Closing speech by Ilham Aliyev at the Cabinet meeting on results of first quarter of 2018 and future tasks30 april 2019, 12:15
Our reforms continue. The ideas expressed in the reports today suggest that the reforms are producing good results. In connection with the implementation of strategic road maps, it was reported that their implementation has reached 52 percent in two years. This gives us grounds to say that this important program will be completed by the end of 2020 and thus we will achieve progress in all areas because the issues already reported on show that very serious steps are being taken in each area. Our budget revenues are growing, the macroeconomic situation is stable, the reforms are bearing fruit, and the business environment is improving. In other words, we are seeing successful results of reforms in all areas. The results of the reforms carried out in the field of agriculture are producing excellent results. The work done in connection with compulsory health insurance is producing excellent results. This program has been implemented for two years now, people are satisfied with pilot projects, citizens are satisfied, and the salaries of doctors are rising. So these are serious steps that indicate that we must take further steps in each area, apply the best practices to Azerbaijan and ultimately create a model for an even more successful development.
In general, I can say that we are currently working on a new strategy for the development of our economy. This process has begun. Leading international experts and scientists will be involved in this process so that our new development strategy is successful and leads to excellent results. The work done so far has created an excellent basis for this. We have implemented major infrastructure projects. As I have already noted, within the framework of the next five-year program, the State Program on the Socioeconomic Development of the Regions, we will implement all the projects we have not yet been able to implement. This is a solid foundation. We must build and are building a new model of economic development on this basis. We have both experience and determination. I can say that leading international financial institutions are supporting our policy. My numerous meetings with leaders of the World Bank, the European Bank for Reconstruction and Development, the Asian Development Bank, the European Investment Bank and other influential financial institutions show that these institutions provide tremendous support for the reforms under way. They want to continue to provide support and carry out this work together with us. We also want this, and their experience and specialists working in these institutions will, of course, be involved in this work. Thus, we must successfully complete the implementation of current roadmaps, develop and submit a new program covering the years 2021-2025.
As for other issues, the modernization process related to electricity will be continued until the end of the year. Work is underway to strengthen the capacity of existing stations. As a result of the work on reconstruction, restoration and modernization, we will be able to obtain at least 400-500 megawatts of additional energy capacity from existing stations. All calculations have already been completed, and I am confident that we will succeed in this matter. Thus, we believe that as a result of modernization alone, a new large station will be created. If we add to this the construction of the “Shimal-2” station – its capacity will also be about 400-500 megawatts – our energy potential will increase further, and the growing industrial potential of our country, our growing population will have a sustainable electricity supply in the future too.
In my opening remarks, I mentioned that gasification in Azerbaijan is at the highest level, and work related to gasification is under way this year as well. We must make the most of the opportunities available to build gas lines to towns and villages that do not receive gas yet. In cities, gas pressure in some places is low. Relevant instructions on this issue have been given and work is being done to ensure that high-quality gas is supplied to the population. At the same time, it is necessary to put an end to some unfounded situations involving “Azerigaz”. I am told that “Azerigaz” unilaterally applies some rules, thus creating problems for people in some cases. This has got to stop. There should be maximum transparency and fairness in this because there are signals from the ground that there are problems associated both with meters and with the quality of gas. All this should be completely eliminated. In all areas – in the supply of electricity, drinking water and natural gas – there should be maximum transparency and fairness.
In connection with the implementation of drinking water projects, I can say that these projects have been completed in 38 cities so far. We have extended clean drinking water lines to 38 cities that were not supplied with water in previous years. Water quality conforms to World Health Organization standards. By the end of this year, these projects should be completed in five more cities, and work continues in 12 other cities. In the coming years, they will also be completed.
In recent years, the implementation of land reclamation measures has become widespread. Over the course of several years, we built water lines to hundreds of thousands of hectares of new land. This year we will extend water lines to at least another 70,000 hectares and carry out land reclamation measures there. It is necessary to build at least 1,000 kilometers of roads. I say at least because we set this goal at the beginning of the year. However, the proposals and appeals coming from the ground suggest that this problem still exists even though we have already built 15,000 kilometers of roads. Therefore, additional measures will be taken in Baku, in its suburban settlements – as you know, this work has assumed large proportions – and in the regions. This process should be coordinated with the construction of water lines. First of all, we need to build communications, water lines and then roads. So we are doing this work in parallel.
I mentioned that Azerbaijan offers its opportunities for foreign investment now, and this is a very important issue for any country. I am glad that investors are showing interest in the non-oil sector. The main issue here is to eliminate bureaucratic obstacles. We must attract potential investors, look for them and convince them to invest in Azerbaijan. However, in some cases, when a local or foreign company wants to invest, it faces artificial bureaucratic and other obstacles. This is completely unacceptable – this should not be allowed. The attraction of investment is one of the key conditions for the economic development of any country. Public investment is and should be made in Azerbaijan as well, but we should encourage the private sector to invest more. We are achieving and will achieve that. The state will always provide support for this area.
This year we plan to build new apartment buildings for the displaced persons. As you know, more than a hundred settlements have been built for the IDPs in recent years. It has been more than 10 years since we eliminated tent camps and created good conditions for the internally displaced persons. However, there are still IDPs living in a dire situation, and solution of their problems is one of our top priorities. Last year, we built new modern houses and provided apartments to 6,000 IDP families. At the beginning of this year, the plan was to build apartments for approximately 6,000 families of displaced persons. We will increase the number of these apartments and houses. Relevant instructions have already been given, additional funds have been allocated and work has begun. Justice should become the key principle here too, and this principle is being ensured.
This year, the state will provide at least 800 apartments to martyr families. In general, the state has provided apartments to more than 6,500 martyr families. Those disabled of the Karabakh war will be given at least 600 cars this year. To date, 6,200 cars have been granted. I should also note that this practice exists in this volume only in Azerbaijan. We are doing and should do this work in a consistent manner. Therefore, our policy in this area shows again that it is centered on the people of Azerbaijan. We must help and are helping those living in a difficult situation. These figures are a clear confirmation of this.
Job creation should become a permanent process in Azerbaijan. Over the past 15 years, 2 million jobs have been created. At the same time, the population has increased in this time by 1.7 million people. This is a very positive fact. As you know, a 10 millionth citizen was born this year. We are already 10 million. This is a historic achievement. Of course, this strengthens our country and increases our potential. But at the same time, growing population is the main condition for infrastructure projects and creation of jobs, because it is necessary to build kindergartens and schools and to implement infrastructure projects. The infrastructure created in Soviet times was designed for the population of those years. Baku has grown bigger now and its population has increased. Rural population has also increased. Therefore, we must pay constant attention to this issue. For example, many infrastructure projects, including those on drinking water, are calculated until 2030, taking into account the growing population.
I want to say again that investment is key main task for job creation. The jobs created by the state are often social by nature. We are doing and will continue to do that. However, the private sector must take on this mission by investing. How can you create jobs without investing?! The state cannot create jobs constantly. We are doing this simply to reduce unemployment. I must note that 40,000 public jobs are opening this year. I was informed that 35,000 people have been provided with public jobs this year. This, once again, is a social initiative, social support. But the private sector must first invest, create jobs and produce competitive products.
One of the important factors and tools for job creation, of course, is the self-employment program. We have begun this process. This program has received great approval. We intend to attract about 7,000 people to the self-employment program every year. However, there are many more applications coming from the ground. We should take this into account and amend our plan. Of course, this is an issue that requires not only financial resources. There are many technical issues here, the issue of acquisition of funds. In addition, a control mechanism should be applied as well. Sometimes, after certain funds are provided to people, they cannot rationally use them and miss this opportunity. Therefore, the state, of course, should provide recommendations. I am aware that trainings are organized. At the same time, rigorous control should be exercised. The self-employment program in Azerbaijan has a great future in terms of employment, economic development and production. I should also note that I raised this issue during meetings with the heads of leading international financial institutions, such as the World Bank and other banks, and they are also showing a great interest in this. We must attract them. We now have financial capabilities. But as far as experience is concerned, we don’t have as much experience as they do because we just started this business, while they have encouraged such programs all over the world. Therefore, the self-employment program should always be in the spotlight. I have repeatedly spoken on this topic – specifically because it is a very important issue.
As I have already mentioned, salaries and pensions have been increased this year, and this process will be continued. I have already said that we always keep this issue in the spotlight. As I said, over the past 15 years, salaries and pensions have increased significantly. However, we cannot be complacent with that. Therefore, there are plans to increase the minimum wage, the minimum pension and other social benefits in the future. We will do that as far as possible. We will consistently pursue our policy in this area.
On social infrastructure – this issue is also always in the spotlight. I should note that about 100 schools will be built or overhauled this year, including the schools of modular type. This also brings great benefits, especially in remote villages. Such schools are created very quickly and meet high standards in terms of quality. Thus, I believe that we will resolve the problem of schools that are in emergency condition this year or next year at the latest. In other words, there should be no schools in emergency condition in Azerbaijan. a lot has been done in this direction, and this work will be continued.
About 10 new central regional hospitals will start operating this year. Thus, there will not be a single city or district left in Azerbaijan without a medical center meeting the most modern standards.
There are plans to commission three Olympic sports centers, one of which has already been opened. Six million people will undergo medical checkups at state expense. This is also our initiative, a very serious social step benefiting our citizens. Everyone should monitor their health and be examined during the year. The state has created such conditions. First of all, there is modern equipment everywhere. At the same time, this issue is addressed at the expense of the state.
As I have already noted, the experience of three pilot projects related to the use of compulsory medical insurance has been very positive. It was mentioned in the report here that we are ready to implement a large-scale program now. This will also be a very serious social step.
Additional measures are envisaged to address transport and business problems in the city of Baku. The city transport is being improved. This year we plan to bring 300 modern buses to Baku. This will be a great contribution to the development of city transport. New subway cars will be delivered to the city. Hundreds of new elevators will be installed. The state budget provides funds for these purposes. The process of construction of the suburban railway is under way. This will also significantly improve the work of the city transport.
Extensive work is under to eliminate the consequences of the earthquake that occurred in the Aghsu, Ismayilli and Shamakhi districts this year. I receive regular reports. Thousands of new homes will be built and overhauled. State funds have been allocated. I want to say again: we responded very quickly. Given the problems of our citizens, we must try to complete this work as soon as possible although it is hard work. First of all, it is necessary to carry out an analysis. The commission should do the necessary work. It is necessary to establish the extent of the damage caused and carry out construction work. Of course, this is a matter of time. This work involves both state bodies and the private sector. The work has assumed large proportions now. People’s homes are being renovated, new houses are built. At the same time, the construction of high-rise buildings has begun. We must try to resolve this issue also in a short time. I have already expressed my opinion on this issue. I want to say again that in developed countries this work is performed by insurance companies. People’s homes are insured, they receive insurance payments and build their own houses. Given that this is not the case with us, the state has taken this issue upon itself. I want to say again: Azerbaijan is one of the countries showing the best example in terms of quality, time, speed and concern for its citizens.
Therefore, the people of Azerbaijan can rest assured that the state stands by them at the most difficult moments. State bodies, representatives of central and local executive authorities should always be attentive to citizens, always be close to them. The heads of relevant executive bodies and responsible officials have been asked to always attend to people’s problems. Heads of executive authorities should go to the settlements and villages, listen to people, not remain indifferent to them, create conditions for them, support them and provide assistance. Very serious reforms are under way in this area and they will be continued.
In general, there is a great need for reforms in governance. I talked about this today and earlier. In all areas, there is a lot of room for development. In all areas. If leaders do their work conscientiously, the result is sure to come. This will certainly be appreciated by the public. Therefore, I want to say again: representatives of local and central executive bodies must always deal with people’s problems.
We have largely shaped the regional development program on the basis of letters and applications from the ground. We have included these issues in the state program and are resolving them. But sometimes there are many miscalculations and shortcomings in the implementation of these projects. They need to be eliminated. Of course, public oversight should get even stronger.
The macroeconomic situation in our country is stable. I have already noted that inflation is at a low level – at just over 2 percent. The manat rate is stable. Under such circumstances, we should definitely prevent artificial overpricing. In some cases, prices of some products are increased. There is no reason for this. Sometimes it is of seasonal nature. But prices are sometimes inflated artificially. There is a revival in the country's economy now. People’s purchasing power is growing. We see it from statistical indicators today. This is also seen by the bodies controlling the consumer market. Salaries and benefits are increasing, payments related to problem loans have begun. But we cannot allow unscrupulous people and speculators to artificially inflate prices or engage in some kind of monopolistic activities. Therefore, consumer prices should be constantly monitored. Artificial overpricing must not be allowed. Relevant bodies need to take these matters very seriously.
In the sphere of industrial production, the process of creating large industrial enterprises is producing good results. But we must try to make small and medium-sized industrial enterprises more active, so that new ones are created and the already functioning industrial facilities improve their work to produce competitive products. This means jobs, local production and the elimination of dependence on imports. Of great importance in this matter are industrial estates. In industrial parks and industrial estates, we have about 60 residents. $3.3 billion has been invested in these parks and estates. If we had not created these industrial estates, then these funds would not have been invested. Favorable conditions are applied there, investors invest and create jobs, and our country develops as a result.
We need to pay more attention to the development of the construction sector. Currently, there is a revival in the construction sector. It employs thousands, tens of thousands of people. Currently, about 400 multi-storey buildings are under construction in Baku. This indicates that there is a major revival and progress in this sector, the production of building materials is increasing. So the construction sector is an industry of great importance for the economy. The state, of course, must fully support entrepreneurs, it is necessary to eliminate all bureaucratic obstacles. Of course, entrepreneurs should also follow all the rules of architecture and town planning under state control.
The State Housing Agency has successfully completed the first social housing project. The Yasamal residential complex has been commissioned. I attended the opening of this complex. The second project is now underway – in Hovsan settlement. Currently, about 3,000 apartments are being built there. This agency, the State Housing Agency, was established on my initiative, and this is a project of particular social importance. The construction of social housing creates conditions for the provision of apartments to thousands of families. This creates thousands of jobs, while at the same time giving a big boost to the construction sector. Notice how many people are engaged in this work, how many entrepreneurs are engaged in the construction of a residential complex of about 3,000 apartments.
There was a report on reforms in agriculture. This sector is also constantly in the spotlight. As you know, the state provides great support and assistance to this sector. Fertilizer, fuel, subsidies and equipment are provided on favorable terms. I can say that Azerbaijan is one of the most advanced countries in this field on a global scale in terms of provision of support to farmers. In addition, they don’t pay tax with the exception of the land tax. So this sector receives maximum support. I am sure that the reforms carried out in this area will lead to even better results. I believe that the current growth of 3.6 percent does not fully reflect our potential. After all, so much is being done – land reclamation measures, government support. The work carried out in the field of hazelnut growing, viticulture, cotton growing, grain growing, fruit growing, vegetable growing has just been reported on as well. So our production and exports are significantly increasing. I believe that given the work done and the reforms, growth in agriculture may be even higher.
Agriculture should become a technology sector in Azerbaijan. It is necessary to apply new mechanisms here, including the mechanism of agricultural insurance. In parallel, we should think about the implementation of investment projects in the countryside. I am instructing the Ministry of Agriculture, the Ministry of Economy, the Ministry of Labor and Social Protection of the Population to work together. You can set up a working group to prepare proposals related to the implementation of investment projects in the villages. Such a program can be prepared for each village. We attract investment mainly to cities. However, a new concept of rural development should be prepared.
Of course, I would like to stress the role of entrepreneurs in all these affairs. A strong class of entrepreneurs has emerged in Azerbaijan in the recent times. I always support businessmen. In numerous meetings with them, I express my support. They are supported by the state – preferential loans, recommendations and conditions. Without the infrastructure projects, entrepreneurs cannot invest. If there is no electricity, gas or road, how can entrepreneurs invest in something? We have created all this and also provided loans. To date, entrepreneurs have been provided with preferential loans amounting to more than 2 billion manats. This year alone, loans in the amount of 170 million manats will be provided at the expense of the loans provided and repaid earlier. Therefore, entrepreneurs should continue to be active. It is necessary to create new enterprises and jobs. I recommended that they create additional jobs at existing enterprises because the state creates 40,000 public jobs. I was informed that entrepreneurs will create about 8,000 public jobs this year. This will not be a big burden for them but will resolve the problem of unemployment. Please note that in one year alone the state and the private sector will create about 50,000 public jobs. Of course, we expect the creation of new enterprises and new industrial sites, so that there are many jobs there.
This year we plan to create five “ASAN xidmət” centers in the regions. Thus, their number will reach 20. I am told that there is also a need for the construction of new centers in Baku because the scope of “ASAN xidmət” services and the number of applications are growing. In some places, people are queuing up. We have created “ASAN xidmət” precisely to make things easy and convenient, to have no queues, no violations, and to do everything in a transparent manner. We have achieved this. The approval ratings of “ASAN xidmət” are close to 100 percent. But if we consider that the scope is expanding and the number of applications is growing, in some places there are queues. Therefore, I have given the instruction – and initial funds have already been allocated – to set up two additional “ASAN xidmət” centers in the city of Baku. Thus, their number will reach 22.
The work done suggests that we are on the right track. There is no doubt about that. the reforms in the economic, social and all other areas will continue to be implemented. As you know, a relevant decree was recently signed relating to reforms in the legal and judicial sphere. I believe that its implementation will contribute to a serious turnaround in this area. So we should go forward in all spheres. Innovations, positive experience and the most progressive approaches in the world should be applied in Azerbaijan. It must be borne in mind that our oil and gas sector is also a big support for the economy. It should be noted that we are now becoming one of the transport centers. The participation of Azerbaijan in the “One Belt, One Way” forum recently held in China once again shows that our country is an integral part of this important project. Our incomes will grow, and financial and economic opportunities will become even greater.
We should not be content with the achieved success; we should constantly look forward. I am confident that we will successfully complete this year too. Year 2019 will be successful for our country and our people. Thank you!