Place of Communications Sector in Non-oil Economy of Azerbaijan

The desired departure of the Azerbaijani economy from raw materials dependence and the development of the non-oil sector of the country on the basis of the "digital economy" would apparently determine successful ways to develop and strengthen the entire economy of our country during the pandemic. Apparently, our country would dream of developing the non-oil sector (for example, as in Norway) and would like to have a real growth strategy for the most important sectors of the country's economy: construction, tourism, agriculture, transport, and telecommunications (for example, in the field of information technology). https://www.azerbaycanli.org/?page=193&lang=rus

By the way, it has already been stated: “The growth of non-oil GDP in Azerbaijan in the first quarter of 2020 was, in particular, ensured by a 23% growth in the non-oil industry.”

http://www.turan.az/ext/news/2020/4/subsc/economics%20news/ru/123208.htm

The share of the communications sector in this growth is interesting and it is interesting why this is all happening.

Apparently, today the Corona Virus is fundamentally changing our world. So, in the USA and Europe, trade and the entire business and political world, as well as education, are almost completely switching to online mode, thanks to the development of Internet services. It is clear that people's well-being really depends on the long-term concept of the development of the non-oil sector, including transport and communications, and this serves as the basis for the prospective development of a market and digital economy in Azerbaijan. And the Corona Virus pandemic catastrophically brings down energy demand and exacerbates the vulnerable overproduction of oil and oil products.

This is probably why the basis for the development of the communications sector of Azerbaijan (as a non-oil sector of the country), taking into account the recommendations of the International Telecommunications Union (ITU), represented by the Ministry of Transport, Communications and High Technologies (MTCHT), should be carried out in the following five main directions:

• Technological policy (plans, projects, specifications, tenders ...);

• Financing (planning, management, advice, funds);

• Digital management (structure, regulation, management);

• Remote commerce (marketing, sale of services, etc.);

• Personnel (technology policy, finance, management, commerce and online education).

After all, the European Community (EU), speaking about the communications sector, has always believed that companies providing communications services provide one of the most profitable services in the business world - moreover, more than banking, oil refining, food production, chemical production, or aerospace business ...

But the question is how realistic is the profit of the communications sector (MTCHT) in the annual statistics of Azerbaijan, and how transparently the revenues of the communications and transport sectors enter the country's non-oil economy.

Apparently, therefore, special importance should be given to the prognostic tasks of the development of the communications sector: the forecast of the basic indicators of the new integrated MTCHT sector (for example, for a five-year period) taking into account possible levels of investment; a forecast of the technical level of the phased development of the transport and subscriber communication networks for a period (for example, for 10 years); and finally, the development of the Master Plan (master plan for development) of the country's telecommunications until 2035, indicating specific objects and the timing of their implementation (for example, for 15 years), etc.

Today, the communications sector, computers, the media (media) and their interconnection (represented by social networks) have become so unified that any events on any end of the world immediately become the property of the whole world with all the transparent details. Apparently, a structural adjustment of the management of the largest ministry of the country (MTCHT) is necessary, dividing the authority of the ministry into two independent units, separating telecommunication services (operator functions) from interconnection and settlement services (regulator functions) outside government agencies, which would be an outlet from the monopoly for all operators and providers in the country. An independent regulator outside government agencies is really a real demand for both the market and the digital economy of the country.

And the primary task of the communications sector is to take an inventory of real income statistics of Azerbaijan’s existing communications networks (managed by MTCHT), especially revenues from international communications, as the most profitable part of the communications sector, with examination and technical audit of all applicable network and administrative solutions in the country to ensure reliability, competition and alternative communications sector.

In the early years of the 21st century, the period of the so-called “telephone war” against the AzEuroTel JV, the revenues of this company were apparently more than the revenues of the Ministry of Communications, and the war seems to have begun the destruction of the first alternative telecommunications company in Azerbaijan.

http://vyshka.azeurotel.com/arxiv/2003/10/2.htm

Apparently, alternative planning, design and construction of new elements of the communication network is necessary, taking into account national security requirements, and most importantly, the technological unity of the communication equipment of two sectors (transport and communications) of the country, for unification and efficiency of MTCHT taking into account the recommendations of the ITU. It is for this that the country's training, research and design institute of communications (or at least three in one, creating a new University of Transport and Communications of Azerbaijan) is required for someone to do all this.

Given that in Azerbaijan, unfortunately, non-specialists are also appointed to manage sectors of the economy (this is common throughout the world today and representatives of the ruling party are brought to management), for the successful development of sectors of the economy, industry-specific institutions are required (mentioned above). Alone, not a single minister, any expert, or even an outstanding specialist is able to solve these problems without the above institutions.

Look at how many industry institutes there are in education, in medicine, in petrochemical industry, etc. So why aren't they in such a huge and integrated MTCHT?

At one time, the Program approved by the President of Azerbaijan on February 17, 2003, entitled “The National Strategy for Information and Communication Technologies for the Development of the Republic of Azerbaijan (2003-2012)” gave us great hope. This was a necessary and joint project of the Government of Azerbaijan and a grant of the United Nations Development Program (UNDP) - Project-AZE / 01/003-NICTS. But we, unfortunately, did not even comply with the order of the President of Azerbaijan on the establishment of the University of ICT.

 http://www.1news.az/chronicle/20130201070925638.html

For more than a hundred years, all telecommunication enterprises operating in Azerbaijan have carried out their services exclusively on the basis of underground and ground facilities belonging exclusively to the republic’s signalmen, represented by the Ministry of Communications (today the Ministry of Transport, Communications and High Technologies - MTCHT), having no alternative and competition in the communications sector (and we have not defended our unique Joint Venture (JV) AzEuroTel).

The question is, why over the years of independence, in terms of per capita income of the communications sector as a percentage of GDP, we have remained somewhere in the last places among the CIS countries, and why are the communications sector revenues not clearly visible in the country's non-oil revenues?

http://www.cnews.kz/reviews/index.shtml?2008/04/17/106340

One can recall the pathos interview of the Ministry of Communications and Information Technologies of Azerbaijan, given to the Rossiyskaya Gazeta Russian newspaper on March 29, 2013, which stated: "In ten years, revenues from the IT sector will amount to about 10% of Azerbaijan’s domestic product."

 https://rabita.az/ru/c-media-ru/intervyu/details/149/

However, about a year and a half after the interview, the most shameful event of the fall of 2015 occurred - the dismissal of the Minister of Communications and the investigation of the 10 leaders of the country's communications sector over the next two years. Although even before the interview, on February 7, 2013, Azerbaijan launched its first communications satellite, and before that, on December 9, 2012, the Azerbaijan Service and Assessment Network (ASAN) terminal was launched in Baku, and even earlier there was an order from the President of Azerbaijan dated November 29, 2011 No. 1862 on the development of the country, and one could also expect the success of the concept “Azerbaijan in 2020: a look into the future”, where a double increase in gross domestic product (GDP) was expected over the next 8-10 years

(https://president.az/files/future_ru.pdf).   

Probably, “this was supposed to be achieved through the development of the non-oil sector, including the ICT sector. For comparison, while in 2011 the profit in the ICT sector amounted to $ 1.7 billion, by 2020 this figure should have been brought up to $ 8 billion. At the same time, it was expected that by 2025 the level of income in the ICT sector would reach 10% of GDP our country". https://rabita.az/ru/c-media-ru/intervyu/details/149/.

It was emphasized here that “the ultimate goal of the project is to provide the entire territory of the country, including remote rural settlements, with high-speed Internet within 10-100 Mbit / s and increase the number of broadband Internet users to 85%, which will allow Azerbaijan to reach the level by 2017 developed countries of the world.” (That is, all this should have happened 3 years ago, but where is it?).

Further, by the current year 2020, the widespread coverage of state bodies with electronic services was supposed, which would be an important tool during the pandemic, to ensure complete transparency in the government’s activities, and, apparently, to eliminate negative phenomena and bureaucratic obstacles against entrepreneurs and citizens of the country. https://rabita.az/ru/c-media-ru/intervyu/details/149/.

Now it’s interesting, has this concept “Azerbaijan 2020: a look into the future” already been implemented? And most importantly, did someone in the country report for this concept, or is it all written off for a pandemic (Corona Virus)?

By the way, at the end of the interview, the Russian newspaper cited important statistics of 2012 for our country: “By the end of 2012, for every 100 inhabitants of Azerbaijan there were 20 computers, and the number of Internet users was somewhere around 70 per 100”, which apparently has two mutually exclusive numbers of “slogan” statistics.” We add that the number of fixed (ordinary) telephones per 100 residents of Azerbaijan in 2013 was 15.6. But the reality is that today the number of telephone sets per 100 inhabitants is somewhere around 20, and according to the Internet freedom rating, we are only in 45th place (behind our neighbors Armenia and Georgia, which are in 10th and 13th places respectively).

http://www.turan.az/ext/news/2019/11/free/politics%20news/en/84994.htm.

Interestingly, what are the real statistics of these same parameters for January 2020?

Indeed, at one time the statistics of Azerbaijan’s communications (at least 2 years late) were published in the collection of the Executive Committee of the Regional Commonwealth of Communications (RCC). For the sake of fairness, it should be noted that if it were not for the RCC and its annual statistics, we would have long been ahead of everyone because of our desire to "stand out" and would have certainly (by our slogan statistics) surpassed the United States and Europe in telecommunications and ICT as a whole (although at the same time we do not produce anything ourselves). Indeed, each issue of the RCC Statistical Digest was a joint work of the administrations of the RCC participants (including the Ministry of Communications of Azerbaijan), which provided more realistic (not slogan) statistics. They received data for the compilation from 11 communications administrations of the CIS countries, and Azerbaijan was a member of the RCC since December 17, 1991 (http://www.rcc.org.ru).

Apparently, this is why a real inventory of statistics of the existing communication networks of Azerbaijan with expertise and technical audit of all applicable network solutions is needed to comply with the alternative and competition in the communications sector.

National interests and welfare of the country's economy sectors should serve the benefit of ten million consumers (subscribers) of Azerbaijan, for the long-term perspective and development of the country's non-oil sector. And the goal of today's reforms carried out in connection with the “latest perestroika” in the country should be to increase the share of the country's non-oil sector with the help of, inter alia, workers in the communications sector, where an independent regulator becomes a real request for a market economy in Azerbaijan.

It is good that the issue of reducing the dependence of the Azerbaijani economy on oil revenues is on the agenda, but in the events of the fall of 2015, we also heard about roadmaps and a number of reforms in the country (but in the communications sector, apparently, we just changed our leadership and brought to investigation 10 industry leaders), and we cannot recall any broad concept for the development of the communications sector itself.

Although it would be possible to streamline many issues - the issue of licenses for the services provided, certification of imported digital technologies, tender and tariff policies, or the introduction of independent regulators in the communications sector, the start of privatization, and most importantly, the establishment of communications institutions in the country. It turns out that so far MTCHT (the successor to the Ministry of Communications), being a monopoly state structure, legislative base and state vehicle of the technical, legal and tariff policy of communications, does not have any branch communication institutions called to carry out and carry out all this.

It should not be forgotten that the introduction of digital technologies is not the merit of the Ministry of Communications (MTCHT), but the financial interest of foreign companies producing these technologies in order to maximize profits from the introduction of their new technological developments in developing countries such as Azerbaijan.

It is no accident that today the world community, in essence, invites all countries of the world, including the CIS countries, to be open and listen to opinions, demanding their full transparency in the economic, information and political spheres (which is clearly visible in social networks of Azerbaijan).

Abdul Kagramanzade