundation is certainly very gratifying indeed.

In general, our economy grew by 1.6 per cent in the first quarter. It is gratifying that our non-oil sector has grown by 5.6 per cent. As you know, our main goal is to develop the non-oil sector, reduce dependence on the oil and gas factor, thus achieving economic diversification. Therefore, special attention is being paid to the development of the non-oil economy, and the social and economic reforms under way are primarily intended to achieve this objective.

Although industrial production has increased by 0.3 per cent, the most important and gratifying aspect of industrial development is that our non-oil sector has grown by 9.8 per cent. This shows that the funds invested in the non-oil sector, the investment and the conditions created for entrepreneurs are yielding great results. Overall, the relatively minor increase in industrial production is explained by a certain decline in oil and gas production. However, this decrease is of temporary nature. At present, we can say that oil production in Azerbaijan has reached a high level and will remain as such. As for gas production, it should also be increased in the coming years due to the investments being made.

One of the worrying issues is the fact that inflation has risen by 9.1 per cent in the first quarter. This worries us. But at present inflation is in single digits, and we must maintain this level. Besides, population incomes have increased by over 16 per cent. So if we compare inflation to population incomes, we can see real growth of the latter. I am sure that these trends will further manifest themselves during the year.

Our accumulated exchange reserves constitute $34.2 billion. All instructions in this direction are also being fulfilled and our exchange reserves are growing. Major investment projects requiring significant resources are being implemented. Despite this, we are securing our investment projects and increasing exchange reserves. This is a great indicator in itself. It is also evidence of the country’s economic and financial capacities.

I have no doubt that our exchange reserves will increase by the year’s end. And this increase will be very impressive.

Overall, all the instructions in the economic sphere are being fulfilled. First quarter results afford grounds for manifestation of these positive trends for the rest of the year. All social programs are being fulfilled. All social issues are being addressed. Work on creating a social infrastructure is based on a program. The construction of schools, hospitals, social, culture and sports facilities is progressing in concordance with the investment program. As of the first quarter, the average monthly wage in the country is 340 manats, or $430. This is a good indicator. The growing average wage is an indicator of the policies being conducted in both economic and social spheres. Our country adheres to a market economy. At the same time, social issues are successfully addressed in Azerbaijan. Of course, the best indicator of that is the fact that the level of poverty in Azerbaijan has been reducing by the year.

According to the results of 2010, the level of poverty in Azerbaijan was 9.1 per cent. I do hope that thanks to the work to be carried out this year in both the economic and social spheres, as well as the expected increase of wages and pensions this year, the number of people living in poverty will be further reduced. As a result, we will meet the objective set several years ago.

There are poor people in every country. But we have set this task, this is our goal. The creative work under way in the country, the economic reforms, social programs will enable us to resolve this difficult problem.

Along with this, the state program on the socioeconomic development of districts is being successfully implemented in all our districts. All of the scheduled investment projects were implemented in a tamely manner in the first quarter of this year. Almost 17,000 jobs were created in districts in the first three months. This process is ongoing. In general, 930,000 jobs were created in the country as part of the first program. In order to help businessmen, we allocate loans which have been yielding great results. In other words, the program on the development of districts is being fulfilled. While traveling to districts, I can see the work being done with my own eyes, and I can confirm that there is development in every district. Most importantly, this development is permanent. We shouldn’t be complacent with these successes although a lot has been done in Azerbaijan in recent years. We must keep on developing and actively resolve existing problems. Along with the program on the socioeconomic development of districts, a program on the socioeconomic development of Baku settlements is being prepared. An expanded meeting was held in this regard last month and all instructions were issued.

Problems are being analyzed now. In fact, these problems are known. After a special program is adopted to tackle them, we will implement some of the issues this year. But in order not to waste any time, 10 million manats has been allocated from the Reserve Fund of the President to the Mayor’s Office of Baku, so that these issues could be resolved without delay.

Work in the settlements has already begun. I often travel to settlements now, as I did in the past. I examine the situation and ask people directly what their concerns are. I can say that a lot has been achieved in settlements lately. The schools built in the settlements have had a positive impact on the development of education. There is a shortage of water in some settlements. The sewage problem is common for practically every settlement. This problem is acute not only for settlements, but also for Baku proper. At the same time, as a result of the work done in recent years, electricity supply is good. There have been no complaints and appeals. Gasification of settlements is under way. This issue has been practically resolved in full. In the coming years we need to build new lines in order to provide a higher gas pressure.

Public health issues have been resolved to a certain extent, but there is a need for new hospitals and clinics. The problem of roads, which is characteristic of all settlements, is a top priority issue. Most of the roads in settlements are earth roads. The process of road construction has commenced.

I think that after the adoption of a broad, very precise and specific program, we must resolve most of the problems existing in settlements by 2013. Even though this is a very large program. At present, settlements are home to over 800,000 people. This is a city in itself. But this issue must be resolved. I do hope that we can succeed in that in a short period of time.

Major infrastructure projects were implemented in the country in the first quarter. Their implementation is progressing on schedule. The process of gasification is under way. Issues of water supply and sewage are being dealt with, both trunk and local roads are being built. Among major infrastructure projects, I would like to point to the construction of a new building of the Heydar Aliyev Airport. The airport is the gateways of any country. At present, our international airport is not fully in line with the present level of Azerbaijan’s development, and our future development in particular. Therefore, a new airport building must be built. Work has already begun. It is also necessary to build new runways and rebuild the whole service infrastructure. The Heydar Aliyev international airport must become one of the most beautiful and top level modern airports on global scale. I am sure that the construction will be completed in two years, and the country’s highly important infrastructure facility will be commissioned.

As you know, other major infrastructure projects are being implemented now. The International Trade Seaport is one of them. Work is progressing well there. A shipyard is being set up. So if we add these two major projects and the airport, this will significantly raise Azerbaijan’s transport capacities. New vessels and ferry-boats are to be purchased in the coming months, because the volume of cargo traffic via Azerbaijan is increasing. Although we have bought around 10 new and modern tankers and bulk carriers in recent years, we need more. We should bear in mind that the Baku-Tbilisi-Kars railway is to be commissioned in 2012. We need to do the preparatory work in a way that would rule out any delays after the Baku-Tbilisi-Kars railway has been commissioned. Therefore, we have set the task of buying new ferry-boats, and this will be accomplished this year.

The information and communication technologies sector has registered major growth in the first quarter of 2011. This sector is developing dynamically. I have repeatedly spoken about that. Azerbaijan is already turning into a regional ICT center. Bakutel exhibitions have become traditional. The world is increasingly interested in Azerbaijan and the work being done here. The development of this sector is contributing to the development of Azerbaijan’s overall intellectual potential and our intellectual capacity. At the same time, this sector is of great commercial importance. It is already turning into another source of revenue for us. In the future, this revenue will have a strong impact on the economic development of the country.

A program on developing an artificial satellite is being implemented. I do hope that Azerbaijan will have its own satellite soon. This is very important for both the image and authority of the country. But above all, this is highly important from a practical standpoint. The income to be made from the commercial operation of the satellite will also create good opportunities for us.

Our country’s military-industrial potential is rapidly developing. I want to emphasize this sphere because it is an industrial sector and, at the same time, a very special sphere. Both of the goals are being pursued. First of all, we must strengthen Azerbaijan’s military potential using domestic opportunities. It is with this aim that the Ministry of Defense Industry has been established. On the other hand, this is a new industrial sector. Thousands of new jobs have been created, good salaries are being paid and modern military-industrial products are manufactured in Azerbaijan. At present, products of 430 denominations are made in Azerbaijan. Our goal is to arrange work in this sphere on the basis of cutting-edge technologies.

Among them I want to highlight the production of unmanned airplanes. These industrial spheres are typical of the more developed countries. Azerbaijan, using its own capabilities, has already started producing unmanned airplanes at the highest level, and this will significantly bolster our military power.

In general, Azerbaijan is playing a very positive role in strengthening the measures of security in the region. Azerbaijan is a stabilizing factor in the region. Our country is conducting successful policies in all the spheres. Our stance on the Armenian-Azerbaijani conflict over Nagorno-Karabakh is unequivocal. The norms of international law must be fully secured. Four resolutions of the UN Security Council must be unconditionally fulfilled. In the same manner as resolutions of the UN Security Council on Libya which started being executed in a matter of hours. I have already expressed my opinion about that. I want to say again that this is unfair, this is double standards, and this discrimination cannot be explained otherwise. Because the Armenians have perpetrated a genocide against Azerbaijanis. The Khojali genocide was committed. The Armenians have massacred innocent people. For some reason, the world community remained indifferent to our grief at the time. Azerbaijan’s internationally recognized territories have been under occupation for many years. Four resolutions of the Security Council, decisions of the OSCE, decisions of the European Parliament, the Council of Europe, the Organization of Islamic Conference, NATO have been adopted – all these decisions demand that Armenian troops should withdraw from our occupied lands. But the issue still remains unresolved. Under such circumstances, Azerbaijani citizens are asking a legitimate question: why are we treated differently? What is the reason for that? I am putting this question to the international community, to the countries that have a say on the international arena. Azerbaijan’s territorial integrity must be restored, an end must be put to occupation, and this issue must be resolved soon because the patience of the Azerbaijani people is not unlimited.

I want to reiterate that Azerbaijan’s position in the negotiations in explicit. This position is based not only on our wishes, but also on international law, which is still the main criterion worldwide. We can see the norms of international law being flagrantly violated now. Therefore, Azerbaijan’s territorial integrity must be restored and there should be no preconditions for that.

The proposals being negotiated now will ensure the restoration of Azerbaijan territorial integrity. At the same time, the issue may be resolved on the basis of principles that can ensure the co-existence of those living in Nagorno-Karabakh and the citizens of Azerbaijan who will definitely return there, in the status of an autonomy and self-governance. I want to repeat: provision of Nagorno-Karabakh with independence now or at any time in the future is impossible. This is not and will never be a subject of negotiation.

In the first quarter, an OSCE evaluation mission visited the occupied territories in this regard. The visit took place on our suggestion. The Armenian side attempted to object to that. As you know, a similar mission visited the occupied territories in 2005. That was a fact-finding mission. This is what it was called. Its main goal was to study the situation on the occupied territories and prepare a report. I know that there are different opinions in Azerbaijani society as to the latest report by the mission. Our society has been voicing its legitimate concerns at the fact that expressions used in the report are not very harsh. But I want to indicate that the goal and the mandate of the mission were to study the situation and describe its observations in a report. From this standpoint, I think that the issues covered in the report do reflect reality. I want to point to several important aspects of the report. First, it says openly that the Armenians have destroyed the entire infrastructure on the occupied territories. We knew that before, this was stated in the 2005 report and it is stated this year again. So the mission saw with its own eyes the consequences of Armenian vandalism. Our mosques, graves, the entire infrastructure have been destroyed and plundered. The second important issue is that the report stresses the unacceptability of artificially changing the administrative boundaries of occupied districts. This demand concerns Armenia directly. We know too well that the so-called local authorities want to artificially change the boundaries of our districts at the direction of Armenia. Also, the report describes as unacceptable the renaming of historical and native places of Azerbaijani districts. This claim is also addressed to Armenia because they are trying to rename our cities, and no-one will ever recognize these new names apart from themselves.

The report covers quite a few similar issues. To a certain extent, all these issues were reflected in the previous report too. This time they are confirmed again. One of the most important issues is that the report points to the policy of illegal resettlement on occupied territories. At present, there are 14,000 facts of illegal resettlement, mostly in Lachin and Kalbajar Districts, i.e. there are 14,000 people who are not supposed to live there. They were moved there subsequently, which is described in the report as an unacceptable fact.

Finally, the report indicates that the status-quo, i.e. the present situation, cannot be continued. I think this is one of the crucial aspects of the report because the Azerbaijani state has been declaring from all rostrums, in all international organizations and in direct meetings with officials from co-chairing countries for many years that the status-quo must be changed.

The Armenian side is using every opportunity to drag out the talks. To some extent, I have informed Azerbaijani citizens of that too. Issues agreed at a certain stage are then tabled again, they back down from the agreements reached earlier. In other words, they want this process to be endless, permanent, eternal, they want the talks to last permanently and create the impression that Armenia acts constructively. However, we have repeatedly indicated that Armenia is not sincere in the talks. Their goal isn’t to resolve the issue. Their goal is to keep the occupied territories under control as long as possible and eventually turn a de facto situation into de jure. Their intentions are as follows: the more time passes, the better, i.e. the world community will put up with the situation, and this status and the process of talks will be endless.

We have repeatedly stressed that this is impossible. Azerbaijan will not join the talks only to imitate them. This is our categorical opinion, and the status-quo must be changed. We all understand what it means to change the status-quo. It means that occupying forces must withdraw from Azerbaijani lands. I think it is very important to include this thesis into the report. Azerbaijan’s position is supported by co-chairing countries, the OSCE. The unacceptability of the status-quo has been stated a number of times. It has been confirmed in the statements of senior officials from co-chairing countries. If the status-quo is changed, and it must be, then the occupying forces will withdraw from the currently occupied Azerbaijani lands, and this must happen soon. Armenia should not be allowed to drag out the talks artificially and under various pretexts. Armenia must provide specific answers to specific proposals, so that the process of liberation of our lands from occupiers could begin.

Therefore, I would like citizens of Azerbaijan to know my position on the issue, the position of the Azerbaijani state both as regards the report and the essence and content of the talks. I think there is a need for that.

Closing remarks by Azerbaijani President Ilham Aliyev

The work done in the first quarter of the year shows that the country’s economy is developing successfully, social issues are being addressed and there are specific programs for each sphere. These programs are being implemented. Government members know their obligations and are fulfilling their public duty.

The processes unfolding in the world, namely the hike in the oil price on world markets, inevitably raise inflation risks. You know that we encountered a similar situation several years ago. The oil price also shot up then – from $60 to 140, and some time later this drastic increase affected consumer prices. So higher inflation risks are not ruled out and perhaps unavoidable. In this case, we should conduct a more targeted policy on boosting anti-inflation measures. We should pay more attention to the macroeconomic stability.

Macroeconomic stability is always the focus of our attention. All macroeconomic development measures focus on this issue. Last year inflation was at an acceptable level. We can see that in the first quarter of this year inflation rose by 9.1 per cent. Both the developments unfolding in the world, the growing oil price, and the expected increase of wages and pensions in the country will inevitably impact on inflation risks. We must try to ensure that inflation stays in single digits in 2011 and all anti-inflation measures are more rigorous and focused.

There is control over consumer prices, there is permanent monitoring. We will continue to tackle these issues in the future. We must further step up fight against monopolism. The fight against monopolism both in imports and in domestic production must be even more rigorous. Sometimes when we speak of “monopolism”, we tend to associate it mostly about imports. But the latest developments, namely the picture observed on the eve of Novruz, show that there have been cases of artificial price increases on domestic goods. We took immediate measures. We took the necessary steps to regulate the artificially increased prices. Monopolism should be nipped in the bud both in imports and domestic production.

We can say that Azerbaijan’s market is rather limited. If a major producer emerges – and we want, we are interested in developing small and medium-sized enterprise, in having large companies and seeing them grow stronger; the support provided by the state, the political and economic support is already serving the emergence of major companies – then, at the same time, the major company inevitably becomes a monopolist and sometimes takes unacceptable steps to secure its interests.

In such cases, the fight against monopolism both in imports and domestic production must be further stepped up, we must prevent such negative phenomena.

The intensified fight against corruption and bribery is producing great results. This policy will be continued. This is our conscious choice and the people appreciate these measures. We must take into consideration a number of factors. This fight must be large-scale and comprehensive. Of course, we must step up administrative measures, measures of punishment will continue to be applied, public oversight must be strengthened.

While talking to people, I always urge them to raise negative phenomena. In general, public control in all spheres of life in Azerbaijan must be further stepped up. Reforms should be deepened. And this is important to anti-corruption measures. It is necessary to secure a sound competition. Unsound competition must be eliminated. There must be transparency in every sphere. We have great experience in that. We are dealing with transparency issues successfully. We can cite the Azerbaijan State Oil Fund as an example. This agency has received the highest and most positive feedback on global scale, we are ahead of many developed countries in terms of transparency. The successes made in this sphere must be attributed to all other spheres as well.

Issues relating to migration are successfully dealt with in Azerbaijan. Migration is also a manifestation of development. Several years ago I said at a Cabinet meeting that there will come a time when we will face this problems too. This time has come, and the timely establishment of the Migration Service has enabled us to regulate these processes properly. Serious measures are taken to curb illegal migration. I want to repeat that migration is a sign of development. If Azerbaijan wasn’t developing rapidly, the number of people coming to Azerbaijan for work would not be so high.

Of course, we should first protect our own labor resources. Although about a million jobs have been created in Azerbaijan lately, most of which are permanent, issues of unemployment are still there. We must ensure that citizens of Azerbaijan are provided with jobs in the first place.

At the same time, Azerbaijan is part of the global economy, and we are very positive about all integration programs. Our economy is liberal and there are all the opportunities for work. The people of Azerbaijan are hospitable, the creative and landscaping work, provision of modern services are certainly attracting migrants. At the same time, I must say that public order in Azerbaijan is protected very well and strong security measures are taken. A typical feature of our cities is that people feel very comfortable here. The crime situation in Azerbaijan is very good.

Of course, all these factors are an additional stimulus for those coming from abroad, so to speak. I want to repeat: we open our doors to all our guests coming here with good intentions. But all this must be done within legal frames, and measures against illegal migration must be continued.

Additional measures will be taken in the months ahead to develop private enterprise. Provision of loans through the National Fund on the Support for Private Enterprise has already begun. These loans cover all the districts. We already have a very positive experience in this field. The loans to be provided this year will be used in establishing new enterprises, creating new jobs, and we will succeed in further diversifying our economy. I can say that the successful results of the first quarter, namely, the growing non-oil sector, have been possible also because of the attention being paid to the private enterprise. The low-interest loans, the support for business people, the implementation of the program on the development of districts and the occasional introduction of changes to it are certainly playing a role.

A package of suggestions is being prepared now to develop grain production. Instructions were issued at previous meetings to set up major farms and create the infrastructure. Large land plots have been engaged and issues of irrigation have been resolved.

I have no doubt that the non-oil sector, agriculture and entrepreneurship will develop even faster in the years ahead, enabling us to ensure our food security.

We raised this issue several years ago. I can say that as was the case with migration-related issues, we have demonstrated far-sightedness again because when we put food security on our agenda, the issue was not so pressing on global scale.

The restrictions certain countries have introduced on exports in recent years, namely on grain production, were due to weather conditions and natural calamities. They show that our agrarian policy should be based exclusively on domestic resources. The agrarian reforms that have been under way in Azerbaijan for many years, the courageous agrarian reforms held in the 1990s and ongoing now, the support for farmers, the cancelation of taxes and the present realities are enabling us to ensure food security by relying exclusively on ourselves. A broad exchange on this issue was held in a meeting with businessmen. There is no need for repeating anything. I simply want to say that this issue should also be on the agenda permanently.

We must step up our efforts to protect the environment. Officially the Year of the Environment is over, but its spirit should apply to every year – tree planting, provision of drinking water, cleaning of oil-polluted land. Funds are envisaged for these issues in the state budget. Extra funds should also be envisaged when amendments to the state budget are introduced.

Projects relating to drinking water and sewage are currently under way throughout the country. They should proceed even faster, and it appears that the Azerbaijani state, i.e. our state budget, should bear the brunt.

I had expected in previous years too that sooner or later we will have to take on this commitment. Because, as you know, our talks with international financial institutions were delaying, certain conditions were being put forward. Today Azerbaijan’s financial capabilities are broad enough, these figures have been mentioned here. Our exchange reserves are growing. We will introduce additions to the state budget shortly. Therefore, the Azerbaijani state should bear the brunt of that. If it is possible to obtain loans on acceptable terms, on good commercial conditions, of course we should take this opportunity. But if the issue delays or the conditions are very tough, I don’t think we should apply for such loans and should work using domestic opportunities. Extra resources should be envisaged for that in our state budget, so that things proceed even faster and water and sewage issues are resolved in the country within several years.

Of course, these issues should be even more extensively covered in the program on the development of districts. The program on the development of districts does raise these issues. Specific deadlines have also been set. So even more attention should be paid to this. Of particular importance among projects relating to districts are those on the construction of rural roads. Funds were allocated for that in the past too, and new rural roads were built in different districts. I took part in their opening. These roads link tens of thousands of people, hundreds of villages. The establishment of a new infrastructure serves the development of districts and is very important to people’s comfort. I think that significant extra funds should be allocated for rural roads. Suggestions are coming from the ground. First of all, I repeat, we should build the roads linking major settlements. Of course, we should also restore, and essentially rebuild the roads that are in deplorable condition. Because most of the roads not only in districts but even in the suburban settlements and villages of Baku are earth roads.

This is absolutely intolerable. So I want to repeat that among the issues relating to settlements, those pertaining to roads, water and sewage are of priority importance.

In my opening remarks I expressed my views on the issues relating to Baku settlements. The program will be adopted this month. There should be a very rigorous control over it. The program should be occasionally analyzed by the Mayor’s Office of Baku, district executive authorities, the Ministry of Economic Development, and additions should be introduced to it. I do hope that the program will cover all the issues pertaining to settlements.

But life never stops. While implementing programs on the development of district, we faced situations when both amendments and additions were introduced to the program at certain stages. In any case, this issue is of special importance among those facing the country. Along with that, we should resolve the issues of restoration and reconstruction of schools that are in emergency condition both within the program on districts and one on the development of Baku settlements.

An enormous amount of work has been done in this area in recent years. Over 2,000 schools were built and commissioned, new buildings established. But there are still enough schools in emergency condition. Of course, there may be different views on this: what are the criteria for a school to be found in emergency condition? And there is a difference of opinion. In this regard, I have asked for a list of schools in emergency condition, specifying the districts of their location. In any case, I think there should be no schools in bad condition in Azerbaijan – they may be described as being in emergency or in bad condition. All the schools must be in good condition. Wherever reconstruction is necessary, they will be reconstructed, wherever renovation is required, they will certainly be renovated. A revised list of such schools is to be submitted to me shortly. Funds for this will be envisaged when additions to the state budget are introduced.

There are also problems with kindergartens in the country. We are aware of these problems. They emerged in the early years of our independence. Some kindergartens were privatized or were used for other ends. Some were transformed into shops, restaurants and other facilities. In other words, such unpleasant phenomena were taking place at the time. So our present kindergartens fall short of our requirements. Considering that Azerbaijan’s population is growing, which is a very positive fact, Azerbaijan’s population is 9 million people already.

The kindergartens built in Soviet times were meant for a smaller population. So this situation is very serious. I think the only real option is that new kindergartens should be built. I don’t think we should reconsider the results of privatization. This is impossible. Azerbaijan is a country adhering to a market economy. Azerbaijan is a country very safe for foreign and domestic investors, and this is our great achievement. Everyone knows that Azerbaijan is a country of its word, and the investment, both external and internal, are protected by the state. This policy will be continued in the future too. Therefore, the only option for us is to determine locations so that we could start large-scale construction of kindergartens. This is why I am issuing this instruction. This issue should be incorporated into the additions to the budget. A program on the construction of kindergartens should be implemented this year and in the coming years.

Work in the oil and gas sector is ongoing. Azerbaijan is expanding its capacities and gasification is under way throughout the country. We can say that one new village is gasified every week. The entire infrastructure is being upgraded, work is conducted at a modern level. I think that key gasification issues will be resolved in the next two years.

In the first quarter of the year, the European Union and Azerbaijan signed a declaration on the Southern gas corridor. The declaration secures the interests of both parties. It describes Azerbaijan as a supplier of European consumers and a country providing assistance. This declaration is very meaningful. Azerbaijan’s vast gas resources are and must be delivered to world markets in different ways. We must make the most efficient use of our abundant gas resources and increase production in the near future. To do that, we certainly need to increase the volume of gas on existing markets and try to access new ones. Bilateral talks are currently under way with different countries, and of course the relations between the European Union and Azerbaijan, the documents signed will be an important step towards resolving this issue.

All our work on power generation is done at a proper level. Azerbaijan has already turned into an exporter of electricity. We are exporting electricity to neighboring countries. Along with that, we are further raising our domestic energy capacities. In the coming years we should pay more attention to renewing the power lines because we have sufficient generating capacities. The 25 megawatt Fizuli hydro power plant and the 800 megawatt Janub power station are to be commissioned this year. According to different estimates, we currently have an additional energy capacity of about 1,000 megawatts which we are not using. In the future, we must deal with electricity exports more seriously of course. To do that, as is the case in the gas sector, we must increase exports to existing markets and, at the same time, access new ones. With this aim, the construction of power lines with a capacity of 55 kilovolts has started between Azerbaijan and Georgia. A new large substation has been built in Samukh for this purpose. I have recently attended its opening. So we need all this to be able to export electricity to the maximum extent possible. This must become our third most important export line after oil and gas. In parallel, the process of developing renewable energy sources is under way, new small hydro power plants are under construction, the foundation of some has already been laid. The construction of new small hydro power plants is on the agenda, and the process of creation of other alternative sources of energy is under way in Azerbaijan.

Extra measures must be taken to build trunk roads. A lot has already been done. Work is under way on all trunk roads. Inter-city and local roads are under construction. I think we must speed up work in this area by the end of this year by allocating extra funds. Namely, additional funds must be envisaged to continue the construction of the Baku-Russian border road, so that we could complete it soon. Most of the road is already in line with international standards. We must also ensure construction of the section near the border. One part of the Baku-Georgia road is two-lane, another is four-lane. If we consider that this road is very busy, we must expand the two-lane section to four lanes. I hereby resolve that the road from Baku to the Georgian border should be four-lane.

Extra funds should be envisaged to start this project. Construction of the Baku-Iranian border road is progressing on schedule. This road was designed as a four-lane one. Work is progressing on schedule there. I regularly examine road construction, and work is being done properly.

The Baku-Shamakhi road. It is part of the Baku-Balakan road. It was also built as a two-lane road. I think necessary measures should be taken to expand it to four lanes, to make it more comfortable for driving.

New road junctions, bridges and tunnels are being built in Baku. This work is under way in different parts of our city. Construction of local roads is also part of the program on the Baku settlements. This work must proceed faster. Additions will be introduced and corrections made to the budget soon to do this work. Relevant instructions have been issued and suggestions are being prepared now. We must remember that we have extra financial resources, the oil price has risen in the world. It would be natural if we resolved all the outstanding issues this year, without leaving them for the next year. The issues I have mentioned, the infrastructure projects, construction activities, social measures – this has been spoken about here – should be incorporated into the corrections in the first place.

Social measures are regularly taken in Azerbaijan. Additional measures are taken both as part of long-term programs and as necessary. Among these I would like to point to the recent writing off of population arrears for water. This shows how strong our social policies are. This is a well-meant and, I think, correct step. It is correct from the standpoint of social justice. It may not be very correct from the standpoint of market economy principles. But the main issue for us is the right prioritization. Social issues are of top priority. It is also true that if we don’t have strong economic indicators, no social issues can be resolved. Therefore, corrections should envisage a broad social package, issues of raising wages and pensions must and will be resolved. Namely, the pensions of those who retired before 2006 should be raised because there is a certain injustice in this sphere. This injustice emerged because new rules were introduced after 2006, and those who retired after 2006 are receiving higher pensions. There are over 900,000 people in Azerbaijan who retired before 2006.

In general, we have about 1,300,000 pensioners. Of them, 900,000 retired before 2006. So we should first improve their pensions, there should be no discrimination in this area and the elderly should receive a proper pension. This is our duty, they worked and tried very hard, they have created this country, played a great role in its development. It is our duty to improve their material security. We do this regularly. Namely, this year we must raise the pensions of those who retired before 2006.

All other issues are being resolved. I want to repeat that our government members know their responsibilities well. In general, work in the country is progressing well. This is confirmed by the results of the first quarter of 2011. In the coming months and for the rest of the year, we should work with the same determination and professionalism to fulfill all the tasks facing our country.

Thank you.