Opening speech of President Ilham Aliyev at the meeting of the Cabinet of Ministers dedicated to the results of socioeconomic development in the first six months of 2013 and future objectives

- Today's meeting of the Cabinet of Ministers will discuss the results of six months. Six months of the year have been very positive. The indicators are very positive. Over the six months Azerbaijan has developed rapidly and all the objectives have been met. These indicators give reason to say that this positive trend will be maintained until the end of the year. Our key economic indicators are at a high level. I believe that this year's economic growth in Azerbaijan can also serve as an example to the rest of the world. The gross domestic product grew by 5 per cent, but the most encouraging fact is that our non-oil sector grew by almost 11 per cent. This is the result of the work done in Azerbaijan in recent years and of the sound economic reforms. I can say that these figures are at the highest level on a global scale. Today, our main goal is to develop the non-oil sector, and I believe that very significant progress has been achieved in this direction.

I believe that we will achieve the goal we set some time ago of doubling our non-oil sector over the next 10 years. The growth of the non-oil sector, of course, is very gratifying. At the same time, it is a testament to the dynamic development of the country’s economy. The country's economy is developing in a diversified manner, and I believe that this development will manifest itself even more prominently in the coming years. The projects being implemented today and awaiting their implementation in the coming years will lead to the creation of a strong non-oil sector. Of course, our non-oil economy, which is growing at a rate of 11 per cent, gives a great impetus to everything. The main branch of our economy, of course, is the oil sector. But lately, the bulk of the gross domestic product is generated in the non-oil sector, which is the logical result of the reforms.

Agriculture has also increased by about 5 per cent. This is a good growth. I believe that this growth should be even higher in the coming years. To do this, we are taking additional measures now. The investment situation is encouraging. Investment of $12.6 billion was made in the national economy in the first half of the year. Most of it has been domestic investment worth nearly $7 billion, while $5 billion has been foreign investment. This is also a very important issue, because Azerbaijan has been an attractive country for foreign investors for many years, which is confirmed by $5 billion in foreign investment in the first six months. Foreign investment is important for any country. Even though we now have vast material resources ourselves, the confidence of foreign investors in Azerbaijan and foreign investment reflect the overall development of the country. Of course, a serious message is sent to international financial institutions that the economic situation in Azerbaijan is very positive. At the same time, domestic investment has been exceeding foreign investment in recent years. This was also our goal. This goal was set several years ago, and we have now achieved it.

It is true that domestic investment is made up more of public spending but the private sector is gradually expanding its investment opportunities. I have no doubt that there will come a time when most of the domestic investment in the Azerbaijani economy will be made by private companies. To do this, of course, private entities should work harder and gain strength. The government, for its part, provides them with the necessary support. The major energy projects expected in Azerbaijan will give an impetus to the development of the private sector because the ambitious projects planned in Azerbaijan’s oil and gas sector are measured by tens of billions of dollars.

I think that the vast majority of these orders should be implemented in Azerbaijan. Azerbaijan already has a strong industrial capacity. This will create additional opportunities for local companies, and they will effectively use them.

I believe that the investment of $12.6 billion is a great indicator. If we can maintain this pace, the level of investment will reach nearly $25 billion by the end of the year. At the beginning of the year I set the task that at least as much as last year should be invested in Azerbaijan this year. Over $20 billion was invested last year but we can already see that this year’s investment will be greater. The investment being made – every manat, dollar or euro – serves the country's economy, promotes the creation of jobs and increases the economic power of Azerbaijan. Any country, including Azerbaijan, is interested in investment. Even though Azerbaijan has begun to invest in the economies of other countries itself, these are the benefits of modern Azerbaijan, especially in the time of the financial and economic crisis that has engulfed the world, Europe in particular, in the past few years. The money invested in the economies of foreign countries suggests that we have great opportunities. We feel very confident. Of course, our economic opportunities and political steps are interconnected, and the more investment we make in foreign markets in the future, the greater our political clout in the region and the world. This is natural, and we are following this course. I can say that only developed countries of the world invest heavily in the economies of other countries. Azerbaijan is a developing country. There will come a time when we will meet all of the criteria of developed countries.

Our material resources and foreign exchange reserves are growing. Our foreign exchange reserves exceed $48 billion. This is a great indicator as it gives us the strength and confidence. At the same time, although very large investment projects are implemented in Azerbaijan, we are increasing our foreign exchange reserves by the year. I am glad that in the six months of this year our foreign exchange reserves have not reduced, did not even stand still but grew. And if things go on like this, they will grow even more by the end of the year. In terms of this indicator - if we consider the absolute figures and the volume of foreign exchange reserves per capita - Azerbaijan is one of the leading countries in the world. This is also part of the progress made in recent years.

The rapid development of Azerbaijan has been a reality in recent years. The international community is already seeing and appreciating that. The world's leading financial institutions approve the reforms ongoing in Azerbaijan. The reforms under way in Azerbaijan should serve as an example for many countries, and I can say that the experience of Azerbaijan is studied in many countries.

We are going our own way. We are addressing the problems of economic and social development together. Azerbaijan’s fundamental economic reforms are complemented by a strong social policy. Otherwise, people’s incomes would not grow. Sometimes drastic economic reforms are too costly for people. People suffer from them. We are seeing that the steps aimed at reviving the economy and finding a way out of the economic crisis in many countries are taken at the expense of the people. Jobs are axed, wages slashed, working hours extended and retirement age increased. In other words, some governments want to heal their economic situation at the expense of the people. Our economic reforms were radical in nature because we have been on the path of transition from a planned to a market economy. These reforms are complemented and supported by a strong social policy. It is therefore no coincidence that the incomes of the Azerbaijani population grew even in the crisis years.

The rate of the manat is stable in Azerbaijan. This, first of all, has a tremendous social significance because people’s deposits are protected by the state. With regard to this issue, I can say that the per capita incomes grew by more than 7 per cent over six months. Inflation was only 2 per cent. This, I think, is also a great indicator.

As for social issues, salaries have been raised in the six months. Today, the average salary in Azerbaijan is at the level of $520. The average pension is $200. In the coming years, these figures will increase further. Pensions and salaries will be increased this quarter.

A similar policy will be pursued in the coming years. I want to reiterate that economic reforms must be supported by a very strong social policy. I believe that the successes of our country in this area are exemplary.

All the issues identified in the regional development program are being addressed. Regular trips to the regions enable me to get acquainted with the situation on the spot and give appropriate instructions. I can say that all our regions and districts are undergoing serious development and revitalization. The mood is great everywhere.

Creative and landscaping work is widespread. Districts and villages are improving and large industrial enterprises being put in place. Unemployment is practically over with. In general, at the beginning of this year the unemployment rate was slightly above 5 per cent. I believe that by the end of the year this figure will be even lower. It is also true that an unemployment rate of 5 per cent is a desired figure for any country. In some developed countries, this figure reaches 10, 15 and 25 per cent. Naturally, this leads to profound social problems. The elimination of unemployment was one of the main tasks we set 10 years ago. Over the past 10 years we have created 1,180,000 jobs and a further 55,000 jobs in six months of this year, including 45,000 permanent ones. So this process is ongoing, and it is natural because our initiatives related to economic policies, including the policy of industrialization carried out in Azerbaijan, certainly lead to the creation of new jobs.

The second state program on regional development will be completed this year. This program has been exceeded. At the same time, we are implementing the state program on the socioeconomic development of Baku and its suburban settlements. Extensive work is carried out in the settlements around Baku under this program.

The work continues. The program should be completed by the end of this year. Of course, we will pay constant attention to this issue in the following years too.

I can say that Azerbaijan hosted a number of prestigious international events last quarter. As a result, Azerbaijan and Baku have become important political, economic and cultural centers in the world. There have been quite a few of such events. It would take too long to list them. I simply wanted to highlight some momentous events. First of all, Azerbaijan has hosted the Davos forum for the first time. And this should be regarded as a sign of great importance attached to the country.

The Davos Forum is forum number one in the world. It is not only an economic forum, although it is called the Davos Economic Forum. It is a political and economic forum. The fact that this forum was held in Azerbaijan was, of course, tremendous responsibility. I am glad that this forum was held at the highest level.

In general, I can say that over the past few years Azerbaijan has actively participated in the Davos forum and has been at the center of attention. The development momentum and Azerbaijan’s achievements are widely covered at the Davos forum.

According to the calculations of the Davos forum, Azerbaijan is ranked in 46th place in the world in terms of economic competitiveness. I believe that this is the most serious assessment worthy of the greatest attention because this is the assessment of the world’s top forum. The fact that the forum was held in Azerbaijan was our great success. Especially when we consider that the topic of the forum was associated with the processes and the economic and political situation in the Caucasus and Central Asia. So this shows again that Azerbaijan is not only a geographic, but also a political, economic and cultural center.

Last quarter Azerbaijan hosted a meeting of the Club of Madrid as well. This is also a representative international organization. It is an entity that brings together highly respected politicians and public figures. This forum was also held at a very high level. Baku has also hosted a US-Azerbaijani conference. I believe that this was also a very significant event, because the conference was attended by more than 300 senators, congressmen, public figures and political scientists of federal and state levels. Very important issues were discussed here.

At the same time, Baku hosted the Second World Forum on Intercultural Dialogue last quarter, which also contributed to the emergence of Azerbaijan as a humanitarian center, i.e. a center of inter-religious and intercultural dialogue. It was the second forum, which gives reason to say that it will be traditional. Azerbaijan holds such events on a regular basis.
The World Humanitarian Forum, the Forum on Intercultural Dialogue, other events and summits of the leaders of world religions have been held in Azerbaijan. In other words, our country has become a political, economic and humanitarian center.

This is a reality we have created by our policy and by our steps. Today, Azerbaijan is a country enjoying great respect in the world. Of course, this makes us very happy. This has been our goal. Of course, I have repeatedly said this and have pursued this policy over the past 10 years so that, first of all, our efforts are focused on the country’s development and we achieve great success on this path.

The Azerbaijani economy is the fastest growing economy in the world. Azerbaijan is the most dynamic country in the world. This is a reality acknowledged by all the structures involved in the region. At the same time, the international authority of our country is very important as well. We have earned this reputation, and our membership in the UN Security Council is an indication of how high it is. This is an assessment given to Azerbaijan by the international community. At the same time, the representative international events held in Azerbaijan further enhance our international reputation. So I believe that very significant steps were taken in this direction last quarter and, in general, over the last six months.

At the same time, as always, our steps related to foreign policy were successful too. I think that several important events took place last quarter. Of course, my visits to foreign countries, the visits by foreign heads of state to Azerbaijan and the development of bilateral relations are of great importance. At the same time, our cooperation with international organizations also deserves a lot of attention. We remember the activities of the Organization of Islamic Cooperation conducted in Azerbaijan last quarter. A donor conference to assist Palestine has been held in Azerbaijan. The fact that the donor conference was held in Baku demonstrates our intentions and policies. In general, Azerbaijan is stepping up its activity within the Organization of Islamic Cooperation. As you know, issues of Islamic solidarity have always been at the center of attention.

Today, I want to say that we still have to work hard. Every Muslim country has to work hard for us to strengthen this unity. We are concerned about some of the developments unfolding in the world, polarization and discriminatory trends. For its part, Azerbaijan is committed and will strive to ensure that intercultural relations are based on a sound foundation, and the activities mentioned earlier are a clear proof of that. We are striving, demonstrating our experience and our achievements. We show that it is possible.

Last quarter I paid a visit to the European Union. I believe that this visit was also very important even though it was my fifth visit to the European Commission as President. In the last 10 years I have visited it five times. So these visits are already an indication that our relations are at a high level. But this visit was also very important, especially when we consider that some European institutions have been waging a dirty campaign against Azerbaijan over the past year. I can say that this campaign never stopped. Over the last 10 years this campaign has gained momentum and then subsided. But as a trend and as a direction, we have observed it all the time. But last year the campaign acquired very ugly proportions. Suffice it to say that the European Parliament has passed three anti-Azerbaijani resolutions over the past year. It is true that the same people have been involved in the adoption of these resolutions. The European Parliament consists of 750 deputies and the adoption of these resolutions included 20, 30 and 40 people. Of course, their opinion does not reflect the opinion of the European Parliament. However, using some procedural gaps, they have succeeded in adopting such resolutions.

As a matter of fact, this is not worth even talking about because no-one pays attention to such resolutions in Azerbaijan and they can’t affect our work. But we have to note this as a trend, of course. The Presidential Administration and the Milli Majlis are providing tangible responses to that. I do not want to talk much about that. I simply want to say that anti-Azerbaijani and pro-Armenian forces that can’t come to terms with the successful development of Azerbaijan have stepped up their activities against Azerbaijan over the past year. And that is probably natural because the successful development of our country, especially its development in the years of crisis, independent policies and specific stance on every international issue, has not impressed everyone. At the same time, the stability, the wonderful atmosphere and the great mood prevailing in Azerbaijan surely don’t please those gripped by the crisis now. So my latest visit to the European Union had a special importance, especially if we consider that there are anti-Azerbaijani forces in the Council of Europe too. However, they are a minority. Azerbaijan’s active work in recent years and its growing international reputation have certainly led to the fact that many international organizations have developed complete information about Azerbaijan. But there are still prejudiced people, the deputies who do not perceive the successes of Azerbaijan and systematically try to deal a blow to Azerbaijan.
The latest attempt was made in the Council of Europe in January of this year. During the discussion of a report on the so-called "political prisoners" an absolute majority of members of the Parliamentary Assembly of the Council of Europe said "No!" to this dirty initiative and rejected this notorious report. The deputies of the Parliamentary Assembly of the Council of Europe have defended the truth and justice and lifted up their voice against double standards. The emergence of this notorious report was only a sign of double standards. We see the trend of Islamophobia gaining ground in some countries. Unfortunately, this trend is on the rise, the situation is going in a negative direction. I keep raising this issue at various meetings because we are worried.

We have been cooperating with European structures for many years. We have been a member of the Council of Europe for more than 10 years. We are effectively cooperating with the European Union. But these trends do exist. Therefore, we need to determine today the forms of this cooperation in the future.

We see the overall picture is positive, of course, and the phenomena I mentioned are quite individual. But there are such trends and we have to see and talk about them. So my latest visit to the European Union had a special significance. We had to clarify many issues. We had to clarify how we will work together in the future. What will be the format of our cooperation? How will the interests of Azerbaijan be secured? I believe that my visit to the European Union and the sincere meetings with the head of the European Union were very positive. I am very pleased with the visit.

We have cleared up many issues, and I think that perfect grounds for further cooperation have been created.

After all, every country integrating into any structure must know why it is integrating. Blindfold integration is impossible. I have always said this and I want to say it again today that Azerbaijan is a self-sufficient country from any point of view. In political terms, it is completely independent and pursues an independent foreign policy. In economic terms, it is also completely independent. It is rich in terms of energy. So our integration steps in the coming years should be prudent. Why are we doing this? What is the purpose? We can and do live without that too. We live at our own expense. Therefore, the negotiations I conducted with the European Union, I want to say again, have had positive results. I believe that both sides have very serious views on further cooperation in the coming years. I believe that in the coming years the relations between Azerbaijan and the European Union will develop and acquire strategic nature. At least that is our desire. But let me repeat that these ties must be based on mutual interest and mutual respect.

I can say that very serious, perhaps even historic events related to our energy policy took place last quarter. The route of the Southern Gas Corridor has been selected. This is a historic event. It is as important for us as the Baku-Tbilisi-Ceyhan oil pipeline and the Baku-Tbilisi-Erzurum gas pipeline. As you know, the world's attention was focused on Azerbaijan. I am sure that the decisions made in Azerbaijan will introduce major changes to the future energy map of the region. The choice of the route of the Southern Gas Corridor and the common position of the "Shah Deniz" consortium on this issue should be regarded as a very positive development. This project will allow us the opportunity to fully realize our gas potential and, as I noted earlier, investments worth tens of billions of dollars will be made in the Azerbaijani economy.

We keep the initiative in our hands. Our initiatives in the energy sector play a crucial role. Our initiatives are aimed at cooperation. Today, it is impossible to address issues of energy security without Azerbaijan. This is also a reality which I think everyone should know. The decisions made in Azerbaijan prove crucial. The decisions made in Azerbaijan are an indispensable contribution to energy security. The decisions made in Azerbaijan will say a final word on the matter in the future too. This is the reality. I think that everyone should know that. Of course, this further enhances the importance of our country and reaffirms the importance of our policy for the region and the continent. This is our advantage. But, as I have always said, this advantage did not fall out of the sky.

We have created it ourselves – by selfless work, deliberate policies and bold steps. Today it is impossible to separate energy issues from political ones. If we hadn’t had the political strength and strong will, and if it hadn’t taken bold steps, all this would be impossible today. And everyone should know that.

I want to mention another important event of the last quarter – the military parade held in Azerbaijan. This parade demonstrated the power of the Azerbaijani army. The weaponry, ammunition and equipment demonstrated during the parade are the latest models and the most powerful hardware. The helicopters, tanks, armored vehicles, artillery units, air defense installations, other hardware have shown again that the Azerbaijan has one of the strongest armies in the world. At the same time, the military parade was a report on the work done in the field of army building in recent years. Of course, I am aware that the Azerbaijani people watched this parade with great interest and a sense of pride from the fact that we have such strong capabilities and such a strong army. At the same time, the parade has caused great concern in Armenia. I know that the hysteria, panic and fear they have experienced after the parade have not let up until now. And this is natural because the enemy saw firsthand the power of Azerbaijan and learned once again that we are ready for any scenario. With the aid of the acquired machinery we can destroy any enemy. As I said at the parade, we can speak to the enemy in any language. Along with all the political and diplomatic efforts, our military power will play a key role in resolving the Nagorno-Karabakh issue.

We will continue to build up our military strength and to buy the most modern equipment. As you know, there are no problems with the acquisition of this equipment. We buy equipment from different countries and at the same time produce it in Azerbaijan. A growing number of countries want to cooperate with us in the military sphere. The media have been providing figures that Azerbaijan has purchased weaponry worth $1 billion from some countries and $1.6 billion from others. I can say that these figures do not reflect reality. In fact, our military and technical cooperation is measured by much bigger figures.

We simply do not reveal the figures. We only comment on the information which appears in foreign media from time to time. But we can disclose the entire information because our state budget is transparent and all our costs are open.

I think that the Armenian people should not be afraid of that. The Armenian people should be afraid of their own leaders. They should be wary of their activities. They should be afraid of the bloodthirsty, insatiable and criminal government mired in corruption that has plunged them into the current situation. As a result of the activities of this government, about 100,000 Armenians leave the country forever. If it goes on like this, in five to six years there will be less than one million people there. And the blame for this falls squarely on the leadership of Armenia because its predatory and occupying policies, its bloodthirsty and voracious nature have brought Armenia to this catastrophe. We are confidently going forward. We are a strong state. Our strength will gradually increase. For this strength to grow further, we have to work even harder.