Azerbaijan: Investing

FDI in Figures

Foreign direct investments are very important in the Republic of Azerbaijan, especially in the energy sector. The flows of FDI reached USD 473 million in 2009, an increase in relation to 2008, then 563 million in 2010. The shares of FDI in relation to the GDP are also increasing, in 2009 exceeding the 20% treshold.

The country is part of the customs union between Russia, Kazakhstan and Belorussia, which in terms of volume is the most important in the region and is almost exclusively related to hydrocarbons, with major projects for oil and gas pipelines and related services.

The development of the FDI in 2012 will depend in particular on the economic health of its Russian partner, currently the dominant investor in Azerbaijan.

Why You Should Choose to Invest in Azerbaijan

Strong Points

The country's strong points are:
- Fast economic growth;
- An interesting geographic location;
- Competitive production costs;
- Cheap and qualified labor;
- The size of its energy sector;
- The signing of numerous bilateral treaties aimed at promoting trade.

Weak Points

The country's main weak points are:
- The poor quality of its infrastructures;
- The high rate of corruption within the administration;
- The slowness of procedures;
- The destabilization risks due to the conflict in Karabakh;
- Other than the oil industry, there are few developed sectors;
- A certain level of Insecurity.

Government Measures to Motivate or Restrict FDI

The country has signed numerous treaties to encourage FDI. It has also put in place legislation facilitating the creation of companies, limiting corporate taxes, and laws to protect FDI.
For more information and to consult the law texts, visit  the Agency for the Promotion of Investment in Azerbaiajan website.

Bilateral Investment Conventions Signed By Azerbaijan

The country has signed conventions with many countries: Austria, Belgium, Bulgaria, China, Egypt, Finland, Georgia, France, Germany, Greece, Iran, etc.

Procedures Relative to Foreign Investment

Freedom of Establishment

In theory, there is a great amount of freedom for investments, but the bureaucracy and the corruption makes investing difficult outside the energy sector, which is dominated by foreign investments.
For more information, consult the report "Investment Climate 2011" on the US Department of State's website.

Acquisition of Holdings

A majority holding interest in the capital of a local company is legal in Azerbaijan.

Obligation to Declare

The Agency for the Promotion of Foreign Investments in the country gives information on the authorizations required for setting up a company.

Competent Organization For the Declaration

Agency for the Promotion of Investment in the Republic of Azerbaijan
Ministry of Taxes of the Republic of Azerbaijan (for starting a company)

Requests For Specific Authorizations

For certain sectors, specific authorizations are necessary.

For more information, consult the report "Investment Climate 2011" on the US Department of State's website.
For more information, consult the website of the Agency for the Promotion of Investment in the Republic of Azerbaijan.

Investment Opportunities

Investment Aid Agency

Agency for the Promotion of Investment in the Republic of Azerbaijan
Ministry of Economic Development of Azerbaijan

Tenders, Projects and Public Procurement

Tenders Info, Tenders in Azerbaijan
Asian Development Bank, Proposed Projects in Asia
Globaltenders, Tenders & Projects from Azerbaijan
DgMarket, Tenders Worldwide

Other Useful Resources

Website of the Azerbaijani government

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