REGIONAL ANALYSIS OF

AZERBAIJAN ECONOMY.
 REGIONAL ANALYSIS

• Economic classification of regions is done

according:

– Economic and geographic structure and position

– Natural resources and richness
– Active population density
– Area and land structure
– History
 REGIONAL ANALYSIS
According to before mentioned country is divided into 10 regions which
are
• Absheron
• Ganja-Gazakh
• Naxchivan
• Shaki-Zagatala
• Lankaran
• Guba-Khachmaz
• Aran
• Garabakh
• Kalbajar-Lachin
• Shirvan.
MAP OF ECONOMIC REGIONS
 ABSHERON ECONOMIC REGION
Covers Absheron and Khızı administrative region as well as one of the
most important cities of country Sumgayit.
• Area of Absheron economic region excluding Baku is 3.34 thousand km2. It
makes 3.9% country’s areas.
• 4.8%- of country population 551.800 people lives in this region. Density is
148 person per sq km. Active population of region is 163 thousand people.
• Region has dry subtropical climate.
• Region is rich with natural resources which are: stone, cement, quartz and
construction sand.
• Absheron peninsula has lots of bath treatment sources, hot waters. Caspian
coast has tourism beach and resources for tourism. However, it is only
region on which area does exist any drinking water sources. Drinking water
of region supplied from other regions and from Samur and Kura rivers.
 ABSHERON ECONOMIC REGION
• Industry of this region is concentrated in oil, natural gas,
electricity, chemical, polymer, glass, metallurgy, steel and
other metal, textile production, light and food industries.
• Transport and related services has a big importance for the
region.
• Agricultural area prevails with sub-tropic fruits, vegetables,
flowers, grapes, dairy production, poultry-breeding and
livestock breeding.
• Regions agriculture enables to grow olives, saffron, pistachio.
• Construction and communication are fastest growing areas as
well.
 ARAN ECONOMIC REGION
• Aran economic region consists of Agjabedi, Beylagan, Barda, Bilasuvar, Goychay,
Hacıgabul, Imishli, Kurdamir, Neftchala, Saatli, Sabirabad, Salyan, Ujar, Zardab
administrative regions, along with Ali-Bayramli, Mingachevir, Yevlakh towns.
• The region has an area of ​21.43 thousand km2 24.7% of the country's territory is
covered. An important part of the region (more than half) of the areas in the
plains below the sea level.
• The regional population is 1,936,000 people, equivalent to 20.5% of the
population of the country. The active population is 918 thousand people. The
regional population density is 82 people / km2.
• Aran economic region has a subtropical climate.
• Natural resources and energy mineral reserves are mainly in the southeast and
centralized region.
• Rich solar energy, water resources in the Kura and Araz rivers, soils suitable for
agriculture and other natural resources of the region.
 ARAN ECONOMIC REGION
• Industry of this region is well developed. The main industries
are oil, natural gas, iodine, bromine, chemicals, textile, leather
processing, construction materials, light and food industry.
• Industrial areas in the south-west, Ali Bayramli, Salyan and
Neftchala; Mingechevir, Yevlakh concentrated in the north-
west.
• Fruits and vegetables, fish, meat, milk, large and small horned
cattle, cotton, sugar beets, wheat, potatoes and grapes are the
region's main agricultural areas.
• The region accounted for 90% of the country's cotton
production.
• Chemistry, engineering industry, light, food industries and
construction materials form the main part of the industry of the
economic region. Chemistry industry is concentrated in Mingachevir,
Salyan, Neftchala including plastic bulk production plant in Salyan,
iodine-bromine plant in Neftchala. Mingachevir, Ali-Bayramly and
Salyan are main centers of engineering industry. In each
administrative region center there are enterprises of food industry.
The significant part of production belongs to cotton-cleaning plants
that do the initial processing of the cotton. Also, cotton cloth
weaving (Mingachevir), initial processing of wool (Yevlakh), artificial
skin production (Shirvan), carpet weaving (Gazy Mammad) are the
important sectors of light industry
• The food industry of the region is based on processing of fruit and
vegetables (Sabirabad), vine, cognac (Goichay), fish cans (Banka),
 GANJA-GAZAKH ECONOMIC REGION
• This important region includes Agstafa, Dashkasan, Gadabay, Goranboy,
Khanlar, Gazakh, Samukh, Shamkir, Tovuz administrative regions as well as
Ganja and Naftalan cities are part of this region.
• Area of region is 12.49 thousand sq km which is 14.4% of total country area.
• 1.240.800 people population makes 13.6% of country population. Density for
each km is 101. 47% population lives in the cities, 53% in rural areas. Active
population is 633 thousand people.
• Region is rich with its natural resources. Iron ore, aluminum, copper,
limestone, marble, zeolite, gypsum and cement raw material are one of the
most important natural resources of region. Kura river which passes through
the region provide hydro energy resources.
• Due to mountain, climate, forests and mineral waters region enables to locate
lots of recreation and resort centers. Goygol, Hajikand and Naftalan are
located inside of this region.
 GANJA-GAZAKH ECONOMIC REGION

• With its 12-13% contribution to the country region is considered to be the

second important region in the country.
• Main industrial areas of the region: production of electric instruments,
communication equipment, agricultural machinery, metallurgy, cotton, textile,
carpet, cement, ceramic, glass, heavy and food industries.
• Main agriculture products are: Sugar, potatoes, wheat, grapes, wine, candy,
canned food, meat and dairy products, animal breeding.
• Main agricultural products of region are potato, grapes and wheat which makes
13-14% of total production of the country. Potato production accounts for
nearly 80%, grape production for 28% of all.country. Cotton is produced on in
Goranboy at this region. Animal breeding makes 15% of all country production
• Inside of the country 6.2% railways and 6.1%vehicle infrastructure
correspondence to this region. Ganja, Gazakh and Agstafa are main
infrastructure networks.
 GANJA-GAZAKH ECONOMIC REGION
• Europe-Caucasus-Asia transport corridor passes through this region
and therefore, in frame of State Program on regions development road
and bridge have been re-built and renovated.
• Since Great Silkway intersect this region demand for railway
transportation increase and there is a plan for second bridge over Kura
in frame of State Program.
• Ganja, Khanlar, Shamkir, Tovuz, Agstafa, Gazakh region socio-economic
situation was improved since Baku-Tbilisi-Ceylan pipeline construction
and intersection from these regions. Korchay, Karayazı-Agstafa and
Karayazı are State Sanctuaries and protect by the government.
• Ganja international airport plays a vital role in cooperation with CIS
countries in line with the Agstafa and Naftalan airports.
GUBA-KHACHMAZ ECONOMIC REGION
• Guba-Khachmaz economic region, Devechi, Khachmaz, Guba, Siyazan administrative
regions have been organized.
• The total area of ​7.66 thousand km2, which is 8.8% of Guba-Khachmaz economic
region covers a territory of the country.
• 5.6% of the country's population lives in the region of 525,700 people. 257 thousand
active population. While there are 76 people per square kilometer. Due to the
topographical structure of the region's population lives in the more flat areas on the
coast of the Caspian Sea. 32% of the urban population, 68% live in rural areas.
• Region is divided into four distinct zones has a specific topographic character.
Therefore, hot, cold, wet and cold climates of which has a type.
• Among the region's natural resources of oil, natural gas, shale, sand, gravel and water
takes place.
• It covers 10-11% of the region's forests. The economic region is rich in natural
recreational resources. In this region, the most important health. Siyazan Galaalti
mineral water resort in the country's major function.
GUBA-KHACHMAZ ECONOMIC REGION
• Dependent on oil and natural gas industry in the region. Siyazan region's oil and natural
resources (Keshchay, Siyazan-Nardaran, Amirdjan, Zoglu-Zeyva, Tangi, Saadan, Vayimdag-
Togcay, etc.) are concentrated.
• Agricultural sector of the region contributes to the development of light and food industry.
Fruit and vegetable canning industry in the field of agriculture, weaving and fish products have
an important place.
• Agriculture and livestock sector in the region, which has an economic advantage.
• Agriculture in particular, fruit and vegetable production is concentrated. Along with these
grapes, potatoes and wheat are also produced. Milk and meat production in the plains of the
region, has developed a small cattle and livestock. Siyazan and Devechi districts spread in
poultry in the region.
• Among the leading sectors of tourism in the region is developed.
• Places of importance to the region's tourism Khudat seashore, Galaalti for kidney disease
treatment center, Gusar, Guba, Khachmaz and Devechi in terms of hunting and fishing.
• Along with tourism in the region, canning, alcoholic and non-alcoholic drinks, flour, meat and
dairy products, packing, construction materials and carpet industries may be considered more
favorable investment areas.
 SHIRVAN ECONOMIC REGION
• Shirvan or Highland Shirvan Economic Region includes Agsu, Ismayilli, Gobustan
and Shamakhi administrative regions.
• Total area of the region is 6.06 thousand km2 which 7%-of total area of the
country.
• In this region inhabits 3.2% of country’s population which is 304.000 people out
of which 141 thousand are economically active. This region has lower density of
population in comparison with other regions. Here for 1 sq km corresponds 50
people.
• Region in topographic sense divided into the highland and lowland areas and
therefore has different climate. Moist, warm, cold or hot and dry climatic
conditions prevail in the region.
• There is not so much natural resources in the region. Region has stone, sand,
lime, crushed and other construction materials. Highland areas are rich with the
curative mineral waters. Water with rich with sulfur and hydrocarbon are used for
treatment and drinking purposes.
 SHIRVAN ECONOMIC REGION
• Low industrial development of this region is obvious. Main industrial areas are
food and light industries which processing agricultural products of the region.
• Light industry of region is made up from juice production, textile and carpeting.
• Food industry is wine production which is used regions grapes as a raw material.
Additionally, region has wood processing, construction materials production,
agricultural maintenance organizations.
• This region is famous by its hand made and textile products, i.e. Lahich for its
cooper and Shamakhi for its silk shawl
• The main grain-growing areas of agriculture and livestock, grape growing,
winemaking, large and small horned cattle.
• Grain has a key advantage in the production of wheat. Other grain products to
meet regional consumption only.
• Growing sectors of the tourism sector in the region and among the leading areas
of silk production.
 SHAKI-ZAGATALA ECONOMIC REGION
• Economic region includes Balakan, Gakh, Gabala, Oguz, Zagatala and Shaki
administrative regions.
• Total area of region is 8.96 thousand sq km which 10.3% country’s area. Due to hill and
mountain structure of the region it lack of agricultural land plots.
• Population of the region is 599.900 people. This makes only 6.5%. Density for 1 sq km is
68 people. 27% lives in city and 73% in rural mountain areas.
• Region has mild climate.
• Copper, sulfur, lead, zinc, sand and other construction products, drinking water are
among the natural resources of region. 90%- of sulfur, 97%-lead, 99%-zinc production
comes from this region. Sole source of cooper is this region. Construction materials are
obtained from mountain areas.
• Region 27% is covered forests which mostly locates on Balakan and Zagatala areas.
• Gabala, Balakan, Gakh, Shaki and Zagatala regions resort and tourism complexes are
famous for their touristic value, however they are not enough.
• Region cross main international road which goes to Georgia.
 SHAKI-ZAGATALA ECONOMIC REGION
• In the region where is industry is weak and mostly mono type only light industry
and food industry have been developed. These areas accounts for 95% of all
industrial production of the region. Region makes only 3% of country production.
Whereas region area makes 27% of whole country area and Shaki has 30% of
population of the region which produces half of the regions products.
• Light industry is made up from silk production. There lot of textile production
organizations in the middle of region.
• Agriculture is one of the important areas for the region. Main agriculture products
of region are tobacco, silk, fruits, wheat products, grapes, meat and milk, cotton and
livestock.
• 75%- of tobacco, 17%-of wheat, 35%-of mulberry, 2%-of green tea produced in the
country comes from this region. 10% of farm products of the country are produced
in this region
• Gakh in the region has a rich potential for tourism however, due to slow
development and distance this region was left by its inhabitants. After
implementation of regions development program state was able to stop migration
and help this region.
 LANKARAN ECONOMIC REGION
• Region is consist of Astara, Jalilabad, Lerik, Masalli, Yardimli administrative regions. Region
borders with the Caspian Sea to the east, west and in south its border is Iran.
• The total area of ​6.08 thousand km2 in the region of 7% of the country's territory.
Lankaran lowland made up from mountains.
• The regional population of 893,000 people, 9.3% of the country's population. The number
of active population in the region is 366 thousand people. Density in the region is 147
people per square kilometer. In Lankaran lowland, the population density is 170 people.
• Differs from other economic regions of the country in terms of natural conditions in the
region. Lankaran economic region accommodates 7 climate zones out of 11 existing.
Basically, has a humid subtropical climate.
• There are very few natural resources in the region. Natural resources of region are river
stone and construction sand.
• Region is rich in terms of thermal waters. The beautiful natural areas, hot and cold mineral
water, favorable climatic conditions and developed transport hub in the region creates the
necessary conditions for the development of health tourism. Lankaran tourist center Istisu
operates as the treatment center from Soviet times.
• 26% of the territory is covered with forests.
 LANKARAN ECONOMIC REGION
• Regional economy is based on agriculture, industrial complexes. According to the
food products industry and the fishing industry is base of the region economy.
• Industrial production accounts for 90% of the food industry. Food industry is
made of fish, tea, fruits and vegetables canning, wine production and tobacco as
well.
• Fruit and vegetables, tea, grapes, grain products and potatoes are the main
agricultural areas in the region. Humid subtropical climate, great land, water and
labor resources useful in the development of agriculture and it plays an important
role in the region. This region's most important economic region in the
production of citrus fruits.
• In coastal areas, fishing activity. Poultry has developed in the region.
• 99% of the tea produced in the country, vegetables 27%, wheat 15%, potatoes
24%, and 13% of the grapes in this region accounts for 10% of the fruit.
• Production of tea is another important area. Region was in second place after
Georgia.
 NAKCHIVAN ECONOMIC REGION
• The economic region of Nakchivan consists of Autonomous Republic of
Nakchivan (NAR). Babak, Julfa, Ordubad, Sadarak, Shahbuz, Nakchivan
administrative regions are part of the economic region.
• The area of ​5.5 thousand km2, 6.3% of the country's territory, which covers the
NAR.
• 4.5% of the country's population of more than 439,800 lives in the region. 198
thousand people are active in the region. Density is 80 people per square
kilometer.
• Natural resources of the region are: molybdenum, polymetallic ore, rock salt,
dolomite, marble, construction materials, concrete, sand, gravel, mineral
water. There are more than two hundred mineral water reserves in the region.
• All of molybdenum and dolomite reserves produced in the country, 60% of the
mineral water is obtained from Nakchivan economic region.
• Only 0.5% of the region was covered by forests.
 NAKCHIVAN ECONOMIC REGION
• Energy, electronic products, cement, sugar, food, aluminum plates, furniture, silk,
tissue-knitted carpets and major industrial areas in the region.
• The country's industrial production accounted for approximately 2.6% of the
region. Industrial production in half, the city accounted for 35% of industrial
production labor.
• The region’s particular importance is in the light and food industries. In light
industry, weaving, silk processing, weaving, knitting enterprises in the food
industry, canning, tobacco processing, mineral water bottling, meat and fish
processing enterprises producing remarkable contribution to the economy of the
region.
• Tobacco, grapes, fruits, vegetables, wheat, henna, beet sugar, meat, milk and wool
production on food, agriculture and livestock breeding and fishing areas are main
areas in the region. 3.6% of the country's performance in the production of
agricultural products comes from this region.
• Favorable climatic conditions, the agricultural sector contributed to the different
areas of specialization. Nakchivan, the country's second major economic region,
which produces tobacco.
• Nakchivan agricultural reforms began in 1992 and accelerated since 1996.
Importance of regional development programs

Regional analysis of Azerbaijan

economy
 Since 2004, in terms of socio-economic development
Azerbaijan has stepped into a new era started to concentrate
on the solution of one of the most important issues :

• development of private enterprise in the regions by

effective usage of increasing labor force, natural and
economic potential to achieve sustainable development
• increase the use of the labor force, and by thus, reduce the
poverty in the country
• Implementation of the programs in this direction will
eliminate differences in the economic development level of
the regions and result in regional balance of the country
 Main problems of the regions
• 80% of the capital invested into the country flows to
the capital.
• Industrial sector in other regions of the country is
negligibly weak.
• Those who could not find jobs that come from the
regions to Baku as a result of the increased population
density in the capital has led to the emergence of
many problems.
• According to the State Statistics Committee 67 city are
dependent on the income from the capital.
 REGIONAL DEVELOPMENT PROGRAM (2004-
2008) GENERAL OBJECTIVES OF THE PROGRAM

• - The continuation of macroeconomic stability,

• - The continuation of small inflation rate,
• - The optimal state regulation directed to areas which have strategic
importance,
• - Carry out second reforms in the agricultural sector,
•  - The development of private enterprise in the regions due to
speed up privatization,
• - The implementation of structural policies in order increase export
potential and non-oil sector,
• - Improve the investment climate for private business,
• - Improve the quality of social services, which have been identified
as key areas.
 
 According to the program
• the volume of the investment reached 16.8
billion US Dollars
• 60% of it directed to the regions.
• The program was implemented within 5 years
and 600.000 jobs were created.
• The average monthly salaries increased by 3.1
times.
 REGIONAL TARGETS OF PROGRAM

• to solve the water problems in Karabakh, Mil, Mugan and Absheron

regions
• The strengthening of the agricultural and manufacturing facilities, the
development of tourism is taken into account in Absheron. Lankaran,
Mountainous Shirvan, Guba-Khachmaz economic regions
• the development of production and processing industries in Ganja-
Gazakh economic region.
• The development of tourism sector in Shirvan economic region,
especially infrastructure activities will be carried out in Ismayilli city and
Shamakhi region.
• In Nakhchivan economic region, the development of the tourism sector
is available in terms of historical sites and Batabat and Ganligol areas in
Shahbuz region.
THE PROGRAM OF SOCIO-ECONOMIC DEVELOPMENT
OFAZERBAIJAN REPUBLIC REGIONS IN 2009-2013

• sustainable development of non-oil sector

• creation of new businesses and job, in regions
• in the country capital increasing the volume and
quality of utilities and social infrastructure provision
• further improvement of the business environment,
increasing the employment rate of the population
• poverty reduction
 By the state program is intended to achieve the following tasks:

• To ensure the rapid development of non-oil sector make effective use

of natural and labor resources of the country;
• The continuation of measures aimed at improving infrastructure;
• Implementation of the measures to improve the business
environment and the accelerated development of entrepreneurship;
• To continue attracting investment for development of the economy;
• To stimulate production of export-oriented;
• The creation of modern infrastructure facilities and existing
facilities in international standards;
• Improve the provision of public utilities;
• The continuation of measures aimed at improving employment;
• Poverty reduction.
 SOURCES OF FUNDING MEASURES ENVISAGED IN THE STATE PROGRAM

• Azerbaijan Republic state budget;

• extra-budgetary funds;
• manage, enterprise and organizations funds regardless of
ownership;
• Funds of National Entrepreneurship Support Fund of Azerbaijan
and "Azerbaijan
Investment Company" OJSC;
• funds of local and foreign entrepreneurs;
• Financial resources of international organizations and foreign
countries;
• other sources not prohibited by the legislation.
 SOCIO-ECONOMIC DEVELOPMENT PROGRAM OF REGIONS OF
AZERBAIJAN REPUBLIC FOR
2014-2018.
• Maintaining an acceptable level of the average annual inflation rate
and the exchange rate of the national currency;
• Determination of the extent of tax and customs tariffs;
• To continue measures to the stimulation of agricultural producers;
• Increasing grain production and strengthening of competitiveness;
• Stimulation of the activity of export-oriented manufacturers;
• The stimulation of creation of new jobs;
• Increasing of non-oil budget revenues special weight in Gross
Domestic Product;
• Will be continued development of the agricultural sector in order to
ensure food safety.
•  
 The development of the agrarian sector consists of
the following areas:
• associated development of production of raw materials and processing areas of agrarian sector and
stimulation of increase of competitive and export- oriented production, primary the continuation of
the measures related to food self-sufficiency;
• Increase financial support to the agricultural sector and the continuation of measures to promote the
development of traditional agricultural areas;
• application of environmentally clear technologies in plant growing and animal husbandry and
stimulating the activity of economic entities in this area;
• creation of large grain or seeding, saplings, vine, intensive gardening farms;
• Continuation of the establishment of hothouse, refrigerators and grain storage complexes (logistics
centers) in regions with the aim of agricultural production, deliveries, keeping and sales;
• taking into account the nature of each region, naturally and the climatic conditions implementation of
appropriate measures by specialization in agricultural production;
• formation of ecologically clean agricultural and food markets;
• strengthening the material-technical base of agrarian sector and the new structures will operate on
market principles;
• The continuation measures to improve the supply of agriculture, irrigation and land reclamation,
efficient use of land and water resources;
• Undertaking relevant measures towards the lands electronic technical registration and creation of an
electronic registration system for farmers.
• The Azerbaijani economy has grown 3.2 times in the
past 14 years. In this period, investments worth $231
billion have been made in the country’s economy
• Within the framework of the State Program, 4.5 billion
manats was directed to regional development in 2017.
• The activity of businessmen expanded as a result of
the reduction of audits in the field of
entrepreneurship, simplification of the issuance of
licenses and permits and other measures.
• In 2017, concessional loans totaling 146
million manats were allocated under the
projects of 1953 entrepreneurs at the expense
of repaid loans. 68 percent of the amount was
made up by the agricultural sector, while 32
percent - by various industries and the
development of other fields.
 SOCIO-ECONOMIC DEVELOPMENT PROGRAM
OF REGIONS OF AZERBAIJAN REPUBLIC FOR
2019-2023

• If during the third program of socio-economic development of

the regions we have achieved significant results in increasing
crop production, today we are working on industrialization, on
automation, in order to create favorable conditions for regions
to produce their products, and export them to the world market.
• Another important area of ​the fourth state program is related to
the improvement of the logistics system, which will strengthen
the economic relations between the regions of the country.
• In total, the country provides for the creation of 51 agro-parks,
17 of which are already functioning.
 SOCIO-ECONOMIC DEVELOPMENT PROGRAM
OF REGIONS OF AZERBAIJAN REPUBLIC FOR
2019-2023
• The fourth regional development program should almost
completely erase the distinction between the capital and
life in the regions.
• water supply, sewage, internet: it should all be at the same
level as in the capital
• According to preliminary estimates, it is planned to allocate
at least 17 billion manat to the implementation of this
program. Of these, 4.6 billion manat will be invested by the
private sector in the form of investments in projects that
are being implemented or are under development, while
approximately 13 billion manat will be public investment.