Speech by Ilham Aliyev at the Azerbaijan-Lithuania business forum

- Mr. President.

Distinguished guests, ladies and gentlemen,

Today, during the official visit of the President of Lithuania to Azerbaijan, we have come here to take part in a business forum and give advice to business circles, taking advantage of this opportunity to engage in a very active dialogue and get good results. I am aware that many documents will be signed today, and I hope that these documents will create new opportunities for building further work.

Given the strong political relations between our countries – we have been strategic partners for many years, and the current visit of the President once again demonstrates that an active political dialogue has been established – I believe that the time has come to maintain active connections in the fields of economy, trade, investment and other areas.

Of course, the business forum is a good opportunity to inform each other about our plans, the business environment in our countries, opportunities, including investments, and establishing business ties. I believe that the joint intergovernmental commission, which will be convened in the near future, will coordinate the efforts of our business circles and create ample opportunities for establishing work in both countries. The issues the delegations will discuss today include trade, investment, agriculture, development of information technology, transport, energy, education, and others. We have a common understanding of all the issues discussed. We also need to achieve tangible results on these issues and determine what more needs to be done to develop cooperation.

I believe that Azerbaijan has created a favorable business environment for investors. We are pleased with direct foreign investment, which amounts to tens of billions. Diversification of the investment portfolio of foreign companies is also very important. Whereas in the early days of our investment programs, investments were made mainly in the oil and gas sector, we are seeing foreign direct investment being made in the field of renewable energy now. At the beginning of this year, two major contracts were signed with investors for the construction of a 470 megawatt solar and wind power plant, which is an indicator of a favorable investment environment in the country.

In general, the diversification of Azerbaijan's economy is our top priority. Of course, the energy sector has traditionally been the leading sector of our economy, and this will continue to be the case. In particular, we have completed the construction of the Southern Gas Corridor, which, for the first time since January 2021, has been transporting Azerbaijani gas to various locations, including the European Union – a system of integrated numerous pipelines with a length of 3,500 kilometers. Of course, the development of the oil sector, which is a traditional branch of our economy, continues to play an important part in achieving our national goals and the energy security of a number of countries. At the same time, diversification is our primary goal because we understand that our plans to create a sustainable economy will not be materialized without diversification. We see good results there. In general, I can tell you that the results of the four months of this year are promising. Our economy has grown by 7.2 percent. Given the post-pandemic period, this is a very good figure. As for the non-oil sector, the figures are higher, with growth amounting to 11.4 percent. We have a very small external debt, accounting for only 12.5 percent of the gross domestic product. The goal is to bring it down to 10 percent of the gross domestic product.

Our export potential is growing due to the growth of gas exports to international markets and reforms in the non-energy sector. This year, exports have grown by 85 percent, and Non-oil exports have increased by almost 40 percent. I believe that this testifies to the country's sustainable development because the energy potential relies on our natural resources and serves the well-being of the Azerbaijani people, our friends, and our neighbors. At the same time, growth in the non-energy sector demonstrates the desire and ability of our government to carry out reforms in the economy.

Given the positive demographic situation in Azerbaijan, we must pay constant attention to issues related to unemployment. We have succeeded in reducing the unemployment rate to 5-6 percent. However, to maintain it at a low level, we must open new jobs every year because the population of Azerbaijan has increased from 7 million to 10 million in 30 years – from the day we gained independence to the present, and it is still growing. Therefore, we must have jobs for more people, especially now, when many specialties no longer exist as a result of the fourth industrial revolution. We need to prepare ourselves for new industries. By the way, this issue was the topic of our discussions today. We also spoke about cooperation in the field of education, in particular, education tailored for the development needs of our countries.

We have also discussed issues of cooperation in the transport sector. I believe that for business circles and cooperation between our countries located quite far from each other, the existence of these sustainable transport routes is very important. We in Azerbaijan have been working on this for many years and have created a diversified transport network. I would call it a new transport map of the region, in the Caucasus, as well as along the Caspian Sea and in Asia. We have created a modern infrastructure – a seaport, railway communications, several international airports, and highways, taking advantage of our geographical location. We are located on the East-West and North-South transport corridors. I can also tell you that Azerbaijan transports goods from north to west. We have invested heavily in infrastructure. However, it is clear that without good business relations with neighboring countries, no country, especially one like Azerbaijan, which has no access to the open sea, will be able to turn into a transit country. However, although Azerbaijan is a landlocked country, we have turned it into an important transport hub. The role of Azerbaijan will certainly increase even more because we have recently received a number of new proposals from our neighbors on the use of our transport infrastructure. Of course, as I said, this will be very important for the cooperation between the business circles of Lithuania and Azerbaijan and the search for better ways of communication.

Speaking about the overall economic growth in Azerbaijan, we must touch on the issue of energy security. Today, Azerbaijan provides for its energy security by 100 percent and contributes to many other countries' energy security, including members of the European Union. We export oil, gas, electricity and petrochemical products, and our plans include a significant increase in the volume of exports of gas, electricity and petrochemical products. As for oil exports, both consumers and we are pleased with the current export profile. At the same time, given the current geopolitical situation, it becomes obvious that the need for Azerbaijan's energy resources will be higher than ever before. This year we have already started an energy dialogue between Azerbaijan and the European Union, and it covers many areas – oil, gas, electricity, hydrogen and renewable energy sources.

There is complete mutual understanding between us, and we are working with a great desire because everyone wins under such circumstances. Azerbaijan needs reliable and long-term markets, markets with fair regulation and legislation. And this is the European market. European consumers need additional sources of energy. Of course, from this point of view, Azerbaijan is perceived by the European Union as a contributing party. Given our plans to raise the share of renewable energy in our total energy mix to at least 30 percent by 2030, I believe these plans can be changed. We can foresee the share of renewable energy in our energy mix even at the level of 30 or 40 percent. In this case, of course, the energy generated from renewable sources may be more attractive to European consumers. We are working on that. In this sense, we are on the right track.

In terms of economic sustainability, Azerbaijan is no longer a country receiving foreign aid or international loans. Yes, we do take loans, but we attract them only for high-tech projects. At the same time, we have already become a donor country. We provide loans ourselves. And our reserves can nullify the external debt in a matter of a few months. This is evidence of a good economic situation and allows us the opportunity to plan our further reforms correctly.

I want to say a few words about our cooperation with the European Union. The European Union is our main trading partner, which will continue to be the case. We are in the final stages of negotiations with the European Union on a new agreement. Of course, cooperation with members of the European Union, particularly with Lithuania, is of strategic importance. I am glad that this cooperation is developing successfully.

Regarding our bilateral trade and economic agenda, I find it quite positive that our economies are not in competition with each other. They are located in various parts of Eurasia. Thus, by joint efforts and projects and providing more information, we can establish cooperation. I believe that one of the advantages of the business forum being held today is to demonstrate opportunities, the business environment, rules, taxes, investment opportunities and other issues. I am sure that the business delegations of both countries will not miss this opportunity.

Once again, I welcome all our guests to Azerbaijan and wish the business forum success. Thank you.