Switzerland and Azerbaijan celebrate 20 years of bilateral cooperation in 2019

  • 17:34 04 March 2019

Switzerland and Azerbaijan celebrate 20 years of bilateral cooperation in 2019

This year, Switzerland’s development cooperation is actively engaged in Azerbaijan for 20 years. 20 years of partnership and cooperation brought our countries closely together. Today, our countries enjoy excellent political and economic relations.

At the beginning of the bilateral development cooperation, in 1999, Switzerland supported Azerbaijan with humanitarian assistance to help refugees and internally displaced persons (IDPs). In those early years of the Republic, refugees and IDPs still needed substantial assistance, which was provided by the government of Azerbaijan and by different international organizations, including the Swiss Agency for Development and Cooperation (SDC).

In the following years, while the economic situation of Azerbaijan, as well as the situation of refugees and IDPs, were gradually improving, Switzerland changed the focus of its support. Projects shifted from a humanitarian approach to more long-term development needs, with a focus on value-chain development and infrastructure. The Swiss projects contributed to the development of tourism in Ismayilli and Qabala, for example, or to the rehabilitation of water infrastructure in the territory of the Nakhchivan Autonomous Republic. Later, rural development projects in central Azerbaijan, including Barda, Tartar, Agdam, Agcabadi and Beylaqan, were implemented through the financial support of Switzerland.

As the economy of Azerbaijan further evolved, Switzerland focused its assistance increasingly on more systemic aspects, mainly by improving the framework conditions for the private sector and by providing technical support in macro-economic areas and the financial sector. This was also the time, when Switzerland’s agency responsible for economic cooperation, the State Secretariat for Economic Affairs (SECO), started its active presence in Azerbaijan in 2004.

The increased volume of Switzerland’s cooperation with and support to Azerbaijan required a legal basis. Thus, a Cooperation Agreement between the two governments on Technical, Financial and Humanitarian Cooperation was signed on 23 February 2006. This agreement is valid until today.

Today’s highly technical economic cooperation is characterized by reliable partnership and mutual trust. The technical support focuses on complex macro-economic reforms, ranging from Public Finance Management, Government Statistics to macro-economic modelling. Switzerland is also a long-term supporter of the financial sector development in Azerbaijan. Support clusters around financial infrastructure, such as introduction of leasing, the establishment of a Private Credit Bureau, the introduction of secured transactions and most recently mobile money solutions. All this is done in close dialogue with local authorities and Switzerland strongly supports Azerbaijan in its goal to diversify and reform its economy.

Swiss assistance in figures

Over the last 20 years, Switzerland provided assistance to Azerbaijan in the amount of CHF 91 million, which is equivalent to AZN 154 mio. Most of the support was provided through SECO (CHF 61 million) and SDC (CHF 29 million), while the other Swiss contributions amounted to approximately CHF 1,4 million. Note that the Swiss National Bank also provides technical assistance to the Central Bank of Azerbaijan. Furthermore, the Swiss Investment Fund for Emerging Markets (SIFEM) has invested the amount of CHF 16 million into Azerbaijan.

Our implementing partners

In the early years, Switzerland mostly worked through international organizations and NGOs to deliver its humanitarian assistance. Similarly, many development projects were implemented by Swiss and international NGOs. This however changed in 2015, when most of international NGOs left due to a new and not fully conducive NGO legislation. The technical assistance of SECO on the other hand usually taps the expertise of global institutions such as the World Bank Group (IBRD and IFC), the International Monetary Fund, regional development banks or universities with large networks, such as the Graduate Institute in Geneva. Additionally, SECO also delivers its assistance through highly specialized consultants or by working with local universities (e.g. Khazar University). The International cooperation of Switzerland – as well as the Swiss Embassy in Baku in general - maintains a close dialogue with the local civil society including the local art & culture scene, which it supports through small innovative projects.

Other facts – did you know?

What is the explanation for the close ties between Azerbaijan and Switzerland? In 1992, the two countries joined the so-called Bretton Woods Institutions – the World Bank Group (WB) and the International Monetary Fund (IMF) – together with the Kyrgyz Republic, Poland, Serbia, Tajikistan and Turkmenistan. These countries agreed to form a new constituency (voting group) in these institutions, to be led by Switzerland. Until today, you will find our offices at the WB and the IMF in Washington D.C. Switzerland continues to represent the interests of Azerbaijan and the other constituency members (including Kazakhstan, which joined in 2010) within these two international financial institutions.

The Swiss Cooperation Office to the South Caucasus started its operations in 1999. From its office in Tbilisi it covered the three Republics of the South Caucasus. Today, there are Cooperation Offices in all three countries, with the main office in Tbilisi. The work of the international cooperation in the South Caucasus is guided by a regional four years’ strategy and some of our projects work in two or three of the countries, such facilitating exchange and mutual learning.

Switzerland’s cooperation activities in Azerbaijan are executed by the Swiss Cooperation Office (SCO) in Baku, which is a part of the Swiss Embassy located in Icheri Sheher. The Embassy in Baku, which was inaugurated in late 2007 and which represents Switzerland in Azerbaijan and in Turkmenistan, provides the full range of services including visa and consular issues.


Embassy of the Swiss Confederation in Azerbaijan

Faig Mahmudov