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Azerbaijan enhances trade resilience by boosting sea-cargo value [ANALYSIS]

17 June 2024 14:30 (UTC+04:00)
Azerbaijan enhances trade resilience by boosting sea-cargo value [ANALYSIS]
Ulviyya Shahin
Ulviyya Shahin
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The latest data from the State Customs Committee of Azerbaijan shows notable changes in the country's maritime cargo sector. From January to May 2024, the value of cargo transported by sea reached $861.4 million, a 16.9% increase compared to the same period in 2023. In contrast, the overall cargo volume decreased by 1%, totaling 1,122,023 tons.

A closer examination of the data uncovers a dichotomy between exports and imports in terms of volume and value.

The volume of sea-transported exports fell by 3.2%, amounting to 29,529 tons.

The value of these exports experienced a significant drop of 40.9%, reaching $46.9 million.

The volume of imported goods saw a marginal decline of 0.8%, totaling 1,092,493 tons.

In stark contrast to exports, the value of imports increased by 21.4%, reaching $814.6 million.

Several factors could explain these divergent trends and their broader economic implications.

The global increase in commodity prices, driven by inflation and supply chain disruptions, likely contributed to the higher value of imported goods despite the slight decrease in volume. This suggests that Azerbaijan is importing more high-value goods or that the cost of previously imported goods has risen significantly.

The substantial drop in the value of exports, despite a relatively smaller decline in volume, indicates a shift in the composition of exported goods towards lower-value items. This could be due to global market conditions, reduced demand for certain Azerbaijani exports, or increased competition from other countries.

The contrasting trends in import and export values reflect potential shifts in Azerbaijan's economic landscape. The country may be focusing on importing essential goods and raw materials for domestic consumption and industrial use while facing challenges in maintaining high-value exports.

For policymakers and stakeholders, these trends highlight the need for strategic adjustments:

Expanding and diversifying export markets can help mitigate the risks associated with dependence on a limited range of goods or markets. This can involve exploring new trade partnerships and promoting value-added exports.

Improving port facilities and logistics can reduce costs and increase efficiency, making Azerbaijani exports more competitive. Investments in technology and infrastructure can also streamline import processes.

Encouraging the growth of domestic industries through incentives and support can reduce reliance on imports and foster a more balanced trade dynamic. This includes investing in sectors with high export potential and promoting innovation.

The latest data on sea-transported cargo in Azerbaijan underscores the complex interplay between value and volume in international trade. While the increased value of imports signals robust economic activity, the challenges in exports call for strategic interventions. By addressing these challenges and capitalizing on opportunities, Azerbaijan can enhance its trade resilience and economic prosperity.

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