Azerbaijan – Economic crisis and international attitude

Ilham Aliyev, the president of Azerbaijan, seems increasingly concerned about international criticism of his country. In Aliyve’s words: [International circles] are trying to present Azerbaijan as a totalitarian and authoritarian country where rights and freedoms are violated. This trend started the day I was elected President” [1].Despite the aggressive tone, this reveals that Azerbaijan is worried about its reputation. This is a change from before and results from the global drop in energy prices, which has severely hit the Azerbaijani economy and, more broadly, the Azerbaijani sense of self-reliance.

On August 24, Mehman Aliyev, head of the independent news agency ‘Turan’, was arrested by the Azerbaijani authorities. However, on September 11, he was released from pretrial custody. According to the analyst Liz Fuller, various developments may have influenced this outcome. One is pressure from international organizations, such as the ‘Council of Europe’ and ‘Reporters without Boarders’, as well as powerful countries. Notably, the US State department called for the immediate release of Mr. Aliyev. Concern was also voiced by the UK and France, while the Norwegian Foreign ministry Tweeted: “We are deeply concerned about the situation around the news agency and, in general, freedom of the press in Azerbaijan[2]“. This apparent responsiveness to international pressures represents a clear departure from the past. For instance, during the ‘European Games’ hosted by Baku in 2015, the Azerbaijani political establishment ignored international pledges to free political prisoners, and dismissed negative press reports as merely the expression of a global anti-Azerbaijani bias.

This departure does not result from a weakening of the ruling authorities. On the contrary, as analyzed in this blog, in 2016 a constitutional reform led to the massive empowerment of the presidency. The presidential mandate was extended from five to seven years, and the president acquired the right to dissolve the Parliament under certain circumstances, and to appoint a vice-President (who is, de facto, an unelected second-in-command). With reference to this latter point, in February 2016 President Aliyev chose his wife, Mrs Mehriban Aliyeva, as the vice president of Azerbaijan[3]. This move can be interpreted as an attempt to further consolidate the continuity in power of the whole Aliyev family. In this regard, it is worth mentioning that the current president, Ilham Aliyev, is the son of late president Heydar Aliyev, who ruled the country from 1993 to 2003[4].

A more convincing interpretation suggests that this more conciliatory attitude on human rights issues could be related to the unfortunate effects of the drop of energy prices. In the past decade, lucrative oil exports fuelled the economic growth of Azerbaijan. For years, the profitability of the energy sector provided few incentives to the systematic promotion of other industries. Thus, despite the president’s emphasis on the importance of the non-oil sector, actual investments in that direction remained modest. In November 2016, the Turan information agency complained about the lack of a coherent strategy to support small and medium-sized business[5]. However, the economic crisis required some proper moves in that direction, such as the promotion of tourism.  At the beginning of September 2017, President Aliyev attended the inauguration of the Khazar Palace hotel complex in the coastal city of Lankaran, which is located relatively near the Iranian border. The complex, equipped with all modern comforts, is openly targeting foreign tourists[6].

In addition, Azerbaijan has also relaxed its visa policy. In mid-2015 President Aliyev declared that: “Everyone who wants to come to Baku should be able to receive an e-visa and not have to go to the embassy or elsewhere”. The introduction of e-visas, effective as of summer 2017, is a minor revolution for a country that “was a stalwart on the ‘Hardest-visa-to-get’ list”[7]. The simplification was welcomed with enthusiasm by Arab visitors, especially from the Gulf, and contributed to the enhancement of the tourism sector. Their increasing presence is starting a debate about the appropriateness of building hotels that are compliant with Halal requirements, as a way of further attracting Muslim visitors. Additionally, the quick increase of affordable travel options is a crucial component of the national strategy of tourism promotion[8]. Since the summer of 2017, low-cost flights have operated between Baku and Moscow three times per week. Furthermore, since the end of October 2017, an equivalent air-link has been in place between Saint Petersburg and Baku.

In brief, whether these mechanisms are effective or not[9], the drop in energy prices is posing a remarkable challenge to Azerbaijan. Other than being a crucial economic issue, this situation affects the way Baku perceives itself and its relative weight in the international system. “There can be no talk of political independence without economic independence. (…) [Our guiding principles are] non-interference in each other’s affairs and mutual respect”. These words, pronounced by President Aliyev in his last inauguration speech  (October 2013), seemed to imply that, by virtue of its oil-related wealth, Azerbaijan deserved immunity from international criticism. Since then, things have dramatically changed. The recent receptiveness of Baku to international pressures can be interpreted as the acknowledgement, for the time being, of the inappropriateness of a daring international attitude.

Notes

[1] Turan Information Agency. 2017. ‘Azerbaijan Not to Lose Anything from Leaving Council of Europe – Ilham Aliyev’, October 5 (Retrieved through LexisNexis).

[2] Turan Information Agency. 2017.‘Foreign Ministry of Norway Concerned about Situation around Turan News Agency’, August 30 (Retrieved through LexisNexis).

[3] Notwithstanding the empowerment of the presidential figure, journalistic investigations shed light on the presidential family offshore investments.

[4] President Ilham Aliyev was elected a few weeks after the death of his father.

[5] Turan Information Agency considers that over-dependency from the oil sector is the main feature of Azerbaijan’s macro-economic structure. That makes extremely difficult to bring about radical changes in the short-run [Turan Information Agency. 2016. ‘Unjustified tariffs and rates’, November 30 (Retrieved through LexisNexis)].

[6] BBC Monitoring Trans Caucasus Unit. 2017. ‘Azerbaijan: Southern region media highlights 28 Aug – 10 Sep 17’, October 3 (Retrieved through LexisNexis).

[7] MENA English (Middle East and North Africa Financial Network). 2017. ‘Time for obtaining evisas to Azerbaijan reduced to three hours’, September 4 (Retrieved through LexisNexis).

[8] Global English (Middle East and North Africa Financial Network). 2017. ‘Land of Fire to take new steps for tourism development’, October 25 (Retrieved through LexisNexis).

[9] Turan Information Agency. 2017. ‘Economy Does Not Come Out of Crisis’, October 14 (Retrieved through LexiNexis).

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