Social and Economic Impacts of Keeping Azerbaijan's Land and Sea Borders Closed

On October 23, Azerbaijan Railways (ADY) presented its first international Sustainability Report, prepared in collaboration with Deloitte, highlighting the company's achievements from 2021 to 2023 and its plans up to 2030.

The negative impacts of Azerbaijan's prolonged border closures, now nearing five years, on the labor market are starkly evident in official statistical figures and data related to self-employment and individual labor activities. A significant portion of the income of residents from border areas was derived from cross-border trade, the sale of goods, transport, public catering, and accommodation services. It is clear from our observations that the closure of the land borders has left those dependent on income from trade and services related to border activities with no choice but to seek alternative jobs and migration to meet their material needs.

Azerbaijan is divided into 14 economic regions, including the capital city of Baku[1], 67 administrative districts, 11 towns subordinate to the republic, six district-subordinate cities, 12 city districts, 262 settlements, 190 town territorial units, 40 sector territorial units, 1,724 village territorial units, and 4,244 villages[2]. In Azerbaijan, neither the districts nor the cities are considered independent subjects of the national economy.

Azerbaijan's oil and gas sector accounted for only one-third of the country's gross domestic product (GDP) during January-September, but showed modest growth (close to 1%) due to high global oil prices in the third quarter of this year, despite declining oil production in the country.