Oil crisis to enable West to press Azerbaijan - Alexander Iskandaryan
Azerbaijan is facing a rather deep economic crisis, which will last for a long period, director of the Caucasus Institute Alexander Iskandaryan told reporters on Friday.
Azerbaijan is in a situation similar to that in the early 1990s.
“Economic developments are directly linked to political developments,” Mr Iskandaryan said.
Early this year Azerbaijan’s Central Bank reduced the reserves nearly three times, gold reserves, with a consistent decline in oil prices.
“It is not a short-term crisis. It will last for years depending on oil prices,” the expert said.
The current situation is linked to global geopolitical processes.
“Further developments are difficult to forecast. What further decline in oil prices should be expected? But Kazakhstan has reduced the oil price to US $20 per barrel, which is serious. They have no money,” Mr Iskandaryan said.
Azerbaijan’s authorities are not implementing an economic policy as Azerbaijan’s economy depends on oil “ninety-five percent,” which is higher than in Russia.
“I am not an economist, and I cannot judge as a professional. It involves major global processes and Iran. Azerbaijan is running out of money, and it has pursued an unwise economic policy during this oil year.
They increased oil exports and purchased expensive cars, constructed buildings, organized propaganda actions, without any economic reforms. Economists cite different figures, saying that the country’s economy depends on oil and gas ninety-five percent. It is a global crisis. Azerbaijan is facing economic collapse,” Mr Iskandaryan said.
He also points out gross mismanagement.
“They are shutting down exchange offices, arresting people that dare to raise prices in village shops. They are trying to deal with the declining oil prices detaining ‘profiteers’ as their mass media say. This is a grossly incompetent policy, and it is strange. They should have realized what could happen, and all economists had forecast it. They are behaving as if they have just encountered this problem. And social riots are a natural consequence,” Mr Iskandaryan said.
For some reasons, people in Armenia think Azerbaijan is a rich state, with no problems. But it is not so. Azerbaijan is a state with a huge gap between the rich and poor.
“They have done away with opposition political forces, and this conduct will only exacerbate the crisis. If a country has done away with the press to the extent Azerbaijan has done, the authorities will never get any information on what is going on in society. I do not think Azerbaijan has time for Nagorno-Karabakh now”
Speaking of a statement by Armenia’s Deputy FM Shavash Kocharyan that the OSCE Mink Group co-chairs consider it necessary to find a new solution to the Nagorno-Karabakh conflict, the expert said:
“Azerbaijan is blocking the talks and is not ready for any concessions. And the talks about their offering us a compromise are absurd. On the other hand, the talks about all the co-chairs seeking control over border incidents are generally true.
“But I do not think the technical means will bring anything new. The situation on the border is clear. It is common knowledge – and the co-chairs know it as well – that it is Azerbaijan, not Armenia, that provokes fire. It is also clear that Azerbaijan is not going to make any concessions. It is crystal clear that Azerbaijan will torpedo the measures to establish control over fire on the border just as they torpedoes withdrawal of snipers. Of course, no changes in the Nagorno-Karabakh format can take place, and the conflict cannot be settled. The co-chairs’ aim is now to support the Minsk Process to maintain the balance and status quo.
“I have one question I cannot answer, because the answer is an economic one. The point is that the West and Russia have very few instruments for pressing Azerbaijan. And Azerbaijan could turn a deaf ear to them. But I am saying in the past on purpose, because the west has very few means of pressing Azerbaijan that has much money, but the situation is changing now. And a change of the political situation surrounding the Nagorno-Karabakh conflict depends on how deep the oil crisis is going to be. If the oil prices go down to US $15 per barrel, I think the West will be able to start pressing Azerbaijan.”
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