Azernews.Az

By Nigar Abbasova

The Cooperation Council of Turkic Speaking States (Turkic Council) intends to boost mutual trade between the member countries as the current level is far below the existing potential.

Azerbaijan’s Economy Minister Shahin Mustafayev said that the trade turnover between Azerbaijan and Turkic Council states amounted to $1.9 billion in January-October 2016, with some $1 billion accounting for imports, and $900,000 accounted for exports from Azerbaijan.

Speaking at the 6th meeting of economy ministers of the Council on December 21, Mustafayev said that the share of the Turkic Council countries in the total trade turnover of Azerbaijan amounted to 14 percent, while the share of these countries accounted for 13 percent in the exports from Azerbaijan and 15 percent in the imports. He said that more than 2,700 companies from Turkic Council member countries are registered in Azerbaijan.

As for the influence of global economic slowdown to the trade turnover between the countries, Mustafayev said that the processes taking place in the global economy influenced trade relations.

“Decrease is observed in the trade turnover between our countries as a result of the global economic processes. However, despite this fact, we have great opportunities to increase mutual trade. Therefore, I propose to analyze the range of products our countries sell. For example, if the goods imported by Turkey, Kazakhstan and Kyrgyzstan are present in the list of products exported by Azerbaijan, these countries could import these goods directly from Azerbaijan and vice versa,” said the minister. He underlined that the issue will become one of the topics of discussion between Azerbaijan and Turkey and invited Kazakhstan and Kyrgyzstan to join in as well.

Talking about the legal base for cooperation Mustafayev said that the countries have already signed MoU in the areas of investment promotion, investment environment, investment statistics, as well as small and medium-sized enterprises. Moreover, more than 300 agreements were signed on a bilateral basis between the Turkic Council countries.

Azerbaijan is about to be a net investor in Turkey, and already has such status in Kazakhstan.

Mustafayev said that Azerbaijan has well-developed mutual investments with Turkey and Kazakhstan, so these ties should be developed with Kyrgyzstan as well.

“Investments of Azerbaijan in the economy of Kazakhstan stands at $190 million. One of the main investment projects between the countries is the establishment of a logistics center in the special economic zone in Aktau Seaport. The cost of the project is estimated at $15 million. Another large project realized with the participation of Azerbaijan is Aktau Energomash plant on the production of transformers and cables (worth $50 million). Kazakhstan, in turn, invested some $67 million.

Spokeswoman of the Kyrgyz Ministry of Economy and antimonopoly policy Ayday Kurmanova, addressing the event said that Turkic countries are also among the main investors in the economy of Kyrgyzstan. She said that the country spares no effort to create favorable business environment in the country, mentioning that the special liberal system, convenient for doing business, was set up in Kyrgyzstan.

She underlined that all spheres of Kyrgyz economy are open for foreign investors. Kurmanova said that main objectives of the country include the provision of economic growth, establishment of competitive economy and poverty reduction.

Establishment of economic alliance

Turkey’s Economy Minister Nihat Zeybekci, in turn, said that the member countries should create an economic alliance, switch to the regime of free trade and expand customs benefits to widen cooperation.

“Population of member countries of the Council is about 115 million people, while total volume of the national income stands at $1.2 trillion. Total volume of foreign trade turnover in the countries amounts to $600 billion, but the turnover of mutual trade between the member-countries accounts for only 2 percent of the sum. We should bring the figure to the level of 5-10 percent.” He added that the countries will be able to strengthen overall ties by means of strong economic cooperation.

Furthermore, the minister said that Turkic Speaking States should use their national currencies in trade operations, noting that Turkey plans to switch to calculations in national currency in mutual trade with Azerbaijan. Turkish authorities believe that the mechanism may increase demand for the national currencies and result in their strengthening. Moreover, it will help to avoid the dependence on fluctuations in the foreign exchange rate and avoid additional costs, associated with the conversion. He went on saying that Azerbaijan and Turkey also intend to simplify customs procedures for trade of certain goods.

Furthermore, he said that the countries will sign franchise trade agreement within the VI meeting of the Turkey-Azerbaijan High-Level Strategic Cooperation Council, which is scheduled for the first part of 2017. He mentioned that the sides are currently working on the list of preferential goods. He also said that Turkic Council states should enhance economic ties, in particular, in such spheres as tourism, healthcare and others, mentioning that the meeting would play an important role in the development of economic cooperation.

Azerbaijan has so far invested $8 billion in the Turkish economy, some $6.7 billion of which accounted for such projects as the Petkim Petrochemical Complex, the Star Oil Refinery and the Trans-Anatolian Natural Gas Pipeline (TANAP), and the remaining part of $1.3 billion was allocated for other spheres. Azerbaijan plans to bring the total volume of Azerbaijani investments to Turkey to $18-20 billion by 2020. Turkey, in turn, invested nearly $10 billion in Azerbaijan’s economy, with $2.6 billion of which being provided for the development of non-oil sector. The countries plan to bring the volume of trade turnover to the level of $15 billion in the coming years. Turkey, which has always held leading positions among the foreign trade partners of Azerbaijan, ranks the second in Azerbaijani imports and the 14th in the exports. Azerbaijan mainly imports various equipment, electrical appliances, household items, cars, while Turkey imports oil and oil products and gas.

Transport sphere

Member countries of the Council have also wide opportunities to connect transport routes passing from China to Europe, as well as from north to south.

Deputy Economy Minister of Kazakhstan Aydar Arifkhanov said that the issues of transport cooperation are among the priority areas that are discussed on a regular basis, recalling the fact that historically the region was a part of the great Silk Road. He mentioned that the facilitation of customs procedures is necessary for successful cooperation in the sphere of transport and logistics.

The deputy minister also provided an insight into business and investment opportunities in Kazakhstan, as well as its transport and transit potential, saying that the country is currently implementing a number of programs aimed at the development of non-oil sector. He called on the countries to enter Kazakh market, which in turn will open ways to the markets of the Eurasian Economic Union and China, mentioning that such cooperation is beneficial for all participants.

Arifkhanov underlined that his country supports the activity of the Council and stressed the importance of the Council in expanding relations among these countries.

The Council was established in 2009 as an international intergovernmental organization, with the overarching aim of promoting comprehensive cooperation among Turkic Speaking States, while its four founding member states are Azerbaijan, Kazakhstan, Kyrgyzstan and Turkey.

By promoting deeper relations and solidarity amongst Turkic-speaking countries, it aims to serve as a new regional instrument for advancing international cooperation in Eurasian continent, particularly in Central Asia and Caucasus. Activities of the Council are also supported by its related and affiliated organizations as Parliamentary Assembly of Turkic-speaking Countries (TURKPA), International Organization of Turkic Culture (TURKSOY), Turkic Academy, Turkic Culture and Heritage Foundation and Turkic Business Council.

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Nigar Abbasova is AzerNews’ staff journalist, follow her on Twitter: @nigyar_abbasova

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