Baku Baku...

In 2019, industrial products totaling 39.7 billion manat (+ 0.7%) were produced in Baku, the capital statistics department reports.

The city of Baku accounts for 85% of the country's total industrial production over the past year.

Food production and import

Recently, there has been a serious increase in imports of grocery goods and agricultural products. It proceeds from the fact that Azerbaijan does not produce all of this in the required amount. According to the State Statistics Committee (SSC), in January-November this year, food was imported in the amount of 1 billion 486.6 million dollars (Figure 1). In the history of Azerbaijan, never before has so much food been imported. It should be noted that over 11 months, food imports increased by 21% compared to the same period in 2018, and by 69.7% compared to 2015.

Figure 1. Import of food products (January-November), in millions of US dollars. Source: SSC

 

Along with other products, a significant increase is observed in the import of livestock products. Over the past 4 years, meat imports in value terms grew 4.2 times, milk imports - 2.5 times, and butter imports - 3 times. The cost of imports mainly for slaughter of meat over the past 4 years amounted to 6.4 million dollars. So, in January-November 2015, the cost of import of live cattle amounted to $ 46.3 million, for the same period in 2018 - $ 51.9 million, and to $ 11.7 million in 11 months of 2019. It should be noted that although there has been a slight increase in meat production, this has become possible due to livestock imported for slaughter.

In January-November this year, 46.2 thousand tons of meat worth $ 71.6 million were imported into the country, which is $ 8 million more in price terms and 3,000 tons more in physical weight in comparison with the same period in 2018.

It should be noted that in January-November 2015, meat worth 17 million dollars was imported into the country, that is, 4.2 times less than the current index.

In 2016, the Cabinet of Ministers established a customs duty on import into Azerbaijan of domestic chicken meat (fresh, cooled and frozen) and products made from it in the amount of 1 US dollar per 1 kg. Customs rates were valid until November 1, 2018. Then, the proposal of the National Confederation of Organizations of Entrepreneurs (Employers) of Azerbaijan was taken into account and in accordance with the decision of the Cabinet of Ministers No. 476 dated November 7, 2018, the validity period of specific duties applied to the import of poultry was extended until December 15, 2019. The purpose of increasing customs duties on imports is to develop entrepreneurship in the country and improve the business environment, expand the activities of local entrepreneurs, and protect local production.

However, in reality, poultry meat imports have increased over this period (Table 1). As it can be seen from the table, the high customs duties applied to poultry meat not only did not reduce the import of products of the same name, but rather, in comparison with 2015, in 2018, poultry meat imports increased by 33,668 tons, i.e., 24.9 times. In production, over this period, growth amounted to only 11.9 thousand tons.

Table 1. Production and import of beef and poultry, in tons. Source: SSC

	2015	2016	2017	2018
Poultry meat production	97 211	95 517	104 362	109 121
Poultry meat import	1 405	25 255	26 775	35 073
Beef production	129 753	130 984	132 902	135 620
Beef import	12 404	9 245	21 243	23 833

In Table 1 we observe a serious increase in meat imports compared with its production.

It should be noted that, starting in 2016, the decline in cattle continues. Over the past 3 years, the number of cattle in the republic has decreased by 49,500 animals. It is possible that the slaughter of so many cattle caused the meat production to increase over that period.

However, it will not be possible to increase milk production without increasing productivity in animal husbandry. Serious growth is also observed in the import of dairy products. So, in January-November 2019, 12.64 thousand tons of butter and other oils made from milk were imported worth $ 63.6 million.

Compared with the same period in 2018, this is 18% or 1,860 tons in physical weight (in terms of milk - about 42,780 tons) more. In addition, over the 11 months of this year, importers spent $ 1.6 million more in comparison with the previous year for importing butter and other milk-made oils into the country. It should be noted that the import of butter and other oils made from milk in value terms increased 3 times in comparison with the same period of 2015.

According to the State Statistics Committee, in recent years, in stocks, use and production of butter, there has been a serious decrease (Table 2). So, in 2014, stocks of butter from 53.6 thousand tons fell in 2018 to 35.3 thousand tons, and as use as food from 44.4 thousand tons to 32 thousand tons. In 2016, the production of butter amounted to 25.6 thousand tons, and two years later in 2018, production, having decreased by 2 thousand tons, amounted to 23.6 thousand tons.

Table 2. Stocks and use of butter, in tons. Source: SSC

	2014	2015	2016	2017	2018
Residue in the early year	8 462	8 904	1 840	1 485	1 952
Production	23 445	23 935	25 604	25 295	23 638
Import	21 776	10 906	8 357	10 785	9 759
Total stocks	53 683	43 745	35 801	37 565	35 349
Used as food	44 472	41 454	32 532	33 394	32 046
Processed	-	-	1 511	1 610	1 539
Export	59	249	107	435	234
Losses	248	202	166	174	164
Residue by the end of the year	8 904	1 840	1 485	1 952	1 366
Total used	53 683	43 745	35 801	37 565	35 349

Compared to January-November of the previous year, milk imports amounted to the same volume (8 thousand tons), but in price terms it increased by $ 2 million. So, during the 11 months of 2018, milk was imported into the country in the amount of 11 million USD, and for the same period of 2019 in the amount of 13 million dollars.

It should be noted that Azerbaijan produces up to 52 percent of the required milk and dairy products and up to 42 percent of the required meat and meat products.

According to the WHO standards, meat consumption per person should be 78 kg per year, while Azerbaijan consumes 33 kg per year per person. That is, up to 42 percent of the demand is produced. Together with the import of meat and meat products, only 51% of the demand is provided. So, in 2018, 39.8 kg of meat and meat products were consumed per person in the country.

In Azerbaijan, milk production is much lower than demand. Thus, according to the WHO standards, per year, the consumption of milk and dairy products per person should be 405 kg. In 2018, 212 kg were produced per person per year.

Produced milk and dairy products provided the needs of the population by only 52%. Together with imported milk and dairy products, the consumption of dairy products per person in 2018 amounted to 240.2 kg, which is up to 59% of total consumption. In the past year, compared with 2014-2015, the consumption of milk and dairy products per person decreased by 6 kg.

Paradoxically, with the low purchasing power of the population, import of meat and dairy products is growing every year. Looking through the statistical data on imports, it seems that the republic’s need for food is made dependent on imports. In accordance with the interests of monopolists, this dependence is increasingly growing. Local products that cannot find their place in the domestic market are being squeezed out of it. For this reason, agricultural production is declining year after year. If it is possible for local farmers to make good profits, unfortunately, this opportunity is missed.

For the import of meat and dairy products, dollars are exported annually from the country, although not much funds are required for the production of livestock products. Azerbaijan can satisfy its needs for livestock products through domestic production, and for this, important work needs to be done. Basically, this is an improvement in the breeding composition of animals, the creation of a solid forage base, as well as the training of specialists in this field.

Source: Turan IA

Some statistics

Households, or in a popular language, families in Azerbaijan suffered from the devaluation of the national currency in 2015 - their expenses exceeded incomes for 2015-2017.

According to the State Statistics Committee, in 2015 the total amount of households remaining at the disposal of households was lower than their expenses by 705 million manats, in 2016 - by 1 billion 224 million manats, and in 2017 - 727.7 million manats. Indicators of national accounts for 2018 have not yet been determined.

As a result of devaluation, household expenditure exceed their income...

Source: Turan 

We care about image and that is all...

In 2020, 222 million manat (130.3 million US dollars), or 0.82% of the state budget expenditures, will be allocated from the state budget for international events.

According to the Ministry of Finance, the costs of international events will increase compared to this a year (76.2 million manat) 2.9 times. For comparison, we note that in 2020, the authorities intend to increase the total amount of targeted social assistance to poor families from 121.3 million to 219.7 million manat.

On the other hand....

In 2020, AZN 142 million will be allocated from the state budget for the construction and sale of apartments under preferential terms. This is 20 million manat or 12.4% less than this year.

The financing will be provided by the State Housing Agency and the Loan Guarantee Mortgage Fund.

Shoes as an economic indicator

Look at the numbers in order to understand the level of customs and the hidden economy. Really good sample:

For seven months of this year, 23 million 196 thousand pairs of shoes were imported into Azerbaijan. This product is declared for a total value of 48 million dollars. This was reported by the State Customs Committee.

According to the State Customs Committee, shoes imported for commercial purposes are declared at an average price of $ 2. According to the estimates of the State Statistics Committee, carried out in order to determine the level of consumer prices, men's shoes are sold at retail at an average price of 24 to 42 manats (14.1-24.7 US dollars), women's shoes - from 14 to 41 manats (8.2 -24.1 US dollars), and children's shoes - from 16 to 19 manats (9.4-11.1 US dollars).

These numbers include shoes that are sold for 100 USD as well.

Looking for economic term

State Statistics Committee: Inflation - 2.6%

Baku / 16.10.19 / Turan: For nine months of this year, consumer prices in Azerbaijan rose by 2.6% year on year, the State Statistics Committee (SSC) said.

During the reporting period, food products rose on average by 3.5%, non-food products - 1.3%, and paid services to the population - 2.4%.

Transparency...

Look at the comparison:

a) Baku / 09.10.19 / Turan: In September 2019, budget revenues from the State Customs Committee amounted to 376 million 759 thousand manat.

Compared to the same period last year, budget revenues increased by 47 million 349 thousand manat or 14.3%.

b) Baku / 10.03.19 / Turan: The SOCAR carbamide plant sold about 45 thousand tons of goods abroad in June-July this year. Moreover, the export cost of the fertilizer is 35% cheaper than domestic sales.

According to the State Customs Committee, from the sale of urea to Turkey (22 193 tons), Ukraine (993.6 tons), Romania (2825.8 tons), Bulgaria (10 166.62 tons) and Russia (8 752.5 tons) 7 million 189 thousand US dollars were received. The product was exported at a price of $ 159.99 / ton or 272 manat / ton. In July, the state-owned Aqrolizinq OJSC announced the conclusion of an agreement by SOCAR to supply 25 thousand tons of urea fertilizers at a price of 420 manat per ton, excluding transportation costs. Thus, the cost of urea for local agricultural needs is 148 manat 35% higher than its export value.