Parliamentary Investigation in foreign countries

DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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“AZERBAIJAN 2020: LOOK INTO THE FUTURE” CONCEPT OF DEVELOPMENT

CONTENTS

1. The current situation

2. Modern challenges

3. Azerbaijan 2020: Strategic View and Main Priorities

4. Towards a highly competitive economy

4.1 The formation of an economic model based on effec tive state regulation and mature

market relations

4.2 The improvement of the economic structure and the development of the non -oil

sector

4.3 Support for scientific potential and innovative activity

5. The improvement of the transport, transit and logistic infrastruc ture. The

balanced development of regions

6. The development of information and communication technologies and

ensuring transition to an information society

7. The development of human capital and the establishment of an effective social

security system

7.1 The main tasks in the sphere of the population’s health and the health care system

7.2 The formation of a modern education system

7.3 The improvement of the social security system

7.4 The provision of gender equality and the development of family

7.5 The development of youth pote ntial and sports

8. The improvement of legislation and strengthening of institutional potential

9. The development of civil society

10. The protection and effective management of cultural heritage

11. Environmental protection and ecological issues

DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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1. The current situat ion

Modern Azerbaijan has travelled a complicated and at the same time, honourable

path in the 20 years of its independence.

The deep crisis of the socialist public -political system and the breakup of a huge

country like the Soviet Union in the early 1990s resulted in political chaos, economic

paralysis and social collapse in Azerbaijan like in other post -Soviet countries. At that time,

military aggression against our country, the occupation of 20 per cent of the country’s

territory and the displacement of more than one million Azerbaijanis from their homes as a

result of the policy of genocide and occupation pursued by Armenian nationalists

extremely exacerbated the situation.

Beginning from the middle of the 1990s, our country gradually started to revive a nd

take confident steps towards resolving fateful issues under the leadership of the great

leader Heydar Aliyev. First of all, the sustainability of our state independence was ensured

and political stability was established inside the country.

At the same time, effective steps were taken to regulate the macroeconomic

balance and prevent the hyperinflation that existed at the time, and difficult social issues

were resolved with great determination.

The foundation of the use of Azerbaijan’s hydrocarbon reserv es for the benefit of

the people was laid by the signing of the “Contract of the Century” in that period. At the

same time, well -thought out large -scale economic reforms were launched. The foundation

of the comprehensive institutional changes aimed at repl acing the administrative –

command system inherited from the Soviet period with new free competitive relations,

purposeful policy measures to form a market economy system, important changes such as

the privatization of state -owned property and the formation of new property relations was

laid precisely in that period.

The further deepening of the large -scale reforms conducted in our country after

2000 created favourable opportunities for rapid development and allowed our society to

rise to a higher level of so cioeconomic development. Important steps were taken to

improve the investment environment in the country and state administration was re –

established in compliance with modern criteria.

The dynamics of economic growth, which gained a new impulse through the

comprehensive extraction and export of natural resources and economic growth in

Azerbaijan even during the 2009 global economic crisis, show that the strategic line that

was chosen was being conducted successfully. Along with that, with the channelling of oil

revenues into the non -oil sector, serious achievements were secured in the development DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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of this sphere, and the average annual growth rate in the non -oil sector over the past 10

years reached almost 11 per cent.

In 2011, the real GDP increased threefol d compared to 2003. According to the

results of 2011, Azerbaijan owned more than 70 per cent of added value in the South

Caucasus and strengthened its positions as a leading state of the region.

Over the past eight years, the country’s strategic currency r eserves increased by

more than 22 times and reached 41 billion US dollars at the end of 2011, which is about 10

times higher than the state’s foreign debt.

Along with that, the opening of new production spheres and the creation of new jobs

in the non -oil s ector, the unprecedented development of the transport and communal

infrastructure, the creation of modern social infrastructure enterprises, including the

construction of new education, health and sports facilities formed the basis of the general

dynamic a nd sustainable progress of our country in this period.

It must be especially noted that during these years, Azerbaijan secured significant

progress in the effective resolution of social problems, and the system of social security

was established anew in co mpliance with advanced international standards. A new

pension system was launched, and a system of targeted social assistance and social

allowances was established and developed. As a result of the successful social policy, the

level of poverty declined fr om 49 per cent in 2000 to 7.6 per cent in 2011, while salaries

and pensions increased several times over.

As the economic potential of the republic increased, favourable conditions were

created for the development of the health system and problems in prote cting the

population’s health started to be resolved consistently. The budget allocated to the health

system increased by more than 10 times over the past 10 years and now exceeds 650

million manats. Over the past 10 years, more than 400 health institution s, most of which

are located in regions of the country, were built or refurbished, and all the health

institutions were provided with modern hardware and equipment.

Important measures have been taken to protect the health of the republic’s

population and i mprove the quality of medical services. Significant achievements were

gained in the fight against infectious diseases, and this sphere is always in the focus of

attention as a priority sphere of practical medicine.

The significant achievements in the spher e of education are directly linked to the

socio -economic policy directed at modernizing our country in recent years. Suffice it to say

that in 2011, the total amount of budget funds allocated to the education sphere increased

by more than five times compar ed to 2003 and reached 1.5 billion manats. Over the past DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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period, significant steps have been taken to modernize the education infrastructure in our

country and as a result, the conditions of education improved for more than one million

pupils. Reforms were carried out to renew the content of education, and important steps

were taken to integrate Azerbaijani education into the European education system. Along

with that, as part of “the state programme on the education of Azerbaijani youths in foreign

countri es in 2007 -2015”, 1,204 people have been sent abroad so far at the expense of the

State Oil Fund. In general, 10,700 young Azerbaijanis are being educated in the leading

universities of the world at the expense of other sources and on personal initiative.

Significant achievements were gained in the sphere of computerizing education.

Although in 2004, there was one computer per 1,063 pupils, the correlation now is one

computer per 20 pupils. As part of the “People’s Computer” project, more than 10,000

teache rs were provided with computers, 1,200 educational institutions were connected to

the Internet and 75,000 people underwent relevant training covering pedagogical and

technical personnel and learnt ICT skills. Educational resources on various subjects were

prepared and handed over to schools, while an “electronic school” project was launched in

20 schools.

The country’s achievements in the socio -economic sphere are also reflected in the

improving assessments of the Azerbaijani economy by international rating agencies (Fitch

Ratings, Moody’s, Standard & Poors). In the report “Doing Business” prepared by the

World Bank and International Finance Corporation, Azerbaijan’s position improved, and

the country took the leading position among the CIS and regional coun tries in the Global

Competitiveness Report of the World Economic Forum.

In the World Bank classification of per capita GDP, Azerbaijan entered the group of

countries 1 with “high average incomes” earlier than other CIS states. Along with that,

according to the report of the UN Development Programme on human development in

2010, Azerbaijan left the group of countries with “average human development” and

entered the group with “high human development”.

The formation of a democratic society and transparent publ ic relations in Azerbaijan

in the years of independence formed the main basis of state policy. Political pluralism in

the country became the necessary basis of public progress in the country. Currently, there

are appropriate legal and democratic political conditions for the free activities of political

parties in the country. Today, 55 political parties are registered in Azerbaijan, and 11 of

them are represented in the parliament. Political parties are closely involved in the public –

political life of the c ountry and are represented in elected and other government bodies.

1 Countries are grouped on the basis of the GDP c alculated in 2010 using the Atlas method of the World

Bank. Countries where per capital GDP is 1,005 US dollars or less belong to the group of low -income

countries, 1,006 -3,975 US dollars – countries with low average income, 3,976 -12,275 US dollars – count ries

with high average income, and 12,276 and more – high -income countries. DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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Additional opportunities have been created to strengthen the material -technical base of

political parties and increase their role in the country’s political system and in the

development of civil society.

The formation of a new system of public relations based on democratic values

resulted in important changes in the structure of society and created conditions for citizens

to play a more active role in public -political processes. The civil s ociety in the country is

currently experiencing an active phase of development. More than 2,700 NGOs are

operating in the sphere of human rights, education, health, culture, economy, social

issues, ecology, gender and other spheres, and their number is ste adily increasing. Over

the past 10 years, important steps have been taken to create NGOs and improve the

legislative base in order to make effective use of their potential. The necessary

environment has been secured to provide NGOs with access to financial sources. Along

with that, a free and pluralist press is taking shape in the Azerbaijan Republic in line with

world standards.

All this was possible as a result of the consistent conduct of a well -thought out and

purposeful policy. The state programmes ado pted by the country’s leadership, concept

and strategic documents and their practical implementation are of special importance as a

mechanism of implementing this policy. Suffice it say that there are currently 60 state

programmes, strategies and concepts in place, and these are of special importance in

developing all spheres of our country’s public life.

We can say with full confidence that the transitional period has already ended in

Azerbaijan. A new socio -economic system, which is based on free market r elations and

political pluralism and has its own rules, has been established. The formation of the

appropriate infrastructure for the functioning of an effective economy is nearing the end. A

reliable system of social security has been established for the population, and this system

is currently improving.

The President of the Azerbaijan Republic issued an instruction on the preparation of

the Development Concept “Azerbaijan – 2020: Look into the Future”. The need to prepare

such a concept is due to the fac t that our country has stepped into a new stage of

development. The achievements that have been gained allow Azerbaijan to set even

higher goals and determine the tasks that stem from these goals.

2. Modern challenges

The information and communication tec hnologies that rapidly developed and spread

in the first decade of the 21 st century and the processes of globalization that received a DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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new impetus in this regard are seriously affecting the socio -economic life of various

countries. In this sense, Azerbaija n is no exception. Factors of a global and planetary

nature are penetrating the flow of processes almost in all the spheres of the country’s life –

economic, social, political, humanitarian -cultural, etc. Along with that, as is the case in any

country, in Azerbaijan there are also regional (typical of regional countries) and domestic

factors by origin and sphere of influence, and taking them into account in managing

various spheres of the country’s public life is of special importance in terms of forming an

effective policy.

The main factors (challenges) are divided as follows for convenience.

1. With the gradual intensification of innovative activity at a qualitatively new level in

conditions of globalization, the pace of change in economic processes in the whole world,

copying of innovations and their application in the sphere of production is increasing in an

unprecedented manner. This, in fact, is the “positively charged” effect of globalization and

gradually allows an increasing number of countries to be nefit from achievements in the

sphere of innovations, advanced technical standards and new methods in management.

According to predictions, world economic growth in the short – and medium -term will take

place precisely as a result of this factor.

In the com ing years, trade is expected to grow more rapidly than production

worldwide and globalization and regional integration is expected to expand even further. It

is believed that new standards will be determined regarding international trade,

competition, inte llectual property and the environment and the role of international

organization in this sphere will strengthen. The global and regional competitiveness of

countries that prefer specialization on the international market, develop production

technologies an d innovative potential and thus promote the fields that create higher added

value is expected to increase. The development of industry on the basis of innovations will

be possible as a result of the strengthening of scientific and technological potential a nd

expansion of education opportunities. It is important to ensure that developing countries

achieve economic growth based on productivity and form comparatively more

advantageous production spheres.

2. In this situation, the main issue facing Azerbaijan i s that countries of the world do

not retreat in the process of development. This, first and foremost, requires constant

attention to such an important issue as preventing the danger of the country turning into a

raw material appendage for the world economy in the medium – and long -term and

becoming a technological “outsider” by eliminating the economy’s current dependence on

the export of hydrocarbon reserves. Although the export of hydrocarbons has been the

main driving force of economic growth in the past decade, the main issue facing us at the

current stage is to ensure the rapid development of the non -oil sector, increase the

effectiveness and competitiveness of the economy and secure its progress based on DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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innovations. In other words, it is necessary to l ay the foundations of transition from a

traditional economy to a “knowledge -based economy” now and prioritize the appropriate

development of human capital, which is a decisive factor for this.

Along with putting forward relevant requirements for the format ion of the economic

model, this also leads to drastic changes in the education system and increases the

importance of such components of education as additional and lifelong education and

signifies the growing role of ICT and virtual education and knowledg e of computer

networks. At the same time, the importance of intellectual property, the main mission of

which is to stimulate creativity and innovation and support the regulation of the market, will

also increase.

3. Globalization, which brought great risks along with broad opportunities, has

increased the tendencies of free production on the global scale, trade, capital flight and

labour migration. The uncertain nature of development in countries of the world

strengthened even further and the countries rega rded as centres of power that have a

decisive role in determining the dynamics of the world economy were joined by new

countries – China, India, Brazil and so on. In turn, this affects economic and trade relations

and the redistribution of resources and al so leads to the strengthening of international

competition.

The next period will be characterized by the change of the balance between the

main centres of the world economy, its reconstruction in this regard and the strengthening

of the role of regional ec onomic unions. This opens new opportunities for Azerbaijan in

terms of foreign economic integration and allows it to prefer the global context in the

direction of socio -economic development, go beyond the local regional framework and

benefit from involveme nt in the economic relations and markets of various economic

areas. Currently, the special weight of economies developing both as the destination and

source of foreign investments is increasing. It is predicted that during the post -crisis

period, the pace of economic growth in high -income countries will be about twice as less

as in developing countries. As a result, developing countries will be the main locomotive of

global economic growth.

4. One of the characteristic features of globalization is the sprea d of “negatively

charged” processes along with such a positive factor as the spread of technologies and

innovations and the ability of these processes to “take over” the countries involved in

worldwide economic integration. From this point of view, the glo bal economic crisis, which

began in 2008 and is now continuing on a new wave, stands out for its scope in history.

The Azerbaijani economy was quite well -prepared for the global crisis and maintained the

surplus in the net international investment position and the stable rate of the manat despite

high investment risks at the time of the crisis and the influence of the wave of devaluation

in neighbouring countries. This was possible due to the rational macroeconomic and DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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monetary policy in the country before the crisis, currency reserves that had been created

and the forward management of financial risks.

Along with that, the global crisis and its consequences necessitate the creation and

strengthening of protective mechanisms against depressive scenarios in m odern economic

architecture. Along with traditional rescue financial funds, it is of special importance to take

special anti -crisis measures that will be used in the state regulation of the economy,

secure the diverse structure of the national economy and its ability to quickly adapt to new

conditions.

5. In the current stage, one of the issues facing humanity and having a great

influence on the public and political life of every country is the disruption of the ecological

balance as a result of industriali zation which has been speeding up worldwide for years.

In the local and regional context, Azerbaijan’s ecological problems are mainly

related to oil extraction carried out for decades with imperfect methods in the Absheron

Peninsula and Caspian Sea without taking into account the ecological consequences.

Apart from that, the mass extermination of flora and fauna in the country’s Armenian –

occupied territories and large -scare arson fires on this territory have become one of the

biggest ecological problems. Th e formation of a large amount of Azerbaijan’s freshwater

reserves in neighbouring countries and their intensive contamination with chemical,

radioactive and other harmful substances on the territory of these countries causes

problems in supplying drinking water to the population. Apart from that, the Metsamor

Nuclear Power Plant, which is located in the seismic zone in Armenia and is outdated from

a technological point of view, is a source of danger for the entire region.

As a manifestation of the environme ntal balance on the planetary scale, climate

change and global warming are related to processes that can cause natural disasters

(rivers bursting their banks, flooding of entire villages and cities, precipitation much higher

than the norm, avalanches, etc. ). All these are factors that directly affect the economic and

social life of the country and need to be taken into account in the process of preparing

necessary policy measures. The experience of recent years shows that in order to

effectively fight natur al disasters and their consequences, the state should prioritize

relevant activities in emergencies and the establishment of rapid reaction mechanisms for

the social security of the population in such situations. At the same time, while drafting and

implem enting infrastructure projects in regions of the country, the high likelihood of natural

disasters should be taken into account, and relevant requirements should be considered

while designing and building infrastructure facilities of vital importance to en sure that they

keep their functionality as required.

DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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3. Azerbaijan 2020: Strategic View and Main Priorities

The main strategic view of the concept is to take account of the current

opportunities and resources and attain a stage characterized by sustainabl e economic

growth and high social welfare, effective state management and supremacy of the law, the

full ensuring of all human rights and freedoms and the active status of the civil society in

the country’s public life.

In 2020, Azerbaijan will be an econ omically and politically developed and

competitive country. Even in the most remote villages of Azerbaijan, all communications

required in the daily lives of citizens (communications, Internet, banking services, public

utilitizies, roads and so on), health and education services will be provided.

Azerbaijan will be a place where the population’s incomes are high, unemployment

is minimum, human capital is highly developed, the environment is protected and health

and every citizen has broad opportunities. As a result of the measures stipulated by the

concept, by the end of the period, the volume of per capita GDP in the country will

increase more than twice and reach 13,000 US dollars.

According to the World Bank classification of GDP, in 2020 Azerbaijan is e xpected

to become a full member of the group of “countries with high average income” and

eliminate its dependence on the export of hydrocarbons, which is the main reason for its

belonging to this group at the moment, and to reach the highest positions in t he group of

“countries with high human development” according to the human development

classification of the UN Development Programme.

From an economic point of view, the Azerbaijan Republic will turn from the region’s

leading state into a highly competiti ve participant in the international system of economic

relations. To this end, taking into account the favourable geographical position and broad

potential, it is planned to turn the country into the region’s commercial centre and to bring

the volume of pe r capita non -oil export to 1,000 US dollars.

In order to achieve the aforesaid goal, state regulation which ensures healthy

competition in market economy conditions, transformation into an export -oriented

economy that makes efficient use of energy and crea tes high added value and principles

of a complex approach to the development of socio -economic spheres will be taken as a

basis. Within the framework of the concept, it is planned to turn the country’s economy into

an economy based on efficiency as a resul t of a growth in general productivity and ensure

transition to a stage characterized by the dominance of innovations.

Increasing the competitiveness of the economy encompasses such fields as the

protection of macroeconomic stability, the strengthening of t he coordination of the DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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monetary and fiscal policy, the improvement of the business environment, support for

private initiative, the development of the market of financial services and the improvement

of the foreign trade and investment policy. During this period, it is planned to keep inflation

at the acceptable level and ensure gradual transition to a more flexible currency rate.

At the same time, purposeful measures will be taken to improve the structure of the

economy. The modernization of the oil and ga s sector and the petrochemical industry, the

diversification and development of the non -oil industry, the expansion of opportunities to

use alternative and renewable energy sources, the development of the agrarian sector, the

strengthening of food security , expansion and development of trade and types of services

and the improvement of the foreign trade and investment structure will be priority spheres.

It is planned that during the period covered by the concept, the average pace of annual

real growth in GD P in the non -oil sector will be more than 7 per cent.

The main task in the current stage is to speed up the diversification of the economy,

to maintain the high pace of the development of the non -oil sector in the future regardless

of the level of oil reve nues, to increase competitiveness and to develop export possibilities.

In the Development Concept “Azerbaijan 2020: Look into the Future”, an export -oriented

economic model is taken as a basis, and it is planned that increasing the competitiveness

of the e conomy and improvement of the structure will boost non -oil exports. Along with the

speedy development of the non -oil industry, the promotion and expansion of innovative

activity will create favourable grounds for the formation of an economy based on

knowle dge in the country.

In order to achieve these goals, it is important to make full use of all the country’s

possibilities, to make effective use of the existing economic, social and political resources

and create conditions for strengthening the country’s p otential. From this point of view, it is

planned to develop the energy, transport, transit and logistical infrastructure, to

concentrate on the development of regions, to form regional development centres taking

into account the competitive advantages of e ach region and to develop the infrastructure

and social services in cities and villages.

The expansion of opportunities for using ICT and communication services, the

creation of a reliable security system aimed at developing information and communication

technologies, the formation of national standards, as well as the launch of totally digital

broadcasting across the country and the halting of analog broadcasting, and the total use

of e -government services will be in the centre of attention as one of the m ain priorities in

the formation of Azerbaijan as a modern state.

The purpose of any economic growth is to increase social welfare. From this point

of view, one of the main priorities of the concept is the development of social spheres and

human capital. Wi thin these priorities, the main spheres are to increase the quality of DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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education and services, to strengthen social security, ensure gender equality and to

develop the family, youth potential and sports.

The issue of poverty within the framework of the con cept is assessed at the level of

the concept of “multi -factor poverty” in line with modern approaches to the human

development concept. Over the past 10 years, Azerbaijan has gained undeniable

achievements in drastically reducing poverty. The settlement of the problem of “absolute

poverty” in our country, i.e. the sharp decline in the number of families included in the

category of the poor within the framework of accepted criteria is a result of the successful

socio -economic policy. Within the framework of the current concept, the problem of

“absolute poverty” will constantly be in the centre of attention again, and along with that,

the expansion of the middle class and the strengthening of the role of this class is one of

the main purposes. The experience o f various countries shows that countries with a

stronger middle class are more sustainable from political, economic, social and other

aspects and have higher development potential.

Quantitative and qualitative indicators linked with the population and its structure

are the main elements of national power, and the protection of the gene pool of the

Azerbaijani people, issues like migration and demography are of special importance in

terms of national security. During the period covered by the concept, the co untry’s

population will increase by 1.1 per cent a year on average and is expected to total about

10.2 million in 2020.

In order to realize the targets stipulated by the concept, measures will continue to

constantly improve the legislative base and strengt hen the appropriate institutional

potential.

The preservation of cultural heritage, its effective management, the protection and

enrichment of new creative results, environmental and ecological problems are accepted

as the main priority within the framewor k of the concept, and it is planned to take the

appropriate policy measures in these fields.

4. Towards an economy with high competitive power

4.1. The formation of an economic model based on effective state regulation and mature

market relations

Achievi ng the socio -economic targets set within the framework of the concept

makes it necessary to form an economic system that is working highly effectively and has

enough competitive power on a global scale. Historical and modern experience shows that

such a sy stem can emerge only in market relations based on private initiative and free DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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competition. Along with that, ensuring a sustainable high pace of growth in economic and

social spheres requires the appropriate establishment of state regulation in market

relat ions and the improvement of this regulation considering the latest tendencies and

spheres in the world economy.

At the time of the end of the transitional period and formation of mature market

relations in Azerbaijan, state regulatory and administrative fu nctions will be carried out in

order to maintain macroeconomic stability, improve the business environment in the

country, ensure free competition, create favourable conditions for local and foreign

investments, implement regulatory measures to improve the structure of the economy,

implement investment and large -scale infrastructure projects and effectively organize the

social protection of the population.

The coordination of the macroeconomic policy will strengthen, an optimal

macroeconomic framework will take shape in terms of financial sustainability and an

appropriate monetary policy will be conducted. The first stage of this policy will include the

target of inflation, other macroeconomic targets and appropriate regulatory tools and the

second stage – targets of stability in the financial sector, activity in the sector and tools that

will manage risks. In line with the target of inflation, special attention will be paid to

meeting the economy’s demand for money and the institutional basis of monetary

man agement will improve.

Special attention will be paid to the establishment of fiscal discipline in the sphere of

forming and using budget resources, correct distribution of funds and increasing the

efficiency of expenses. Quick assessments of various budget risks (foreign, financial,

operational risks, etc.) will be carried out.

In order to increase the competitiveness of the economic system even further, the

passive taxation policy will gradually transform into an active taxation policy, while the

measures to be carried out to improve tax rates will help create a favourable environment

for business activity.

The mechanism of using oil and gas reserves will improve. A strategy will be

implemented to gradually replace the revenues from the sale of hydrocarbon reserves with

revenues gained from investing those funds, and work in this sphere will intensify.

A more flexible currency policy will be conducted as a separate important

requirement of improving the country’s solvency and orienting the economy towards

ex port, and the surplus in the net international investment rate will be maintained.

Measures to improve the business environment, the legislation and policy on

competitiveness will continue and mechanisms of protecting investors’ rights will be DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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improved. Th e sustainable and fair enforcement of laws and the formation of an effective

mechanism for the supremacy of the law will be kept in the centre of attention.

Measures will be taken to simplify and enhance foreign trade procedures and

increase state support for entrepreneurs in increasing their competitiveness on foreign

markets. Promotional activities will be carried out in order to increase the export capability

of small and medium -sized businesses, the provision of preferential loans to businesses

by the s tate will increase, anti -dumping and other protective measures accepted in

international practice will be taken to protect the domestic market from unfair competition.

At the same time, efforts will be mobilized to enhance customs, migration and other

proc edures and eliminate the factors that put investors off the local market. Conducting

reforms in line with the international trade system in order to join the World Trade

Organization (WTO) and bringing laws in line with practices applied in the world trade

system will ultimately open new opportunities for the development of local companies and

the country’s economy in general.

Along with that, the measures that will be taken to optimize the structure of tax rates

and mandatory state social insurance fees (t he parts paid by employers and insured

parties) will help create favourable conditions for business activity.

Measures to form a fair competitive environment and restrict monopolies in the

economy and especially on the consumer market will continue. Anti -m onopoly laws and

practices will be improved and practical measures will be taken to eliminate non -tariff

obstacles being applied in trade.

The protection of consumers’ rights will be improved, effective mechanisms to

control the quality of products will be created, national standards of quality control will be

prepared and the system of certification will be improved.

The creation and development of public unions of entrepreneurs, including

professional associations, will be supported and monitoring will be carried out regularly in

order to detect and eliminate the factors that prevent the development of business.

The measures that will be carried out in the period covered by the concept will

ensure the balanced development of the main segments of the market of financial services

in Azerbaijan (banking sector, non -banking credit organizations, insurance market, leasing

market, securities market and factoring market). Banking control instruments will be

improved, and appropriate measures will be taken to ensur e the stable and safe

development of the banking system. Consolidation measures and structural reforms in the

banking sector will continue, and stimulation of competition, increasing the quality of

banking -financial services, including the improvement of t he infrastructure of electronic DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

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payment systems and the expansion of its coverage zone will be kept in the centre of

attention. The capitalization of the banking system will continue, the expansion of the

banking network in regions will be promoted and the mechanism of mortgage loans will

improve. The electronic payment, post and savings systems will develop and the

protection of the rights of users of banking services will strengthen.

The increasing level of capitalization in insurance companies and the gr owing range

of insurance products, repeat insurance, as well as the expansion of the use of life

insurance and medical insurance will open the way for the development of the insurance

market in the country. In order to stimulate the insurance of agricultur al produce, it is

planned to improve the appropriate legislation. Also, the improvement of the legislative and

institutional environment for the provision of leasing services will allow leasing

organizations to develop and easily enter the market, which wi ll increase the share of

leasing as an important source of finances in implementing the infrastructure and

investment projects of leasing organizations and in improving the supply of equipment to

agriculture.

Important steps will be taken to form a securit ies market that will provide the

economy with broad capitalization opportunities that meet modern, international standards

and ensure reliable risk management. Systemic measures will be taken in order to limit the

disorganized market of securities and incr ease the attractiveness of the market for

investors, and the legislation that regulates the activities of the market’s professional

participants and mechanisms of overseeing them.

It is planned to take measures to improve the institutional development leve l of the

securities market, ensure that it meets international standards, increase the rate of

capitalization in the country’s economy and expand the use of non -inflationary investment

funds directed at the financing of economic projects through the stock market. At the same

time, the formation of appropriate conditions for economic entities and the population to

efficiently place their savings on the stock market and gradually integrate the country’s

securities market into the international capital market will always be in the centre of

attention.

4.2 The improvement of the economic structure and the development of the non -oil sector

During the period covered by the concept, it is planned to build, reconstruct and

modernize systems for the extraction, tra nsportation and refining of oil and gas. Also,

within the framework of the development of the economy on the basis of clusters, it is

planned to build a complex consisting of oil and gas refineries and petrochemical factories.

The establishment of the comp lex will make it possible to attract the necessary DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

15

investments, observe environmental rules, establish a production chain up to the

manufacture of the end product, increase the competitiveness of finished products and

expand export and the range in this fi eld.

At the same time, the involvement of the country’s natural and economic resources

in the economic turnover will expand and the efficiency of their use will increase.

During the period covered by the concept, it is planned to carry out stimulating

meas ures to speed up the use of alternative (renewable) energy sources, develop the

institutional environment, strengthen the scientific -technical potential, continue training

specialists and enlighten energy consumers. Along with projects carried out by the s tate in

this field, the close involvement of the private sector in this process will be promoted and

the quick regulation of alternative energy tariffs will be ensured.

A production, social and market infrastructure network that serves to develop the

non -oil sector and meets modern requirements and the use of modern forms of economy

and management will be expanded.

Measures will be carried out in regions to establish the activities of industrial

enterprises based on local raw materials at a qualitatively ne w level and to create new

enterprises. During the period when the concept is implemented, steelworks, oil and gas

refineries, petrochemical complexes, fertilizer factories, shipyards and cement plants will

be built in the country. The aluminium industry wi ll be developed, the production of first

aluminium will increase, a technological chain up to the production of the end product will

be established with the involvement of the private sector and the potential of export in this

sphere will expand.

The use o f innovative technologies in industrial enterprises will be stimulated and

special and general industrial estates will be set up. Along with the development of the

non -oil processing industry, the formation of the industrial estate infrastructure in econom ic

districts will be the main sphere of the state investment policy. From this point of view,

during the period covered by the concept, it is planned to create a special economic zone

and industrial estates in every economic district taking into account ec onomic potential

(including industrial estates for the processing of petrochemical products in Sumgayit, the

processing of domestic waste in Balakhani and the production of metal (aluminium)

products in Ganja).

Along with the development and boosting of th e export potential of the traditional

production spheres of the non -oil industry (chemical industry, metallurgy, machinery

construction, electrotechnology, electronics, light industry, food industry, etc.), the creation

of new competitive spheres will be s upported. Stimulating mechanisms will be applied to

intensify local and foreign investment in the country’s non -oil sector, while the investment DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

16

cooperation of the state -run and private sector in order to develop the export -oriented non –

oil sector will be developed.

Measures will be taken to encourage intellectual activity, create favourable

conditions for investment in innovation and creativity, ensure the sustainable development

of a creative economy based on intellectual property and increase its share in the

country’s GDP.

Within the framework of the concept, it is planned to develop the tourism

infrastructure, expand the scope of tourist services that meet international standards,

increase the competitiveness of this sphere and increase its special rol e in GDP. In order

to develop tourism, legislation and standards regarding this sphere will be improved, the

necessary measures will be taken to make full use of the tourism potential of the Caspian

Sea, tourism activities will be stimulated in the regions , information and propaganda work

will be strengthened, and various types of tourism and relevant tourism routes will be

created and promoted on the basis of national, historical -cultural, socio -economic and

natural features.

Special attention will be paid to the processing of agricultural produce as a sphere

that is of special importance in terms of developing the non -oil industry, and complex

measures will be taken to increase the productive capability of existing agrarian –

processing enterprises as a resu lt of the application of modern technologies and to create

new enterprises. State support will continue in line with international experience in order to

stimulate the intensive and effective development of the agrarian sector. Additional

measures will be taken to create an environment where the allocation of funds (loans) to

this sector by private banks and credit organizations will be encouraged, while the

mechanism of insuring agriculture will be improved. As a result, productivity in agriculture

will in crease and the rural population will become more closely acquainted with advanced

international experience.

In the next few years, the land market in the country will develop and farmers will be

encouraged to join farming traditions on a voluntary basis. M elioration and irrigation

measures will be strengthened, and measures will be intensified to prevent soil erosion

and the salination of irrigated sowing areas and to increase fertility.

The production of eco -friendly agricultural and food products in the c ountry will be

stimulated. Also, purposeful measures will be taken to protect genetic reserves and

biodiversity and to improve the production of saplings and seedlings, and breeding work.

The provision of agricultural producers with modern equipment, ferti lizers, seeds

and seedlings will improve. In the agrarian sphere, it is planned to improve scientific

support and staff training in the agrarian sector. In order to ensure the intensive DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

17

development of various agricultural spheres, stimulating measures will be implemented

and initiatives to support major grain -growing farms will be supported.

Considering the importance of creating warehouse complexes on the basis of the

most modern technologies in the region in terms of the intensive development of

agricultu re, the regulation of seasonal prices, prevention of loss of the harvest, protection

of the domestic market and export potential, and consistent measures in this sphere will

continue.

4.3 Support for scientific potential and innovative activity

In order t o ensure long -term sustainable economic development, form a knowledge –

based economy and speed up the creation of science intensive technology and products

(work and service), the expansion of innovative activity will one of the main fields. In this

connect ion, the development of science will be prioritized on the basis of its history in our

country and global tendencies, and the process of effective integration into progressive

world science will be continued. The scientific infrastructure will be improved, the material –

technical basis of science will be modernized and the digitalization of information support

systems in this sphere will be ensured.

At the same time, along with state funding, the financing of science from other

sources will be stimulated, an d this will ultimately strengthen the social protection of those

engaged in scientific activity and prevent “brain drain”.

In order to create an innovative economy in the country, the link between science

and production will be strengthened, and the necess ary mechanisms will be created in

order to carry out applied scientific studies in line with the requirements of the market.

State support measures will be implemented and the relevant legislative basis will

be created in order to stimulate the manufactur e of competitive products through

increasing innovative activity, establish the necessary mechanisms to implement

innovative activity, make effective use of innovative potential and ensure development.

Along with the development of innovative entrepreneur ship and the creation of a

favourable environment for the development of new types of activities and products, it is

planned to strengthen measures to transfer and use advanced technologies and to create

industrial parks and innovative zones to develop and apply science intensive products and

technologies. From this point of view, a relevant legislative basis will be prepared and

adopted, and it is planned to set up a State Fund for the Development of Information

Technologies in order to develop an economy based on innovative entrepreneurship and

knowledge. DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

18

The determination of links between economic goals and reserves, knowledge and

the duties of the cultural sphere, and the development of information technologies will help

develop innovative potential ref lected in the National Strategy on Intellectual Property and

the related state programme in the long -term.

In the next few years, advanced world experience will be used to complete the

process of forming a national innovation system that ensures the use, study and spread of

new knowledge and technologies in line with the requirements of the information society in

Azerbaijan.

5. The improvement of the transport infrastructure. The balanced development of

regions

In order to turn Azerbaijan into a regional trade hub, it is planned to make effective

use of the country’s strategic geographical position, develop transit and transport services

and form logistical centres in the regions of the country. All this will also increase the

country’s attractiveness as a production and investment centre and help create new

business and employment opportunities.

The mechanism of managing local and international cargo transportation will

improve and the integration of the country’s transport system into the international

transport system will expand. In this regard, it is planned to take general measures that

reflect a united strategic approach to automobile, railway, water, air and underground

(metro) transport.

In order to boost the country’s competitiveness in the Europ e-Caucasus -Asia and

North -South transport corridors, measures will be carried out to reduce the cost of cargo

transportation in Azerbaijani territory, reduce the time of import and export operations and

transit, and simplify procedures.

In the coming year s, the construction of the International Sea Trade Port in Alat will

be completed, the maritime fleet will be updated and expanded, a transport -logistical

centre will be built, the Baku -Boyuk Kasik and Baku -Yalama railways will be restored and

modernized a nd the Baku -Tbilisi -Kars railway will be put into operation in line with the

policy of diversifying the railway network. At the same time, the necessary reconstruction

work will be carried on the main railways, the rolling stock will be updated and transit ion to

an alternative current system in all railways will ensured.

In the East -West and North -South transport corridors, the country’s road and

transport infrastructure will be brought in line with international standards with the widening

of roads and co mpletion of projects to reconstruct and build roads of republican DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

19

importance. The construction of new roads will be accompanied with the principle of

ensuring the population’s security, the construction of intra -urban and inter -urban car parks

will be spee ded up, the relevant infrastructure will be improved and an intellectual

management system of transport will be implemented in big cities. The public transport

system in the capital and other cities, districts and villages will significantly develop. The

country’s railway system and air transport will improve even more and grounds will be

created for the regions’ balanced development and diversified progress of tourism.

During the period covered by the concept, the Baku metro will rapidly develop and

expan d, new stations will be built and the car fleet will be updated.

In the sphere of air transport, a new air terminal, runway and hangars will be put

into operation at Heydar Aliyev International Airport and a free economic zone will be

created in this area . Work to update the other six international airports and the air fleet will

continue.

Taking into account regional development priorities, the state’s infrastructure and

investment policies and business investment strategies will be coordinated and will be

prioritized mainly in terms of economic effectiveness (through analysis of expenses and

revenues). The differences between the country’s economic regions in terms of quality of

life, per capital production and the volume of investment will be reduced.

The flexibility of local government bodies in the adoption of economic decisions will

be increased within the framework of a modern approach. Special projects will be carried

out to develop rural areas and measures will continue to improve the infrastructu re and

social services. The problem of roads in regions and villages will be kept in the centre of

attention and relevant steps will be taken to meet the demand in the transport sector.

The improvement of the infrastructure in the country’s regions, the e xpansion of the

use of information technologies, the formation of tourist and recreational zones, territorial

production clusters in priority economic spheres and new regional development centres

considering the competitive advantages of every region will speed up the socio -economic

development of regions.

The regional development centres will stimulate balanced socio -economic

development in regions and reduce regional inequality and sharp differences in the

structure of the commodity turnover in economic districts, and slow down the concentration

of economic resources mostly in central cities.

DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

20

6. The development of information and communication technologies and ensuring

transition to an information society

The ensuring of transition to an information so ciety, the establishment of an

economy based on knowledge with the development of ICT, the expansion of the use of

ICT in state and local government bodies, the development of electronic services, the

development of the activities of the National Centre fo r Electronic Security, fully meeting

society’s demand for information products and services and the strengthening of

competitive and export -oriented ICT potential are priority tasks within the framework of the

Concept.

Appropriate measures will be taken t o develop the space industry, and Azerbaijan

will join the group of countries that have their own artificial satellites. The use of new

technologies in the telecommunications network and the package satellite transmission of

national radio and TV programme s will be arranged.

With the implementation of the Trans -Eurasian Information Super Highway project,

it is planned to eliminate the digital difference between regional countries, provide access

to cheap and high quality broadband Internet through the crea tion of a strong and

sustainable information infrastructure, develop the e -commerce and e -market system,

develop legislation in order to protect and ensure the security of participants in e –

commerce deals, and speed up the country’s integration into global information space.

In the coming years, due to the migration of many facilities protected from mutual

interference between ICT and intellectual property and by intellectual property rights, a

system will be created to manage digital rights based on the p rovision of services in the

format of online television and one stop shops.

Important indicators as the number of computers, telephones and mobile

communication employees, the number of households that have access to the Internet and

broadband communicati on services from home among all the households across the

country, and the correlation between the number of pupils and computers allocated to

them will improve, especially the level of digital preparedness will increase following the

expansion of the use of ICT in the regions. Telephone and Internet tariffs will be optimized

and the replacement of TDM telephone exchanges with IP telephone exchanges, the

expansion of the use of Wi -Fi technology, the establishment of 4G CDMA stations and the

organization of universal telecommunications and post services will be completed.

Measures related to the formation of an electronic government stipulate the

consistent and staged use of modern information -communication technologies, the

implementation of safe informatio n exchange within a single infrastructure, the provision of DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

21

e-services in functional tasks, the ensuring of existing information security, the training of

skilled users and specialists and activities in other important spheres.

7. The development of human capital and social spheres

The concept prioritizes the provision of high quality health and education services to

the population and the availability of these services to various social groups, including low –

income families and poor citizens as a strateg ic line.

7.1 The main tasks in the sphere of the population’s health and the health care system

To this end, it is planned to dynamically increase the share of the funding for the

health system in the gross domestic product and form mechanisms that ensure the

effective and purposeful use of the funds. In order to strengthen the logistical base of the

health system, health institutions will be constructed, refurbished, reconstructed, provided

with modern medical equipment and at the same time, the health ref orm will continue in a

planned manner. Measures will be taken to abandon extreme centralization in the

management of the health system and to replace purely executive functions in

management with administrative -economic forms and thus the powers of various

management entities will be effectively separated and their activities will be coordinated.

Mandatory medical insurance and on its basis, conditions will be created to improve

the quality of medical aid, protect patients’ rights and improve control mecha nisms. As a

result of reforms in the health system, medicine oriented towards in -patient aid will be

replaced with medicine where first medical sanitary aid is dominant and relevant conditions

will be created for expanding the practice of family doctors. A t the same time, active and

purposeful work will be carried out to improve out -patient and clinical services.

The state will carry out work to fight diseases (diabetes, haemophilia, thalassaemia,

oncologic diseases, immunoprophylaxis, hemodialysis, tuberc ulosis, AIDS, etc.) and

implement preventive measures, sanitary -educational work, and various state programmes

against drug addiction, alcoholism and smoking. Preventive measures against infectious

diseases will be strengthened, and a programme will be pre pared to develop the sanitary –

epidemiological service in 2015 -2020, which provides for appropriate measures. Along

with that, a special strategy will be adopted on the fight against non -infectious diseases

(smoking, obesity, lack of physical activity, abus e of alcohol, etc.) in 2013 -2020, and

practical measures will be taken to create conditions and opportunities for a healthy

lifestyle and expand educational work to boost the population’s responsibility and interest

in its health. DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

22

A state programme will be adopted to improve children’s health in 2012 -2020 and

preventive checkups and mass health examinations among children and teenagers will be

intensified. In order to strengthen the fight against infectious diseases, appropriate

measures will be taken amo ng children to carry out immunoprophylaxis. A national action

plan (2014 -2020) on the early prevention of typical children’s disability and health

institutions will specialize in various spheres in order to improve in -patient services to

children.

Along w ith that, measures will be taken to ensure that medicines of vital importance

are physically and economically accessible to all groups of the population. A single

registration system will also be created to ensure that medicines are of high quality,

effect ive and safe. Practical steps will be taken to prevent unlicensed and low -quality

medicines from entering the market.

The issue of improving staffing in the health system will be in the centre of attention

as the most important issue, appropriate mechanis ms will be created to constantly

enhance knowledge and skills and training will be organized in foreign countries.

Appropriate work will be carried out to create proper conditions for doctors and medium –

ranking medical staff working in rural areas and enco uraging material support mechanisms

will be determined. Measures will be carried out to apply the principle of assessing doctors’

work on the basis of the end result.

Various medical electronic registers, a system of citizens’ “electronic health card”

and a single health information system will be created to monitor the population’s health.

7.2 The formation of a modern education system

In 2012 -2020, the share of the funding for education in GDP will increase from year

to year and reach the appropriate in dicator in developed countries. Stimulating

mechanisms will be created to increase the quality of education, and the financing of

grants that promote per capita funding and innovative activity will be expanded.

Management will continue to be improved in e ducation and a management model

that ensures the involvement of all interested sides will be prioritized. This will be carried

out through reforms to increase the independence of all kinds of education institutions, to

manage education centres in a state -public form through the broad involvement of the

public (parents, pupils, students, local community, etc.), to apply other modern

management technologies, etc.

The level of children’s involvement in pre -school education will reach average

European indicato rs. To this end, support measures will be carried out and mechanisms of DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

23

encouragement will be created to expand the chain of state kindergartens, create pre –

school education institutions that belong to different forms of property (municipal,

community, pri vate and family kindergartens) by improving conditions and supplies.

Work to construct and refurbish schools will continue and a special programme will

be drafted and implemented to rationalize the network of general education institutions.

Transition to a 12 -year general education system will be secured. In order to ensure

transition from the “memory school” that slows down pupils’ intellectual activity and general

development to the “school of ideas and thought”, systemic measures will be implemented.

Ed ucation at the level of full secondary education will be organized on the basis of

specialization and individual developing programmes will be created for talented children.

At the same time, various developing, correcting and inclusive education programme s will

be created for children who need special care and have limited physical abilities.

University estates (campuses) and appropriate industrial parks will be created for

institutions of higher education. Standards will be prepared and applied that will support

institutions of higher education in nurturing specialists with knowledge and skills that meet

the country’s socio -economic development requirements and in turning into centres of

education, research and innovation.

The computerization of the info rmation system will always be in the centre of

attention as one of the main directions of establishing general education at a modern level.

In 2013 -2020, a state programme will be adopted to computerize the education system in

the Azerbaijan Republic. With in the framework of the state programme, all the education

institutions of Azerbaijan (including schools located in remote regions) will be provided with

access to the Internet, every education institution will be provided with the necessary

technical equi pment and connected to the single Education Network of Azerbaijan. Every

classroom in schools will be provided with a laptop, projector and electronic table, while all

pupils will be provided with a netbook or tablets within the framework of the project on e

pupil – one computer.

The use of electronic education technologies will significantly expand and a virtual

learning environment will be created for teachers and pupils. To this end, the creation of

electronic education and methodical resources on all su bjects will continue, and “Cloud’

technologies will be used to safely keep electronic resources and ensure easy access to

them. Open Education Resources operating free of charge will be created, and these

resources will be integrated into the education pro cess and relevant free use with

copyright licences. The number of “electronic schools” will reach 1,000. To ensure self –

education and the growing demand for lifetime education, libraries will be modernized and

opportunities for using digital education reso urces will be expanded. The number of

electronic libraries will increase, a Distant Education Centre will be created and the use of

distant education in institutions of education will expand. DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

24

The effective integration of ICT into the management of educati on will continue and

information -based management mechanisms will be used through the creation of a single

information system for education. The use of the system for the electronic turnover of

documents will be expanded and as a result, transparency in th e management of the

education system will grow. At the same time, an online TV channel Tahsil TV will be

established and presented to the general public.

Taking into account that the factor of teachers is of special importance in the

efficiency of the edu cation and its achievements, special importance will be attached to the

strengthening of teachers’ training. All general education teachers will specialize in

active/interactive teaching technologies and inclusive education, and a flexible system will

be c reated to ensure that every teacher learns ICT skills. The training of Azerbaijani

teachers will be brought in line with international standards, a stimulating refresher training

system for teachers based on a new module -credit system will be developed and

mechanisms that meet modern requirements will be created to ensure teachers’ career

development, stimulate their activities and spread the working experience of leading

teachers. Along with that, differential salaries and an awarding system based on resul ts

will be created. The new mechanism employed in the recruitment of pedagogical staff will

be improved even further, and material stimulation measures aimed to providing remote

village schools with pedagogical staff will be strengthened.

The integration of Azerbaijani education into world and European education will

increase. Along with the unification of education standards and deepening of the Bologna

Process, attention will be paid to the expansion of the international relations of Azerbaijani

institut ions of education, especially institutions of higher education, and the creation of

appropriate conditions for their active involvement in international programmes being

implemented in the sphere of education.

At the same time, the number of Azerbaijani s tudents studying in leading foreign

universities at the expense of the state will reach 5,000 by 2015, and the efficient use of

the potential of specialists educated abroad in the country’s development will be ensured.

A new state programme will be adopted on the education of young people in foreign

countries in 2015 -2020.

7.3 The improvement of the social security system

In order to ensure social security for the population, purposeful measures will be

continued within the framework of the current “state programme on the development of the

insurance -pension system in the Azerbaijan Republic in 2009 -2015”. In order to deepen

the current pension reform even further, a new state programme will be drafted for 2016 – DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

25

2020. As a result of the measures that will be implemented, the compulsory state social

insurance system will improve and state pension saving mechanisms will be created.

Issues of transferring some of the compulsory state social insurance fees into a

saving account, the application of voluntary pens ion insurance and the involvement of

private pension funds in managing the funds accumulated in private saving accounts will

be resolved. At the same time, citizens will be provided with easy access to information

about the amount of social insurance fees accumulated in their individual accounts.

The registration of insurers will be totally automated, the insurees will be

automatically registered in the state social insurance system, information about

compulsory state social insurance accounts and about in surees will be passed and

received electronically, and insurers will be audited automatically. Along with the aforesaid,

citizens of the country will not need to provide any document to get their pensions, the

appropriate request will be submitted electron ically and pensions will be appointed from a

single centre in an automatic way on the basis of electronic requests from citizens.

In order to secure a worthy lifestyle for working citizens, measures will be taken,

depending on economic development, to gra dually increase the amount of minimum

wages to minimum living standards and the norm determined in European countries – 60

per cent of the average monthly salary. The difference in the population’s incomes will be

reduced as a result of continuing work to increase the share of wages in the population’s

general incomes and appropriate measures in the sphere of social security. Work will be

strengthened to ensure safe and healthy working conditions for working citizens and a

state programme will be prepared t o protect labour and improve working conditions.

A national information system in the field of labour and employment will be created,

a system for monitoring and analyzing the situation on the labour market will be

established and serious measures will be taken to prevent unofficial employment.

The population’s social security system will improve, and along with the

strengthening of the material -technical base of government agencies providing social

services and expansion of their types and networks, the sector of private and non –

commercial organizations working in this sphere will be developed.

The number of social apartments (houses) will increase and the main groups of the

population will be provided with a legal right to live in these apartments.

Soc ial allowances will be unified and measures to increase their amount will

continue. The system of allowances given to families with children will be improved. Rules

of identifying families’ need for social aid in order to establish a modern social security

system and to reduce poverty will be improved and the level of the needs criteria will DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

26

constantly increase in order to bring it in line with minimum living standards. The

effectiveness of social aid will be increased through the use of modern social techn ologies,

and along with the existing targeted state social aid system, active social aid programmes

(self -support, preferential social crediting) will be applied.

Mechanisms will be created to support incomplete, low -income families and families

who adopt orphan children, and appropriate measures will be taken to expand the system

of care. Rehabilitation centres will be created to prevent homelessness among those who

have not yet come of age and a community -based rehabilitation network in regions for

child ren with limited physical abilities will be expanded.

Appropriate projects will be prepared and implemented to prevent the isolation of

the disabled from society and to enable them to use the infrastructure without hindrance.

Also, in order to develop the skills and abilities of those persons and increase their

employment opportunities, the number of social and professional rehabilitation enterprises

will be increased. Disabled people will have wider opportunities to benefit from information

and communicat ion technologies and obtain information through communication systems.

In order to improve the housing conditions of displaced persons, enhance the social

infrastructure in areas densely populated by them, increase employment, allocate

microcredits, suppo rt young displaced persons, provide professional training and other

measures, communities will be developed, education and health programmes will be

expanded, new buildings will be constructed for education and health institutions working

in decrepit build ings and provided with appropriate equipment. Great Repatriation (Great

Return) programmes will be prepared together with international financial organizations,

UN agencies, especially the UNHCR and other international humanitarian organizations

and the pu blic will be constantly informed about it.

International cooperation in the sphere of improving the system of regulating labour

migration will continue and the business of dispatching citizens of the country to foreign

countries as labour migrants will be regulated in compliance with international experience.

At the same time, appropriate work will be carried out to create an efficient mechanism

regulating the use of social allowances by refugees from other countries, prevent the

illegal influx of foreign labour force into the country and strengthen the social security of

our citizens working abroad.

Necessary measures will be carried out to improve the system of preventing and

managing emergencies in order to ensure the population’s security in crisis sit uations,

automate management in this sphere and apply information technologies, carry out civil

defence, fire and rescue work at a high level, protect the population and territories from

natural and manmade emergencies and carry out educational work in eme rgencies. DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

27

7.4 The provision of gender equality and the development of family

The gender problem in the country will remain in the centre of attention and

appropriate measures will be taken to resolve it. The main direction of the state policy in

this sphe re will be to take measures to prevent gender violence, create equal opportunities

for women and men on the labour market, promote women at work and expand their

opportunities to occupy leading positions.

The strengthening of the social security and prote ction of mothers and children, the

facilitation of childcare for working parents in compliance with the ratified ILO Convention

“On Workers with Family Responsibilities”, increasing the number of kindergartens and the

development of the family planning ser vice will be supported.

A number of special documents will be adopted to implement the above tasks. In

this connection, it is planned to draft “Azerbaijan’s family strategy”, a national action plan

on gender equality, a children’s code and a national chil dren’s strategy. Along with that, an

institute of “family psychiatrists”, help centres and shelters for women subjected to

domestic violence, and a system to monitor evasion of education and early marriages will

be created.

7.5 The development of youth pot ential and sports

In order to ensure a healthy and active lifestyle for the Azerbaijani youth and their

integration into society, a strategy for the development of the Azerbaijani youth in 2013 –

2020, a national strategy for the development of physical tra ining and sports in 2012 -2020

and a state programme covering 2013 -2016 will be prepared and implemented.

The legislative base in this sphere will be constantly updated, advisory councils of

young people will be set up under heads of the executive authorit ies in districts (cities) to

support the systemic development of physical training and sports, and local municipal

bodies will be actively involved in organizing, conducting and developing the physical

training and sports business.

In order to meet the de mand of young people and young families for housing, the

terms of social mortgages will improve and reaction and training centres will be opened for

young people with limited physical abilities.

The network of information and counselling services for youn g people, especially

those living in remote and rural areas will be expanded. In order to develop the working

skills of the younger generation and to ensure that young people quickly learn labour and

economic issues, effective forms and methods will be imp lemented. Young specialists who

graduate from Azerbaijani and foreign institutions of education will be encouraged to work DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

28

in regions of Azerbaijan, and in this connection, additional social mechanisms (rise in

allowances and wages, allocation of service a partments, etc.) will be created and applied.

By 2020, training and appropriate sports bases will be created for republican sports

federations, sports clubs (professional clubs) and children’s and youth sports schools.

Work to strengthen the logistical ba se of physical training and sports institutions will

continue, while staff training will improve and the social protection of specialists working in

this sphere will strengthen.

8. The improvement of legislation and strengthening of institutional potentia l

In order to achieve the goals stipulated by the concept, consistent measures will be

carried out to improve the legislation and strengthen the appropriate institutional potential.

In improving the legislation, the principle of effective state regulatio n, which ensures

healthy competition in market economy conditions, will be taken as a basis. The

improvement of the business environment and priorities of bringing the national legislative

basis in line with the requirements of the international trade syst em will be the focus of

attention, while executive discipline and the supervisory system will be strengthened in

order to ensure the supremacy of the law.

Legislation will be improved and effective measures will be taken against copyright

violations, incl uding piracy and counterfeit products.

The activities of the law -enforcement agencies will be brought in line with modern

requirements, while the principles of transparency and openness will be taken as a basis

in their activities. The court infrastructur e will be improved, these activities will include

electronic services, and citizens’ right to justice will increase. Increasing citizens’

(especially those living in regions) legal awareness will always be the focus of attention.

In terms of implementing the goals stipulated by the concept, the strengthening of

institutional potential will include three main directions: the development of human

resources in the state -owned sector, the expansion of the activities of the electronic

government and the continu ation of institutional reforms.

The strengthening of public servants’ social protection and social security system,

the expansion of the fight against corruption, the strengthening of the potential of

municipalities, the training of specialized staff in t he sphere of municipal administration,

measures to support the activities of non -government organizations, especially in regions,

will continue. DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

29

Special attention will be paid to the division of state resources between priority state

services and to their efficient and economical use. As an important and integral part of

democratic and transparent governance and in line with the principles of equality,

neutrality and openness, citizens’ rights to access information disseminated by the state

will increase a nd a number of services in the state sector will be handed over to private

enterprises specializing in appropriate spheres.

In line with the concept, complex measures will continue to improve methods and

mechanisms of governance in government agencies and to ensure that citizens and

organizations can use services in a simple, easy and free manner, while the number of

state services provided to the public through electronic channels will increase.

Necessary measures will continue to protect the domestic ma rket from hazardous

products, to eliminate technical obstacles in trade, bring the system of standardization,

which is of importance in the development of trade, in line with international requirements

and to improve and develop it.

Based on international experience, it is planned that every government agency and

enterprise will prepare and implement a strategic plan in order to determine the priority

development goals of government agencies and enterprises in spheres of activity, to bring

those goals in l ine with relevant state programmes and effectively implement them.

9. The development of civil society

The rapid socio -economic development of Azerbaijan and the ensuring of national

interests make it necessary to deepen democracy even further, constantl y modernize

relations between the state and civil society institutions and stimulate the activities of

NGOs. During the period when the concept is implemented, the development of civil

society and the state policy to enhance cooperation between government agencies and

civil society institutions will continue.

To this end, “a national action plan on the development of civil society” will be

prepared and implemented. The programme will provide for the preparation and adoption

of new legislative acts that sti mulate the development of civil society and the support of the

state and private sector for civil society, an increase in financial aid to NGO projects and

programmes, the creation of “NGO houses” and education centres and other issues.

NGOs’ substantiate d proposals on the improvement of mechanisms of cooperation

between the state and public organizations and on alternative solutions to problems in

various spheres of public life will be the focus of attention. NGOs will be involved in the

preparation of st ate programmes of special importance and will closely participate in the DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

30

work of public commissions. NGOs’ potential in informing the world public and international

organizations about the fair position of our country on the Armenian -Azerbaijani Nagorno –

Ka rabakh conflict will be used more effectively.

In order to develop civil society, it is important to stimulate the private sector’s donor

activity and achieve an institutional level in this sphere. The creation of a national donor

institute will give an i mpetus to the formation of corporate culture of social responsibility

and increase social investment programmes by transnational companies and large

business organizations. In order to achieve this, a strategy and state programme on

corporate responsibilit y will be prepared and appropriate changes will be made to the

legislation.

The consideration and application of civil society initiatives during the period when

the concept will be implemented will deepen mutual relations between government

agencies and NGOs, while the number of NGOs in regions will increase and their material –

technical base will strengthen.

In the long -term implementation of the concept, measures aimed at developing

freedom of speech and information will continue, the national legislati ve basis regulating

the activities of the information and mass media will be improved in line with international

standards, and comprehensive support will be given to strengthen the economic

independence of the mass media, increase their potential and ensu re their leading position

in global information space.

Necessary measures will be taken to determine and implement priorities in the

information sector in the current period when a trans -border information –

telecommunications network and information societ y are taking shape, and the study and

application of modern methodological and technical innovations will speed up. Increasing

the quantity and quality of national information resources in the global network, expanding

their coverage area and strengthening their ability to influence international public opinion

will be one of the main tasks.

As an effective means of forming and expressing public opinion in the modern

period, the role and importance of the mass media in society are high. For this reason, th e

implementation of legal, economic, organizational and technological measures aimed at

balancing the interests of persons, society and the state in their activities and ensuring

information security are one of the major directions of the state’s informati on policy.

Along with stimulating new manifestations in the information sector, the Azerbaijani

state will also continue to effectively organize the activities of traditional information

resources and support the strengthening of their logistical basis. I n compliance with the

“Concept of state support for the development of the mass media in the Azerbaijan DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

31

Republic”, along with funding for media projects, they will also receive subventions,

subsidies and preferential loans through the Fund of State Support for the Development of

the Mass Media under the President of the Azerbaijan Republic. In order to develop the

media operating in regions of Azerbaijan, editorial offices will be given targeted aid, and

the creation of “Press Houses” and regional publishin g houses will be supported. In order

to ensure the economic independence of the mass media, the expansion of the

advertisement market will be stimulated and problems existing in this sphere will be

eliminated.

The state policy of strengthening the social security of mass media employees and

solving their housing problems will have a sustainable nature.

Increasing the professionalism of journalists is one of the main conditions for

forming a democratic and responsible press. In order to achieve the tasks t hat have been

set, attention to the training of journalistic staff will be increased, and joint events will be

continued with international organizations and foreign media organizations in order to

increase the professionalism of Azerbaijani journalists.

In line with the law of the Azerbaijan Republic “On access to information” adopted in

2005, the activities of structural sections of government agencies responsible for providing

information will be improved and Internet information resources will be devel oped.

Measures will be stepped up to ensure the rights of the mass media to access and

disseminate information, to increase mutual trust between government agencies and the

media and to strengthen cooperation.

10. The protection and effective management o f cultural heritage

Necessary work will be carried out to promote the rich traditions and customs of the

Azerbaijani people, maintain national holidays and ceremonies, reconstruct historical

symbols and legends, promote national music and dances, maintain oral folklore, restore

national games and performances, develop the rich traditions of painting, decorative and

miniature arts, study samples of Azerbaijani arts kept in the world’s influential museums,

prove their belonging to Azerbaijan, and promote our arts in UNESCO, ISESCO,

TÜRKSOY and other international organizations.

Taking into account the illegal misappropriation and groundless losses of integral

parts of non -tangible cultural heritage, additional measures will be carried to maintain

creative ac hievements and innovations generated collectively and handed down from one

generation to another and include samples of folklore and traditional knowledge on the

UNESCO special list. Also, national legislation in this sphere will be maintained in a DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

32

complex manner, copyright and related rights will be protected and participation in the

application and development of the international legal base will be ensured. Systemic

measures will be taken to establish the logistical basis in the sphere of culture in line with

modern standards, make wide use of information and communication technologies,

increase efficiency in the use of funding allocated from the state budget and use funding

from legal sources. Along with that, necessary work will be carried out to create an

educational course on culture at institutions of the system of paid cultural services and at

institutions of secondary and higher education.

In order to adopt a state programme on the restoration and protection of immovable

historical and cultural mon uments and improvement and development of the activities of

cultural reserves in 2013 -2020, a single electronic database and register will be created in

this sphere.

In order to protect and effectively manage archaeological heritage, necessary work

will b e carried out to support the activities of organizations studying archaeological

heritage in our country, complete the study of archaeological zones and sites of ancient

cities and use those territories for cultural and tourist purposes.

Taking into accou nt social, economic and cultural development in the republic, a

new approach will be taken to the museum business, and in order to ensure the complete

protection of items kept in museums, an electronic database on museum items and a

centralized information system of museums will be created in line with international

standards. Work will continue to refurbish and build museums, strengthen their logistical

base and create new museums.

Work to collect material in order to return museum items stolen in the occ upied

territories, to study exhibits of Azerbaijani origin kept at world museums and prove their

belonging to Azerbaijan will continue.

Along with the development of mechanisms of cultural -political support for the non –

tangible cultural heritage of Azerba ijan, consistent measures will be taken to organize

spheres such as the study of regional history, folklore and popular applied arts, and

international promotion in this field will be a priority task.

A special programme and action plan will be drafted an d implemented to familiarize

the countries of the world with the Azerbaijani language, Azerbaijani culture and history.

An action plan will be developed to expand the ability of special social groups in the

country to use cultural facilities and services. Also, necessary work will be carried out to

prepare appropriate state programmes on the printing and book business, develop the

country’s library information network, provide libraries with literature and modern DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

33

information carriers and increase state sup port for private entities operating in the cultural

sphere.

11. Environmental protection and ecological issues

One of the main targets of the concept is to achieve sustainable socio -economic

development from an ecological point of view. The necessary meas ures will be continued

in the future to protect biodiversity, neutralize the negative impact of the fuel -energy

complex on the environment, eliminate the pollution of the sea and its basin and protect

them, restore green areas and effectively protect the e xisting resources.

In the sphere of creating and restoring forests, the correlation of forests to common

areas will increase, road -protecting green areas will be created to protect roadside areas

and the atmosphere and to reduce traffic noises. National st andards will be prepared and

applied in line with European standards adopted on poisonous substances released into

the atmosphere.

During the period covered by the concept, it is planned to bring the amount of

energy used for the production of one unit of GDP and the amount of carbon dioxide in line

with the appropriate indicator of member countries of the Organization for Economic

Cooperation and Development, and this is important in terms of implementing the

development goals of the millennium.

Necessar y work will be carried in order to save, neutralize and utilize raw materials,

make effective use of natural reserves, protect the environment and apply technologies

that produce little or no waste. Progressive methods will be used to manage waste and

ente rprises will be established to recycle industrial and domestic waste.

Zones where emergencies are expected due to floods will be identified and

forecasts will be regularly made to be used by relevant organizations.

In order to make effective use of land resources, measures will be implemented to

prevent desertification, rehabilitate lands that have become unusable as a result of the

activities of major industrial and mining enterprises, improve the system of using lands

suitable for agriculture and streng then the protection of lands from anthropogenic

contamination.

Over the past 10 years, Azerbaijan’s urban population has relatively increased. The

tendency towards urbanization is expected to continue in the coming years, and this puts

forward new require ments for the formation of the urban infrastructure. Requirements for

environmental protection will be prioritized to prevent damage to the environment during DEVELOPMENT CONCEPT “AZERBAIJAN – 2020: OUTLOOK FOR THE FUTURE” Project

34

construction work in the capital and other parts of the country (both by the state and

private se ctors) and while taking measures to develop all industries.

During the period covered by the concept, comprehensive reforms will be carried

out in the housing sphere, the access of the country’s population to enhanced water

supply services and sewer syste m will be improved, cities and villages will be provided

with purifying installations and the system of monitoring in this sphere will be improved. A

new heating system will be installed, the zone of heating supplies will be expanded, new

heating sources w ill be built and economically ineffective boiler houses will be closed.

Along with all this, practical steps will be taken to improve the legislation on

environmental protection in compliance with advanced international experience and create

effective mon itoring and supervision mechanisms. At the same time, measures will be

implemented to support scientific research in the sphere of protecting the environment and

nature and the creation of the necessary infrastructure for such activities will be planned.

Special attention will be paid to public awareness measures in order to develop

international cooperation on the protection of the environment in the country and foster a

culture of environmental protection.

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