Exploring Wealth: Azerbaijan Vs Turkey

Azerbaijan and Turkey are both countries with majority-Turkic and majority-Shia Muslim populations. Azerbaijan is a secular nation, while Turkey is a presidential republic. Both countries have complex political histories, with Turkey having experienced several military coups and Azerbaijan having been ruled by the Aliyev family since Heydar Aliyev became president in 1993.

Azerbaijan's economy is highly dependent on oil and gas exports, with the industry making up two-thirds of its GDP. In contrast, Turkey's economy is driven by its industry and service sectors, although its agricultural sector still accounts for about 25% of employment.

While both countries have experienced economic growth, they also face challenges. Azerbaijan's economy is characterised by corruption and inequality, with wealth concentrated in the hands of the ruling elite. Turkey, on the other hand, has seen a recent period of political uncertainty and security concerns, which have impacted its economic outlook.

In terms of GDP, Turkey's is significantly larger at $2.37 trillion compared to Azerbaijan's $144 billion. However, when looking at per capita income as a percentage of the USA, Azerbaijan is higher at 28.5% compared to Turkey's 14.4%.

Therefore, while Turkey's overall economy may be larger, when adjusted for population, Azerbaijan appears to have a higher standard of living.

Azerbaijan's energy sector

Azerbaijan is a major producer of oil and gas, with two-thirds of its energy coming from fossil gas and almost a third from oil. The country has 7 billion barrels of oil reserves, accounting for 0.4% of global reserves, and 1.3 trillion cubic meters of proven natural gas reserves. The Azeri-Chirag-Deepwater Gunashli (ACG) field, located about 100 km east of Baku, is the largest oil field in the Azerbaijan sector of the Caspian Basin and is responsible for about 65% of the country's current oil production.

Azerbaijan has a long history of oil production, dating back to 1847 when the world's first industrially drilled oil well was established in the country. By 1899, Azerbaijan produced half of the world's oil volume. Today, most of Azerbaijan's oil is exported through the Baku-Tbilisi-Ceyhan (BTC) pipeline, which began operations in 2006 and has a capacity of 1.2 million barrels per day. The country also has two other major oil pipelines: the Baku-Novorossiysk pipeline and the Baku-Supsa pipeline.

In addition to oil, Azerbaijan has become a significant natural gas producer in recent years. The country's largest gas development is the BP-operated Shah Deniz field, which supplies gas for the Southern Gas Corridor (SGC) pipeline to Europe. The SGC is a major energy project that aims to deliver 10 billion cubic meters of gas from Azerbaijan to Europe through Georgia and Turkey. The SGC is comprised of three parts: the South Caucasus Pipeline Expansion (SCPX), the Trans Anatolian Pipeline (TANAP), and the Trans Adriatic Pipeline (TAP).

Azerbaijan is also pursuing wind and solar projects and aims to increase the share of renewables in power production to 30% by 2030. The country has implemented various concessions to promote the development of renewables, including tax exemptions and customs duties exemption.

The energy sector is very important to Azerbaijan's economy, and the country has attracted significant foreign investment from major international oil companies. The State Oil Company of the Azerbaijan Republic (SOCAR) is the country's state-owned oil and gas company and has stakes in all production-sharing agreements. SOCAR is involved in exploring oil and gas fields, producing and transporting oil and gas, and marketing petroleum and petrochemical products.

Azerbaijan's political landscape

Azerbaijan is a unitary semi-presidential republic, with a president and a prime minister. The country is one of six independent Turkic states and an active member of the Organization of Turkic States and the TÜRKSOY community. Azerbaijan has diplomatic relations with 182 countries and holds membership in 38 international organizations, including the United Nations, the Council of Europe, the Non-Aligned Movement, the OSCE, and the NATO PfP program.

The country's government functions as an authoritarian regime, with power concentrated in the executive branch. The ruling New Azerbaijan Party, in power since 1993, has been accused of authoritarianism under president Heydar Aliyev and his son Ilham Aliyev, who became president in 2003. The Aliyev family has been criticized for election fraud, economic inequality, and domestic corruption.

Azerbaijan's system of governance can nominally be called two-tiered, with the top or highest tier of the government being the executive power headed by the president. The local executive authority is a continuation of executive power. The Security Council is the deliberative body under the president, established in 1997.

The legislative power is held by the unicameral National Assembly and the Supreme National Assembly in the Nakhchivan Autonomous Republic. The Parliament of Azerbaijan, called Milli Majlis, consists of 125 deputies elected based on majority vote, with a term of five years for each elected member. The executive power is held by the president, who is elected for a seven-year term, and the prime minister. The president is authorized to form the Cabinet, which includes the prime minister, their deputies, and ministers.

The country's political opposition has been weakened by years of persecution, and there have been extensive crackdowns on civil liberties. The government has targeted dissenters, opposition figures, civil society representatives, and religious activists. The media environment has deteriorated, with restrictive legislation and a political environment preventing genuine competition. Social media has become a platform for free expression and activism, with Facebook being the leading social network.

Overall, Azerbaijan's political landscape is characterized by a consolidation of authoritarian practices, with the ruling family exerting uncontested authority and monopoly over the country's economy and politics.

Azerbaijan's economy

Azerbaijan's ruling elite has been criticised for corruption and authoritarianism, with wealth being concentrated in the hands of a few oligarchs, including the ruling Aliyev family. The country has also been accused of human rights abuses and media repression. Despite this, Azerbaijan has made significant progress in reducing poverty rates since gaining independence.

In recent years, Azerbaijan's economy has faced challenges due to declining oil prices, which caused a contraction in GDP and a weakened financial sector. The country's long-term economic prospects depend on its ability to develop export routes for gas production and improve its business environment.

Turkey's economy

Turkey's GDP was $1.024 trillion as of 2023, and the country has seen major developments in its financial and social aspects over the past 20 years, including increases in employment and average income. Between 2006 and 2017, Türkiye (the country's official name) pursued ambitious reforms and enjoyed high growth rates, reducing poverty and propelling the country to upper-middle-income status. Real GDP growth averaged 5.4% between 2002 and 2022, resulting in more than doubling income per capita. The poverty rate decreased from over 20% in 2007 to 7.6% in 2021.

The manufacturing sector is also prominent in Turkey, with 241,362 registered companies as of November 2023. The automotive industry, in particular, plays a crucial role in the Turkish economy. In 2022, Turkey produced 1,352,648 motor vehicles, ranking as the 13th largest producer globally. Turkish automotive companies, such as TEMSA, Otokar, and BMC, are among the world's largest manufacturers of vans, buses, and trucks. Additionally, the country has a strong presence in the production of consumer electronics and home appliances, with brands like Vestel and Beko dominating the European market.

Turkey's construction and contracting industry is another significant contributor to its economy. Turkish construction and contracting companies have completed projects in various countries, and their business volume abroad reached $472 billion in 2022.

However, Turkey's economy also faces challenges. The country experienced a slowdown in growth between 2014 and 2020, particularly during the 2018 Turkish currency and debt crisis. Additionally, Turkey's energy trade deficit was over $80 billion in 2022, contributing to a large foreign trade deficit. The country's energy mix relies heavily on fossil fuels, with natural gas, oil, and coal supplying a significant portion of its energy needs.

To address these challenges, Turkey has implemented various measures. The government has adopted tax and savings measures to rebalance the economy and mitigate the impact of currency crises and price rises. Additionally, there is a focus on increasing investment in renewable energy sources, with Europe supporting energy efficiency and renewable energy initiatives through funding.

Overall, Turkey's economy has shown resilience and strong growth over the years, positioning it as a significant player in the global economy.

Turkey's military

In recent years, Turkey's military influence and global reach have grown significantly. It is currently ranked as the 8th most powerful military force globally by Global Firepower, and its strategic investments and advancements in defence technology have bolstered its position as a regional powerhouse. Turkey has also become a pivotal player in the global arms trade, with its highly acclaimed Bayraktar TB2 drones being widely recognised and utilised.

In conclusion, Turkey's military might, technological advancements, and strategic global presence have solidified its position as a significant player on the international stage, shaping regional dynamics and contributing to its influence in the Middle East and beyond.

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