INTERNATIONAL CRISIS GROUP - NEW REPORT
Azerbaijan: Vulnerable Stability
Baku/Tbilisi/Brussels, 3 September 2010: If it continues to ignore the need for economic and political reform, Azerbaijan will squander an historic opportunity to use the country’s energy resources to build a more durable state system and a prosperous nation.
Azerbaijan: Vulnerable Stability,* the latest report from the International Crisis Group, examines how oil money has entrenched a stagnant political system, making it even more resistant to reforms. But oil revenues are levelling off and are projected to gradually decline within a few years, which could lead to economic problems and growing public frustration. The time to address these issues is now, yet the closed political system prevents meaningful debate on long-term challenges and stimulates a sense of apathy and distrust.
“The continuation of ‘business as usual’ will no doubt work in the short term, but in the long run, Azerbaijan won’t be able to sustain it”, says Lawrence Sheets, Crisis Group’s Caucasus Project Director. “There may be no alternative to some liberalisation of the economy, and even politics, if the government is to satisfy popular expectations of continued improvements in living standards and services”.
Ilham Aliyev’s presidency has been marked by stabilisation of the country’s political life and economic growth driven by oil exports. This stability, however, has come with the consolidation of authoritarian rule, greater suppression of freedoms and an increased reliance by elites on corruption and patronage networks to dominate virtually all aspects of public life. As a result, domestic politics are shaped less by unequal opposition-government contests than by internal dynamics and occasional power struggles within the ruling elite.
The growing over-reliance on the energy sector, discrepancies in wealth distribution and public disenchantment with both the government and traditional opposition parties increase the likelihood of a surge in radicalism and instability in the medium to long term.
The government of Azerbaijan must allow its citizens freedom of assembly, engage in a real debate with the political opposition and release political prisoners. To maintain stability and create prosperity, it should foster transparency and accountability and establish a sustainable and diversified market-based economy. The international community should do more to persuade the leadership that its own self-interests lie in gradual but genuine liberalisation. Human rights need to be kept on the agenda.
The international community needs to closely monitor the November 2010 parliamentary elections, as well as insist on follow-up from the government in cases in which a judgment has been entered against it by the European Court of Human Rights
“As oil production is about to begin its decline, easy-money euphoria should be replaced by a pragmatic policy review”, says Sabine Freizer, Crisis Group’s Europe Program Director. “It is in the regime’s own interest to open up political space, take steps to rein in corruption and de-monopolise the economy, while it still stands on solid financial and political ground”.