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Baku is the capital city of Azerbaijan. On the coast of the Caspian Sea, in the Caucasus region, it is an international junction of land and sea trade routes and the center of Azerbaijan's economic life. The city's economy encompasses a number of sectors.
Baku's main branches of heavy industry include oil and gas extraction, shipbuilding, steelmaking, mechanical engineering, and chemical manufacturing. The city also manufactures equipment for local and international oil and gas extraction, including a deep foundation plant in Sahil, and engineering plant in Keshla and clay and steel plants in Binagadi.
The Baku Steel Company meets local demand for casting imported steel. It has two electric arc furnaces and three rolling lines, with an annual steel-production capacity of 1,000,000 tonnes. The company manufactures rebar, square and round billets, channels, rolled wire, angle bars, I-beams, square and round rods, and related products. Steel Structures, the open joint-stock company Baku Steel Construction, and several other plants produce products for the construction industry. Radio-electronics factories and car and shipbuilding plants (Baku Shipyard) also operate in the city. The Gozdak, Shuvalan, and Korgöz quarries surrounding Baku produce sawn stones. Reinforced concrete, asbestos and brick plants, and the Garadagh cement plant produce construction materials. [1]
Clothing is an important part of Baku's light industry, in addition to shoe and leather plants. Baku-Glass produces bottles for juice and alcoholic beverages, and Baku Sewing House manufactures coats, jackets, suits and casual clothing. Caucasus Paper Industry is one of the largest producers of cleansing and hygienic paper in Azerbaijan and the South Caucasus. [2]
Oil production decreased by 6.2 percent from 2016 to 2017, and commercial gas production decreased by 2.2 percent.
| Product | January–November 2017 | January–November 2016 (%) | 1 December 2017 stockpile |
|---|---|---|---|
| Crude oil (including gas condensate), thousand tons | 34,889.8 | 93.8 | 216 |
| Natural gas, million cubic meters | 16,551.4 | 97.8 | - |
| Product | January–November 2017 | January–November 2016 (%) | 1 December 2017 stockpile |
|---|---|---|---|
| Limestone for construction, thousand tons | 112.3 | 80.4 | - |
| Gravel, crushed stone | 31,942.6 | 167.6 | - |
| Gypsum and anhydride, tons | 19,739.8 | 130 | 2,585.6 |
Total 2017 oil production was m2,469.2 million, a 9.2-percent decrease from January to November of the previous year. Petrol production increased by 4.7 percent, petroleum coke by 6.8 percent, bitumen by 22.7 percent, and lubricating oil by 370 percent. Diesel-fuel production decreased by 20 percent, mazut fuel oil by 42.6 percent, and white petrolatum by 6.9 percent. [3]
| Product | January–November 2017 | January–November 2016 (%) | 1 December 2017 stockpile |
|---|---|---|---|
| Petrol for cars | 1,097.6 | 104.7 | 55.2 |
| Petrol for petrochemical use | 169 | 96.5 | 1.1 |
| White petroleum | 539 | 93.1 | 13.4 |
| Diesel fuel | 1,718.4 | 80 | 53.1 |
| Mazut | 262.5 | 57.4 | 7 |
| Lubricating oil | 33.6 | 370 | 8.2 |
| Bitumen | 208.8 | 122.7 | 2.9 |
| Petroleum coke | 197.5 | 106.8 | 1.3 |
From January to November 2017, goods with a value of m4,843.7 million were manufactured.
| Period | Change from previous year (%) | Change from previous year (%) |
|---|---|---|
| 2016 | 2017 | |
| January | 99.2 | 102.0 |
| January–February | 103.5 | 92.5 |
| January–March | 103.8 | 84.1 |
| January–April | 106.2 | 89.6 |
| January–May | 106.4 | 89.6 |
| January–June | 112.7 | 89.3 |
| January–July | 103.9 | 89.3 |
| January–August | 98.9 | 89.2 |
| January–September | 99.9 | 87.9 |
| January–October | 100.1 | 89.4 |
| January–November | 100.0 | 89.9 |
| January-December | 99.1 | 102.0 |
Baku's agricultural sector has been developed in the city's suburbs. Due to its semi-desert, dry-steppe climate, olives, pistachios, almonds and saffron are also grown. [4]
| Total area (ha) | 2010 | 2013 | 2014 | 2015 | 2016 | 2017 |
|---|---|---|---|---|---|---|
| Potatoes | 20 | 20 | 10 | 10 | 18 | 19 |
| Vegetables | 459 | 606 | 456 | 509 | 688 | 1196 |
| Plants and flowers | 13 | 10 | 10 | 11 | 11 | 11 |
| Fruits and berries | 1,277 | 1,466 | 1,483 | 1,526 | 2,899 | 2,927 |
| Grapes | 1,498 | 1,435 | 1,441 | 1,441 | 1,300 | 1,303 |
| Production (tons) | ||||||
| Potatoes | 50 | 136 | 36 | 50 | 134 | 128 |
| Vegetables | 13,868 | 23,861 | 7,561 | 8,693 | 12,812 | 53,343 |
| Plants and flowers | 105 | 80 | 174 | 322 | 103 | 102 |
| Fruits and berries | 3,972 | 6,999 | 7,125 | 6,022 | 4,688 | 5,313 |
| Grapes | 14,800 | 9,600 | 8,918 | 9,433 | 7,963 | 8,009 |
| Production (centners per ha) | ||||||
| Potatoes | 25 | 68 | 34 | 50 | 76 | 67 |
| Vegetables | 158 | 294 | 154 | 135 | 91 | 50 |
| Plants and flowers | 84 | 80 | 174 | 293 | 93 | 93 |
| Fruits and berries | 31.1 | 47.8 | 48.6 | 41.1 | 18.4 | 19.2 |
| Grapes | 23.1 | 47.8 | 39.9 | 47.8 | 41.2 | 40.8 |
| Total livestock | ||||||
| Cattle (including water buffalo) | 5,343 | 5,963 | 6,203 | 6,022 | 8,289 | 8,341 |
| Sheep and goats | 2,755 | 2,710 | 3,155 | 2,826 | 3,880 | 4,360 |
| Pigs | 15,938 | 16,480 | 16,466 | 13,540 | 18,872 | 18,359 |
| Birds | 578 | 438 | 447 | 422 | 125 | 152 |
| Animal products (tons) | 393,465 | 334,126 | 298,699 | 557,474 | 504,016 | 875,447 |
| Meat | 1,180 | 1,994 | 1,996 | 2,302 | 2,434 | 2,406 |
| Milk | 3,799 | 5,082 | 3,910 | 4,058 | 4,245 | 4,669 |
| Eggs | 10,252 | 7,301 | 5,597 | 9,678 | 7,458 | 7,391 |
| Wool | 36 | 36 | 31 | 31 | 27 | 31 |
Baku, the capital of Azerbaijan, receives 2.5 million tourists a year. According to Ilya Umansky, vice president of the Association of Tour Operators of Russia, Baku has become a more popular tourist destination in recent years.
Tourism in the city of Baku, Azerbaijan.
The new Baku Higher Oil School campus, the new Narimanov District Court administrative building, a bridge in Pirallahı raion, the Pirallahi Solar Power Plant, the Balakhani Industrial Park, the Baku–Tbilisi–Kars railway, the Pirshagi-Novkhani road and the Binagadi-Novkhani-Corat highway were completed between January and November 2017. Almost three-quarters of the funds allocated to capital assets were spent on construction. [5]
| Total (thousand m) | January–November 2016 (%) | |
|---|---|---|
| Baku | 5,130,130 | 104 |
| Raions | ||
| Binəqədi | 227,090.3 | 97.9 |
| Xətai | 858,471.7 | 103.9 |
| Xəzər | 100,992.8 | 3.9 d.[ clarification needed ] |
| Qaradağ | 492,102.9 | 120.5 |
| Nərimanov | 476,879.7 | 112.3 |
| Nəsimi | 1,047,540.8 | 123.5 |
| Nizami | 168,072.8 | 43,2 |
| Sabunçu | 114,550.7 | 163.7 |
| Səbail | 1,073,628 | 85.7 |
| Suraxanı | 47,033.7 | 88 |
| Yasamal | 523,766.7 | 131.1 |
Baku is considered one of the country's largest metallurgy centers due to the availability of scrap metal, local energy resources (oil and natural gas) and a large, well-trained labor force. The city produces non-ferrous and ferrous metals. [6]
Baku's transportation system consists of the Baku Metro, buses, and taxis. According to data from January to November 2017, freight transport by road increased by 1.6 percent over 2016 to 5,3021.2 thousand tons. Passenger transportation increased by 0.1 percent, to 623,024.1 thousand passengers. The number of metro passengers increased by 5.3 percent over 2016, to 207.6 million. [7]
From January to November 2017, the cost of consumer products and services in Baku increased 2.2 percent over the same period of 2016 to m21,964.1 million. Non-governmental goods and services made up 95.6 percent of the total; retail goods and services in this sector increased by 1.7 percent over the previous year, to m21,001.3 million.
| Markets | January–November 2017 (million m) | 2016 (%) |
|---|---|---|
| Total | 21,964.1 | 102.2 |
| On state property | 962.8 | 115.1 |
| On non-state property | 21,001.3 | 101.7 |
| Private enterprise | 15,663.5 | 99.4 |
The Baku-Novorossiysk, Baku-Supsa (Georgia) and Baku-Tbilisi-Ceyhan (Turkey since 2006) pipelines originate in Baku and transport Azerbaijani oil to the global market. [8]
The economy of Azerbaijan is highly dependent on oil and gas exports, in particular since the completion of the Baku-Tbilisi-Ceyhan Pipeline. The transition to oil production in the late 1990s led to rapid economic growth over the period 1995–2014. Since 2014, GDP growth has slowed down substantially.
Sumgait is a city in Azerbaijan, located near the Caspian Sea, on the Absheron Peninsula, about 31 kilometres away from the capital Baku. The city had a population of 491,068 at the 2019 Census, making it the second largest city in Azerbaijan after Baku.
Agdash District is one of the 66 districts of Azerbaijan. It is located in the centre of the country and belongs to the Central Aran Economic Region. The district borders the districts of Yevlakh, Shaki, Oghuz, Qabala, Goychay, Ujar, Zardab, and Barda. Its capital and largest city is Agdash. As of 2020, the district had a population of 111,100.
Goychay District is one of the 66 districts of Azerbaijan. It is located in the centre of the country and belongs to the Central Aran Economic Region. The district borders the districts of Agdash, Qabala, Ismayilli, Kurdamir, and Ujar. Its capital and largest city is Goychay. As of 2020, the district had a population of 121,700. It is famous for its pomegranate growing industry, and for its pomegranate festival.
Kurdamir is a city and the capital of the Kurdamir District of Azerbaijan. It is located in Aran Economic Region. The city's population is 18,100 people.
Shah Deniz gas field is the largest natural gas field in Azerbaijan. It is situated in the South Caspian Sea, off the coast of Azerbaijan, approximately 70 kilometres (43 mi) southeast of Baku, at a depth of 600 metres (2,000 ft). The field covers approximately 860 square kilometres (330 sq mi). Stretching out over 140 square kilometres, the reservoir is similar in size and shape to Manhattan Island.
The petroleum industry in Azerbaijan produces about 873,260 barrels (138,837 m3) of oil per day and 29 billion cubic meters of gas per year as of 2013. Azerbaijan is one of the birthplaces of the oil industry.
Azeri–Chirag–Gunashli or Azeri–Chirag–Deepwater Gunashli is a complex of oil fields in the Caspian Sea, about 120 kilometres (75 mi) off the coast of Azerbaijan. It consists of the Azeri and Chirag oil fields, and the deepwater portion of the Gunashli oil field. An overall estimate of the area of the development is 432.4 square kilometres (167.0 sq mi). It is developed by the Azerbaijan International Operating Company, a consortium of international oil companies, and operated by BP on behalf of the consortium. The ACG fields have estimated recoverable reserves of about 5 to 6 billion barrels of petroleum. Peak oil production of 835,000 barrels per day (132,800 m3/d) was reached in 2010, however by the first quarter of 2022 production had declined to 434,000 barrels per day (69,000 m3/d), or about one-half of peak value. As of 2021, ACG oil accounted for 95% of all Azerbaijani oil exports.
The Sangachal Terminal is an industrial complex consisting of a natural gas processing plant and oil production plant, located on the coast of the Caspian Sea 45 kilometres (28 mi) south of Baku, Azerbaijan.
The Baku–Novorossiysk pipeline is an 1,330-kilometre (830 mi) long oil pipeline, which runs from the Sangachal Terminal near Baku to the Novorossiysk terminal at the Black Sea coast in Russia. The Azerbaijani section of the pipeline is operated by the State Oil Company of Azerbaijan Republic (SOCAR) and the Russian section is operated by Transneft.
As of 2017, Azerbaijan produced a range of metals and industrial minerals, including aluminum, bentonite, copper, gold, iodine, limestone, silver and steel.
The Mozdok–Makhachkala–Kazi Magomed pipeline is a natural gas pipeline from Mozdok in North Ossetia through Chechnya and Dagestan to Azerbaijan. The Azerbaijani section is also known as the Kazi Magomed–Novo Filya or Baku–Novo Filya, and it connects Baku with the Novo Filya gas metering utility on the Russian side of the Azerbaijan-Russia border. The pipeline will be used for transportation of Azerbaijani gas to Russia starting from 1 January 2010.
Two-thirds of energy in Azerbaijan comes from fossil gas and almost a third from oil. Azerbaijan is a major producer of oil and gas, much of which is exported. Most electricity is generated by gas-fired power plants.
Chirag is an offshore oil field in the Caspian Sea, located 120 km (75 mi) east of Baku, Azerbaijan, and is a part of the larger Azeri-Chirag-Guneshli (ACG) project. The production, drilling and quarters (PDQ) platform Chirag 1 (EOP) has been in operation since 1997. Chirag 1 has been producing the Early Oil from the ACG field. West Chirag is planned as an extension of ACG project.
The Absheron Economic Region is located in the eastern part of the Republic of Azerbaijan and comprises Baku and Sumgait cities and the Absheron and Khizi districts. The eastern part of the economic region is located on the shores of the Caspian Sea, which has positive effects on the economy of the region. It borders Shaki-Zaqatala economic region to the north, Mountainous Shirvan to the west and Aran to the south.
The economic history of Azerbaijan covers the development of the country's economy from its incorporation into the Russian empire at the beginning of the 19th Century, through the period of independence under the Democratic Republic (1918-1920), as part of the Soviet Union (1920-1991) and subsequent transition to the Republic of Azerbaijan.
Azerbaijan is one of the birthplaces of the oil industry and its history is linked to the fortunes of petroleum, with pipelines used from the late 19th century. The total length of the main pipeline in Azerbaijan is 4,600 kilometres (2,900 mi)
The Heydar Aliyev Baku Oil Refinery is an oil refinery located in Baku, Azerbaijan. It is currently the only oil refinery in Azerbaijan, capable of producing about 120,000 barrels (19,000 m3) of refined products per day. The refinery meets the entire domestic demand for petroleum products and exports more than 40% of the products. The plant processes 15 different products including gasoline, diesel, jet fuel, black oil, petroleum coke, asphalt, lubricants etc. It is owned and operated by SOCAR, which is the national oil company of the Azerbaijan Republic.
Ganja is the second largest city of Azerbaijan, according to its population (331.4 thousand, however, it is behind Baku and Sumqayit in terms of industrial production. The city is located in Ganja-Gazakh economic region. The economy of Ganja embraces the issues connected to the economy of the city of Ganja. Industry, tourism, agriculture, and transportation are the major branches of its economy. Most of the total volume of industrial products is accounted for non-ferrous metallurgy, light and food industries, electronics industry and home appliances.
The metallurgical production of the Republic of Azerbaijan is considered high due to the large deposits of alunite, polymetallic ores, deposits of iron ore, etc. The metallurgy industry of Azerbaijan encompasses both ferrous and non-ferrous branches.