Nijat Hajizadeh, head of a department at the CAERC, commented on Azerbaijan–Turkey economic relations in the context of the official visit of Turkish President Recep Tayyip Erdoğan to Azerbaijan.

He highlighted that the economic policies led by Azerbaijani President Ilham Aliyev and President Erdoğan have positively influenced economic growth and development in both countries. Turkey’s emergence as a strong regional and global power under Erdoğan has further strengthened its economic and political influence.

Key infrastructure projects have been pivotal in deepening bilateral economic ties. The Baku-Tbilisi-Ceyhan (BTC) oil pipeline has boosted Azerbaijan’s macroeconomic stability and household incomes through oil export revenues. The Baku-Tbilisi-Kars (BTK) railway has expanded trade between the two countries and facilitated Azerbaijan’s exports from Central Asia to global markets. Recent statistics show both economic and political dividends from these projects.

Tourism and trade flows underscore the strengthening ties: in 2019, Azerbaijan received 3.2 million foreign visitors, up 11.4% from 2018, with 10% from Turkey. Turkish visitors increased by 8.6% to 316,000. Outbound Azerbaijani travelers rose by 13.4% to 5.567 million, with 11.4% visiting Turkey.

Bilateral trade continues to grow. Turkey is Azerbaijan’s second-largest trade partner after Italy, with total trade reaching $4.5 billion in 2019, a 33% increase. Azerbaijani exports to Turkey rose 36% to $2.9 billion, with non-oil exports showing notable growth. Imports from Turkey increased by $69.9 million to $1.6 billion. Positive trade balance with Turkey has been maintained since 2017, reaching $1.2 billion in 2019, a record high.

The visit included signing the Preferential Trade Agreement between Azerbaijan and Turkey, expected to further boost bilateral trade. Existing free trade agreements with CIS countries provide price advantages for Azerbaijani products, and similar preferential agreements with Turkey will enhance trade further. Harmonization of technical regulations and standards under the 2012 Memorandum of Understanding will simplify trade documentation and leverage Turkish experience for EU market compliance.

On investments, Azerbaijan is Turkey’s largest investor, hosting nearly 4,000 Turkish companies and projects totaling approximately $16 billion. Bilateral investments include $18 billion from Azerbaijan into Turkey and $12.5 billion from Turkey into Azerbaijan.

Energy cooperation is highlighted by the Trans-Anatolian Natural Gas Pipeline (TANAP), ensuring energy security for Turkey and Europe. TANAP began deliveries to Turkey in 2018, initially 16 bcm annually, with phased increases to 24 bcm and 31 bcm. By 2020, TANAP connects to the Trans Adriatic Pipeline (TAP), supplying gas to Greece, Albania, and Italy via the South Caucasus Pipeline.

The presidential visit also advanced tourism and investment opportunities, supported by the mutual visa exemption agreement, enabling Turkish investors to conduct business freely in Azerbaijan and stimulating cross-border tourism.