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(Photo: British Embassy, Azerbaijan)

20TH CASPIAN OIL AND GAS EXHIBITION HELD IN BAKU Also in this issue: IDP and refugee football team to play against the Arsenal legends UK Prime Minister Cameron – “close friend and partner to Azerbaijan” EBRD predicts 3.5 per cent GDP growth Occupation forces place Nagorno-Karabakh under flood threat Fidan Hajiyeva gears up for Proms performance

06 / 2013 June 2013

Welcome to the TEAS Magazine The European Azerbaijan Society (TEAS) is a UK-registered pan-European organisation dedicated to raising awareness of Azerbaijan and fostering closer economic, political and cultural links between that country and the nations of Europe. As well as promoting the positive aspects of Azerbaijan, TEAS also highlights the plight of the 875,000 refugees and Internally Displaced Persons (IDPs) within the country. These people are unable to return to their homes and lands because of the illegal occupation of Nagorno-Karabakh and seven surrounding regions by Armenia’s armed forces – in defiance of four UN Security Council resolutions. TEAS has three main facets to its operations: • Culture – TEAS raises awareness of Azerbaijan’s rich and vibrant culture to a worldwide audience by organising cultural events and operating as a networking centre. • Business – TEAS supports its membership of European and Azerbaijani businesses. It provides a platform for organisations to establish links and strengthen their existing business relationships via a programme of networking opportunities across the regions. • Public Affairs – TEAS works to increase awareness about Azerbaijan amongst key opinionformers, key decision-makers and other political, academic and civil society stakeholders. In pursuit of its objectives TEAS: • Organises meetings with interested parties, opinion-formers and decision-makers • Arranges roundtables, seminars, lectures and conferences • Publishes pamphlets, reports, bulletins, books and films. • Facilitates fact-finding trips by politicians and business people

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Membership and Sponsorship

TEAS offers a range of corporate and individual membership packages, providing such benefits as advertising, trade missions, networking, business sector advice and hotel discounts. TEAS also offers numerous sponsorship opportunities throughout the year for its events and conferences. To find out more, e-mail:

Forthcoming Azerbaijani events

For full details of all TEAS events, go to 24–28 June Azerbaijan Through the Lens: Photography Exhibition (Belgium) European Parliament, Rue Wiertz 60, B–1047 Brussels Mezzanine Yehudi Menuhin (2nd floor), Paul Henry Spaak Building Opening hours: 09.00–18.00hrs. Free admission. Following the successful Azerbaijan Through the Lens exhibitions in London, Paris and Berlin, featuring photographs from TEAS’ photography competition of the same name, the exhibition continues its European tour at the heart of Europe – in the European Parliament in Brussels. The photographs give an excellent introduction to Azerbaijan, showcasing many aspects of Azerbaijani life, culture, nature and history. Organised in collaboration with Katarína Neved’alová MEP (S&D, Slovakia). For more information, e-mail:

Latest Member Please see website for more members

June 2013

23 June Charity Football Match: World Refugee IDP XI vs. The Arsenal Legends (UK) Barnet FC, Underhill Stadium, Barnet Lane, Barnet, Hertfordshire, EN5 2DN Gates open 14.30hrs; Kick-off 16.00hrs. £3 (under-12s free).

20–23 June Photography exhibition: Five Roads Back Home by Philipp Rathmer (France) La Galerie Joseph, 7, rue Froissart, 75003 Paris Opening hours: 10.00–18.00hrs. Free admission.

This TEAS-sponsored charity football match is between the World Refugee IDPs XI and the Arsenal Legends. Mo Farah, the Olympic Double Gold Medal Winning British Athlete, will manage the Arsenal Legends, and Fabrice Muamba, the former Bolton Wanderers footballer, will manage the World Refugee IDP XI.

On the occasion of World Refugee Day, TEAS presents Philipp Rathmer’s stunning photography exhibition, entitled Five Roads Back Home. This is his study of the ongoing situation affecting some of the Azerbaijani refugees and IDPs who continue to live in camps across the country.

The Arsenal Legends team will include Tony Adams, the former England and Arsenal captain, Lauren, Nigel Winterburn, Ian Wright, and Michael Thomas. Several MPs and MEPs will also play in the World Refugee IDP XI.

The exhibition, first shown in Berlin, will run in Paris, before continuing to Brussels, Istanbul and Baku in 2013. Philipp Rathmer will be attending the opening night, which will take place at 19.00hrs on 20 June, at La Galerie Joseph, Paris. To attend the opening, please RSVP to:

20 June has been designated by the UN as World Refugee Day, remembering the plight of refugees around the world. This includes the Azerbaijani refugees and IDPs who are unable to return homes due to the Nagorno-Karabakh conflict. Tickets are available from the Barnet FC website at

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Politics and News


Peacekeepers in

Afghanistan to remain after 2014

World Refugee IDP XI to do battle against the Arsenal Legends

The World Refugee Internally Displaced Persons (IDPs) XI and the Arsenal Legends will meet for a TEAS-sponsored friendly match at Barnet FC’s Underhill Stadium on 23 June. The guest manager for the Arsenal Legends will be Mo Farah, the Olympic Double Gold Medal Winning British Athlete, and his counterpart for the World Refugee IDP XI will be Fabrice Muamba, the former Bolton Wanderers footballer. The Arsenal Legends team will include the

former England and Arsenal captain Tony Adams, Lauren, Nigel Winterburn, Ian Wright, and Michael Thomas. Several MPs and MEPs will also play in the World Refugee IDP XI. UN World Refugee Day is commemorated every year on 20 June, remembering the plight of all refugees. This includes the 875,000 Azerbaijani refugees and IDPs who are unable to return to their homes, due to the NagornoKarabakh conflict. For more information, go to

Sergiy Grechyn achieves victory in the first Tour d’Azerbaїdjan

The five stages of the Tour d’Azerbaidjan concluded on 21 March. Much to the joy of the local fans, Christoph Schweizer (Baku Synergy Cycling Project, Azerbaijan) applied his sprinting abilities to claim the opening stage in Baku. Stage 2 was no less dramatic, as Bakhtiyar Kozhatayev (Continental Team Astana, Kazakhstan) and Oleksandr Surutkovych (Baku Synergy Cycling Project) put in brilliant performances in the mountains. This stage was won by Ukrainian Sergiy Grechyn (Torku Sekerspor, Turkey), who retained the general classification leader’s blue jersey for the remainder of the competition. Stage 3 concluded with Vitaliy Popkov (ISD Continental Team, Ukraine) and Stig Broekcx (Lotto-Belisol, Belgium) cycling neck-andneck to claim the finishing line. In fact, Popkov claimed victory, with Schweizer finishing third and regaining the green jersey as the Tour’s top sprinter. Stage 4 proved to be an endurance test for all cyclists, concluding in a maiden career victory for Jan Hirt (Leopard-Trek Team, Luxembourg), while there was yet another podium finish for the Baku Synergy Cycling Project, as Connor McConvey achieved second place.

As sports cycling in Azerbaijan remains comparatively underdeveloped, Sahib Alekperov, Vice-President, Azerbaijani Cycling Federation, commented that the Tour’s greatest achievement was a significant increase in the number of cyclists taking to Azerbaijani streets. The recently-formed Baku Synergy Cycling Project Team was particularly delighted by their performance, as riders Connor McConvey and Christoph Schweizer claimed the Tour’s King of the Mountains and Best Sprinter titles. Jeremy Hunt, Manager, Baku Synergy Cycling Project Team commented on the positive future of Azerbaijani cycling, saying that qualification for the 2016 Olympics remains realistic. He said: “There are many talented riders here. No less importantly, Azerbaijan has all of the resources needed to allow them to maximise their potential.” For the final stage, the Tour returned to Baku, where Tomas Vaitkus (Lithuanian National Team) achieved victory. Meanwhile, the overall winner was Sergiy Grechyn, who commented: “I’ve shown with this victory that I still have a lot to offer, and still know how to win!” Oleksandr Surutkovych and Bakhtiyar Kozhatayev respectively took the second and third places in the competition.

During a briefing to journalists in Baku, Khazar Ibrahim, Azerbaijani Ambassador to NATO, revealed that Azerbaijani peacekeepers would remain in Afghanistan after the withdrawal of US troops from the country at the end of 2014. They will serve alongside troops from eight partner countries. Mr Ibrahim stated that Azerbaijan would reduce its presence in Afghanistan after 2014. He said: “The name and essence of the mission will be changed, and a concept for the operations is to be prepared. Two documents are being developed by NATO, after which the countries will define the contribution they will make – whether this is training for Afghan forces, anti-mine actions or equipment supply.” Azerbaijan is closely involved in restoring peace and security to the post-war country. Since 2002, the peacekeeping contingent of the Azerbaijani armed forces has served under the NATO-led International Security Assistance Force (ISAF) in Afghanistan. The Azerbaijani peacekeeping contingent initially comprised 22 persons, rising to the level of a detachment in 2008. In October 2009, the Azerbaijani parliament passed a decision to double the number of peacekeepers in Afghanistan to 90 servicemen, serving under the Turkish ISAF contingent. The detachment personnel are currently protecting the TV tower in Kabul and ISAF munitions storage, in addition to undertaking patrol service. Mr Ibrahim said that Azerbaijani airspace remains open for the transportation of goods to Afghanistan. In total, 35 per cent of all cargo to Afghanistan is transported via Azerbaijan. The country also provides opportunities for the transportation of goods by land and maritime routes, namely the Baku–Tbilisi–Kars railway and the Alat seaport, located near Baku.

A victorious Sergiy Grechyn stand on the podium alongside second prize winner Oleksandr Surutkovych (left) and Bakhtiyar Kozhatayev (right)

June 2013


Politics and News The luminaires on the Flame Towers give the impression of a flickering flame

Flame Towers named ‘best hotel and tourist centre’ The iconic Flame Towers, which have become a symbol of modern Baku, have received an international award at the Le marché international des professionnels de l’immobilier (MIPIM) 2013 event in Cannes, France. It won The Best Hotel and Tourist Centre award at the show, which is the largest investment exhibition focusing on

innovative projects in the European real estate market.

Opened in 2012, the Flame Towers comprise three structures, rising up to 190m over Baku. The architects for the project were HOK, and the shape of the towers was inspired by the tradition of Zoroastrian fire

Azerbaijan blocks ‘biased’ Euronest proposals Azerbaijan has successfully stopped over 25 “biased and immoral” proposals, prior to the Spring Session of the Euronest Parliamentary Assembly in Brussels amidst claims that these questioned territorial ownership over Nagorno-Karabakh and the seven surrounding regions. Armenia and its EU supporters had added the proposals and amendments to a resolution on regional security challenges.

According to Azerbaijan Monitor, H.E. Elkhan Suleymanov, Chairman of the Azerbaijani Delegation to the Euronest Parliamentary Assembly, was able to block the amendments – some of which he branded as “absurd” and many of which he regarded as “dangerous”. Following the session in Brussels, he said: “By managing to delete all non-objective proposals by Armenians and some supportive


TEAS Belgium has organised another meeting of the European Parliament’s Friends of Azerbaijan Group. The MEPs discussed the exemplary role of Azerbaijan in promoting and maintaining a high degree of religious tolerance within its society.

This meeting was hosted by Kristiina Ojuland MEP (ALDE, Estonia) and focused on the extent of religious tolerance in Azerbaijan, which has been on a crossroads of different cultural influences for centuries. Freedom of religion and respect for personal religious affiliation continue to be important values in contemporary Azerbaijan. Roman Huna, Head, TEAS Belgium, said: “Azerbaijan can be called a real example of best practice in religious tolerance. The freedom of religion and belief is one of the most June 2013

MEPs, and most of these proposals directly questioning the sovereignty of Azerbaijan, we eventually secured our national interests.” “I accepted to withdraw a few amendments tabled by the Azerbaijani delegation to respect the spirit of co-operation between the European Parliament and Eastern Partnership countries, yet it doesn’t make sense to have these kind of forums if we can’t discuss our problems openly and find solutions to them.” He added that Azerbaijan remains ready to discuss Nagorno-Karabakh in any democratic forum. However, Suleymanov acknowledged that Armenia appeals to the “so-called common European Christian legacy”, and has effectively used this to rally support within the EU and the wider international community. The amendments from the Armenian side

worship in the city, and the past and present production of natural gas. The towers incorporate over 10,000 LED luminaires, and give the impression of a flickering flame, the Azerbaijani flag and other images at night. The buildings provide residential, hotel and office accommodation and range in height from 33 to 39 floors.

included a proposal to open the borders of the occupied territories which, in the case of Nagorno-Karabakh, would have breached “all international standards and practices.” The Armenian amendments included a call for co-operation between the EU and “de facto authorities”, which is a euphemism for the unrecognised authorities in the occupied territories. Suleymanov said that he would continue to ask the international community to apply the international resolutions regarding Nagorno-Karabakh, based on the principle of territorial integrity. He went on to reiterate his commitment towards resolving the Nagorno-Karabakh conflict through the Euronest Parliamentary Assembly and other international bodies.

e-mail: personal choices a human being can make. The country has profiled itself as a very tolerant country where, according to the Constitution, each person has the right to choose and change their own religious affiliation and belief, to join or establish the religious group of their choice, and to practice their religion. The law on religious freedom expressly prohibits the Government from interfering in the religious activities of any individual or group.”

Foreign Relations, Azerbaijani State Committee for Work with Religious Organisations, to attend the meeting. He said: “Azerbaijan has always adopted an attitude of hospitality and tolerance towards people of other races and religions. The country and its government are committed towards fostering an atmosphere of inter-religious tolerance and respect. That’s why today we find such a rich diversity of religions in the country.”

Kristiina Ojuland, MEP stated: “I am happy to observe that, in Azerbaijan, there exists a clear law on religious freedom that expressly prohibits the Government from interfering in the religious activities of any individual or group. In this regard, Azerbaijan is a model of tolerance and respect for any faith and way of life.”

H.E. Fuad Isgandarov, Azerbaijani Ambassador to Belgium and Head of the Azerbaijani Delegation to the EU, concluded: “It is not widely known that Azerbaijan is a real model of tolerance, secularism and respect for every personal conviction. The best proof of this is the existence of the State Committee on Religious Organisations, which protects and guarantees religious freedom to its citizens.”

TEAS Belgium invited Nijat Mammadli, Head of



Songlines mugham

special – 25 per cent reduction

Artist Ulvi Pepinova, surrounded by some of her amazing glass paintings

Stunning glass paintings displayed in London A selection of vibrant abstract works by the London-based Azerbaijani artist Ulvi Pepinova was exhibited during a single-night exhibition at The Hollywood Arms in Chelsea, London. Entitled Glass Buta and Spacious Dreams, the primary focus of the exhibition was her glass paintings, complemented by some of her works in oils. Attended by over 200 people, Ulvi was pleased to note that many of her works were purchased and taken to new homes. Speaking to Pomp magazine, she said: “Glass

is an unusual medium to work with, but I like the texture of painted glass; its transparency; brightness and glossiness. Glass has its own sensual qualities of smoothness, silk and gloss, creating a stunning effect. It can also be flexible and malleable, giving successful results in most cases. In my opinion, glass is a considerably more accommodating material than is generally perceived to be the case. But in my new series I have also experimented on canvas, where I aimed to achieve the same glossy effect as on glass. I liked the result!”

Songlines is the leading international magazine focusing on ‘world music’, and the July 2013 issue will focus on Azerbaijani mugham. Containing an article written by editor Simon Broughton on his recent visit to the Space of Mugham Festival in Baku, the magazine contains a covermounted CD featuring some of the leading mugham singers and instrumentalists, including Alim Qasimov, Ferghana Qasimova, Gochag Askarov, Nazaket Teymurova, Ramiz Guliyev and Shirzad Fataliyev. TEAS’ members and friends can save 25 per cent off the cover price of the issue, reducing it to just £3.71 (normally £4.95). For more details visit newissueoffer or call Edward Craggs on 020 7371 2777, quoting ‘TEAS offer’. The offer expires on 30 June. Songlines is also available on the Tablet for iPad and Android, and the new issue includes streamed excerpts from the Azerbaijan mugham CD. To hear this, download the free Songlines app from the App store at or Google Play on

UNESCO Secretary-

General: Azerbaijan is a cultural centre

Pianist Saida Zulfugarova performed a wide range of music by the most acclaimed Azerbaijani composers (Photo:

Captivating Parisian music and poetry performance

An outstanding concert took place on 1 June at the Centre Culturel d’Azerbaidjan in Paris, in the shadow of the Eiffel Tower, as part of the commemorations for the 900th anniversary of the birth of poetess Mahsati Ganjavi. This introduced more than 150 people to the poetry, literature and classical music of Azerbaijan. The first half comprised a reading of poetry, literature and miniatures, written by such leading Azerbaijani authors as Nizami Ganjavi and Jalil Mammadguluzade and Mahsati Ganjavi herself, read by the leading French actors Simone Hérault and Xavier Clion, some of which were accompanied by the Paris-based Azerbaijani pianist Saida Zulfugarova. The second half consisted of songs and piano pieces, performed by Saida and the classical

soprano Farida Mamedova, who frequently appears at the Baku Opera, the Gabala International Music Festival, and across Europe. This section began with Farhad Badalbeyli’s remarkable sweeping evocation of The Sea, followed by a setting by composer Asaf Zeynally of Jafar Jabbarly’s poem Olkem. Other works included Nizami’s poem Sevgili Canan, set to music by Uzeyir Hajibeyli, and an emotional performance of Yarim Kecti to music composed by Oqtay Zulfugarov. Saida had opportunity to demonstrate her dazzling technique when she played Gara Garayev’s Third Book of Préludes, Ismayil Hajibeyov’s Menuetto and Tofiq Guliyev’s Gaytagi. A French flavour was also brought to the evening by the inclusion of Claude Debussy’s setting of Paul Verlaine’s poem Fantoches, and a solo piano Prélude.

Speaking at the second World Forum on Intercultural Dialogue in Baku, Irina Bokova, Secretary-General, UNESCO, commented: “Azerbaijan has become a centre of culture. The Old City is already in the list of UNESCO World Heritage Sites, and the Novruz holiday is on the list of Intangible Cultural Heritage, together with mugham.” The Forum was named Living Together Peacefully in a Diverse World, and she continued: “For UNESCO, peace is achieved not only through economic and political actions, but also on an intellectual level. New forms of dialogue are required, and the years 2013–22 have been declared as the International Decade for Rapprochement of Cultures.”

Irina Bokova, Secretary-General, UNESCO, acknowledged Azerbaijan’s contribution to world culture

June 2013


Culture Ali Banisadr’s stunning evocation of fire and light

Yarat! destroys preconceptions at the Venice Biennale

The Yarat! Contemporary Art Space is at this year’s Venice Biennale with the exhibition Love Me, Love Me Not, running at Tesa 111, Arsenale Nord until 24 November. This landmark event features recent works by 17 artists from Azerbaijan, Iran, Turkey, Russia, and Georgia. It has been produced and supported by Yarat!, a not-for-profit contemporary art organisation based in Baku. Dina Nasser-Khadivi, Curator, commented: “There are currently equal amounts of curiosity and misconceptions about Azerbaijan and the countries surrounding it. The works on show will provide an insight into the dynamics of each nation, bringing to light forgotten aspects of history, and demonstrating the breadth of vision and creativity at play within their borders.”

The exhibition incorporates a diverse range of media and subject matter, with video, installations and paintings on display. Notable inclusions are works by the Azerbaijani sculptor Faig Ahmed, who takes the motifs of his country’s carpets as a point of departure,

reinterpreting these to underline the rapid shift of Azerbaijan towards modernity. His thread installation Untitled (2012) deconstructs the traditional craft of carpet-weaving, extending the usual two-dimensional plane of the finished carpet across a three-dimensional space.

The Iranian-American artist Ali Banisadr produced his largest work, to date, in the form of a triptych inspired by the pervasive symbolism of fire and light. These elements, prevalent in both Azerbaijan and Iran, relate both to the origins of Zoroastrianism and the word ‘Azerbaijan,’ which is derived from the Persian name for ‘Guardians of Fire’. Through the effective use of colour, he has evoked the imagery of his childhood, his interpretation of art history, and his sharp observations of everyday life on the canvas. His works are housed in public collections across the world, including the Metropolitan Museum of Art in New York and the Saatchi Gallery. On the other hand, the Azerbaijani Ali Hasanov

uses ‘found objects’. The work entitled Masters (2012) features hundreds of ‘veniki’ brooms, made from bundled twigs, bound together to create a sculpture. In contrast, the collective Slavs and Tatars’ installation entitled Molla Nasreddin: The Antimodernist (2011) features a life-size sculpture as a playground ‘ride’ for adults and children, referring to the popular Sufi philosopher of the 13th Century and the Azerbaijani satirical periodical of the early 20th century. Visit to see some of the artworks on exhibition.

Ali Hasanov’s mammoth work is made from traditional ‘veniki’ brooms

Sophisticated lady Figarova tours the US and Europe

Farid Mammadov (right) during his memorable Eurovision final performance (Photo: Dennis Stachel – EBU)

Hold Me nearly returns Eurovision to Baku

Hold Me, the Azerbaijani entry to the Eurovision Song Contest in Malmö, Sweden, achieved 234 points in the final, when it was performed by Farid Mammadov. The song came in second position after Only Teardrops by Danish singer Emmelie De Forest, which attracted 281 points. Azerbaijan first entered the contest in 2008, when it achieved eighth position. Since then, it has consistently ranked amongst the top five Eurovision performers, and won the contest with Running Scared by Ell and Nikki in 2011. June 2013

The New York-based Azerbaijani jazz pianist Amina Figarova has been raising waves across the US and Europe with a punishing schedule of concerts and broadcasts. In May, her Sextet performed at Dizzy’s Club CocaCola, home to jazz in New York’s Lincoln Centre. This was subsequently broadcast on Sirius/XM radio. She also performed at the CD release launch party of Alone and Together, by harmonica player Enrico Granafei, at Trumpet’s Jazz Club in New Jersey, alongside Vitali Imereli (violin), Rick Crane (bass) and Gordon Lane (drums). Amina then went on to play in a trio setting with Joe Sanders (bass) and Justin Brown (drums) at the Mayne Stage in Chicago, and with her regular Sextet at the Firehouse 12 in New Haven, Connecticut and the Brubeck Room of the Wilton Library, Wilton, Connecticut.

Summer will see Amina playing in Luxembourg and the US. There will be a residency at the L’Inoui, Redange sur Attert, in Luxembourg, where she will perform on 30–31 July, and collaborate with Israeli singer Shlomit Butbul from 1–3 August. Amina will then return to

the US, where the performance schedule includes Blues Alley, Washington, D.C. on 12 August, and the Idyllwild Jazz festival, Idyllwild, California on 18 August. To see her full schedule, go to

Amina Figarova is performing in various ensembles around Europe (Photo: Andrea Canter)

Personalities – Fidan Hajiyeva


Fidan Hajiyeva during her interview with blogger and broadcaster David Bailey

Fidan Hajiyeva – bringing mugham to the Proms Living in Enfield, North London, 18-year-old Fidan Hajiyeva is the daughter of Neman Hajiyev, previously a nagara drummer and now a sound recording expert. In January, Fidan was selected by the producers of the BBC Radio 3 World Routes programme for tuition under the World Routes Academy scheme, making her the youngest participant in that scheme, to date. This initiative pairs a leading musician in a traditional discipline with a young UK-based musician, who is focusing on the same musical genre. Since then, Fidan has been studying mugham under the tutelage of Gochag Askarov, a leading Azerbaijani mugham singer, both by skype and during visits to Azerbaijan. They will bring Azerbaijani mugham to the stage of the prestigious Royal Albert Hall for the first time on 22 August for the World Routes Prom. Following her interview for the TEAS Magazine, February 2013 (p.14), Fidan and Neman visited the TEAS offices to discuss the development of her talent and how she is preparing for her biggest concert, to date: You were announced as the BBC World Routes protégé in January. How have your studies been undertaken since then? During my two-week trip to Baku, I visited some mugham masters for some lessons, and had the opportunity to attend three or four masterclasses. I began to understand how Azerbaijani students undertake their studies. They all know mugham far better than myself, having been immersed in the technique and theory of the music from a young age. I also took some lessons from Gochag, who instructed me on some new techniques for mugham, as it is very challenging music to perform. He particularly concentrated on vocal technique, as there are some special ways of singing mugham, which do not come naturally, but must be taught. The mugham masters also instructed me on these techniques, in addition to the spiritual and meditative aspects of the music.

Upon which aspects of performance have you focused? I gradually began to realise that Azerbaijani students know more than I ever will. When the teacher demonstrates a phrase to sing, they can immediately replicate this. I was greatly impressed by their apparently natural abilities, and do not consider myself to be in the same league. I was also taught about breathing techniques, as previously when I was singing, I did not breathe in the correct places. Many masterclasses were undertaken at the International Mugham Centre and Baku Music Academy. I attended a masterclass with Alim Qasimov, the most famous Azerbaijani mugham singer on an international level, which was very intimidating. I also had the opportunity to appear live on breakfast television on AzTV, where I sang one solo song and a duet with Gochag. I felt quite apprehensive about this performance, and forgot a word in one of my songs. Did you attract any media attention in Azerbaijan? During my time in Baku, I appeared on Gochag’s radio show, which is broadcast across the country. This also provided Gochag with the opportunity to interview Lucy Duran, academic and presenter of the BBC Radio 3 World Routes programme, reversing the roles of what happens on Radio 3, where she is the interviewer. I was also able to sing on the show. I had chance to visit Shamakha, outside of Baku, to meet and hear other musicians, such as an ashiq group and mugham singers. We had dinner in a private house, and they played and sang. World Routes recorded the music for broadcast. Were your experiences charted at all for the BBC World Routes programme? The World Routes crew were always stopping us to undertake interviews. All performances by the mugham masters were recorded so, following each masterclass, they would wait

until the students had gone, and then settle down to record them. I spent most of my time with Gochag whilst I was in Azerbaijan, and managed to learn two more new songs. Typically, I would spend two hours learning with him, and then undertake a masterclass. During my studies with Gochag, Azerbaijani journalists were constantly interviewing me for Azerbaijani radio or newspapers. Much to my surprise, I have now become something of a celebrity in Azerbaijan, and have appeared in newspapers (both print and online), radio and television. All the journalists were asking me what I was studying, how I had come to meet Gochag, and what I was gaining from the experience of studying in Azerbaijan. I also went to Azerbaijan from 26 May–7 June, to prepare for the BBC World Routes Prom at the Royal Albert Hall. On this occasion, I focused on studying with Gochag in preparation for the Proms. I expanded my repertoire by learning two more songs – Ay Lacin and Evleri var Xana Xana. What are your thoughts as one of the performers in the first mugham concert to take place at the Royal Albert Hall? I feel extremely apprehensive – a few weeks before the concert I will be singing at a café in an informal concert, accompanied by a Turkish group, so I can gain the experience of singing before an audience. At the Proms, I will sing three or four songs solo, then Gochag will perform a solo, and we will then duet. The billing for the World Routes Prom will be shared with a Malian group. Prior to the concert, I will visit the Royal Albert Hall so I can experience the perspective from the stage, and become used to projecting my voice. To attend the World Routes Prom on 22 August at 22.00hrs at the Royal Albert Hall, Kensington Gore, London, SW7 2AP, go to Tickets are £12–16 (10 per cent discount for groups of 10 or more). June 2013


Personalities – Rashad Nabiyev raising awareness and general interest in the sphere, and for promoting and fostering the intellectual evaluation of innovations and space technologies in the country. How long did Orbital Systems take to develop and construct the satellite? Orbital designed and built the Azerspace–1 satellite in less than two years. Orbital was selected on the basis of the reputation of the flight-proven GEOStar platform for onschedule delivery and in-orbit reliability.

A CAD representation of Azerspace–1, the first Azerbaijani communications satellite, in orbit (Copyright: Azercosmos)

Space – the final

frontier for Azerbaijan

The launch of Azerspace–1, the first Azerbaijani communications satellite, on 7 February from the European Space Port, Kourou, French Guiana, had an historic significance for the region. Developed under the auspices of Azercosmos, established in 2010, Azerspace–1 will provide television, radio and broadband services across Europe, Central Asia and parts of Africa. Azerbaijan will use 20 per cent of the satellite’s capacity, with the remainder being available for rental by other customers. Following his speech at the TEAS Business Forum 2013 in Paris, TEAS caught up with Rashad Nabiyev, Chief Executive and Chairman of the Board, Azercosmos, to learn more about Azerbaijan’s objectives in space: Why, at this time, did Azerbaijan decide to launch its space programme? The space programme forms part of Azerbaijan’s attempt to double its nonoil economy during the next decade. The Azerbaijani government’s visionary plan to transform the information and communications technology (ICT) sector into Azerbaijan’s second main business area has provided impetus towards integrating the advantages of space capabilities with the national development programme. By doing so, the Azerbaijani government aims to bring the country to a new stage of development regarding its economic power, intellectual capacity and information security. The use of satellite-based technologies will further enhance the Azerbaijani contribution towards regional development. The Azerbaijani decision to enter the space industry should be unsurprising, given the economic justification for the move. According to a 2012 report from the US Space Foundation, the global space industry was worth $290bn (£186bn) in 2011, equating to an increase of 12 per cent from 2010, and 41 per cent since 2006. In addition, the ICT sector in Azerbaijan has doubled every three years since 2004, which is 2.5 times more

June 2013

than the world average indices. This is clearly indicative of the real prospects for ICT-related growth and the urgent requirement to respond to the increased demand for satellite-based communication services. The strategy for building e-government systems across Azerbaijan and the need to bring reliable connectivity to the mountainous regions has necessitated the introduction of satellitebased services throughout the country. To what extent were Azerbaijani scientists involved in the design of Azerspace–1? One of the world’s leading space technology companies, Orbital Technologies, designed, built and tested the Azerspace–1 satellite at its manufacturing and test facility in Dulles, Virginia, USA. Azerbaijan has a 30-year history of space technology, due to its substantial participation in Soviet space programmes and aerospace projects. However, its space industry systems and space data receiving and processing technologies have become outdated. The State Programme on Development of the Space Industry in Azerbaijan, adopted in 2008, is essentially aimed at reviving the space industry through various measures, one of which involves training specialists in the space industry and satellite systems field, together with operating and using satellites. Given its lack of experience in the satellite industry, it is remarkable that, within a mere two years, Azercosmos has been able to recruit young talented specialists and train them in space-related fields. Azerspace–1 is now being entirely controlled by local Azerbaijani specialists from its own control centres. Azercosmos attaches great significance to capacity-building and the development of local specialists in the space sector in order to increase the potential of this industry. As a constantly evolving and resultsoriented organisation, undertaking various projects aimed at further development in the space sector, Azercosmos regards itself as being socially responsible for both

Azercosmos considers its close cooperation with Orbital Sciences to have been a complete success. It looks forwards to drawing on US expertise in the future, and working with US companies regarding its forthcoming satellite projects. The company is pleased to be contributing towards the growth of US businesses, and the development of the US market share in the sector. Why was Arianespace selected to undertake the launch of the Azerspace–1 satellite? During its short life before the launch of its first satellite, Azercosmos was able to attract companies from the US, France, Canada, and Malaysia regarding the manufacturing, launching, insurance and capacity-leasing of Azerspace–1. It also attracted finance from such international banks as EXIM and BNP Paribas. Arianespace, as the world’s first commercial satellite launch company, which is renowned for the reliability and availability of its family of launchers, won the contract for the launch of the satellite, as it satisfied Azercosmos’ selection criteria and launch requirements. Indeed, Arianespace demonstrated an impressive launch performance with regard to Azerspace–1. When did Azerbaijani scientists take over control of Azerspace–1? As planned, operational control of the spacecraft was handed to Azercosmos by Orbital after Azerspace–1 successfully completed its programme of in-orbit testing. Following the launch of Azerspace–1 on 7 February 2013 from the European Space Port, a team of Azercosmos and Orbital engineers undertook several weeks of tests to verify that all subsystems were operating as planned. As of 2 April, Azerspace–1 entered full commercial service and has subsequently provided a complete range of communications services. All satellite command and control operations are now being undertaken at control centres in Baku and the Nakhchivan Autonomous Republic. These facilities were designed and built by Azercosmos in support of the ground control systems provided by Orbital.

Personalities – Rashad Nabiyev


The positioning of Azerbaijan’s current and future satellites set against the backdrop of major ICT projects of regional importance

What services will Azerspace–1 provide? With its advanced design and switching capabilities and an anticipated service life of at least 15 years, Azerspace–1 is designed to tap into the massive demand for satellitebased communication services to provide high-quality broadband internet, data and broadcasting services, both in the region and beyond, covering the Caucasus, Central Asia, Europe, Middle East and Africa. The hybrid satellite generates approximately five kilowatts of payload power and carries 36 active transponders. It operates from an orbital location at 46° East Longitude through an arrangement between Azercosmos and MEASAT, providing Ku-band capacity over Europe and Central Asia; and C-band capacity over Africa, Central Asia, the MiddleEast and Europe. This satellite connectivity will transform the way by which millions of users across more than 50 countries can obtain information. However, this is not solely a question of connectivity – it a question of economic wealth. The development of the communications infrastructure brings new economic prospects and opportunities. It opens the doors of the global marketplace, stimulates the improvement of local education, and promotes overall development. You said at the TEAS Business Forum 2013 in Paris that Azerspace–1 is to be followed by a further observation satellite in 2015, and Azerspace–2 the following year. What additional facilities will these satellites provide? Alongside Azerspace-1, we plan to launch an Earth Observation low-earth orbiting satellite (LEO) in 2015, in addition to Azerspace–2,

the second communications satellite, in 2016. Azercosmos has already started its engagement and preparatory work regarding the manufacturing, launch and insurance of the LEO satellite, and work is well underway for the second telecommunications satellite. While Azerspace–2 will increase the capacity of telecommunication services, the LEO satellite will be used for agricultural and environmental monitoring, mapping, transport infrastructure, offshore oil exploration, and the managing of emergencies and natural disasters.

for them, and are undertaking the necessary groundwork for their development and use.

Azercosmos has begun construction work on the Multi-Mission Ground Station in Azerbaijan, together with developing the reception of high-resolution satellite images from other regional satellite operators. This will satisfy the demand for optical and radar satellite imagery in the regional market.

As for our second telecommunications satellite, Azerspace–2, negotiations between the Azerbaijani ICT Ministry and International Telecommunications Union (ITU), which started some years ago in order to develop an independent orbital slot for Azerbaijan, are continuing. However, Azercosmos is also considering alternative slots that belong to existing satellite operators. In the meantime, the company is proceeding with various assessments of Azerspace–2, the development of which will incorporate market feedback and the lessons learned from the first commercial activities on Azerspace–1.

Given the current growth rate of ICT in Azerbaijan, we also expect the future satellite projects to generate profits and for long-term costs to be negated. Azercosmos positions itself as the operator that is most able to satisfy customer requirements through its real presence in the region. Azercosmos will offer its services to both existing and emerging satellite markets, together with a visible comparative and competitive advantage that stems mainly from its flexible transaction costs and common language with the principal players in the regional markets. What is determining the specification of these satellites? It remains too early to assess the usable life of these two forthcoming satellites, as we are currently engaged in different activities regarding determination of the specifications

With regard to the LEO satellite, the application fields for remote-sensing satellites in Azerbaijan have been studied in detail in the wake of local and foreign market research. Consequently, relevant work has been undertaken to build the satellite, based on the existing demand, within the specified technical parameters. Currently, governmental assessments are being undertaken to choose the winning bid for procurement of the LEO satellite.

For more information, go to www.azercosmos. az


International Space Treaty membership finalised

According to Azercosmos, Azerbaijan has ratified the Treaty on the Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies. This agreement is aimed at accelerating development of the country’s activities in outer space, both from an economic and scientific perspective.

June 2013


Nagorno-Karabakh Conflict Minsk Group Co-Chairs continue contacts with both sides

John Kerry (right) met Elmar Mammadyarov, Azerbaijani Foreign Minister, at the US Department of State in Washington D.C.

US Secretary-of-State Kerry hints at ‘path forward’ AFP reports that John Kerry, US Secretaryof-State, has indicated the US will upscale efforts to achieve peaceful NagornoKarabakh conflict resolution. Speaking to Elmar Mammadyarov, Azerbaijani Foreign Minister, Kerry stated: “This is a ‘frozen conflict’ – as we call it – one that threatens the stability of the region and one with which we need to deal. The last thing we want is a return to war and to conflict. I believe there is a path forward, and we will continue to work quietly and patiently in an effort to try to encourage the parties to be able to take either confidence-building measures that may get you further down the road, or to find a way towards a settlement.”

Kerry recalled that both sides: “Have been close before and, at the last minute, things have happened that have denied everybody that opportunity.” Mammadyarov replied that, with the help of Washington D.C., Baku believed it could “successfully move forward” on many challenges, “including one of our biggest problems, the resolution with neighbouring Armenia, with whom we are definitely interested in living in peace, and with dignity.” The Minister said that his country wanted to leave the: “Negative outcome of the conflict... in the past. And we’ll look to the bright future of successful co-operation, living next to each other as a good neighbourhood.”

The OSCE Minsk Group Co-Chairs – Igor Popov (Russia), Jacques Fauré (France), and Ian Kelly (USA) and Ambassador Andrzej Kasprzyk, Personal Representative, OSCE Chairpersonin-Office – travelled to the South Caucasus on 23–24 May to continue their efforts towards the establishment of a negotiated peace. They met Azerbaijani President Aliyev in Baku on 23 May, and Armenian President Sargsyan in Yerevan the following day. The Presidents and Co-Chairs discussed developments since their last meeting, reiterated their commitment to the peace process, and expressed the need for a Summit in late 2013. The OSCE Minsk Group CoChairs expressed willingness to explore ideas for moving the process forward, and reiterated the need to avoid actions or rhetoric that could raise tensions or damage negotiations. They will meet both countries’ Foreign Ministers during the next few weeks to explore approaches to conflict resolution.

Bareiss: “Peace is a vital condition”

Thomas Bareiss, Christian Democratic Union member, German Bundestag and permanent member of the Committee of European Affairs and fellow party member Peter Tauber have issued statements on Nagorno-Karabakh. Bareiss stated: “The German Bundestag will contribute to the efforts towards achieving a sustainable peace agreement between the conflict parties in the Armenian–Azerbaijani conflict over NagornoKarabakh. In order to provide the displaced people of the South Caucasus with a permanent and safe return to their homeland, it is imperative to return the occupied Azerbaijani territories of Nagorno-Karabakh and the seven surrounding regions. Therefore we support the OSCE Minsk Group’s call for UN engagement. Two Iskander-M vehicles, photographed in Russia

Russia sends the latest missiles to Armenia Russia has deployed an advanced new missile system to its base in Armenia. Speaking to RFE/RL’s Armenian Service, the Armenian Defence Ministry confirmed that it had received “several” Iskander-M systems. This is a recently-developed Russian mobile (truck-mounted) theatre ballistic missile system, similar to the Scud system, but with a longer range of 400km and greater accuracy. Iskander-M systems will be stationed at the

Russian base in Gyumri.

Emil Sanamyan, a keen observer of ArmenianAzerbaijani defence issues and Washington Editor for The Armenian Reporter, told The Bug Pit that: “I see it as an effort to build up deterrence against the war in NagornoKarabakh and to increase the Russian footprint in the Caucasus, particularly in light of the closure of the Gabala Radar Station.”

19-year-old soldier shot dead The Azerbaijani Defence Ministry has reported that a soldier was shot dead on the Nagorno-Karabakh ‘contact line’. June 2013

Private Namig Gamidov, aged 19 years, was killed on 27 May by an Armenian sniper.

“All forms of displacement contradict the European Idea. In making the absolutely necessary effort towards a quick and sustainable solution of the conflict, we must consider the interests of the many Internally Displaced Persons (IDPs) and refugees. This is why, to uphold European interests, we are committed towards seeing the rapid implementation, not only of the decisions of the OSCE Minsk Group, but of all resolutions by the UN, the Council of Europe and the OSCE.” Tauber noted that the UN Security Council has repeatedly called on Armenia to withdraw from Nagorno-Karabakh, and that these calls had been reiterated by the EU and OSCE. He said: “While there is debate about the opening of the Khojaly Airport, the conflict in the occupied territories can escalate any time, as it is a major provocation against Azerbaijan.”


Nagorno-Karabakh Conflict comprehensive, co-operative, equal and indivisible security. We are convinced that the human dimension belongs to the core of the concept of comprehensive security.”

An Armenian soldier patrols in a trench on the ‘contact line’ near the town of Aghdere (Photo: Karen Minasyan)

New $30m road

provokes Azerbaijan

The Armenian government has outlined plans to construct a second main road to NagornoKarabakh. Tatul Hakobyan, Political Analyst with the Yerevan-based Civilitas Foundation, commented that if Armenia constructs a second main road to Nagorno-Karabakh, Armenia “will be more uncompromising about Kelbajar,” referring to the adjacent Azerbaijani region that the road will cross. The road will connect Gegharkunik, north-east Armenia, to Aghdere in northern NagornoKarabakh, passing through ShahumyanKelbajar, one of the Armenian-occupied regions surrounding Nagorno-Karabakh. Construction of the 114km road will begin in 2014, after the Hayastan All-Armenian Fund, financed by the Armenian diaspora, has raised $30m (£19.3m) to facilitate road construction, according to Gevorg Gevorgyan, Spokesman, Hayastan All-Armenian Fund.

He emphasised that achievement of progression on protracted conflicts remains crucial for the region’s security, which was why he visited Moldova as his first official visit as OSCE Chairperson. Speaking ahead of his planned visit to the South Caucasus from 17–20 June, Kozhara stressed his support for the OSCE Minsk Group Co-Chairs in promoting dialogue between the parties regarding the Nagorno-Karabakh conflict and underlined the need “for a strict implementation of the ceasefire.”

Ambassador Morningstar called for ‘second-tier diplomacy’ to be exerted to resolve the conflict


OSCE Minsk Group strengthening is necessary

Leonid Kozhara, Ukrainian Foreign Minister and Chairperson-in-Office, OSCE, meets William Hague, British Foreign Minister, in May 2013 (Photo: FCO)

OSCE Chair Ukraine stresses need for security

Speaking to the US Helsinki Office in Washington D.C., Leonid Kozhara, Ukrainian Foreign Minister, commented that the protection of human rights and fundamental freedoms are the main priorities of his country’s OSCE Chairmanship. Kozhara said: “Ukraine, as the Chair-in-Office, remains a consistent advocate of the OSCE concept for

H.E. Richard Morningstar, US Ambassador to Azerbaijan, has commented that the US seeks strengthening of the OSCE Minsk Group, which is currently brokering a negotiated settlement of the longstanding NagornoKarabakh conflict. Speaking to journalists, he said: “The US supports settlement of the Nagorno-Karabakh conflict. We know that the existing status quo, where there is occupation of a part of the country, is unacceptable. After nine months in Azerbaijan, I realise that the Nagorno-Karabakh conflict unites the Azerbaijani people, and that the tragedies of the conflict are the tragedies of the whole nation.” He continued: “I believe that the issue of strengthening the OSCE Minsk Group should be put on the agenda. Confidence-building steps should be taken for each of the countries involved. At a time when the people are not ready to make certain compromises for reaching peace, it will not be reached. Apart from the OSCE Minsk Group, the so-called ‘second-tier diplomacy’ should be applied. International and local NGOs should contribute to reaching peace.”

PACE President Mignon stresses conflict resolution need

Jean-Claude Mignon, President, Parliamentary Assembly for the Council of Europe (PACE) has indicated optimism regarding settlement of the Nagorno-Karabakh conflict. During a meeting with Cemil Çiçek, Turkish Parliamentary Speaker, in Ankara, Mignon recalled that Armenia would begin to chair the Committee of Ministers of the Council of Europe in a few days. He said: “It is a term presidency for six months. Immediately after this, Austria and then Azerbaijan’s term presidency will come. It must be seen as an absolute opportunity. It must be seen as an opportunity to bring about a solution to the Nagorno-Karabakh issue, in collaboration with the great countries in the region, and primarily with Turkey.” The Sarsang Reservoir in NagornoKarabakh has not been maintained for over 20 years

400,000 people placed at flooding risk

The Turkish Water Department, working in conjunction with international engineers, has mapped out a “catastrophic flood” scenario resulting from the dilapidated Sarsang Reservoir in Nagorno-Karabakh. If this fails, it is predicted that 400,000 people living downstream will be affected. The 125m-high dam was built in 1976 and is overdue for maintenance, which has not been undertaken by the occupying forces. Engineers and hydrologists from the firms Su-yapi, Chartis and the Turkish Water Department predict that, in the event of collapse or sabotage, a wall of water up to 65m in height and travelling at between 100 and 200km/h, would swamp the plains below and completely submerge 20 villages. An Azerbaijani government spokesman said: “Such a flood would be an absolute catastrophe. Armenia has neglected all maintenance on the Sarsang dam, in total defiance of international safety standards.” Elkhan Suleymanov, Azerbaijani MP, added: “Imagine if something goes wrong with that reservoir, the adjacent seven regions will be obliterated, blotted out from the earth. This means that up to 400,000 people are in imminent danger.” The study found that the path of the water would sweep along the Terter riverbed and the effects would be felt 48km from the base of the dam.

June 2013


Business News

Charles Hendry, Prime Minister’s Trade Envoy for Azerbaijan, Kazakhstan and Turkmenistan, delivered a congratulatory message from UK Prime Minister David Cameron (Photo: Iteca Caspian)

Caspian Oil and Gas

brings industry leaders to Baku

The 20th annual Caspian Oil and Gas Exhibition and Conference, organised by the ITE Group and Iteca Caspian, took place in Baku from 4–7 June, attracting oil and gas industry leaders from around the world. The first exhibition was held in 1994, just prior to the signing of the Contract of the Century, which determined the main development areas for Caspian resource extraction. In addition to Azerbaijani President Aliyev, VIP guests included Kakha Kaladze, Georgian Energy Minister; Charles Hendry MP, the Prime Minister’s Trade Envoy for Azerbaijan, Kazakhstan and Turkmenistan; and Gunnar Oom, State Secretary of the Swedish Ministry of Trade. Altogether, 386 companies from 28 countries were in attendance, including oil and gas field developers and service providers. National representations from Germany, China, Russia, Turkey and the UK, amongst others, were in attendance. The General Sponsor was SOCAR, and the Gold Sponsors were BP Azerbaijan and Statoil. When compared with the 2012 event, exhibition space grew by 22 per cent and total exhibitor numbers by 25 per cent, according to Iteca Caspian. Altogether, 20 per cent of exhibitors were companies that had never previously been active in the Azerbaijani marketplace. Local companies accounted for 30 per cent of all exhibitors. Oettinger supports all pipeline options In a message sent to attendees, Günther Oettinger, EU Energy Commissioner said that Azerbaijan is currently playing an essential role as an oil supplier, and will perform a similarly pivotal role in providing gas supplies to Europe. The message, read out by Roland Kobia, Head of the EU Delegation to Azerbaijan, stated that significant progress had been made regarding construction of

June 2013

the Southern Gas Corridor of pipelines. He said: “Currently we are waiting for the final decision on a pipeline route.” The Shah Deniz Consortium is currently deciding between the Trans-Adriatic Pipeline (TAP) and Nabucco West for gas exports to European markets.

The Trans-Caspian Gas Pipeline, running around 300km, will be laid from the Turkmen coast of the Caspian Sea to Azerbaijan, where it will be linked to the Southern Gas Corridor. It will have an annual capacity of 30–40bcm of gas.

The Consortium will make its final decision on the pipeline route in June, and a final investment decision will be made in October. TAP will transport gas from to southern Italy and further into western Europe. Its initial annual capacity will be 10bcm per year, but will be easily upscaled to 20bn m3 (bcm). Nabucco West, a reduced version of the Nabucco project, envisages construction of a pipeline from the Turkish–Bulgarian border to Austria. In both instances, the gas will be sourced from the Shah Deniz II development, which is expected to come on-stream by 2018.

His comments were re-echoed by Amos Hochstein, US Deputy Assistant Secretaryof-State for Energy Diplomacy, who said: “Opening of the Southern Gas Corridor will change the energy map of our continent.” He stated that this would be an important link for delivering Caspian gas, initially from Azerbaijan’s Shah Deniz field, then from Turkmenistan, and hopefully from northern Iraq, to Europe. Hochstein continued: “The US will support either pipeline selected by the Shah Deniz Consortium. We believe that the pipeline that is selected will diversify energy supplies to Europe.” H.E. Richard Morningstar, US Ambassador to Azerbaijan, said that Azerbaijan had become a strong country that makes a significant contribution to global energy security.

Rovnag Abdullayev, President, SOCAR, predicted that Azerbaijani gas production would reach 20bcm by 2015 (Photo: Iteca Caspian)

Oettinger went on to express hope that eventually there would be investors for both projects. He commented that Shah Deniz gas would be the first to be transported through the Southern Gas Corridor, saying: “This will be just the beginning, not the end. We see the Southern Gas Corridor as a multistage project, and the EU expects more gas from other sources, such as Turkmenistan, to be transported through this Corridor. We will continue the negotiations with Azerbaijan and Turkmenistan on the Trans-Caspian pipeline. We expect agreements to be reached in the nearest future.”

He explained that Azerbaijan contributes to the energy security of the world through the Baku–Tbilisi–Ceyhan (BTC) oil pipeline, adding that Azerbaijan will make an additional contribution to energy supplies by expanding the Southern Gas Corridor. Cameron: Close friend and partner of Azerbaijan On 4 June, Charles Hendry, former UK Energy Minister and the Prime Minister’s Trade Envoy for Azerbaijan, Kazakhstan and Turkmenistan, delivered a personal message of congratulation from UK Prime Minister David Cameron to the Azerbaijani people. Cameron said that he welcomed the “strong bilateral relationship” that exists between the UK and Azerbaijan, and emphasised the importance of trade agreements between the two countries. He stressed that the UK remains the largest provider of foreign direct

Business News

Vanessa Raine, Business Co-ordinator, TEAS, on the TEAS stand at the exhibition

investment in Azerbaijan, with UK companies continuing to invest heavily in the oil and gas sectors. The development and strengthening of Azerbaijan’s role as a provider of energy resources to Europe and other world markets was also highlighted, with Cameron commenting that Azerbaijan would play a central role in global energy provision in the years to come. He spoke of his delight that BP had been able to play a close part in the Azerbaijani energy exploration process. Prime Minister Cameron said: “2013 will be an important year for the realisation of the Southern Gas Corridor project, with the continued development of the worldclass Shah Deniz field, and a number of key decisions being made on the final pipeline route to Europe. However, much work still needs to be done to realise that this ambition can become reality.” Cameron went on to describe himself as “a close friend and partner” of Azerbaijan. Gas output to reach 20bcm by 2015 Rovnag Abdullayev, President, SOCAR, has revealed that Azerbaijan could potentially increase annual gas production to 20bcm by 2015. He said: “This achievement is able to increase Azerbaijan’s position regarding European energy security.” SOCAR is currently undertaking commercial talks across Europe with potential buyers of Azerbaijani gas.

He continued: “Now, we are analysing all variants and assessing all gas price and transit tariff-related proposals.” Abdullayev concluded that the final decision regarding the route for Azerbaijani gas exports to Europe would be made at the end of June. He also pointed to the intensive talks being undertaken with the Turkish government regarding agreements relating to the TransAnatolian gas pipeline (TANAP), which has a projected annual capacity of 16bcm. He commented: “In all, the gas pipeline is the only acceptable alternative route for the supply of natural gas to Europe.” Abdullayev added that TANAP construction would start in 2014, whilst gas supplies to Europe are expected to begin in 2019. BP projects reach $40bn Speaking at the event, Gordon Birrell, Regional President, Azerbaijan, Georgia and Turkey, BP, revealed: “Within the framework of investment projects in Azerbaijan, BP and its partners have invested $40bn (£25.7bn). A reliable and safe system of oil and gas export pipelines has been created.” Birrell went on to explain that the Western Chirag platform on the Chirag field, located in the Azerbaijani sector of the Caspian Sea, would be launched by the end of the year. He said this would be constructed between the Chirag and Deepwater Guneshli platforms. Birrell explained that BP is to continue to invest in the Azeri–Chirag–Guneshli (ACG) offshore block, and that this will be the eighth platform in the ACG fields, from which the first oil would be extracted by the end of 2013. Earlier, during the signing of a BP cooperation agreement with the Azerbaijani National Olympic Committee, Birrell stated that the ACG fields had produced 2.2bn barrels of oil, to date. He also stated that some 1.7bn barrels of oil have been transported via the BTC oil pipeline. Birrell noted that, Some of the world’s leading energy companies were present (Photo: Iteca Caspian)


at present, the Shah Deniz Consortium is developing the Shah Deniz gas condensate field, and that around $25bn (£16bn) of investments will be made there, creating the conditions to transform Azerbaijan into one of the major European gas suppliers.

SOCAR signs $800m Keppel rig deal

Energy specialists Platt’s reports that the Caspian Drilling Company, a SOCAR subsidiary, has signed an $800m (£515m) contract with the Singaporean company Keppel Offshore and Marine, through its Caspian Rigbuilders subsidiary, to construct a new offshore drilling rig, being the first in a new generation of rigs. Scheduled for delivery during the final quarter of 2016, the semi-submersible DSSTM 38M rig will be built to drill in the harsh conditions of the Caspian Sea, at depths up to 12,000m below the seabed and in 1,000m of water. The rig will drill for gas at SOCAR’s Babek field, which the company has indicated could contain up to 400bcm of gas and 80m tonnes of condensate, according to Khoshbakht Yusifzade, First Vice-President, SOCAR. He also revealed that a further deal would be signed regarding a second rig, to be built by Keppel at its Baku shipyard. In a statement, Rovnag Abdullayev, President, SOCAR, said: “We are keen to expand our offshore drilling programme to drill wells, such as the Babek and Absheron fields, in addition to the Shah Deniz field. We have ordered the first of our new next-generation rigs from Keppel. We are confident that the Keppel-designed rig is a robust and efficient rig that will increase our offshore drilling capabilities.” SOCAR is currently prioritising expanding export-oriented production at such new fields as Absheron and Shah Deniz II, which should produce 16bcm of gas per annum from 2017. However, it has been acknowledged that rig and infrastructure shortages are currently delaying plans to develop around 2 trillion m3 of proven gas reserves in the Caspian Sea. Azerbaijan recently stated that it is looking to spend around $4bn (£2.6bn) on new rigs to overcome a critical shortage, which has impacted the exploration and development of such fields as Umid and Absheron, where hydrocarbons have already been found. Those international companies currently working to develop Azerbaijan’s considerable offshore prospects argue that at least three new additional rigs are required, as existing rigs are currently tied up in the development of the ACG oil field and the Shah Deniz gas field.

June 2013


Business News Azerbaijani economy – attractive for overseas investment

The Azerbaijani economy and banking sector retained its attraction for foreign investment during the first quarter of 2013, according to a report by the Central Bank of Azerbaijan (CBA) regarding financial stability. During this period, the amount of funds received from non-resident banks and international financial institutions increased by 1.9 per cent, equating to AZN2.3bn (£1.9bn).

A suite in the Embawood ‘Perestroika’ range

$12m EBRD loan for leading furniture producer The European Bank for Reconstruction and Development (EBRD) has provided a $12m (£7.7m) loan to Embawood, the leading Azerbaijani furniture manufacturer, for factory development. This should improve quality levels, and also enhance energy efficiency at its three production units. The EBRD loan will be complemented by €120,000 (£102,047) of EBRD Technical Co-operation Funds, provided by the Early Transition Countries Initiative and the Regional Energy and Resource Efficiency Programme for the Corporate Sector. Azerbaijan-headquartered Embawood is the largest manufacturer and retailer of home and office furniture in Azerbaijan. It owns seven factories, three of which are based in Azerbaijan, with two in Georgia and one each in Ukraine and Uzbekistan. Embawood is represented in 10 countries via a retail network of around 200 shops. The EBRD started working with the company

in 2003 through its Business Advisory Services (BAS) and Turn Around Management (TAM) programmes. Paul-Henri Forestier, Director: Caucasus, Moldova and Belarus, EBRD, said: “We are pleased to expand our co-operation with Embawood, helping to further strengthen the company’s operations. We are particularly glad to support our client’s efforts regarding the control of production quality, and to make its facilities more energy efficient with our funds. This is a further demonstration of the company’s commitment to quality, good corporate governance and social responsibility.” To date, the EBRD has signed 131 investments worth more than $2.1bn (£1.4bn) across various Azerbaijani economic sectors. The evolving Azerbaijani manufacturing and services segment provides great opportunities for enhancing economic diversification – one of the core EBRD priorities.

The report stated: “Along with that, the volume of funds drawn from abroad was retained at an acceptable level, accounting for 14.9 per cent of the total commitment.” According to the CBA, the share of domestic assets in the banks’ resource base also remained high. During the first quarter, deposits in the banking system grew by 8.3 per cent, reaching AZN5.6m (£4.6m), with their share of total liabilities reaching 35 per cent. The CBA established that there have been positive changes in the structure of deposits. Those deposited for under a year amounted to AZN2.1bn (£1.7bn) during the reporting period, signifying an increase of AZN34.2m (£28m) since January. The volume of longterm deposits (exceeding a year) increased by AZN286.2m (£234.8m), amounting to AZN2.3bn (£1.9bn) altogether.

Azerbaijan to manufacture first fibre-optics Isfandiyar Aliyev, Head of Strategic Development, Azerbaijani Ministry of Communications and Information Technology (ICT) has revealed that Azerbaijan will soon begin production of fibre-optic cables to meet local demand. Mr Aliyev said that negotiations are currently being undertaken in collaboration with an Austrian company that will undertake factory construction. Capacity will meet local domestic demand with some export capacity. It is anticipated that demand for fibre-optic cables will increase substantially, due to the project to develop broadband internet in Baku and the Azerbaijani regions. He said: “It is important to provide quality broadband, which is supplied using fibreoptic cables.” He noted that internet tariffs had reduced in recent years, and were now almost equal with those in Western Europe. Aliyev continued: “Instances of high internet tariffs are quite unusual, unlike the situation five or six years ago. Internet service June 2013

providers are gradually increasing internet speeds, while retaining the existing level of tariffs. Whilst currently using internet at the speed of 2 Megabytes per second (Mbps) costs AZN10 (£8.19) per month, over time the consumer may receive increased speed of 3.5Mbps or more at the same price.” The State Oil Fund of the Republic of Azerbaijan (SOFAZ) has allocated AZN103m (£84.4m) to the development of broadband internet across the country this year, together with future funding for maintenance and upgrades. It is anticipated that all Azerbaijani regions will be provided with broadband internet by 2017 as part of the Fibre to the Home (FTTH) project, using fibre-optic technology. During the past three years, Azerbaijan has reached a leading position amongst CIS countries in terms of broadband internet penetration. This reached 70 per cent in 2012, amounting to a five per cent increase on the previous year.

The Central Bank of Azerbaijan headquarters in Baku (Photo: Reuben Martinez)

The CBA also stated that the quality of the loan portfolio in the domestic banking sector during Q1 2013 remained acceptable. The CBA concluded that its stress tests, undertaken on a regular basis, demonstrate that preventive control and improvement of risk management systems in the banking sector can be maintained at an adequate level of asset quality. It states: “Maintaining liquidity at an acceptable level and the ongoing process of capitalisation of banks increases the resistance of the system to possible shocks.”

Business News


(from left) Zafer Caglayan, Shahin Mustafayev and Giorgi Kvirikashvili stressed the ongoing need for economic collaboration (Photo: AZPROMO)

Azerbaijani investments in Turkey to almost quadruple, says Minister

Speaking at the third joint Azerbaijan– Georgia–Turkey Business Forum in Gabala, Shahin Mustafayev, Azerbaijani Minister of Economic Development, stated that Turkey remains the leading destination for Azerbaijani overseas investments, predicting that SOCAR investments alone would reach $17bn (£10.9bn) by 2018. The forum was also attended by Giorgi Kvirikashvili, Georgian Minister for Economics and Sustainable Development; Zafer Caglayan, Turkish Economics Minister; and Halil Akinci, Secretary-General, Co-operation Council for Turkic Speaking States, together with more than 250 business people. Caglayan said: “The total population of the three countries equals 87m people, with a total annual national income of $868bn (£558.7bn), and total foreign trade turnover of $440bn (£283.2bn).” Mustafayev commented that the three countries in combination play an essential role in ensuring European energy security, and that the region’s importance is rapidly developing. He explained that Turkey is a major player in the Azerbaijani non-oil sector: “Turkish companies in Azerbaijan are working as contractors and subcontractors on projects worth $4.7bn (£3bn). In recent years, Turkish investment in the Azerbaijani non-oil sector exceeded $1.5bn (£965,431), making it the leading foreign investor in that sector.” Currently, 2,000 companies with Turkish capital operate in Azerbaijan, accounting for 36 per cent of all foreign companies operating in the country. According to Mustafayev, over 1,100 Azerbaijani companies are currently active in Turkey. With regard to Azerbaijani–Georgian economic relations, Mustafayev revealed that Azerbaijani investments in the country amounted to $210m (£135.2m) during the past two years, being mainly active in the energy, tourism, construction, industry and other sectors, with SOCAR activities in Georgia creating 7,700 new jobs. He said: “The trade turnover between the two countries increased by 12 per cent in 2012. Around 150 Georgian companies operate in Azerbaijan, and around 300 Azerbaijani entrepreneurs are working in Georgia.”

Speaking of the Baku–Tbilisi–Kars (BTK) railway, currently under construction, Mustafayev said that the three countries should collaborate to maximise use, once this is completed later this year. He said: “In the future, we should expand supply deliveries on the BTK railway, and seek to attract the maximum cargo volumes. Today, there is tough competition, and we must strengthen the role of the transit corridor. The launch of BTK will create favourable conditions for cargo transportation from Asia to Europe.”

Zafer Caglayan predicted that Azerbaijani investments in Turkey would virtually quadruple. He said: “According to our estimates, Turkish companies have invested $6.5bn (£4.2bn) in the Azerbaijani economy. The volume of Azerbaijani investments in Turkey stands at $4bn (£2.6bn), and we expect this to increase to $15bn (£9.7bn) in the next few years. This will be achieved through the implementation of oil and chemical projects.” Caglayan informed journalists that Azerbaijan and Turkey are currently working to develop a free trade agreement. He said: “This will significantly simplify the trade operations as well as increasing the volume of bilateral trade.” In 2012, trade turnover between Azerbaijan and Turkey amounted to $2.1bn (£1.4bn). Turkey ranked first among the foreign trade partners of Azerbaijan in terms of imports, which accounted for 15.8 per cent of total Azerbaijani imports. He said that Turkish companies have invested $1.1bn (£708.3m) in projects in Georgia, whilst Georgian investments in Turkey amounted to $23m (£14.8m). He said: “The economies in the three countries have high growth prospects. They have demonstrated resilience to the economic crisis, whilst many developed countries have suffered great losses. We need to develop a solid potential for co-operation between the three countries.” Giorgi Kvirikashvili, Georgian Economics Minister, said that, during the past decade, both Azerbaijan and Turkey have considerably increased their Georgian investment portfolio.

In addition, there are great opportunities to continue investing in Georgia, and he stated: “The objective of our government is to further improve and simplify the investment and business environment in the country.”

EBRD – 3.5 per cent GDP growth predicted

The European Bank for Reconstruction and Development (EBRD) has predicted that Azerbaijani economic growth will accelerate during 2013. According to the EBRD’s Regional Economic Prospects in EBRD Countries of Operation report, May 2013, the Azerbaijani economy slowed, as the pace of oil extraction decelerated.

The Azerbaijani economy will experience continued expansion this year (Photo: Retlaw Snellac)

According to the report, the decline of oil output has been more than offset by the encouraging growth of the non-oil sector, led by construction and services. The report stated: “Some recovery of the oil sector and continued expansion of the non-oil economy should lead to an acceleration of output growth in 2013.” The EBRD continues by stating that immediate macroeconomic risks will be mitigated by a very strong fiscal position, partially due to oil reserves. The EBRD went on to predict Azerbaijani GDP growth at 3.5 per cent in 2013 and 4 per cent in 2014. The EBRD also stated that inflation would amount to 3.4 per cent in 2013, although it was only 0.7 per cent in 2012. To read the full report, go to http://bit. ly/ebrdresearch. June 2013

June 2013

TEAS Magazine June 2013 (English)

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