By Leman Mammadova
The new model of cooperation within the One Belt One Road Initiative encourages mutual investments in both Azerbaijan and China.
Opening ceremony of the Belt and Road Energy Partnership has been held in China within the framework of the second One Belt One Road international forum. On the sidelines of the event, Azerbaijani Energy Minister Parviz Shahbazov met with Head of China’s National Energy Administration Zhang Jianhua.
During the meeting, the minister said that Azerbaijan has invited Chinese companies to cooperate in the field of alternative energy.
The parties discussed expansion of ties in the energy sector and cooperation within the One Belt, One Road initiative.
Shahbazov noted that the signing of documents worth $821 million between Azerbaijan and China, which took place on April 24, creates new opportunities for expanding cooperation between the countries.
“We hope that we will be able to continue this success in the field of energy,” the minister added.
At the meeting, attention was drawn to the possibility of cooperation in the fields of oil, gas, petrochemicals, processing industry, electric power industry and alternative energy.
Zhang Jianhua, in turn, noted the importance of strengthening mutual activities of the companies of the two countries operating in the energy sector. In his words, the administration headed by him will make efforts to expand the participation of Chinese companies in Azerbaijan’s energy sector, including the field of alternative energy.
Shahbazov invited the Chinese side to visit Azerbaijan to explore the potential for cooperation in the field of alternative energy.
Azerbaijani and Chinese companies have recently signed ten agreements covering various fields on the sidelines of the second One Belt One Road international forum. The total worth of the contracts is $821 million.
Azerbaijan is one of the first countries that supported the One Belt, One Road project and is one of the active participants in its implementation. Azerbaijan became a signatory to the Belt and Road Energy Partnership Declaration in October 2018.
China announced the One Belt, One Road initiative in 2013, aimed at creating infrastructure and establishing links among the Eurasian countries back. This Chinese strategy envisages two key areas of development: the economic belt of the Silk Road and the maritime Silk Road. It is related to the creation of trade corridor for direct deliveries of goods from East to West on preferential terms.
Successful transport projects implemented by Azerbaijan, such as Baku-Tbilisi-Kars, South-North, Alat International Sea Trade Port, have considerably contributed to the One Belt, One Road initiative.
Azerbaijan is China's key trade partner in the South Caucasus region. Last year, the trade turnover between Azerbaijan and China exceeded $1.3 billion, making 43 percent of China’s total trade turnover with the countries of the South Caucasus.
Over the past period, Azerbaijan invested $1.7 billion in China, and Chinese investments to Azerbaijan exceeded $800 million. Chinese companies also took part in projects implemented in Azerbaijan at the expense of public funds worth $600 million.
Although China participated in only a few oil projects in Azerbaijan, two countries have great potential for cooperation in the energy sector. For a long time, Azerbaijan’s state oil company SOCAR has been cooperating with China National Petroleum Corporation (CNPC), from which it bought equipment used in the petrochemical sphere.
In October 2018, SOCAR and the Chinese company BGP Inc, which is a subsidiary of the CNPC, signed an agreement on the establishment of a joint venture to carry out seismic exploration in Azerbaijan and the Caspian Sea.
Earlier, Azerbaijan and China agreed for the cooperation on the oil and gas processing and petrochemical complex (GPC) project of SOCAR.
Leman Mammadova is AzerNews’ staff journalist, follow her on Twitter: @leman_888
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