Mr. Altai Efendiev 
Chairman of the Delegation of the Republic of Azerbaijan 

International Conference of Financing for Development 

Monterrey, Mexico 
21 March 2002


Mr. President, 
Distinguished participants, 
Ladies and Gentlemen! 

It is a great honor, privilege and responsibility to represent my country at this high Forum. Let me start with emphasizing the importance and significance of the spirit and objectives of the Monterrey for the countries like Azerbaijan. As a young state, country in transition and land-locked country Azerbaijan falls into the group of the most vulnerable countries in ever globalizing economy and among those who are in most need for international assistance. Conducive external environment is critical for the sustainable development of these countries. Therefore banging the needs of countries like Azerbaijan into the focus of Monterrey Consensus as well as commitments for development aid made by the donor community conveys encouraging messages as well as raises our hopes and expectations for better future. 

However we clearly understand that in mobilizing resources for development major emphasis should be put on national level.  Sound market-oriented reforms, democratization of all spheres of social life, integration into the world economy reveal enormous potential both inside the country as well as attract so much needed external resources for the development. 

Coherent and consistent policies of comprehensive reforms for the last 7 years in close cooperation, with all major international institutions succeeded in achieving impressive results in macroeconomic stability, structural changes, attracting FDI, as well as ensuring overall growth. 
Just a few figures to illustrate. Average inflation rates remained at level of around 2-3% while exchange rates against major currencies have been stable even during recent financial crisis. 

Share of the private sector in the economy exceeded 70% thus transforming private initiative and entrepreneurship into driving force of developing and shaping new economy. Level of private investments approaching US$ 10 bn mark of which about US$ 7 bn are FDIs. FDl measured per capita is one of the highest indicators among countries of Eastern Europe. As a result, Azerbaijan experienced one of the highest average growth rates at the level of 8-10%. 

However prospects for growth are even higher in the coming years as the country enters into the full-phased development of its natural resources, implementation of regional infrastructure projects, progressing with large-scale privatization. 

Handling and managing the expected massive inflows of resources in a most efficient way, transform potentially high growth into sustainable development is one of the major challenges facing the country. To this end, building up adequate institutional infrastructure, enhancing institutional capacities, introducing good-governance practices, pursuing radical structural and administrative reforms, implementing poverty reduction strategy, SME and non-oil sector development are at the core of economic policy and are the areas where the international assistance and expertise is most needed. 

Mr. President, 

We recognize that regional cooperation and trade are powerful instruments in efficient utilization and allocation of resources from the point of economy of scale consideration. Utilizing its natural and geographical comparative advantages and sharing their benefits, Azerbaijan is contributing to the development of regional cooperation through participation in a number of regional economic organizations. Azerbaijan is also actively involved in implementation of large regional infrastructure projects such as development of multiple pipeline routes for export of the Caspian oil and gas to international markets as well as transport corridor - Europe-Caucasus-Asia, linking two major global economic power centers - Europe and Asia. 
We are a signatory of a number of free trade agreements and accession to the WT0 and integration into the multilateral trade system is on top of economic agenda. 

Mr. President, 

Notwithstanding the optimistic prospects for development drawn above, resources needed to tackle the pressing needs of the country and those for development now are much higher. And here I ought to draw the attention of the high audience to another most serious and acute problem country has been confronting for over a decade. As many of you might know Azerbaijan is affected by one of the most protracted conflicts with unprecedented in its scale and magnitude consequences and implications.  As a result of the aggression fifth of the territory is under occupation, over a million of refugees and displaced persons (every 7th person) scattered across the country living in temporary camps in misery and poverty. Needless to say that it imposes an enormous burden on the economy and society arid has most serious implications on mobilization and distribution of resources
for development. 

More aid is badly needed to tackle the problems of refugees and displaced to prevent these people from further degradation and human tragedy, to help them to remain as productive part of society and get involved in social and economic activities. 

Conflict and its consequences also seriously impeding cooperation and development on the regional level by distorting economic rational and efficient allocation of resources, badly affect attractiveness of the region and discourage FDIs. Occupied territories are used for drug trafficking and smuggling of arms and human. beings. This is why conflicts and convict-affected areas should be in the focus of international community as well as adequately reflected in Monterrey Consensus. 

In that respect I would like to share with you some considerations with regard to coherence and consistency in providing international aid to conflict-affected areas. 

To our believe, aid should be viewed as a powerful tool to promote and endorse the basic values and spirit of the UN Charter and Millennium Declaration, as well as norms and principles of international law. Aid is a channel for communicating a message and message should be clear, unbiased and unequivocal, eliminating the risks of indirect financing of the conflicts. Therefore compliance of the recipient countries with above mentioned norms and principles should be a stringent criteria for providing development aid. We all should be more coherent and consistent in pursuing policies along the agreed rules if we sincerely want to build a better common home. 

For the time being, Mr. President, while whole-heartedly supporting and endorsing the Monterrey Consensus, I would like to make my country's reservation with regard to provision concerning sub-regional cooperation. Obviously and understandably we cannot commit ourselves to all-inclusive cooperation within the South Caucasus until just and lasting settlement of the

Mr. President, 

In conclusion, let me voice once again our support for Monterrey Consensus and state that Azerbaijan stands ready to cooperate with the international community to contribute to the implementation of its noble objectives emanating from the spirit of the Millennium Declaration. 

Finally, may I express gratitude to the government of Mexico and beautiful city of Monterrey for hosting this event and extended genuine hospitality. May I also express sincere appreciation to the UN Secretariat and all involved in organization of the conference whose invaluable contribution ensured the success of UN Conference on Financing for Development. 

Thank you for your kind attention. 

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