20/20 VISION

Azerbaijan 2016 | ECONOMY | FOCUS: ECONOMIC DEVELOPMENT STRATEGY

With the rapid pace of development taking place in virtually all sectors of Azerbaijan, the government has formulated a development concept based on the vision for the country in 2020.

The official development concept is titled Azerbaijan 2020: Look into the Future, and its main objective is to guide the country on an achievable course of economic and political prosperity. It was officially approved by President Ilham Aliyev back in 2012.This all-encompassing look at the country spares no detail and includes plans for the growth of social welfare programs, effective state management, export potential, and everything in between.

The main task at this stage of the 2020 plan is to accelerate the diversification process in the country. Original critics of this vision brought up the fact that outlining an ambitious, overarching plan would be rendered useless by the many changes that the world experiences over the years of the vision. What we have seen play out in reality has been the smart planning of this strategy, for the plan was designed to protect Azerbaijani national interests against the backdrop of a continually changing and unpredictable situation in the international economy. As evidence of this flexibility in action, 2015 saw a 6.4% growth in the non-oil sector of the economy. It is important to remember that this 2020 plan is a conceptual outline. Thus, the 2020: Look into the Future plan serves as a point of reference for relevant policymakers and institutions; it informs the necessary officials of what the results of reform measures should look to accomplish instead of laying out rigid plans for 8 years of development, a much more fluid and dynamic approach to development in an unpredictable world.

The 2020 plan invites the organic progression into an economy centered on the idea of efficiency and guided by the growth of innovation and general productivity. The plan lays out many goals for the country's social, political, and economic activities. For example, this plan looks to increase state support for local businesses that are trying to penetrate foreign markets and stay competitive after they are established. This is especially important for small and medium sized businesses, which are a point of focus in this development plan. Alongside this, the 2020 plan calls for the state to provide more preferential loans to businesses and to remain vigilant against dumping measures that work to create an unfair domestic market. The plan also calls for removing barriers to foreign investment and enacting reforms in line with the international trade system, setting the stage for Azerbaijan's entrance into the World Trade Organization, which will open countless new opportunities for both developing and well-established businesses in the country. The optimization of the tax structure for the benefit of businesses and enforcement of anti-monopoly laws are also listed as a priority. The securities markets in the country will be developed to the level of modern, international standards, utilizing risk management strategies and using legislation to regulate the activities of market players. The Baku Stock Exchange has purchased a new trading platform from the Korean Stock exchange as part of this policy.

Apart from purely economic strategies, the 2020 development plan touches on important social programs and political goals as well. Among the political goals are the strengthening of the territorial integrity of the country, the continuance of democratic and legal reforms, and upholding the rule of law. The social plans seek to further health initiatives, expand education and sports, and, on a broader level, look to turn the oil profits of the country into the successful development of human capital. The plan envisages the full integration of all regions of Azerbaijan into modern life, including telecommunication improvements, internet access, improved public utilities, and more.

The state document on the 2020 plan cites that Azerbaijan is set to become a member of the group of countries with high average income according to the World Bank GDP classification system. The path to a membership in this exclusive club will be forged in part through using the country's preferable location to turn Azerbaijan into a regional commercial center. Azerbaijan has big plans to accomplish by the year 2020.