10:12 23 July

Whose future was determined in Baku: South Caucasus and Central Asia, or European economic area? - ANALYSIS

Baku. Vugar Masimoghlu – APA. Azerbaijan hosted one more world-famous international event.

The regional meeting of Davos Forum held in Baku can be considered one of the indicators of Azerbaijan’s growing influence. The forum focused on the projects on economic development and development of unique economic strategy for the South Caucasus. I World Economic Forum Strategic Dialogue on the Future of the South Caucasus and Central Asia was attended by the representatives of more than 300 world leading political and economic circles, financial institutions and civil societies. Representatives of more than 50 leading media outlets were accredited to cover the forum, about 500 media outlets have published news articles and views about the forum. This confirms world’s great interest in the event.


What is the source of this interest? Analysis of the ongoing processes in the world and region gives ground to conclude – Europe is looking for a way out of the ongoing economic crisis for several years. The urgent crisis rescue scenario is the support of the reviving Asia. This scenario increases more the influence of the South Caucasus, which will become a bridge between Europe and Asia, especially the influence of Azerbaijan, which makes 80 percent of the economy of the South Caucasus.


The real view in Eurasia is that – the economic crisis continues in Europe, though political circles are trying to claim that the crisis is over, the processes in Greece and Cyprus show that the European Union will suffer from economic crisis for a long time.


Unlike Europe, Asia could more easily neutralize the impact of the economic crisis. The cause of different impacts of the crisis on two economic regions is clear – Asia is rich in energy resources, while energy dependence exists in Europe. Energy dependence in Europe, the economic region, has become chronical. There is cause and consequence between energy dependence and economic crisis, the two key problems of Europe. First, the continent must eliminate energy dependence. Europe can not meet energy needs at the expense of Gulf region – the instability in the region, the sanctions against Iran and the possibility of escalation of tension impede this. The continent, which is going to end the crisis, needs to be “fed” with unrisked energy resources. These regions are the South Caucasus and Central Asia.


On the other hand, Europe needs foreign investment and promising markets for investment to solve the economic crisis. This market is Asian region. Europe’s access to Asia passes through the South Caucasus and Central Asia. For this reason, the I World Economic Forum Strategic Dialogue on the Future of the South Caucasus and Central Asia held in Baku is purposeful. The South Caucasus and Central Asia, which are rich in energy and human resources and have transit opportunities, are able to fully meet the needs of Europe.


Successful completion of the strategic dialogue in Baku, actually will first of all determine the future of Europe rather than of the South Caucasus and Central Asia.


First of all the Forum is of great importance for Europe’s political, economic and financial circles in terms of the presentation of these two regions. The place of the South Caucasus and Central Asia regions in the world economy should be defined first of all in order to realize development scenarios and strategic planning that will cover the coming decades. The Forum will allow prepare recommendations on the potential of the region’s transport, infrastructure, agrarian sector, finance, telecommunications and create scenarios to fully use this potential. Europe does not hide that in order to meet its demands it wants to use the potential of 4.2 million sq m area region with population of more than 80 million. Europe, whose human resources are expiring, realizes very well that it is facing the region that will prevail over it in 15-20 years both in terms of economic potential and human resources, therefore it is interested in establishing cooperation with the South Caucasus and Central Asia, turning this factor into the guaranty of its economic growth, political existence. These are the goals and objectives of the I World Economic Forum Strategic Dialogue on the Future of the South Caucasus and Central Asia (Davos Forum) that ended yesterday.


The agreement on holding the Forum was reached in Davos in January. Baku was chosen because Azerbaijan a) has the most developed economy in the South Caucasus, b) has started playing a significant role in Europe’s energy supply, c) is located between the modern Europe and conservative Central Asia, comprises both features, d) has become the most important transit point between Asia and Europe through implementation of Baku-Tbilisi-Kars railway project.


Deputy Director General of Center for Post-Soviet Studies Alexander Karavayev said several factors were taken into consideration while passing the decision to hold the forum in Baku.


“Azerbaijan’s capital has been hosting large-scale international events for a long time. Baku has developed infrastructure to host international events. On the other hand, this is a successful choice in terms of access to the main regional centers surrounding Azerbaijan. Since the event is held in Baku, representatives of business circles of Europe, Asia, Russia can come here,” he said.


The Forum has played an important role in the presentation of Azerbaijan’s investment environment, investment potential and transit capacity. This event is also of great importance in terms of specification of Azerbaijan’s potential in Europe’s energy security.


The high-level statement that our country will play an important role in Europe’s energy security at least for 100 years makes Azerbaijan much more important for Europe.


The Forum has highlighted more the traits of “stable country” ($130 billion can be invested only in the economy of a stable country),

“stable energy guarantor” (successful projects on the diversification of the delivery of energy resources to the world market)

“the country with highest transit capacity” (Realization of Baku-Tbilisi-Kars at the end of this year will increase these opportunities more),

“the country with fast-growing economy” (the country’s economy has tripled in the last ten years), “the country having space industry” (launching of Azerspace-1 satellite), “the country with a favorable geographical position” (bridge between Europe and Asia)

The economic growth target (double GDP in 8-9 years) outlined by Azerbaijan at the forum is real. Of course, these indicators and targets will be taken into account as positive factors in the development scenarios on the region.


It is still early to speak about the real results of the forum. The real results will depend on the recommendations prepared basing on the presentations and development scenarios to be made by the world’s leading political, economic and financial institutions basing on these recommendations. One thing is exact – the success of any development scenario depends on minimization of the risks in the region. Protracted conflicts are the biggest threat to the stability in the South Caucasus, Europe’s door to Asia. The solution of these conflicts will be important not only for the states of the region, but also for Europe striving to end the crisis.

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