Opening speech by Ilham Aliyev at the meeting of Cabinet of Ministers dedicated to results of socioeconomic development of 2018 and objectives for future11 january 2019, 12:00
At today’s meeting of the Cabinet of Ministers, we will discuss the key results of 2018, and also talk about the work to be done this year.
2018 was a successful year for our country. Regardless of the developments that unfolded in the world and in our region, Azerbaijan developed successfully and rapidly. All the tasks we set at the beginning of last year have been fulfilled and the full dynamic development of our country was ensured.
As you know, very negative processes occurred in various regions of the world, including ours, last year. New risks and threats are emerging. The conflicts and bloody clashes that started in previous years have continued, stability has been disturbed in many places, and protests have assumed large proportions. Against this negative background, Azerbaijan’s successes are seen even more clearly. Azerbaijan is a country of development, progress and stability. Regardless of the processes occurring in the world and in the region, Azerbaijan is successfully following the path of independence and will continue to do so in the years to come.
The third state program on the socioeconomic development of the regions was completed last year. This five-year program has been exceeded. It has allowed us the opportunity to achieve rapid implementation of infrastructure projects in the regions, creation of hundreds of thousands of jobs, new industrial enterprises and more dynamic development of agriculture. In short, the regional development program is of great importance and has produced excellent results. This year we will adopt the fourth state program on the socioeconomic development of the regions. Most of it is almost ready.
Last year, I visited the regions of Azerbaijan 24 times. During these trips, I have the opportunity to exercise control over the work being done and, through meetings with local residents on the ground, give additional instructions to resolve their problems. Many orders have been signed relating to the improvement of the socioeconomic situation of the districts, including infrastructure projects. These orders go down quite well in our regions and lead to great results. As I have already mentioned, my visits to the regions create an excellent opportunity to be in touch with the people, monitor the work being done and take the right steps related to the work ahead. I have repeatedly visited every region of Azerbaijan – at least five times in every district. There are regions which I have visited more than 10 times, and these regular trips are of great importance.
In general, the domestic situation in our country – both in connection with public and political and socioeconomic issues – is stable. In other words, I can say that 2018 was not particularly different from previous years and our country was on the path of dynamic development.
I also believe that last year was successful for us in terms of the foreign policy. Last year I paid 16 foreign visits and 16 heads of state and government visited Azerbaijan. This shows once again that we have a multi-vector foreign policy, and the number of countries cooperating with us is growing every day. Of course, I believe that we have, first of all, managed to raise the level of our communication with neighbors to a higher level. Last year, I had numerous meetings with heads of state and government of neighboring countries, during which we resolved specific issues. Good relations with neighbors is a very important factor for any country. Azerbaijan is one of the countries that managed to establish excellent relations with all its neighbors except for Armenia by pursuing a thought-out policy, and we benefit from these relations. Both the development of regional security and the successful solution of transport, energy and trade issues depend, inter alia, on relations with neighbors. In a nutshell, our relations with neighboring countries are very positive, and I am sure that further steps will be taken in this direction this year too.
As you know, Azerbaijan has earned tremendous respect and authority in the Muslim world. The steps we have taken in relation to Islamic solidarity are highly appreciated by the Organization of Islamic Cooperation, as well as by many Muslim countries, and our contribution to this area is quite sizable. In other words, our policy strengthens solidarity and cooperation in the Muslim world. The measures we have taken in this direction – both domestically and abroad – have further strengthened Islamic unity. It is no coincidence that Nakhchivan was elected the Capital of Islamic Culture last year. Nakhchivan city carried this honorary title very successfully. We will develop our relations with Muslim countries in various directions this year too, so our authority, reputation and role in the Muslim world will further increase.
As you know, an important document was signed between the European Union and Azerbaijan last year. It is called “Partnership Priorities”. This document covers many issues. I should emphasize that issues related to the Armenia-Azerbaijan Nagorno-Karabakh conflict are becoming rather positive. The document expresses support and respect for the territorial integrity and sovereignty of Azerbaijan and the inviolability of our borders. I believe that this document has a special place in the work we carried out in this direction in recent years. Thus, the European Union has unequivocally demonstrated its opinion on ways of settling the Armenia-Azerbaijan Nagorno-Karabakh conflict. At the same time, the final declaration adopted at the NATO Summit last year also expressed support and respect for the territorial integrity of Azerbaijan.
Last year, we held a large conference at the level of foreign ministers of the Non-Aligned Movement in Baku. As you know, a Summit of the Non-Aligned Movement will be held in Baku this year, and Azerbaijan will chair this major organization. Of course, chairmanship in the second biggest organization after the UN will further enhance our authority and, at the same time, have a positive impact on the settlement of the Armenia-Azerbaijan Nagorno-Karabakh conflict.
One of the important issues of our foreign policy was the determination of the legal status of the Caspian Sea. The signed Convention is of great importance for the resolution of this issue. We are glad that the position we have defended over the years is fully reflected in this Convention. The signing of this document shows again that the Caspian Sea is a sea of peace, cooperation and security. The convention is very important. I consider the signing of this document to be a great diplomatic and political success of all Caspian littoral countries.
As for the settlement of the Armenia-Azerbaijan Nagorno-Karabakh conflict, our position remains unchanged. This issue must be resolved only within the framework of the territorial integrity of our country. The resolutions of the UN Security Council must be implemented and Armenian armed forces must unconditionally withdraw from our occupied lands. These very expressions are contained in resolutions of the UN Security Council. The process of continuing the negotiations has begun despite the fact that the new leadership of Armenia tried to evade them at the initial stage. There were even thoughts that Azerbaijan should conduct negotiations with the self-styled “Nagorno-Karabakh republic”. We immediately rejected such attempts. Of course, the mediators dealing with the conflict also could not support such an incomprehensible approach and expressed their opinion. The process of negotiations was eventually restored. Several meetings of foreign ministers have already taken place, and negotiations are being held between Armenia and Azerbaijan. Only this format of negotiations is acceptable.
As you know, major changes took place in Armenia last year. The regime of the criminal junta that had illegally usurped power for over 20 years fell. And this was natural. This is a logical and bitter end of the criminal regime. An important role in this issue, of course, is played by Armenia’s aggressive policy. It is because of this policy that we have isolated Armenia from all regional projects. It is because of this occupying policy that Armenia’s economy has practically collapsed. Armenia is experiencing a profound demographic crisis. The process of depopulation, i.e. reduction of the population, has become widespread. Azerbaijan has proved to the world that its policy is correct. I have never concealed this policy and explicitly declared from various platforms that we will use all available means to isolate Armenia until our lands are liberated. This policy has yielded results, the criminal regime has collapsed and a new situation has arisen in Armenia.
We have repeatedly said that the regime of criminal and bloodthirsty junta has dominated Armenia for 20 years. Unfortunately, certain international organizations have turned a blind eye to this. The question may be asked now: how can it be possible that international organizations gave positive assessments to the presidential and parliamentary elections held in Armenia with major falsifications in recent years? After all, the latest parliamentary elections showed that a group of people that had illegally seized power could not even get 5 percent of the vote. This is recognized by everyone. Why didn’t anyone condemn the criminal regime, which ascribed more than 50 percent of the votes to itself in previous years?! Why did the Council of Europe, the European Parliament and other international organizations ranting about democracy and justice turn a blind eye to this shameful picture?! Didn’t they know that all elections in Armenia were rigged? Didn’t they know that the Armenian people hated the criminal regime? They knew that perfectly well, but turned a blind eye to that. Why? Because of double standards. What for? It is likely that there were other issues related to their selfish goals. It is no secret for anyone that Armenia activated its “cognac diplomacy” in the international arena and bribed many politicians. In previous years, the factor of bribe was in the first place in Armenia’s foreign policy.
Therefore, I believe that this issue should be seriously investigated by relevant international bodies, and the “politicians” who supported the criminal regime for 20 years, turned a blind eye to its crimes and received orders and medals from it, must be brought to justice. Our demand is precisely this. If this does not happen, it means there are no changes. If this is not done, then the ridiculous statements by certain international organizations regarding justice and human rights will remain just ridiculous statements. If international organizations that supported the Sargsyan regime and its deeds, and turned a blind eye to them want to wash away their sins, they must admit that they were in agreement with criminals for 20 years, which means that they have contributed to these crimes too.
I have repeatedly said that Armenia is ruled by a criminal regime. The Armenian people are saying this today. Their former leaders are criminals and this is a proven fact. Their heroes are cowards and their generals are thieves. This is the current situation in Armenia. If a country which gained independence only 27 years ago is led by criminals for 20 years, then it is not too difficult to form an idea about this country.
I have repeatedly said this and I want to say it again that there is one way for Armenia to come out of this difficult crisis – to normalize relations with Azerbaijan. We are ready for this. But, of course, there is one condition – Armenian armed forces must withdraw from our occupied lands.
At the same time, of course, we paid great attention to our military potential last year, and there are impressive achievements in this area. The combat capability of our army is growing, and the Nakhchivan operation clearly confirmed this. As a result of the successful Nakhchivan operation, we now fully control 11,000 hectares of land. It was a very successful operation. At the same time, the occupied heights are of strategic importance. They allow us the opportunity to exercise full control over the road connecting Armenia with Nagorno-Karabakh. So this event, the Nakhchivan operation, shows again that the Azerbaijani people and the state will never put up with this occupation and will restore their territorial integrity by all means. There is simply hope for negotiations, this is why we still believe that the path of negotiations is the main remedy. At the same time, we are building up our military power. The work done to bolster our combat capability last year certainly deserves a very high assessment. The servicemen who distinguished themselves in the successful Nakhchivan operation have received relevant state awards.
We did a great deal last year to strengthen the material and technical infrastructure of our army. During the two military parades, we demonstrated some of our military hardware. Among them, of course, I would like to highlight the “Polonez” and “LORA” long-range missile systems. The opposite side has no ability to protect itself from these systems. These systems can cover a distance of 300 kilometers or more and destroy any military target with high precision and great destructive power. Let me say again that there is not a single enemy military target that we cannot destroy with high precision.
The acquisition of these systems, of course, increases our military power. At the same time, our military power is multiplied by the acquisition last year of unmanned combat aircraft. Of course, the air defense and missile defense systems acquired in recent years have strengthened our defense capabilities, while other systems have increased our offensive power. Everybody knows that. The events taking place in the military sphere are no secret to anyone. The opposite side, the enemy also knows and should know that the Azerbaijani army is one of the strong armies on a global scale today, and additional steps will be taken in this direction this year.
The problems of our compatriots who suffered as a result of the war were successfully solved last year as well. Very serious steps have been taken in connection with this issue. Last year, more than 5,800 IDP families were provided with new houses and apartments. This is a record figure in recent years. Along with this, more than 620 apartments were provided to the families of the martyrs and those handicapped in the Karabakh war. Even more apartments will be provided this year, including new IDP settlements. In other words, this issue is always in the spotlight. To address the problem of the IDPs still living in difficult conditions, we have provided major funds this year as well. We will address these issues.
Of course, all this work requires economic power, and we are creating it. In terms of economic development, Azerbaijan today does not depend on anyone – on any international financial organization or country. Economic independence allows us the opportunity to pursue an independent policy and to protect the interests of the Azerbaijani people. Last year was successful for us in terms of economic development. I can say that last year was a year of profound economic reforms, and everyone sees their results now. State budget revenues have significantly increased. The main goal of economic reforms is to fully ensure transparency in this area, step up the fight against negative phenomena and thus accelerate the successful development of our country. I can say that international organizations and leading financial institutions are following the processes occurring in Azerbaijan with great interest and giving a high assessment to our work. I should note that the World Bank’s “Doing Business” report ranks Azerbaijan in 25th place globally. In a matter of one year, we have advanced 32 steps. I think this is a record figure. To be in 25th place on a global scale in terms of doing business conditions is a great achievement.
All our economic indicators are very positive. I want to bring some indicators to the attention of our people. Last year, the gross domestic product, or the rate of economic growth in Azerbaijan, constituted 1.4 percent. I think this is a good indicator. Of course, it does not fully reflect our aspirations. At the same time, looking at the processes taking place in the world, I consider this a good indicator. The development of the non-oil sector is an even better indicator. Development here constitutes 1.8 percent. Industrial production has increased by 1.5 percent, while industrial production in the non-oil sector by 9.1 percent. This indicates that our industrialization policy is producing excellent results.
Inflation is only at 2.3 percent. Monetary incomes of the population have increased by 9.2 percent. As you can see, population incomes are ahead of inflation. If we look at 2017, we can see that inflation exceeded 12 percent, and now it is at 2.3 percent. The rate of the manat is stable. Agriculture has increased by 4.6 percent. I believe that this is also a good indicator. Last year, 17.2 billion manats were invested in the country's economy. This is a very large figure, and it is particularly gratifying that 11 billion manats of these investments, or even more, were invested in the non-oil sector. In other words, this shows that Azerbaijan is a very attractive country for investment. The fact that we have risen to 25th place in the world according to the latest report of the World Bank will further encourage investors to invest even more in our country.
Last year we increased our foreign exchange reserves. Although we had a lot of expenses, we managed to increase our foreign exchange reserves by $3 billion. Thus, our country's foreign exchange reserves today amount to $45 billion. Our external debt has dropped from 22.8 to 19 percent, which is also a very positive development. In other words, at present, Azerbaijan’s external debt accounts for 19 percent of the gross domestic product. The task for the coming years is to further reduce this debt. A corresponding program has been prepared on this issue now. I believe that we should gradually reduce the debt. It is true that 19 percent is also an excellent indicator on a global scale. There are countries, in particular even developed ones, where foreign debt accounts for 100-120 percent of the gross domestic product. If it is at the level of 50 percent in a country, then such a country is considered to be economically stable. In our country, it is 19 percent, and I think this is quite high. I think that it should and will be reduced. Of course, if we compare our foreign debt to our foreign exchange reserves, we can see that our foreign exchange reserves are four to five times higher than our foreign debt. So we can fully repay the external debt at any time. This reflects our policy and shows that although we can receive numerous loans, I have given the instruction to limit the number of loans. This is not necessary now. As an exception, we can get a loan in some cases only for high-tech projects because there is no need for that. We have our own money and our foreign exchange reserves are increasing.
A total of 118,000 permanent jobs were created last year. This is a very important issue for keeping unemployment low. There are good indicators related to exports. Exports have increased by 36 percent. If we take the total figure, our exports have reached $19 billion. Our trade surplus in the foreign trade balance, i.e. the prevalence of exports over imports, is $8.6 billion. If we look at different countries, such a picture is observed quite rarely. In most countries, imports prevail over exports. In Azerbaijan, we see the opposite picture. In fact, in connection with exports, we have brought more money into the country than we spent - $8.6 billion. If we add to this the money coming from foreign tourists, then this figure will increase even more. I should also note that 2,850,000 foreign citizens visited our country last year. This means a 6-percent increase. According to calculations, foreign visitors have spent $2 billion in our country. As you can see, our policy on the development of tourism is primarily manifested in the financial sector. We both promote our country and earn money.
So our economic indicators are such that any country of the world would perceive them as great heroism, but for us it is business as usual. We have a thought-out economic policy. In general, our policy fully reflects the interests of the Azerbaijani people and is fully aligned with them. That is exactly why the people of Azerbaijan support our policy. This support was once again manifested in last year’s presidential election. The people of Azerbaijan showed great confidence in me once again. As you know, the results of opinion polls conducted on the eve of elections and of the exit polls held on election day fully coincided with official results. This shows again that the will of the Azerbaijani people is fully reflected in the election results. This is a high assessment of the work done. And the work done is obvious.
It might take hours to list the important events of the past year. I would like to mention several important events. Last year, we launched our third satellite into orbit, and Azerbaijan further strengthened its positions as a space-faring nation. The Southern Gas Corridor was inaugurated last year. This is a historic event in the true sense of the word, as it will bring great benefits to Azerbaijan for many decades – political, economic and financial benefits. Last year, the TANAP project, an integral part of the Southern Gas Corridor, was also put into operation. Thus, three out of four projects of the Southern Gas Corridor have been implemented. This is a great success for us, a historic success. Last year, a very important event took place for the transformation of our country into a transport hub – the Alat international trade seaport began to operate. Thus, Azerbaijan has already asserted itself in the world as a transit country.
I want to say again that many events we could talk about occurred last year. But I believe that that to a certain extent I have briefed the Azerbaijani people on the work done last year. Of course, meetings of the Cabinet of Ministers, among other things, serve the goal of providing a report to the people. At various events and meetings, I regularly report to our people. At the same time, I consider this form of reporting on the work done to be right.
Today we will also talk about the work to be done this year. Relevant instructions will be given so that 2019 also becomes a successful year for our country.
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