Economy Overview
Azerbaijan is less developed industrially than either Armenia or Georgia, the other Caucasian states. It resembles the Central Asian states in its majority Muslim population, high structural unemployment, and low standard of living. The economy's most prominent products are oil, cotton, and natural gas. Production from the Caspian oil field declined through 1997 but registered an increase in 1998-99. Negotiation of 19 production-sharing arrangements (PSAs) with foreign firms, which have thus far committed $60 billion to oil field development, should generate the funds needed to spur future industrial development. Oil production under the first of these PSAs, with the Azerbaijan International Operating Company, began in November 1997. Azerbaijan shares all the formidable problems of the former Soviet republics in making the transition from a command to a market economy, but its considerable energy resources brighten its long-term prospects. Baku has only recently begun making progress on economic reform, and old economic ties and structures are slowly being replaced. An obstacle to economic progress, including stepped up foreign investment, is the continuing conflict with Armenia over the Nagorno-Karabakh region. Trade with Russia and the other former Soviet republics is declining in importance while trade is building up with Turkey, Iran, UAE, and the nations of Europe. Growth in 2000 should match growth in 1999. Long-term prospects will depend on world oil prices and the location of new pipelines in the region.
Agriculture Products
cotton, grain, rice, grapes, fruit, vegetables, tea, tobacco; cattle, pigs, sheep, goats
Industries
petroleum and natural gas, petroleum products, oilfield equipment; steel, iron ore, cement; chemicals and petrochemicals; textiles
Industrial Production Growth Rate
3% (1999 est.)
Labor Force
2.9 million (1997)
Electricity production
18.062 billion kWh (1999)
Electricity production by source
Fossil fuel: 90.98%
Hydro: 9.02%
Nuclear: 0%
Other: 0% (1998)
Electricity Consumption
15.508 billion kWh (1998)
Electricity Exports
1 billion kWh (1998)
Electricity Imports
1.2 billion kWh (1998)
Currency
1 manat = 100 gopiks
Unemployment Rate
20% (1999 est.)
Population Below Poverty Line
60% (1999 est.)
Household Income or Consumption by Percentage Share
Lowest 10%: NA%
Highest 10%: NA%
Budget
Revenues: $565 million
Expenditures: $682 million, including capital expenditures of $NA (1996 est.)
Commercial Bank Prime Lending Rate
Market Value of Publicly Traded Shares
Reserves of Foreign Exchange and Gold
Debt External
$684 million (1998)
Stock of Direct Foreign Investment at Home
Stock of Direct Foreign Investment Abroad
Exchange Rates
manats per US$1 - 4,342 (October 1999), 4,373 (1999), 3,869 (1998), 3,985.38 (1997), 4,301.26 (1996), 4,413.54 (1995)
