Azernews.Az

President Ilham Aliyev has signed a decree on additional measures to stimulate exports of non-resource products and subsidize transportation costs, AzerNEWS reports.

The decree states that the development of the non-resource sector is of particular importance for strengthening the country’s economic stability, minimizing the negative impact on the national economy of complex geopolitical processes unfolding worldwide, disruptions in global supply chains, and instability in foreign markets, as well as for ensuring the country’s strategic economic sovereignty.

Despite the positive trends observed in the structure of the non-resource sector, access to foreign markets for domestic products, as well as for products manufactured in the Nakhchivan Autonomous Republic, remains limited to other territories of the Republic of Azerbaijan.

One of the main factors hindering the full realization of the export potential of the non-oil and gas sector, as well as the transportation of products manufactured in the Nakhchivan Autonomous Republic to other regions of the country under the blockade, is high logistics costs. Especially when directing local oil- and gas-independent products to new and alternative foreign markets, distinct from traditional ones, high transportation costs significantly limit exporters’ competitiveness. The complexity of the logistics chain and the high share of transportation costs in the cost of production for long-distance shipments are factors hindering the diversification of exports in terms of goods and geography. As a result, the share of non-oil and gas products in total exports is lower than its potential.

Pursuant to the decree, to stimulate exports of non-oil and non-gas products and to support the transportation of products manufactured in the Nakhchivan Autonomous Republic to other regions of the country, upon the export of oil- and gas-independent products of Azerbaijani origin, a transportation support payment (hereinafter referred to as “export transportation support”) will be made from the state budget to cover the costs of transporting these goods, depending on their type, customs value, country of destination, and mode of transport. In addition, for the transportation costs of products of Azerbaijani origin manufactured in the Nakhchivan Autonomous Republic and transported across the territory of the Republic of Azerbaijan by road, a domestic transportation subsidy (hereinafter referred to as “domestic transportation subsidy”) will be paid from the state budget.

The Decree stipulates that the amount of the subsidy for export shipments is calculated based on the amount paid in cash for expenses incurred in transporting the exported goods, provided that the shipment is carried out by rail, air, and sea transport, as well as by motor vehicles registered in the Republic of Azerbaijan—70 (seventy)%, provided that the transportation is carried out by motor vehicles not registered in the Republic of Azerbaijan—50 (fifty)%, depending on the type of transport used, provided that transportation is carried out by road, rail, and air transport – 15 (fifteen)%, provided that transportation is carried out by sea transport – 5 (five)% of the customs value of the exported goods.

The final amount of the subsidy for export transportation is the lesser of the amounts calculated in accordance with subparagraphs 3.1.1 and 3.1.2 of this Decree.

The amount of domestic transport support is 70 (seventy) % of the amount paid in cash for transport costs incurred in the land transport of non-oil and gas goods of the Republic of Azerbaijan, produced in the Nakhchivan Autonomous Republic, to other territories of the Republic of Azerbaijan.

Export and domestic transport subsidies are paid for shipments carried out during a given quarter, upon the relevant application by the exporter and the seller (shipper) after the end of that quarter, by the Ministry of Economy of the Republic of Azerbaijan.

The Cabinet of Ministers of the Republic of Azerbaijan must prepare proposals for financing the payments of the types of support provided for in Parts 1 and 2 of this decree in 2026 and submit them to the President of the Republic of Azerbaijan within three months. At the same time, the Cabinet of Ministers is required to ensure that the necessary funds for financing payments in 2027–2036 are included in the draft state budgets for the relevant years, and within three months to approve the rules for determining the Azerbaijani origin of oil- and gas-independent goods when paying export and domestic transport support, a list of operations and persons to whom these types of support do not apply, and relevant regulatory acts, and to submit information on this to the President of the Republic of Azerbaijan.

The Ministry of Economy, in coordination with the Ministry of Finance of the Republic of Azerbaijan, must approve within three months a list of non-oil and gas goods and countries (groups of countries) eligible for export transportation support, the procedure for submitting applications for the payment of support amounts for export and domestic transportation and for reviewing such applications, the procedure for calculating the amount of support for export shipments involving various modes of transport (multimodal transport), shall inform the President of the Republic of Azerbaijan thereof, and must take the necessary measures to resolve other issues arising from this Decree.

Parts 1–3 of this Decree come into force on September 1, 2026, and remain in effect until December 31, 2036, applying to export and domestic transportation carried out until September 30, 2036.