President Ilham Aliyev chairs meeting on 2020 Q1 socio-economic results through videoconference
President of the Republic of Azerbaijan Ilham Aliyev has chaired a meeting on the socio-economic results of the first quarter of 2020 through videoconference.
The head of state made an opening speech at the event.
Opening remarks of President of the Republic of Azerbaijan Ilham Aliyev
- Today we will discuss the results of the first quarter of the year and talk about the upcoming work. I can say that 2020 got off to a good start. The indicators for the beginning of the year suggest that the continuation of reforms in Azerbaijan is producing good results. In particular, our economic and social indicators in January-February were very positive. However, we experienced a certain recession in March. And this is natural because coronavirus is a big disaster for the whole world and a major problem for the global economy. If we take three months of the year as a whole, we can see that there is still development and progress. But everyone should know that the world has entered a new stage today and even the most developed countries are faced with big problems.
Coronavirus is a major scourge that has put an end to the lives of more than 100,000 people. We can say that all countries of the world are experiencing problems associated with coronavirus. Azerbaijan is also a part of the world. However, I can say that as a result of the preventive measures and a thought-out policy, we are keeping the situation under control. I believe that all steps taken so far have been in the right direction. Thanks to these actions, the situation in Azerbaijan is under control. If these steps had not been taken in a timely manner and we had not gradually tightened the restrictive regime as part of a sound strategy, there would be not a thousand, but perhaps 10,000, 20,000 patients today. The experience of the most developed countries shows that no country can consider itself fully insured. The health system of no country can withstand the growing dynamics of these patients. Therefore, this should serve as a lesson for us. I have already said this but want to say it again that we must learn a lesson. All our steps are balanced, it is no coincidence that several countries are taking advantage of our experience and taking similar actions. We are seeing that.
Therefore, our further steps should be such that we can protect the health of the people, their lives. As I noted earlier, we will take action in accordance with the situation. All of us, of course, want the quarantine regime to end soon and citizens to return to normal life. But I want to say once again that the key thing for us is the health of our citizens, the lives of our people. The hundreds and thousands of letters, emails and messages addressed to me recently testify to the fact that people highly appreciate the steps we have taken.
However, I want to say again that no-one knows when the coronavirus pandemic will end, no-one can give a forecast. Therefore, we must simply keep the situation in the country under full control, conduct monitoring, as we are doing that now. At the same time, by carefully monitoring the processes taking place in the world, we must be fully convinced that the coronavirus pandemic is no longer a threat. I believe that only after that can mitigating actions be taken. It's too early to say this but the figures of recent days are encouraging. I do hope that the positive dynamics, i.e. the positive dynamics associated with the number of patients, will be continued. But let me repeat that we will take steps in accordance with the situation.
As for the negative impact of the pandemic on the country's economy, this is also inevitable. Leading international financial institutions already note that the crisis that may arise and is arising in the aftermath of the pandemic will be even harsher than the one of 2008-2009. This was stated by the leaders of the International Monetary Fund. At the same time, we know that more than 150 countries have turned to the International Monetary Fund and the World Bank for help. That is, the absolute majority of the world community already feels the need for help and has applied for it. Azerbaijan is not on this list. I believe that we will come out of this situation with dignity – I am sure of that – and this will once again show that all our steps are thought-out and meet the interests of the people and the state.
But I want to say once again that the impact of the pandemic on the economic situation is inevitable. We are already seeing it. Therefore, I ask the government, especially the Prime Minister, the Minister of Finance and the Minister of Economy, to review government spending and reduce non-priority spending. At the same time, it is necessary to apply the mechanism of rigorous control over spending. I expressed my opinion on this issue earlier. Recently, there has been a positive trend in this direction, as a result of which, both last year and in the three months of this year, we managed to transfer additional financial resources into the budget. But I think that there are still reserves, and it is necessary to review both investment and current expenses. Because sometimes running costs are inflated. In particular, unfortunately, the running costs of state organizations, state companies are inflated, so very serious attention should be paid to this area. Additional steps must be taken to ensure full transparency in this area. I believe that thanks to this, of course, we will maintain the stability of our financial and economic situation. At the same time, I am asking the government to find new sources of revenue. I want to say this again: there are reserves, there are ample reserves. Some of these reserves have already been identified recently, and budget revenues are growing - both last year and in 2020. Last year, more than one billion manats was transferred into the budget in excess of the forecast, and over three hundred million manats over the three months of this year. Therefore, it is necessary to seriously examine this issue and prepare proposals. I want to say this again: we do not know how much longer this situation will last. Therefore, we must take steps so as to ensure economic, macroeconomic stability. Of course, first of all, we need to solve the problems of citizens suffering from this situation, and we are solving them. Major funds were allocated for this purpose, the state provides support to more than 600,000 people who have temporarily lost their jobs due to the pandemic. A significant part of the salaries of these people is paid by the state. At the same time, problems related to unemployment are being resolved and people who have lost their jobs are being registered collectively. We must be very careful in this so that there are no abuses. This applies to both citizens and government agencies. People who have truly lost their jobs or who are unemployed should be given assistance. As I was informed, the dynamics of appeals in recent days has been very high and this causes some doubts. State bodies have enough opportunities to study this issue so that people in need receive help from the state.
I should also note that, on my instruction, the number of people receiving targeted social assistance has been increased in recent months. There are more than 70,000 such people now. Of course, each issue must be examined separately, common and understandable criteria should be applied, so that there are no doubts in this regard.
Of course, life does not stand still, it continues, and I am sure that 2020 will also be a year of deep and broad reforms – just like a significant part of reforms was implemented in 2019. In fact, a new phase of reform began after the 2018 presidential election. In my speech at the inauguration ceremony, all directions of our development and reforms were clearly identified. After that, we began to engage in the consistent implementation of these reforms, and I can say today that there is a better situation in our country – politically, in the economic sphere and in addressing social problems. Of course, if the coronavirus pandemic had not intervened, our success would have been even more tangible. But I am sure that we will overcome this difficult situation, our economy and jobs will be restored.
The pandemic has once again shown that successful development requires a sustainable economy. To achieve this, reforms must certainly be carried out in all areas – both in the socioeconomic and political spheres. I believe that the implementation of political reforms will continue to expand our capabilities. We see excellent results from these reforms. Azerbaijan will continue to take important steps towards democratic development. We have a fairly strong political will. We see that by carrying out political and economic reforms in parallel, we can really achieve great success.
Structural reforms have been carried out, and I believe that we should once again consider prolonging them. Political reforms are evident, personnel reforms have been carried out. Major personnel transformations were carried out in the Presidential Administration, the Cabinet of Ministers and parliament. The reforms carried out in all branches of government pursue one goal: to further improve the governance mechanism, of course, to pursue a rejuvenation policy and to appoint qualified professionals to senior posts. I believe that our words, as always, are consistent with our actions. We are providing everything I declared. I believe that as a result of serious reforms carried out in the Presidential Administration, the Cabinet of Ministers and the Milli Majlis, our country is confidently entering a new stage of development today, and improvement in governance is obvious. At the same time, personnel reforms carried out in local executive authorities are in full view, in particular, the serious struggle against negative phenomena. This is our conscious choice. A serious struggle will continue to be waged against all negative phenomena. I believe that the warning made by the President should be a lesson to everyone. If someone has not learned the lesson, they will only have themselves to blame.
The parliamentary elections held in February this year have been a logical continuation of these reforms. The parliamentary elections once again expressed the will of our people, showed again that the citizens of Azerbaijan approve and support our policy. Parliamentary elections are yet another step towards democratic development. After the elections, the composition of the parliament was changed significantly and its governing bodies completely. For the first time in history, an opposition representative was elected to the post of deputy chairman of the Milli Majlis. I believe that this is an important step aimed at improving the political system and building political relations on a sound footing. At the same time, for the first time in history, representatives of the opposition are leading parliamentary committees – in the positions of both chairman and deputy chairman. I believe that this is also a very important step as it, first of all, opens the way for a new configuration of the political system. At the same time, it will have a positive impact on the processes taking place in the Milli Majlis. In the current conditions, we clearly see that for the vast majority of political forces the principles of statehood are above all, and this is our main goal. Our goal is to create a political system in which one idea remains sacred for all political forces regardless of their views – statehood, independence, freedom, prosperity and development. Under such circumstances, things on the political plane will go in a positive direction and problems existing in the country will be resolved faster because opposition representatives sometimes see miscalculations that the authorities don’t, talk about them, bring them to attention, and this is a very positive phenomenon. But at the same time, I want to say again that one thing should remain untouched for all political forces – our independence, statehood and state interests.
I believe that the steps taken by the authorities, the beginning of political dialogue and the positive reaction of the opposition parties to this have led to the emergence of a completely new situation during the period of independence. Never before has there been such a positive picture in the period of independence.
Of course, perhaps I am somewhat ahead of the curve because this process is only beginning. But I am ahead probably because I want this process to go quickly. I am glad that all opposition parties have responded positively to our proposal for dialogue and the political dialogue is already beginning. I am sure that this will bring great benefits to our country.
As for those who rejected the dialogue idea, it would be wrong to call them a political force. Because the people gathered in this camp have for many years been struggling not with the authorities, but with our state and people. Their main goal is to aggravate the situation. The worse it is for our country and people, the better for them. This is confirmed by the history of their activities. We have not forgotten this history. In the early 1990s, these forces put Azerbaijan in a difficult situation, committed treason and preconditioned the occupation of our lands. And after that they cowardly fled and went into hiding. These people dealt a serious blow to Azerbaijan, unleashed a civil war. When our lands were under occupation, brotherly blood was shed here. This group created chaos and anarchy in our country, corruption became state policy, incompetence, bad manners, lack of culture turned into a symbol of the PFPA-Musavat government. As a result of the negligent and treacherous activities of the people who represented that government, the country was actually on the verge of collapse.
Therefore, this grouping cannot be described as a political force in the current conditions. I must say that they are always waiting for something, always hoping for an external factor. Remember 2005, when revolutions were taking place in post-Soviet republics. Inspired by this, they decided to stage an “Orange Revolution” in Azerbaijan. They did not even bother to choose a different color for themselves, they wanted to adopt the orange color from Ukraine and applied it here. They ordered and imported orange T-shirts and ribbons into the country. But they did not take into account one thing: at that time, in 2005, parliamentary elections were held in November, when it was already getting cold. I remember this funny picture when they took to the streets wearing orange shirts over their jackets and coats. Some wore them around the neck, others tied them around their heads. This created a comical picture. That's what they are capable of. And it didn’t work out. After that, when the “Arab spring” began, they were inspired again, believing that they had the opportunity. In 2011-2012, they wanted a repeat of the “Arab spring” in Azerbaijan. It didn’t work either. Everyone remembers what ugly steps they took on the eve of the 2013 presidential election. Coronavirus for them is a gift from the skies. Today, only this anti-national group is happy about coronavirus. I am certainly aware of current events and know that their dirty intentions create a monstrous picture. They want an increase in the number of the dead, they want an increase in the number of patients, they are glad that people are dying. So this is a hostility not against the government, but against the state. I call things by their proper names. If someone is hostile to our people and state, then he has only one name – an enemy. Everyone should call them that. Their current dreams will not come true either. But I am not talking about that. I want to say that political reforms have created a completely new configuration. I am sure that there is no and should not be a place for any marginal groups in the new configuration. The people of Azerbaijan threw them into the dustbin of history 27 years ago.
I believe that our activities on the international plane have also been successful since the beginning of this year. My participation in the Davos Forum and the Munich Conference, I believe, has led to very positive results. The Davos World Economic Forum is the main international economic event of the world, which brings together the world’s political and economic elite. Once again, I saw a great interest in Azerbaijan. I witnessed this. Giant companies of the world want to work with Azerbaijan. Good conditions were created for further steps and the signing of new agreements. Many of the meetings I held at the Davos Forum lead to specific results. Investments are being made in Azerbaijan, large companies actively cooperate with Azerbaijan, etc.
As for the Munich Security Conference, this is the main global security conference. This time, there was an opportunity to communicate both historical and the overall truth about the Armenia-Azerbaijan Nagorno-Karabakh conflict to a wide audience in a live format. This audience includes millions of people. Given that the leaders of Azerbaijan and Armenia conducted live debates for the first time in history, there was a great interest in them. The debates once again showed that Armenian propaganda is built on falsification, lies and mythology. Our words are based on history, historical documents, historical realities and international law. Therefore, the results of the Munich Security Conference blew the Armenian propaganda to the smithereens and put an end to the false information they had been circulating for years. Of course, it is possible that such attempts will continue to be made, but no-one will believe this.
Therefore, I consider that the event related to the conflict and the history of the South Caucasus was a great success for us. In tens of thousands of messages addressed to me, the Azerbaijani people once again expressed their support.
In connection with the conflict, I should also note that another major blow was recently dealt to Armenian propaganda and Armenia’s position on the conflict as a whole. In fact, they dealt this blow themselves. Of course, our focused activity and relations with international organizations have intensified this blow. We are talking about the so-called “election” of the so-called “president” in the so-called “Nagorno-Karabakh republic”. These “elections” once again showed that no-one would recognize this illegal junta. After the “elections”, leading international organizations did not recognize them and made open statements about this. A statement was made by co-chairs of the OSCE Minsk Group – America, France and Russia. A statement was made by the OSCE Parliamentary Assembly. A statement was made by the European Union and even the European Parliament, which is biased against us. NATO, the Organization of Islamic Cooperation, the Non-Aligned Movement, the Turkic Council – all these organizations represent the absolute majority of the world. The Non-Aligned Movement includes 120, the Organization of Islamic Cooperation more than 50, the European Union about 30, the OSCE about 50 countries. All these organizations did not recognize the “election” and once again showed that Nagorno-Karabakh is an integral part of Azerbaijan. This has once again demonstrated – as I said earlier and want to say again – that Nagorno-Karabakh is Azerbaijan, an exclamation mark!
But I want the people of Azerbaijan to know that one organization is not among these international organizations. I believe that everyone understands this – it is the Council of Europe, the Parliamentary Assembly of the Council of Europe, which has been doing everything possible for many years, for over 20 years, to denigrate and slander on Azerbaijan and undermine its authority.
The Parliamentary Assembly of the Council of Europe is silent. Notice that all organizations, including European ones, have said that they do not recognize these elections. The unambiguous meaning of this is that Nagorno-Karabakh is Azerbaijan. Why is the Parliamentary Assembly of the Council of Europe silent? Why doesn’t it talk about that? The answer is clear. Because the anti-Azerbaijani forces gathered there, the pro-Armenian forces look at Azerbaijan as an enemy. All claims coming to us from this organization are irrelevant. I have said this before and I want to say it again: the decisions and resolutions adopted by them are nothing more than a piece of paper for me. I am not and never will be interested in the opinion of this organization about Azerbaijan.
I want to draw your attention to another issue. There are rapporteurs on Azerbaijan, and they are also tight-lipped, they are not saying anything. As soon as an insignificant event takes place here, they sprinkle our country with lies and slander with foam at the mouth. Why are they silent now? After that, they have lost the moral right to be rapporteurs for Azerbaijan. The people of Azerbaijan see everything perfectly well. They see that their ugly statements are not at all underpinned by the issue of democracy and the protection of human rights in Azerbaijan. The purpose of this organization is to denigrate and blackmail Azerbaijan, undermine its authority, and thus inflict a blow to the interests of our country.
We are going our own way. I want to say this again: there is one way to resolve the Nagorno-Karabakh conflict, it is the restoration of the territorial integrity of Azerbaijan. The reaction of the entire international community to these far-fetched “elections” further strengthens our position.
Speaking about international events, of course, I should note the extraordinary summit of the Cooperation Council of Turkic Speaking States held on the initiative of Azerbaijan in the form of a video conference. Last October, Azerbaijan assumed chairmanship of this organization. Such an initiative was put forward. I must say that the Turkic Council is the only organization today that held a summit at the level of heads of state related to the coronavirus. The thoughts expressed at the meeting, the mutual support, the solidarity and the Final Declaration adopted once again showed that our organization has a very solid foundation and we stand by each other on a difficult day. I believe that Azerbaijan’s initiative is a very appropriate and timely step, all my colleagues emphasized this.
Growth in the non-oil industry is at 23 percent. This indicates that the attention paid to this area in recent years and the investments made are producing excellent results. Inflation is at 3 percent, in the first two months of the year it was at 2.8 percent, and now it has increased slightly. And household incomes grew by almost 7 percent. In three months, tax and customs authorities transferred more than 310 million manats into our budget in excess of the forecast. I believe that this is a good result, which is a clear example of the measures related to transparency, especially considering that economic activity has now subsided.
I must note that not a single program in the social sphere will be reduced until the end of the year. On the contrary, the total support package for coronavirus is provided in the amount of 2.5 billion manats. But there will be more. Recently, only 97 million manats was allocated from the Contingency Fund of the President for the purchase of necessary equipment and supplies. And further by the end of the year, there are plans to allocate as much as necessary, another 150 million manats. This is not part of 2.5 billion manats. All social payments are being made. I believe that an increase in the average monthly wage by 28 percent and the average pension by about 27 percent indicates that positive work is being done in this direction. Now our average monthly salary is 712 manats and the average pension is 295 manats. Age-based pension is close to 330 manats. So we increase wages and pensions every year. Of course, there was a very large increase last year, as 4.2 million people benefited from the programs adopted by the state. This year, all social infrastructure facilities will be built without any reductions. At least 7,000 IDP families will be resettled to new apartments and at least 1,500 martyr families will be provided with new apartments.
In a nutshell, I want to say that the results of three months can, in principle, be evaluated positively. However, I want to say again that no-one knows how long the pandemic will last and when economic activity will recover. We must take all steps in accordance with the situation.
I should also note that in order to maintain the stability of the social, economic and financial, macroeconomic situation, four working groups were set up on my executive order. Let the leaders of these groups report on the work done and submit proposals. Minister of Finance Samir Sharifov will be the first to speak.
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President Ilham Aliyev:
Thank you! I noted that inflation is low this year. For two months it was even lower. According to the results of three months, it reached 3 percent. But it is under full control. Therefore, the floor for a report on the macroeconomic situation, as well as the work already done and to be done in the banking sector, is given to the Chairman of the Board of the Central Bank, Elman Rustamov.
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President Ilham Aliyev:
- Thank you! During the crisis, the banking sector is of particular importance. Therefore, the improvement of banks and the correct assessment of the contribution the banking sector can make to the country's economy are very important. I believe that the issues you underlined are based on an absolutely correct analysis. Of course, we must protect the macroeconomic situation and keep it stable. The experience of the first months of coronavirus shows that we have achieved this. The macroeconomic situation is stable, the manat rate is stable. As you noted, for some time the population and legal entities were taking steps towards dollarization. But there is a process of de-dollarization now.
I want to draw the attention of the public to one more issue and express my opinion. Unfortunately, if there are any changes in the national currency of any country, especially neighboring countries, Azerbaijan immediately reacts to that even though there is no need for this. We came across this several years ago, which is why we had to go for two devaluations. It is possible to say that the foreign exchange reserves of our Central Bank were shrinking, there was some artificial excitement and dollarization reached its peak – as was the case in the current environment. As soon as the coronavirus pandemic spread, the national currencies of some countries collapsed. But there is currently no reason for this in Azerbaijan. We have enough resources and representatives of government agencies made statements on this issue. However, some people spread rumors, others succumbed to panic. We immediately saw activity in the exchange market and the demand for dollars increased. At the initial stage, even the sale of a large volume of dollars was envisaged. But then we saw that the macroeconomic situation was stable, the manat rate was stable and there is no such excitement now. Therefore, I urge the people of Azerbaijan not to succumb to rumors, not to believe them. Our ill-wishers, internal and external anti-Azerbaijani forces are spreading rumors, trying to mislead people, to sow panic among them. There are no grounds for this. Azerbaijan is a strong state and the Azerbaijani leadership shows everything the way it is to the citizens of Azerbaijan. We are not embellishing the big picture, but at the same time, I can say quite frankly that there is no reason for panic or any kind of concern. Our main goal is to win the fight against coronavirus, to overcome this situation with small losses and little damage to the economy. We are well aware that restrictive measures are harmful to the economy. Here we must make a choice between two factors – economic activity and public health. My choice is obvious – public health. Therefore, restrictive measures have been taken. Of course, we initially knew that this could negatively affect economic activity and inevitably lead to the spread of certain rumors and a certain concern in the economic sphere. We did it consciously to protect people, their lives, because there is nothing more valuable than this. The economy can survive the recession and grow next year. In any case, everything is under control. Therefore, there is no need for any anxiety in the exchange market today either.
We must protect the macroeconomic situation. At the same time, in the current environment, banks should provide more support to the business. I am very pleased that the percentage of business loans is already increasing, while the percentage of consumer loans is declining. I think that this is a very good trend that needs to be maintained.
I also welcome the accession of banks to the self-employment program. You are well aware that there is a great need for this program and we planned to provide funds to 10,000 people through the state. Today, the World Bank has joined it. Both they and our banks will provide funds because the need is much higher. Approximately 40,000-50,000 applications have been filed. Therefore, it is imperative to develop microbusiness, especially in the current conditions – work in this area is also planned in agriculture – so that we could protect businesses, support them, and I agree that we should already prepare for a return to normal life.
Therefore, in general, I positively assess the work done in the banking sector and in the macroeconomic sphere. So keep up the good work. I know that you monitor everything in a daily format. I believe that maintaining interest rate stability is also a very positive step. This is not a very simple question, because the sharp drop in the oil price, the decline in economic activity inevitably caused an increase in interest rates. However, in recent months, interest rates have been consistently falling. Therefore, you are keeping them stable to this day. I believe that this is the right step in the current conditions.
Of course, coronavirus created huge problems related to economic activity. But, despite this, I believe that the timely steps we have taken, especially the support of entrepreneurs and businesses, once again demonstrate state policy. Our policy is unequivocal and we have opportunities. We have created them ourselves. If we had not created these financial opportunities, how could we help them today? I do not want to compare Azerbaijan with anyone, but we can see what is happening in other countries now. Such a volume of support per capita as in Azerbaijan is observed in a handful of countries, because we have both opportunities and political will. It is true that the drop in the oil price has negatively affected these opportunities. Therefore, the support for business structures in this situation is only natural. We can’t leave them in a difficult situation because the coronavirus has damaged their business and we must make their work easier.
I should also say that as a result of recent reforms, the business environment in Azerbaijan has significantly improved. This is acknowledged by several international organizations. The well-known Heritage Foundation has also published a rating table related to economic freedoms, and Azerbaijan ranks 44th in the world for the index of economic freedoms. In just one year, we climbed 19 steps. I think that this is a good result.
The floor for a report on the work already done and to be done in the field of financial support and economic stability as a whole is given to the Minister of Economy, Mikayil Jabbarov.
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President Ilham Aliyev:
- I said in my opening remarks that the government and, of course, the Ministry of Economy should find new sources of revenue. I want to say this again: there are resources, and I know that work in this direction is going on. We can’t delay this. I believe that new proposals should be prepared and submitted to me in a short time.
We should also be aware that the agreement of OPEC and non-OPEC countries puts certain obligations on us too. I want to note that Azerbaijan has always played a very active role within OPEC+. I also want to remind you that the idea of the OPEC+ format was first put forward by me at the panel discussion of the Davos World Economic Forum. Today, even the OPEC Secretary General acknowledges this. Today, not only OPEC+ but also all oil-producing countries have come to an agreement. I consider this a unique format of cooperation, which puts additional obligations on each country, including Azerbaijan. In accordance with this agreement, our oil production will be reduced this year. Quotas are already defined. If the price of oil does not rise to the desired level, then we will incur additional losses. We should be aware that these losses could amount to approximately 700 million, perhaps even 1 billion dollars. Therefore, it is now necessary to take steps because on the basis of decisions made last year, a large social package was already implemented. This social package will, of course, be provided to people this year and in subsequent years. At least 2.5 billion manats is envisaged in connection with the coronavirus. As I have already mentioned, about 100 million manats was allocated from the President’s Contingency Fund for the acquisition of the necessary supplies. If the oil price does not recover, we will incur additional losses and our foreign exchange reserves will naturally decline. In the first quarter, foreign exchange reserves already decreased compared to 1 January. This is natural, and under such circumstances, I want to repeat, we must carefully examine the costs. Public spending should pursue two main objectives. Employment – we cannot drastically reduce our investments. First, because important projects must be implemented. Most importantly, if public investments reduce sharply, then people working in this area will lose their jobs. Therefore, when considering our investment program, consider two main factors: employment and the impact of these projects on the real sector of the economy. Azerbaijan has implemented major infrastructure projects. A significant part of them is completely over. Therefore, two main factors should be considered. I believe that in April-May it is necessary to analyze and draw up investment programs for the second half of the year. Take this issue seriously.
In parallel – I have already set this task and know that the Ministry of Economy is working on this issue – additional steps should be taken to encourage private investment. We must confidently go for economic liberalization. All areas in our country should be open to investment. We need to convince both local and foreign investors that their investments will yield effect and bring them income, especially if we consider that we have made great progress in the Doing Business program, the index of economic freedom. As I have already noted, Azerbaijan is highly rated there as well. Our credit rating is positive and the external debt is low. Azerbaijani citizens know this. Even before the coronavirus, I often drew attention to the fact that our state external debt amounted to 17 percent of the domestic product and should be reduced. In the current crisis, this factor is of great importance. A low level of public debt allows us the opportunity to keep our credit rating stable. And this is one of the main factors for investors.
The social sphere has always been a priority for us, and in the current conditions it should be of double priority. In recent years, important steps have been taken in the field of employment and social security, but in the current conditions this is of particular importance. Therefore, let the Minister of Labor and Social Protection of the Population report on the situation with employment, how the self-employment program is being implemented, what steps have been taken and what steps are to be taken in connection with unemployment.
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President Ilham Aliyev:
- For some time now, work has been going on in relation to informal employment. I am regularly updated about this. Last year, a positive picture was also observed in this direction, i.e. the number of employment agreements is increasing. I believe that the current period of the pandemic should serve as a lesson for those who are still working in the shade. I have repeatedly appealed to both entrepreneurs and employees: get out of the shadows and sign employment contracts. If there is no employment contract, then you will not be able to receive a pension and medical insurance. If you are unemployed and have not been registered, you will not be able to receive unemployment benefits. You noted that the number of labor contracts increased by tens of thousands in a short time. Therefore, I believe that in the current conditions we need to pay even more attention to this area. I believe that both through educational work and, of course, as a result of administrative measures, monitoring and institutional reforms we will be able to significantly narrow the scope of informal employment, and work in this direction should be continued. The signing of 70,000 labor contracts indicates that there are still many reserves, and the current difficult situation should, as they say, become a guide for those still in the shade today.
As for paid public jobs, we planned to create 37,000 paid jobs at the beginning of the year. As a result of the pandemic, their number has reached 50,000. But have another look, especially in the regions, if there is an additional need for this, then let us know, maybe we will allocate additional funds to provide people with work during this difficult period.
I believe that the attraction of 12,000 people to the self-employment program is a very good result, especially if we consider that we started with about 3,000, 4,000, 5,000 people. But, as I said in the opening remarks and you also informed me about this, there are tens of thousands of requests. Of course, it is not easy to meet these needs because each issue is considered separately. Sometimes people can’t do this work, others receive resources but then sell them. Such facts are also there. There is international practice. I am told that the success rate of the self-employment program in the world is about 50 percent. As for Azerbaijan, it is higher. However, citizens involved in this program should know that if they misuse the opportunities provided to them, they will lose them and such conditions will not be created for them for the second time. Therefore, I kindly ask people that if someone has received resources, they shouldn’t sell them, try to use them effectively, to create a sustainable and permanent source of income for themselves. Our main goal is for people to create independent sources of income for themselves and be able to support their families. Therefore, studying the capabilities of 12,000 people requires a lot of time, and here it is necessary to accurately weigh the criteria so that the principle of justice is fully ensured.
I believe that in the current environment, the protection of vulnerable segments of the population, as you reported, is quite crucial. We must support them, help them. Today, all our people must demonstrate and are demonstrating these wonderful qualities that the Azerbaijani people have kept for centuries. As you noted, the business community is helping the poor with their initiatives, and I welcome this. This is a manifestation of the social responsibility of the business sector. Let everyone help the lonely, elderly, people from vulnerable segments of the population with what they can. Of course, the state has taken on this function, is doing and will continue to do that. However, the fact that business circles in these conditions have joined this work, that individual people help needy citizens on their own initiative makes me extremely happy. I want to express my gratitude to them. Local executive authorities must create the conditions for them to provide this assistance in a larger volume. As for students from vulnerable groups, as you noted, the state will provide tuition for 17,000 students. This is a great step, and there should be full control over this so that no-one is left outside this program.
Benefits related to utility bills have been introduced. I believe that the full implementation of the social package related to the pandemic will provide serious assistance to citizens during the period of the quarantine and pandemic.
At the same time, we should not forget the programs outlined at the beginning of the year. I already spoke about this in the opening remarks. The provision of martyr families with apartments – in this direction, we need to provide 1,500 apartments by the end of the year. How many martyr families have been provided with homes in the first three months? Please report on that.
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President Ilham Aliyev:
- The quarantine regime should not interfere with agricultural work. Therefore, appropriate instructions have been given. As you know, some people have to travel from one area to another due to seasonal work. Therefore, since the work of intercity transport has been suspended, we need to discuss this issue separately and create all the conditions so that the quarantine regime does not create problems for us in the field of agriculture and people are able to move around. The task force has received instructions on this issue. I am sure that this instruction will be followed.
In the first quarter, growth in agriculture was 3.7 percent. In crop production, even higher results were achieved – a 13 percent increase. Given that growth in crop production was also high last year, this indicates the successful and dynamic development of this sector. As for livestock, in order to achieve development here, we need more time. Over 3-percent growth has also been achieved here.
This year, we plan to provide loans to entrepreneurs engaged in the agriculture from the Entrepreneurship Development Fund. In particular, I believe that in the current environment, more attention should be paid to the field of agricultural processing because we must create a value chain and try to supply more finished products to both domestic and foreign markets. It will also help create jobs. Of course, we must not forget representatives of small businesses. I know that the Ministry of Agriculture has some suggestions. Therefore, the floor for a report on preparations for farming, upcoming work and problems is given to Minister of Agriculture Inam Karimov.
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The head of state then made closing remarks.
Closing speech of President Ilham Aliyev
- I want to repeat that there have been positive changes in the field of agriculture in recent years. The E-Agriculture Program is being implemented. The mechanism for the provision of subsidies to farmers has been improved and cards have already been issued. This is a very positive fact. In other words, agriculture must meet modern standards. This being the case, of course, productivity will increase, people working in the village will work. At the same time, we will provide the domestic market and will be able to supply a wider range of products to foreign markets. The main issue related to agriculture is to increase productivity. The Ministry of Agriculture is already working in this direction. We can say that the yields of all types of produce are increasing every year. However, we should know that the population is growing as well, and so will domestic consumption. Therefore, agricultural production must develop at a rapid pace so that we can meet the domestic demand and supply our products to external markets.
I believe that additional funds should be allocated to resolve the issues you have noted. We should consider allocating funds from the President’s Contingency Fund for the provision of microloans. I believe that 30 million manats can be allocated for this. It is necessary to prepare and submit a draft of the relevant Order to me.
What you said about the drought is a very serious matter that causes great concern, as this trend may continue. As you know, there is great concern in the world about climate change. Some forecasts suggest that perhaps in 10 or 20 years, even desertification is not ruled out in Azerbaijan. Therefore, we already need to prepare for this. Last year’s drought created major problems for us. Even the elderly don’t remember such a drought. Drought is also expected this year. Therefore, the mobilization of our water resources and their rational use are becoming a priority. It is no secret that where there is water, productivity and people's incomes increase. It is for this purpose that several important large-scale projects have been implemented in our country. If the Shamkirchay and Takhtakorpu water reservoirs had not been built in time, the canals had not been laid, then great difficulties could have arisen in the areas that feed on this water. Over the past few years, we have been supplying water to approximately 100,000 hectares of lands. These are lands that were not irrigated at all or were irrigated inadequately. Therefore, in order to continue to meet the needs of agriculture and farmers in this area, it is necessary to draw up a new program. We cannot work with old methods because they are not proving effective. Technologies are developing in all areas in the world today, including the field of land reclamation. We can no longer do this work by old-fashioned methods. New technologies must be introduced. I am told that in some places water loss reaches 40-50 percent even though major investments have recently been made in this area. However, the installations built in the old days and most of the infrastructure have decayed and do not allow for the supply of water. In addition, these leaks lead to the salinization of the soil. Therefore, we suffer damage twice here. We should also know that our water resources are not so large. The main sources of water in our country are formed outside our borders. Therefore, every drop of water is important to us. It is necessary to seriously address this issue. We can say that all the water utilities built in the Soviet era are ground-based. We have been building only concrete canals and concreting the ground-based canals built earlier. We are thus preventing the loss of water. However, I believe that we should look further. Developed countries of the world, in particular, countries with the same climate conditions as ours, have gained experience. They have fairly high yields and their experience should be applied to Azerbaijan.
Therefore, I believe that in order to achieve serious progress in this area, it is necessary to set up a special commission. A commission will be established to deal with the rational use of water resources. I believe that the commission should be headed by Deputy Prime Minister Shahin Mustafayev, since during his work as Minister of Economy he was heavily involved in this issue and regularly reported to me. The commission should include heads of the relevant agencies – the Minister of Agriculture, the Minister of Economy, the Minister of Ecology and Natural Resources, the heads of the “Land Reclamation and Water Resources” Joint Stock Company, the “Azersu” Joint Stock Company and other relevant bodies, so that a plan of specific measures can be prepared. We can say that there is material and information available in relation to the analysis. The key question is what we should do, what steps we should take. We should probably also engage foreign specialists to give us good advice. We must appreciate every drop of water.
So our meeting today is coming to a close. I should note, of course, that our economic and social plans remain unchanged. Although coronavirus has had a definite impact on our plans, it cannot make us turn off the main path. Of course, today all our efforts are aimed at combating coronavirus. And this is natural. This is why the Operational Headquarters led by the Prime Minister has been set up by my order. The Headquarters works very efficiently around the clock. I can say that I am in contact on a round-the-clock basis. During the day, we probably call each other five to six times and talk. I can say that if these steps had not been taken in good time, if very serious coordination had not been carried out, we could have faced even greater problems. To date, it is possible to say that we have managed to protect ourselves from major problems. The dynamics of the last two days, i.e. the difference between the number of patients and those who have recovered, instills a certain optimism. But I don’t want to jump the gun as analysis is still under way. As you know, the quarantine regime is valid until the 20th. Next week, both the Operational Headquarters and all other relevant agencies should submit their proposals on what steps we should take after the 20th, whether the quarantine regime should remain in force and, if so, in what form and when we can begin to start mitigating it. We need to know all of this for sure. I want to say this again: the main goal is to protect our people from this disease. The economy can be restored. We are now working hard and will continue to work to overcome this situation with minimal losses.
Consistent action is being taken in related to coronavirus. Currently, patients are being treated in more than 20 hospitals. At the same time, citizens are quarantined in 4-5-star hotels, including the Athletes Village. We have already conducted more than 70,000 tests, and by the number of tests we are in 30th place on a global scale. Attention is being paid to doctors, their salaries have been increased by three, four and five times. We started the production of masks, one enterprise has already begun to operate. I am told that another enterprise is about to be launched. This is also a very positive fact. The construction of 10 modular hospitals has already begun. Six of them will be built by the state and four by the private sector. At the end of last month, our most modern hospital, “Yeni klinika", was commissioned. This is the most modern clinic with 575 beds and it was placed at the disposal of those infected with coronavirus. At the opening of the clinic, I noted that because of this disease, we commissioned this clinic somewhat ahead of schedule, and it gradually begins to operate. According to recent data, 100 coronavirus infected people are already undergoing treatment in this clinic. So, the process of commissioning more beds there continues and all the possibilities will be mobilized as much as possible.
The best assessment of our work in this area is given by the Azerbaijani people. I want to say again that I am receiving thousands of emails. People express their appreciation for the work done. The World Health Organization has praised our work and described Azerbaijan as an exemplary country in the fight against coronavirus.
All this gives us reason to say that we will overcome this misfortune and get the upper hand in this struggle. As a people, we have already shown unity and solidarity. Now we must demonstrate more responsibility and discipline. If this is the case, we will get out of this difficult situation with dignity and small losses.
I wish the people of Azerbaijan good health and happiness. Thank you!
Minister of Finance Samir Sharifov, Chairman of the Board of the Central Bank Elman Rustamov, Minister of Economy Mikayil Jabbarov, Minister of Labor and Social Protection of Population Sahil Babayev and Minister of Agriculture Inam Karimov delivered reports.
President Ilham Aliyev made closing remarks.