Domestic Pricing and Energy Policies
As Azerbaijan prepares to host the 29th Conference of the Parties (COP29) on Climate Change in November 2024, the country has been grappling with a series of economic challenges that have put a strain on its citizens. One of the key issues has been the recent hikes in prices for essential goods and services, including gasoline, diesel, public transportation, and household waste collection.
According to the Tariff Council, the state agency responsible for setting local prices, the decision to raise the price of diesel fuel was driven by environmental concerns, as diesel is believed to have a greater impact on the environment. However, independent experts argue that these price hikes are more likely a government attempt to offset declining oil and gas revenues, rather than a genuine effort to address ecological problems.
“The hikes are government’s attempt to offset declining oil and gas revenues through price hikes and to dress up those price hikes as addressing ‘ecological problems,’” said economist Natig Jafarli in an interview with Meydan TV.
The price increases have not been well-received by the Azerbaijani public, with residents of the capital city, Baku, expressing their dissatisfaction with the rising costs of fuel and public transportation. Agriculture expert Vahid Maharramli warned that the fuel price hikes will likely lead to sharp increases in food costs as well, as transportation expenses for agricultural production have risen by 25%.
“Our transportation expenses increased by 25 percent. This means serious hardships for villagers. Because as a consequence this will raise costs of agricultural production. Sharp hikes for food are expected in the coming months,” Maharramli told Meydan TV.
Economist Akram Hasanov echoed these concerns, stating that the recent price hikes are just the beginning and that Azerbaijanis can expect increased costs for utility services and a decline in the value of the national currency, the manat.
Despite these challenges, the Azerbaijani government has maintained that the country’s citizens and their social welfare are at the center of its policy, as stated by member of parliament Elman Nasirov. However, the opposition politician Camil Hasanli argued that the ruling elite is covering budget deficits at the expense of the people, rather than addressing corruption and embezzlement.
Infrastructure Development
Alongside the domestic pricing issues, Azerbaijan’s capital city of Baku has been undergoing extensive renovation and construction work in preparation for COP29. Residents of the city have reported dealing with traffic jams, rerouted public transportation routes, and the pervasive presence of construction dust, all of which have made their daily lives more difficult.
Economist Natig Jafarli estimated that approximately 470 million manats (around $277 million) have been allocated for these city-wide renovation projects ahead of the COP29 summit. He criticized the government’s priorities, stating that “These works illustrate that this government cares more about making an impression for its international guests, not impressing its citizens.“
The lack of transparency regarding the total budget for COP29 and its associated infrastructure projects has also raised concerns among experts. While the authorities and the organizing committee have not disclosed the full financial details, some estimates suggest that the indirect expenses for the event could exceed $1 billion, covering infrastructure, hotels, transportation, logistics, communication, and security.
“Some experts estimate the indirect expenses for COP29 to exceed 1 billion USD, including expenditures on infrastructure, hotel, transport, logistics, communication, security, and other expenses,” the report from Global Voices stated.
This is not the first time Azerbaijan has hosted a major international event. Since 2010, the country has played host to a variety of events, including the Eurovision Song Contest, the European Games, the Islamic Solidarity Games, and the European Football Championship. According to academic Gubad Ibadoglu, hundreds of millions of manats have been allocated from the state budget to finance these events, with more forecasted for the coming years.
The question of who is ultimately footing the bill for COP29 and these other international events remains a point of contention. As Azerbaijan’s citizens grapple with rising costs and infrastructure disruptions, the government’s priorities in hosting these high-profile events have come under scrutiny.
Environmental Concerns
As the host of COP29, Azerbaijan has a unique opportunity to showcase its commitment to environmental sustainability and emissions reduction. However, the recent price hikes and the focus on infrastructure development have raised concerns about the country’s environmental priorities.
The Tariff Council’s justification for the diesel fuel price increase, citing its impact on the environment, has been met with skepticism from experts. They argue that the decision appears to be more about generating revenue than promoting eco-friendly practices.
“The justification of recent hikes on gas and diesel fuel by the Tariff Council also makes no sense given the new regulations on taxis. According to the Tariff Council’s statement, ‘the price change will accelerate the transition to fuel-efficient hybrid, electric, and compressed natural gas engines, while ensuring the sustainability of energy security.’ If this was the case, then why not take into account advice from experts and replace all taxis with electric vehicles?” the Global Voices report questioned.
Beyond the pricing policies, Azerbaijan’s environmental commitments for COP29 and its broader sustainability efforts remain unclear. The country’s emissions reduction targets and plans for sustainable urban planning have not been widely publicized, leaving some to wonder about the true scope of its environmental agenda.
International Engagement
As the host of COP29, Azerbaijan has a significant role to play in the global climate change negotiations and discussions. The country’s diplomatic and international engagement in the lead-up to the conference will be crucial in shaping its outcomes and impact.
However, Azerbaijan’s international relations have been a subject of scrutiny, particularly its ties with neighboring countries and global powers. The country’s long-standing tensions with Armenia, for instance, have had a ripple effect on its regional and global partnerships.
Furthermore, Azerbaijan’s relationships with other countries, such as its close ties with Israel and its shifting dynamics with Turkey, have also been a topic of interest. These geopolitical factors could influence Azerbaijan’s ability to effectively navigate the complex landscape of international climate diplomacy.
“Azerbaijan’s ties with Israel have long been based on trade in military and agriculture equipment, oil supply, surveillance equipment, and more recently aerospace technology. In all of these cases, Azerbaijani government and its leadership got away with its dubious financial transactions and deals all the while, building new friendships and cracking down on freedoms,” the Global Voices report noted.
As Azerbaijan prepares to host COP29, its ability to bridge divides, foster cooperation, and demonstrate genuine environmental leadership will be closely watched by the international community. The success of the conference and the long-term impact of Azerbaijan’s sustainability efforts will be crucial in shaping the country’s global reputation and influence.
Conclusion
Azerbaijan’s preparations for COP29 have been marked by a complex interplay of domestic challenges, infrastructure development, environmental concerns, and international engagement. The country’s handling of these issues will have a significant impact on its citizens, its global standing, and the overall success of the climate change conference.
While the government has emphasized its commitment to its citizens’ welfare, the recent price hikes and the apparent prioritization of international events over local needs have raised questions about the true nature of its priorities. As Azerbaijan navigates these challenges, it will be essential for the country to strike a delicate balance between economic development, environmental sustainability, and the well-being of its people.
The outcome of Azerbaijan’s preparations for COP29 will be closely watched by the international community, as the country’s ability to host a successful and impactful conference will be a testament to its leadership and its dedication to addressing the pressing global issue of climate change.
