The EU Business Climate Report 2017 was launched during the recent EU-Azerbaijan Business Forum on 8 June 2017. The survey aims to assess the current conditions for doing business in Azerbaijan, highlighting key reform achievements and remaining bottlenecks.
Improvements made but economy still weak
Despite notable improvements in the EU businesses' perception of the economic situation over the past year, the majority still consider the national economy as weak. The findings of the survey suggest that concerns about the fragile economy and a low level of government investments continue weighing on many EU companies operating in Azerbaijan this year. The sluggish economic outlook emphasises the need for more comprehensive economic policies and their implementation to support the diversification of the economy.
This year, improvement in the customs system and immigration policies (referring to the e-visa in particular) was positively assessed. Since many EU businesses express a lack of confidence in the local judicial system and report the tax system as the main point of concern for their business operations, structural reforms in these areas remain a priority. Moreover, discussions suggest that additional measures to enhance the human resource base through improved academic education and vocational training would promote opportunities for the private sector in general and small and medium-sized companies in particular.
Long-term outlook more positive
Consistent with the projected moderate recovery of the Azerbaijani economy in 2018, the European companies' longer-term outlook for revenue growth is positive. Thus, if genuinely implemented, the government´s Strategic Roadmaps are expected to alleviate the economic uncertainty and important downside effects of the financial sector, and stimulate the business environment in Azerbaijan.
It is important to note that the EU Business Climate Survey Azerbaijan 2017 was conducted soon after the launch of the Strategic Roadmaps and therefore, the real outcome of this long-term government agenda can be gauged with the implementation of annual assessments of the business and investment climate in Azerbaijan.
The second business survey was carried out by the German-Azerbaijani Chamber of Commerce (AHK Azerbaijan), with support of the EU.