Azerbaijan

Since the 1990’s, the countries of Eastern Europe, the Caucasus and Central Asia (EECCA) have made great progress in pursuing economic development that is also environmentally sustainable. The countries, in collaboration with the GREEN Action Task Force hosted by the OECD, has developed a number of policies aiming to improve environmental quality and social well-being, while creating opportunities for strong economic growth and decent jobs in the region. This report was prepared as the OECD contribution to the ninth 'Environment for Europe' (EfE) Conference (5-7 October 2022). In this context, this report aims to: (i) take stock of progress on policy developments towards a green economy in the EECCA countries; (ii) showcase selected contributions from of the Green Action Task Force that integrate environmental and climate considerations into development pathways of the EECCA countries, and mobilise finance for action; and (iii) provide an outlook for the future, including priority actions that the Task Force in co-operation with the EECCA countries should take to enhance the momentum for green economy transition in the region.

Long-term energy planning is central to a country’s strategic direction. Without it, governments may end up relying on a patchwork of policies and legislation that can be incoherent and ill-suited for the complex challenges countries are increasingly faced with. Good long-term energy planning encompasses domestic and foreign policy, while touching on many key areas of the economy including industry, natural resources and trade. The process involves multiple stakeholders across the government, but also brings in the private sector as well as citizens, as it aims to set out a strategic path towards a clear goal. Azerbaijan, like many of its peers, is looking to understand how best to meet the opportunities and complexities of the global clean energy transition. The 2014-2015 oil shock prompted the government to consider and draft a slate of new laws and reform packages, and at present efforts are being made to finalise and pass an energy strategy. The price volatility seen in global markets over 2020-2022 is making it even clearer that energy planning using scenario analysis and modelling will help countries successfully respond to new and unexpected challenges in a resilient fashion. This roadmap details the necessary steps in building that process and exploring relevant policy options that producer economies have pursued, which may be relevant to Azerbaijan. It then discusses data collection and survey design, which are key to establishing the base for energy modelling. The roadmap then looks at energy modelling and its role in policy making. This roadmap aims to help Azerbaijan reconsider the policy planning process as it looks to connect key laws and reforms into a greater energy strategy. It also sets out a path for Azerbaijan to make this process sustainable and iterative, connecting its policymakers with its statisticians, and investing in in-house modelling capacity. Every country must choose its own energy path, based on its specific needs and resources, but having a long-term plan can smooth out that path significantly.

This pilot report assesses Azerbaijan’s anti-corruption framework and practices based on the criteria to test the new methodology for the 5th round of monitoring under the Istanbul Anti-Corruption Action Plan. The report examines Azerbaijan's anti-corruption policy documents, the investigation and prosecution of corruption offences and the overall enforcement framework. The report also identifies areas for improvement and provides recommendations.

The COVID-19 crisis has given renewed urgency to efforts to support the digitalisation of SMEs. However, many SMEs lag behind larger firms in the digital transition as a result of important barriers with respect to skills, innovation, infrastructure, regulation and finance. The SME digital gap slows productivity growth and increases inequalities among people, firms and places. In this context, the Government of Azerbaijan requested the OECD’s assistance in supporting the design and implementation of strategies and policies to foster the digital transformation of Azerbaijan’s SME sector.