Azerbaijan - Future trends

Azerbaijan still has to go through a severe democratization process (including proper representation of the people, free elections, and the improvement of human rights), as observed in the parliamentary elections in November 2000, which proved to be a failure in the election mechanism.

Economically, Azerbaijan is improving, with some reservations in the non-oil sectors, which have deteriorated sharply due to the focus on oil. There has been a significant fall in the agricultural, mining (excluding oil), and manufacturing sectors' production levels, decreasing the export levels at the same time. Between 1994 and 1998, agricultural exports decreased by 43 percent, metals by 87.3 percent, chemicals and petro-chemicals by 50.4 percent, and machinery and equipment by 62.6 percent.

Energy remains the keystone of Azerbaijan's economic future. In the oil sector, pipeline projects and the gains from production are estimated to reach substantial levels in 2010-2015, giving Azerbaijan political and economic leverage in the region. The production of oil and the supplementary sectors in the oil industry are of importance. In addition, recent discoveries of gas deposits will help supply both Azerbaijan's energy needs and provide exports to Turkey and Eastern Europe. Privatization is another important task. Renovation of the infrastructure, including roads, railways, communications, power generation and distribution, will gain importance as trade relations improve.

The resolution of the Armenian conflict over Nagorno-Karabakh will also affect economic and social conditions in the region and will help improve the international relations of Azerbaijan.