Business of officials in Azerbaijan

Baku/30.07.21/Turan: The leader of the Movement for Democracy and Welfare of Azerbaijan, economist Gubad Ibadoglu, answered questions about the bureaucratic business in Azerbaijan, the monopolistic activities of state officials in the "Difficult Question" program.

According to him, to say that there is no bureaucratic business in Azerbaijan is the same like to say that there is no business in Azerbaijan. Because business in Azerbaijan is controlled by officials.

“This is not only an economic but also a political issue. Azerbaijan differs from other countries (I mean the post-Soviet countries) because it was not allowed to create a class of free owners in Azerbaijan. And in essence, this was done for a political purpose,” Ibadoglu is sure.

In his opinion, the process of formation of a class of free owners was impeded by the bureaucratic business, crushing all entrepreneurial activity. Of course, there are islands of free enterprise. Thus, there is competition in the services provided by taxi companies. Their prices are affordable; the quality of services has improved. In general, under the present situation in Azerbaijan, even some officials do not feel like businessmen, because their property or business can be taken away (expropriated) at any time.

Ibadoglu believes that the authorities deliberately did not allow the formation of entrepreneurship; the privatization was carried out in an ugly manner. After its completion, the minority shareholders of the formed joint-stock companies could not receive dividends, and they were forced to sell shares for a pittance.

“During that period, about 60-65 thousand shareholders were registered. Subsequently, they were also overboard. For example, after the privatization of Kapital Bank, it turned out that 98.8% of the company's shares were owned by Pasha Holding. Only 0.2% of the shares remained in the ownership of the labor collective. And, most likely, he will soon lose even these crumbs,” he said, stressing that the class of free owners, consisting of shareholders, free entrepreneurs, this is the very middle class that is the guarantor of the stability of any society, the sustainability of economic development.

According to the expert, free enterprise is impossible without personal freedom, while bureaucratic business is politically dependent, and therefore full of risks.

“An example is Gilan Holding, the largest representative of the bureaucratic business in Azerbaijan. This once gigantic conglomerate began to shrink suddenly like pebbled skin. But then, after changing owners, it again began to grow by leaps and bounds,” Ibadoglu said.

The economist stressed that when free owners are the captains of a business, it is quite difficult to take their business away from them. This is fraught with extremely difficult litigation with unpredictable results, since it is clear that an independent court will not rule on a call from above. Thus, it is obvious that the existence of free enterprise is possible only if there is an independent court.

“It's another matter when a businessman is an official and there is no independent court. Then everything is simple - it is enough to dismiss the official from his post and then, by means of pressure in one form or another, the business is taken away. Such a business is manageable and therefore beneficial to the authorities,” Ibadoglu concluded.—0—