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Polish Minister on prospects of cooperation with Azerbaijan: from investments, shipbuilding to participation in transport corridors - INTERVIEW

Polish Minister on prospects of cooperation with Azerbaijan:

Report's interview with Jerzy Kwiecinski, Minister of Finance, Investments and Development of Poland.

How do you assess the current level and future prospects of economic relations between Poland and Azerbaijan? Which sectors of the Azerbaijani economy may be attractive to Polish investors?

In 2018 Polish-Azerbaijani trade turnover amounted to 94.6 million USD, including Polish exports of 80.7 million USD, and supplies from Azerbaijan to Poland of 13.9 million USD. Despite the upward trends (in 2018 the increase in trade amounted to + 11.4%), the current level of trade in goods is not high. The investment projects of entrepreneurs in both countries have not reached the implementation phase. This situation does not correspond to the potential and economic possibilities of Poland and Azerbaijan. We hope for an increase in Polish-Azerbaijani economic cooperation. Stable contacts between the two countries should suport it.

In recent years there have been a number of meetings aimed at developing the economic cooperation between Poland and Azerbaijan. In June 2017, the visit of the President of Azerbaijan to Poland took place. During the visit the Joint Declaration on the Road Map on Strategic Partnership and Economic Cooperation was signed. In September 2018, the chairman of the Azerbaijani part of the Polish-Azerbaijani Intergovernmental Commission for Economic Cooperation, the Minister of Emergency Situations K. Heydarov paid a visit to Poland. In December 2018, Azerbaijan's Minister of Economy S. Mustafaev paid a working visit to Poland. In February 2019, at the invitation of the Ministry of Entrepreneurship and Technology, a delegation of management of the Port of Baku visited Poland, and in March 2019 a trade mission of over 20 entrepreneurs from Poland visited Azerbaijan. In May 2019, the President of the Republic of Poland, A. Duda visited Azerbaijan.

We hope that active economic dialogue will result in the realization of investment projects and commercial contracts.

In the opinion of Polish entrepreneurs, there are many prospective directions of cooperation that include, among others, transport and logistics, construction sector, chemical industry, shipbuilding industry, agricultural machinery and technologies, urban transport means, pharmacy, as well as conventional and renewable energy sector and environmental projects.

The creation of the Alat Free Economic Zone in the Port of Baku may create additional cooperation opportunities.

What areas of trade and economic cooperation between Azerbaijan and Poland show the greatest progress and what directions between Azerbaijan and Poland have a bigger potential for growth?

In 2018 Polish export to Azerbaijan increased by 12.2% and amounted to 80.7 million USD, while Polish imports increased by 6.9% and reached 13.9 million USD. The most important in Polish export are products of the electromechanical industry (combine harvesters, equipment for the food industry, refrigeration equipment, medical apparatus), agri-food products (cheese, frozen potato products), chemical industry products (toothpastes, medicines). When it comes to imports of products from Azerbaijan, the largest increases are recorded in the agri-food sector (high importance of hazelnuts and juices) and mineral products. We hope that the business support structures created in both countries will contribute to the development of Polish-Azerbaijani trade and investment cooperation.

What are the opportunities for expansion of cooperation in shipbuilding? Are negotiations underway in this area?

In our opinion the shipbuilding and port industry of Azerbaijan, in particular Baku and Alat, has enormous development potential, both for the country itself and for large neighboring countries. Polish enterprises in this sector have experience and traditions in cooperation with the Azerbaijani shipbuilding sector, and hence the Polish offer for future development projects in Azerbaijan can be very interesting. Polish shipbuilding companies remain open for cooperation and are ready to offer the Azerbaijani side, according to their demand, comprehensive technological solutions for the construction of ferries, patrol vessels, tugs, structures from the offshore sector and other types of vessels.

President of Poland Andrzej Duda during his visit to Baku noted that Poland is interested in participating in transport corridors and in developing the Middle Corridor (Trans-Caspian International Transport Route). How can Poland benefit from participating in this project and what in particular are the goods transported along this route?

Cooperation between Poland and Azerbaijan for the improvement and development of transport corridors connecting Europe and Asia using the logistics infrastructure of both countries, in particular the Polish national Railways’ broad-gauge line (PKP LHS) and terminals in Sławków, will enable the proper use of the transport potential of both countries. The Trans-Caspian International Transport Route (TMTM) is a project of particular importance for achieving this goal. Thanks to the constant activity of the entities involved in this project, on the Polish side it is PKP LHS, it was possible to carry out test transfers, and recently regular feeder connections were launched in the Black and Caspian seas. From the infrastructure side, the route is ready to handle goods. Transport rates can be found on websites dedicated to this route and on the websites of particular carriers. The TMTM creates additional opportunities for transport of goods in the Asia-Europe-Asia route, in particular for goods that cannot be transported on the Trans-Siberian routes, but not only. This route can be used to transport a wide range of agri-food products, metallurgical products and many more. TMTM participants continually strive to improve transport conditions as well as their offer to customers.

During the visit of President Andrzej Duda to Baku in May 2019, six cooperation agreements were signed. They indicate the possibilities of cooperation between countries f.e. in agricultural machinery and playground equipment sectors. In addition, entrepreneurs' conversations conducted during the business forum which accompanied the presidential visit, show the possibilities of cooperation in the field of pharmacy and medical equipment, construction and cosmetic products.

Structures for supporting entrepreneurs have been created in both countries. In 2018 in Baku the Foreign Trade Office of the Polish Investment and Trade Agency was created. It supports Polish entrepreneurs and deals with an economic promotion of Poland in Azerbaijan. Whereas in Poland works the Azerbaijani Trade Representation for Central Europe and the Azerbaijan Department Store. They help Azerbaijani entrepreneurs in cooperation with Polish partners.

The promotion of Polish health-related services is also planned during the BIHE Healthcare Exhibition in Azerbaijan in 2020.

How attractive do you find the business environment for Polish entrepreneurs in Azerbaijan after the economic reforms carried out in recent years?

Economic reforms carried out in Azerbaijan in recent years, such as simplification of procedures for obtaining the necessary permits, facilitation of the registration of enterprises, as well as the possibility of getting an electronic visa, have simplified the operating conditions for foreign entrepreneurs.

What are the prospects for investing by Poland (Polish entrepreneurs) in the projects of Azerbaijan, both domestically and abroad?

The interest of Polish entrepreneurs in the Azerbaijani market has focused on the construction and agri-food sectors so far. Polish companies have been paying close attention to the specializations of Azerbaijani parks and industrial zones. Hence, cooperation opportunities also include shipbuilding, waste processing, light industry, furniture, as well as the chemical industry, energy, agriculture and food processing. We also see perspectives for development of cooperation in the infrastructure projects carried out in Azerbaijan. Polish entrepreneurs are interested in the free customs zone which is being created in the Port of Alat.

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