EU-companies about the business climate in Azerbaijan

20% of businessmen from EU countries working in Azerbaijan are not willing to invest more in the country;  40% do not believe in it, and another 40% would  re-invest  resources in this country,  said the report of the German-Azerbaijani Chamber of Commerce about the business climate in Azerbaijan. According to Turan, a survey was conducted among workers in Azerbaijan, 300 companies from 19 EU countries. The report states that of falling oil prices and the reduction of the country's income has stimulated the government to reform, and it is hoped that this process will speed up genuine reforms to diversify the economy. 81% of respondents said that, overall, the Azerbaijani economy is weak.

Only 35% of respondents said that the situation in the  sectors where they work is satisfactory. The report indicates that the top priority for improving the business climate are the structural reforms. In general, respondents are pessimistic about their company's prospects in Azerbaijan. Thus, 60% of companies from the EU, believe that their income will be reduced, and 45% think about reducing staff.  Half of all exporting companies believe that their exports fall and imports will dwindle. Responding to questions about labor market conditions, the respondents believe that the qualification of employees is satisfactory. The authors point out that the education system in Azerbaijan needs serious reform. The respondents are not satisfied with any quality of academic education or vocational training. Respondents believe that inflexible immigration policies may discourage foreign investment. In this context, half of the respondents dissatisfied with the immigration policies relating to visa issues, and work permits for foreigners.

Turning to infrastructure, 76% of EU companies have estimated it at a medium level or higher. Half of the respondents are dissatisfied with the quality of local suppliers, and 45% rated the payment discipline, as the average. The report pointed out that the oil companies feel more confident in economic policy compared with counterparts from non-oil sector. Almost half of all respondents expressed concern about the level of legal uncertainty and the predictability of economic stability. In addition, they believe that the current state of  administration is inefficient. Overall, economic policies and institutions have received a relatively low rating. Assessing the economic and political conditions affecting the activity of the companies, respondents called the devaluation, market uncertainty and bureaucracy.

70% of EU companies indicate that the devaluation impacts their business most of all. More than half of the respondents indicated that corruption and customs control have a negative impact on their operations and to improve the business and investment climate should eliminate corruption. The Company believes that the measures to eliminate corruption and crime are ineffective. However, corruption is a negative factor in the system of taxation and customs procedures. 46% of respondents believe tax policy in Azerbaijan is unsatisfactory. The authors noted that if the government and local authorities to ensure compliance with existing laws, there will be significant progress. Summing up, the report's authors believe that the following two years will not be easy for, but the owners believe that as a result of the implementation of reforms within 3-5 years the situation will improve. -71D-