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Azerbaijan and China: cooperation for a sustainable energy future

By Seymur Mammadov | chinadaily.com.cn | Updated: 2024-01-24 09:55

Customs officials in Qingdao, Shandong province, check a freight train bound for Azerbaijan. [Photo by Xie Hao/For China Daily]

In the modern world, characterized by globalization and international economic cooperation, the relationship between China and Azerbaijan stands out as an exemplar of a successful and mutually beneficial partnership.

Over recent years, these two countries have significantly strengthened their economic and trade ties, evidenced by a surge in trade turnover and collaborative investment projects. The importance of this cooperation extends beyond bilateral interests, contributing to regional stability and economic development.

China-Azerbaijan trade relations

From January to October 2023, the volume of China-Azerbaijan trade reached an impressive 2.57 billion dollars, marking a 47.5 percent increase compared to the previous year. These figures clearly illustrate the growing significance of the economic relationship between the two countries. China, emerging as the largest source of imports, has become Azerbaijan's fourth-largest trading partner, reflecting the strategic importance of this cooperation.

Exports from China to Azerbaijan predominantly consist of high-tech products. Encompassing mechanical apparatus, electronic equipment, and automobiles, these goods account for over 50 percent of the total export volume. This focus on advanced technologies significantly impacts Azerbaijan's socio-economic development, opening new prospects for local businesses.

In recent years, China-Azerbaijan relations have demonstrated substantial deepening, thanks to a series of political and economic initiatives. The visit of Azerbaijan's Deputy Prime Minister, Shahin Mustafayev, to China marked a significant milestone in these relations. His participation in the opening ceremony of the 6th China International Import Expo and leadership in the 9th session of the China-Azerbaijan Intergovernmental Commission underscored the mutual interest and readiness to strengthen cooperation.

During this platform, the parties exchanged views on investment and trade issues. Special attention was given to project collaboration opportunities in promising areas such as alternative energy sources, power generation, and the construction of power stations. These discussions not only promote the strengthening of bilateral economic ties but also open new horizons for joint innovative projects.

Azerbaijan's role in advancing the Belt and Road Initiative

The Belt and Road initiative, launched by China, represents a vast project aimed at creating an extensive network of trade and infrastructure links across Asia, Europe, and beyond. Azerbaijan plays a pivotal role in this initiative, contributing to the development of new transportation routes and energy corridors.

A significant achievement of Azerbaijan within this initiative is the implementation of major transport projects such as the Baku-Tbilisi-Kars railway line and the Alat International Sea Port. These projects not only strengthen transport links between China and Europe but also foster economic development in the region.

Under the leadership of President Ilham Aliyev, Azerbaijan is actively participating in the development of the Trans-Caspian International Transport Route (TITR), also known as the Middle Corridor. This initiative includes the creation of transport infrastructure in Karabakh and Eastern Zangazur, as well as planning for the future Zangazur Energy Transport Corridor.

In 2024, it is planned to reduce transit time on the Middle Corridor from 18-23 days to 14-18 days, marking a significant improvement over previous figures. Particularly impressive is the reduction of transit time within Kazakhstan from 6 to 5 days. These logistical improvements will not only speed up delivery but also make the route more competitive.

The volume of freight transport on the Middle Corridor in the first nine months of 2023 increased by 88 percent, reaching 2 million tons compared to 1.1 million tons for the same period in 2022. In 2022, the volume of freight transport along the route increased by 2.5 times, reaching 1.5 million tons, highlighting its growing importance in the global transport network.

Energy cooperation and green energy

Energy cooperation between China and Azerbaijan holds a significant place in their bilateral relations, especially in the context of transitioning towards sustainable and renewable energy sources. In 2023, a substantial memorandum of understanding was signed between the energy departments of both countries, aimed at developing cooperation in the field of renewable energy.

As part of this collaboration, the Chinese company Dongfang is involved in constructing the 230 MW "Garadagh" solar power plant in Azerbaijan. This project is a crucial step towards increasing the share of green energy in the country's energy balance. Additionally, cooperation with China Gezhouba Group Overseas Investment opens new prospects for implementing renewable energy projects.

Azerbaijan plans to significantly increase its green energy production to 7 GW by 2030, of which 5 GW will be directed for export through the Caspian-EU and Azerbaijan-Turkey-Europe transport corridors. These plans not only contribute to achieving environmental goals but also strengthen Azerbaijan's role as a key player in the global energy system. This will also enrich the Belt and Road Initiative with green and sustainable links.

The consolidation of relations between China and Azerbaijan in recent years demonstrates mutual benefit and strategic partnership. The trade growth, the enhancement of investment cooperation, the development of transport infrastructure, and joint projects in green energy are the cornerstones of this cooperation. Particularly significant is the integration of these efforts into the global Belt and Road project, opening new horizons for economic growth and strengthening regional stability. The interaction between China and Azerbaijan serves as an example of effective international cooperation, paving the way for shared prosperity and development.

Seymur Mammadov is a journalist based in Azerbaijan. The views do not necessarily reflect those of China Daily.

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