Exploring Azerbaijan's Exports And Their Dollar Value

Azerbaijan's economy is highly dependent on oil and gas exports, with two-thirds of its GDP coming from gas and oil alone. In 2022, Azerbaijan exported a total of $38.1 billion worth of goods, making it the 65th largest exporter in the world. The country's top exports include crude petroleum, petroleum gas, refined petroleum, nitrogenous fertilizers, and gold. Italy, Turkey, Israel, India, and Greece are the top five importers of Azerbaijani goods.

Crude oil and petroleum gases

Azerbaijan's economy is highly dependent on oil and gas exports, with gas and oil accounting for two-thirds of the country's GDP. Azerbaijan's top exports in 2022 were crude petroleum ($19.4 billion), petroleum gas ($15.5 billion), and refined petroleum ($561 million). Together, these three categories made up 91.8% of the total revenue paid for all Azerbaijani exports during 2022.

The Baku-Tbilisi-Ceyhan Pipeline, which became operational in 2006, is expected to generate up to $160 billion in revenue for the country over 30 years. This pipeline has been a significant factor in the country's economic growth and has made Azerbaijan one of the top eight biggest oil suppliers to EU countries.

In addition to crude oil and petroleum gases, Azerbaijan also exports processed petroleum oils, nitrogenous fertilizers, gold, and other mineral fuels, further contributing to the country's economic performance and making it a key player in the global energy market.

Mineral fuels, mineral waxes, and distillation products

Azerbaijan's economy is heavily dependent on oil and gas exports, particularly since the completion of the Baku-Tbilisi-Ceyhan Pipeline. The transition to oil production in the late 1990s led to rapid economic growth from 1995 to 2014. Large oil reserves are a major contributor to the country's economy, with gas and oil comprising two-thirds of Azerbaijan's GDP. This makes Azerbaijan one of the top ten most fossil fuel-dependent economies globally.

The Baku-Tbilisi-Ceyhan Pipeline, which became operational in 2006, is expected to generate up to $160 billion in revenue for the country over 30 years. Azerbaijan has also concluded 21 production-sharing agreements with various oil companies, further boosting its oil exports. The recent high price of oil has been highly beneficial to the country's economy, as it is in the midst of an oil boom.

In addition to crude oil and petroleum products, Azerbaijan also exports mineral waxes and distillation products such as nitrogenous fertilizers. However, the country's exports are not limited to these products alone. They also include fruits, nuts, plastics, vegetables, aluminum, cotton, gems, precious metals, and organic chemicals, among others.

Fruits and nuts

Azerbaijan's economy is heavily dependent on oil and gas exports, but it also has a large agricultural sector. In 2023, Azerbaijan exported $513 million worth of edible fruit and nuts, peels of citrus fruit, and melons. This was a 14.4% increase from 2022.

Azerbaijan's agricultural sector includes crops such as grapes, cotton, tobacco, citrus fruits, and vegetables. In 2018, Azerbaijan produced 167,000 tons of grapes, making it an important crop for the country. The country also produces a variety of nuts, including hazelnuts and walnuts. In 2023, exports of nuts and fresh or dried fruit (excluding citrus) from Azerbaijan were valued at $125 million. The country also exported $66 million worth of apples, pears, and quinces in 2023.

Azerbaijan's agricultural sector has faced challenges in the past, including outdated equipment and irrigation systems, and a lack of modern technology. However, the government has tried to play an active role in the development of agriculture by providing subsidies, tax exemptions, and import substitutions. The government also runs procurement centres for the purchase of agricultural products such as tobacco, cotton, tea, silk, and grapes.

Azerbaijan's exports of fruits and nuts have contributed significantly to its economy, and the country continues to focus on the development of its agricultural sector.

Plastics and plastic articles

Azerbaijan's economy is heavily dependent on oil and gas exports, with the country ranking as one of the top ten most fossil fuel-dependent economies globally. However, Azerbaijan has also been working on diversifying its exports, with plastics and plastic products accounting for a notable portion.

In 2023, Azerbaijan's exports of plastics and plastic products amounted to $523.42 million, while imports totalled $460.79 million. From January to May 2024, the country reduced its exports and imports of plastics year-on-year, with the export volume reaching 180,756 tons, valued at $163.8 million. During this period, plastics and plastic products accounted for 1.47% of Azerbaijan's total exports and 12.99% of its non-oil sector exports.

Azerbaijan's plastic exports are projected to increase in the coming years. By 2026, the country's plastic exports are forecast to reach $196 million, representing a 10.8% annual increase since 2001. This growth can be attributed to the rising demand for plastics and the advancements in the plastic processing and manufacturing field, such as the adoption of new technologies like 3D printing.

Cotton

However, since the fall of the Soviet Union, cotton production in Azerbaijan has significantly declined due to the shift towards more profitable crops such as oil and grains. Additionally, cotton production in the country has become expensive, with operating expenses three times higher than in the United States, mainly due to low yields of 1.5 tonnes/ha. Despite this, Azerbaijan has the necessary climatic and soil conditions to support a thriving cotton industry, and the country intends to further grow its cotton sector.

In 2023, cotton accounted for 0.483% of Azerbaijan's merchandise exports, equivalent to $163 million. While this may seem like a small percentage, it is important to note that the country's exports are heavily dominated by mineral fuels, mineral oils, and related products, which accounted for 91% of total exports.

Azerbaijan's cotton industry faces several challenges, including the high cost of production, resistance from farmers to policies of forced cultivation, and the use of child labour in cotton production. However, the country has taken steps to support the industry, such as the development of the State Cotton Growing Program 2017-2020, which aims to increase cotton production in 27 districts across the country. Additionally, the Scientific Research Institute of Cotton-Growing in Ganja works to improve cultivation methods and adopt ecologically efficient technologies.

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