Economic cooperation

 

 

The Republic of Azerbaijan and Republic of Korea are enjoying dynamic economic-trade relations. Azerbaijan is the largest and most significant economic-trade partner of Korea in the South Caucasus. In 2022, compared to 2021, the bilateral trade turnover increased by 18.23%. During the same period, Azerbaijan’s exports to Korea expanded 3.52 times and imports from Korea grew by 18.14%.Korea is one of the biggest foreign direct investors to Azerbaijan’s non-oil sector.

 

The mutual high-level visits, various trade promotion platforms and mechanisms, as well as diverse economic events contribute to boosting bilateral economic-trade cooperation. Azerbaijan continues its efforts to diversify the economy, develop non-oil sector, advance economic clusters and improve export structure, as well as promote Alat Free Economic Zone, “Made in Azerbaijan” brand, “Invest in Azerbaijan” and “Make in Azerbaijan” concepts. In this context, in order to achieve the country’s strategic goals and targets, Azerbaijan considers Korea as a reliable partner.

 

The interest of Korean companies to Azerbaijani economy and products is continuously increasing. 77 Korean companies are currently operating in Azerbaijan in the fields of trade, industry, construction and services.

 

The Offices of Korea International Cooperation Agency (KOICA) and Korea Trade-Investment Promotion Agency (KOTRA) function in Azerbaijan to enlarge bilateral economic cooperation. Since launching of its operations in Azerbaijan, KOICA has implemented several grant agreements covering various economic sectors. Numerous Azerbaijani officials and government collaborators have participated in KOICA’s capacity building trainings aimed at exploring Korea's development experience.

 

The Agreement between the Government of the Republic of Azerbaijan and the Government of the Republic of Korea on promotion and mutual protection of investments has been signed on 23 April 2007. The Convention between the Government of the Republic of Azerbaijan and the Government of the Republic of Korea for the avoidance of double taxation and prevention of fiscal evasion with respect to taxes on income and capitalhas been signed on 19 May 2008. The legal base of economic cooperation is being continuously broadened.

 

Bilateral trade

 

In 2023, compared to 2022, the bilateral trade turnover increased by 59.24%. During the same period, Azerbaijan’s exports to Korea expanded by 78.2% and imports from Korea grew by 59.22%.

 

78 Korean companies are currently operating in Azerbaijan in the fields of trade, industry, construction and services.

 

 

 

2019

(thsd $)

2020

(thsd $)

2021

(thsd $)

2022

(thsd $)

2023

(thsd $)

Azerbaijan’s export to Korea

137.88

82.58

83.81

295.35

526.33

Azerbaijan’s import from Korea

159 333.96

178 579.69

227 573.62

268 854.71

428 091.14

Trade turnover

159 471.84

178 662.27

227 657.43

269 150.06

428 617.47

Source: State Customs Committee of the Republic of Azerbaijan

 

 

Top export products in bilateral trade(2022)

  

Azerbaijan’s exports to Korea

Korea’s exports to Azerbaijan

Products

Value

(thsd $)

Share in Azerbaijan’s exports

Products

Value

(thsd $)

Share in Azerbaijan’s imports

Jet kerosene fuel

 

220,8

 

74,75%

 

Land vehicles and parts thereof

148.482,7

55,23%

Plants used in perfumery and pharmaceuticals

42,8

14,49%

 

Equipment, mechanical devices and parts thereof

44.890,2

16,7%

Pomegranate juice

 

21,8

 

7,38%

Plastics

15.474,3

5,76%

Furniture and parts

3,4

1,15%

Ferrous metals and products thereof

13.674

5,09%

Source: Ministry of Economy of the Republic of Azerbaijan

 

 

Joint Commission

 

The Joint Commission on Economic Cooperationbetween the Government of the Republic of Azerbaijan and the Government of the Republic of Korea has been established in 2015 topromote bilateral economic, trade and investment cooperation, as well as to foster “G2G” and “B2B” contacts. The First Meeting of the Joint Commission was held on 14 June 2016 in Seoul. The Second Meeting of the Joint Commission was convened on 6 February 2020 in Baku. The Third Meeting of the Joint Commission was organized on 7 June 2023 in Seoul and its protocol encompasses multifaceted matters. The Deputy Minister of Digital Development and Transport of the Republic of Azerbaijan and Deputy Minister of Trade, Industry and Energy of the Republic of Azerbaijan are the co-chairs of the Joint Commission.

 

 

Last updated: 31.01.2024

 

 

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