Accelerating Economic Diversification in Azerbaijan : Challenges, Shaping Prospects

This paper, presents an analysis of the sectors that show the largest potential for supporting the country’s quest for economic diversification. It draws upon latest information about the diversification of economy and development strategy of oil producers countries from various sources, including research publications and reports provided by international economic organizations (OECD, WB, IMF, ADB, CAREC, EU4 Business programmes and OPEC+).The study assesses the challenges and key constraints of economy, and analyzes key areas in which specific sector reforms can best contribute to economic diversification. The paper also discusses evidence-based policy suggestions that will be useful for the government’s future strategies and plans diversifying the industrial base. This paper highlights the importance of foreign investment in supporting SME integration in global value chains (GVCs). Disruptions to global supply chains are one of the clearest effects of the Coronavirus in the world economy. A growing number of researchers expect to change the breadth of their supply chains as a result of the COVID-19 pandemic. Therefore, it is important to act swiftly and in meaningful ways to minimize the fallout from this crisis. As the crisis evolves, complexities and vulnerabilities in global supply chains, which extend beyond role CIS countries in manufacturing and goods trade. Diversification is helping unlock the Azerbaijan’s vast resources and human potential. Accelerating economic diversification in Azerbaijan will require strong political will to improve the country’s business climate, enhance competitiveness, and increase private sector participation—as laid out, along with the state program of reforms, in Azerbaijan