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Azerbaijan

Beyond oil score(out of 100 points) 35.5
Index ranking(out of 26 countries ranked) 21
Overall status*  
General Economic Framework  
Political Framework  
Society and Future Skills  
(Beyond) oil related factors  


Azerbaijan ranks among the world’s top 30 oil producers with production capacities comparable to those of Ecuador or Syria.

Europe’s “Wild East”

Trying to estimate Azerbaijan’s oil reserves is like skating on thin ice. Even serious sources diverge greatly in their estimates. However, judging by the scope of current international projects like the recently inaugurated Baku-T'bilisi-Ceyhan oil pipeline that is estimated to have cost up to 4 bn USD, we tend to the assumption that oil reserves in Azerbaijan are still substantial. The difficulty of getting reliable figures about Azerbaijan’s oil reserves also sheds light on the country’s administration as a whole: in all but the oil-related parts of our index, Azerbaijan scores very low which seems to justify its arguable reputation as the “wild east” on the insecure frontiers of Europe. In fact, human rights activists as well as environmentalists critisise President Ilham ALIYEV for not acting decisively against social inequality and environmental damage caused by oil drilling.
The country’s oil drilling facilities are widely regarded as outdated, foreign investment in non-energy sectors is largely missing. In Transparency International’s corruption perceptions index, Azerbaijan ranks 137 of 158 surveyed countries. Unlike its Western neighbour Georgia which is intensifying its relations with de facto EU candidate Turkey, Azerbaijan is lacking a dynamic economic environment.

Beyond Oil Summary

Regarding Azerbaijan’s glorious past in the history of oil production (at the beginning of the 20th century the Baku area produced 50% of the world’s demand for oil) the future outlook for Europe’s “wild east” is rather gloomy.

  Indicates high preparedness   Indicates deficits but potential for development   Indicates unfavourable preconditions.
 
     
   
 
 
Beyond oil © 2007.