On January 29, the World Bank Group (WBG) Board of Directors reviewed a new Country Partnership Framework (CPF) for Azerbaijan, setting out its strategic engagement for the next five years. The initiative aims to bolster Azerbaijan’s transition toward a more competitive, sustainable, and inclusive economy, addressing key structural challenges and unlocking new growth opportunities.
News.Az spoke with leading Azerbaijani economic experts to assess the potential impact of this framework.
Dr. Elshad Mammadov, Professor of Economics, emphasized the need for a substantial increase in investment to drive economic modernization.
"Expanding lending is naturally desirable, but it must be structured to ensure accessibility and align with sectoral profitability. More importantly, financing should stimulate Azerbaijan’s real production sector," he told News.Az.
While Azerbaijan possesses significant domestic investment resources, Mammadov stressed the importance of foreign technology imports to enhance competitiveness.
The CPF places a strong emphasis on renewable energy development, a sector where Azerbaijan has considerable untapped potential. However, Mammadov cautioned that integrating renewables should complement, not undermine, the country’s traditional energy strengths.
"Alternative energy sources must be developed with a clear strategy for short-, medium-, and long-term implementation. However, renewables should be seen as a way to enhance, rather than replace, Azerbaijan’s competitive edge in traditional energy production," he explained.
While Azerbaijan has taken significant steps to expand its renewables sector, the professor noted that technological advancements will be crucial in shaping the future of alternative energy production.
Another key priority of the CPF is enhancing Azerbaijan’s transport and logistics infrastructure, particularly within the Middle Corridor, a trade route linking Asia and Europe. Mammadov underscored the need for rapid digitalization to ensure Azerbaijan remains competitive in regional logistics.
"Transport and logistics firms that embrace high-tech solutions and digitalization will gain a significant edge. Azerbaijan must take the lead in deploying innovative solutions to strengthen its competitive position within the Middle Corridor," he said.
MP Vugar Bayramov, a prominent economist, highlighted Azerbaijan’s long-standing cooperation with the World Bank, emphasizing the mutual benefits of economic collaboration.
"The World Bank plays a vital role in supporting economic diversification, improving the business climate, and boosting employment in Azerbaijan. Ongoing discussions between the government and the Bank signal a deepening partnership that benefits both sides," Bayramov noted.
He also pointed to the growing focus on renewable energy, particularly as Azerbaijan prepares to host COP29. Strengthening ties with international financial institutions, including the World Bank and the European Bank for Reconstruction and Development (EBRD), is a strategic priority for Baku.
Azerbaijan is also working to expand the Middle Corridor, positioning itself as a key transit hub between Europe and Asia. Bayramov highlighted the importance of modernizing transport infrastructure and leveraging electronic services to increase trade volumes.
"The World Bank has been instrumental in financing transportation projects worldwide, and Azerbaijan is keen to deepen cooperation in this sector. With the opening of the Zangazur Corridor, Azerbaijan is poised to play a greater role in regional trade, facilitating East-West connectivity," he said.
As Azerbaijan navigates its economic transformation, the new CPF framework signals an intensified collaboration between Baku and the World Bank, with a strong focus on investment, sustainability, and digital innovation.
