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Azerbaijan Foreign Trade
As during the Soviet era, Azerbaijan's economy depends
heavily on foreign trade, including commerce with the other
former Soviet republics. In the late 1980s, exports and imports
averaged about 40 percent of GDP. At that time, Azerbaijan's
exports to other Soviet republics averaged 46 percent of GDP and
over 90 percent of total exports; its imports from those
republics averaged 37 percent of GDP and nearly 80 percent of
total imports. In the early 1990s, Azerbaijan's main trading
partners in the CIS were Russia, Ukraine, Kazakhstan, and
Belarus, in that order.
In the last years of the Soviet Union, Azerbaijan showed a
net trade surplus. After a sharp decline in net trade surplus in
1990, oil sales outside the Soviet Union boosted the surplus in
1991 and 1992. In 1992 Azerbaijan made major gains in hardcurrency exports, mainly from selling refined oil products abroad
at world prices. Trade with CIS countries, determined by yearly
bilateral agreements, declined significantly after 1991. Although
products from those countries still dominated Azerbaijan's
imports, less than half of exports went to them. Important
obstacles were the bypassing of the state order system in the
Baltic states and Russia, the high VAT on some items, and the
complexity of central-bank credit systems in the transitional
period. Trade agreements were negotiated for 1993 with Belarus,
Estonia, Kazakhstan, Latvia, Lithuania, Moldova, Russia,
Turkmenistan, and Ukraine.
In 1990 Azerbaijan's major trading partners outside the
Soviet Union were led by Germany and Poland (see
table 16,
Appendix). In 1992 Azerbaijan's main non-CIS trading partners
were Britain and Iran. According to government statistics for
1993, Azerbaijan had a large trade surplus with Russia, and more
than US$60 billion was owed Azerbaijan by customers in Greece,
Iran, and Turkey. Through 1993 Turkish enterprises, considered a
primary source of new foreign capital, refrained from large-scale
investment in Azerbaijan because of concerns about political
instability in Baku. Disagreements with Russia and Turkey delayed
construction of an oil pipeline that would connect Baku with the
Mediterranean through Turkish territory
(see Energy
, this ch.).
In the early 1990s, increasing numbers of products were sold
directly by Azerbaijani enterprises to foreign enterprises
without government export licenses, although the inefficient
state-managed trade system of the Soviet era remained in place.
In 1993 the Ministry of Foreign Economic Relations monitored all
foreign trade and supervised the export of petroleum products and
other strategic items. In late 1993, government control was
tightened because most private firms were keeping hard-currency
foreign-trade earnings outside Azerbaijan.
Data as of March 1994
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