Azerbaijan is the country located in the South Caucuses at the crossroad between Eastern Europe and Western Asia. Humans have settled in this area in the Stone Age, and throughout the history, the country location was ideal for trade and commerce. Today, Azerbaijan, from the perspective of the capital city of Baku, has transformed itself into a polished country of luxury with glass skyscrapers and trendy malls. The country even began hosting a Formula One Grand Prix in 2017 and the European Games in 2015. But behind the glitz and glamour of the freshly paved streets of Baku, the country still deals with poverty. Here are ten facts about poverty in Azerbaijan.
- Azerbaijan was hit by a major economic shock in 2015 and 2016. In a study done for the Government of Azerbaijan in 2015, the GDP of the nation was decreased from 74.19 billion USD in 2014 to 34.9 billion USD in 2015. Understanding this fact is integral to understanding the poverty in the country, as in one year span the income per capita in the nation fell from $5,359.70 to $2,808.
- In 2017 the World Bank noted that Azerbaijan only experienced a “very modest recovery” from the recession that occurred in 2015-16. The country fell short in increasing the nominal average wage and the minimum cost of living enough to offset higher prices. The World Bank stated that poverty likely increased in 2017.
- The Asian Development Bank reported that in 2016 5.9 percent of the Azerbaijan population lived below the national poverty line, which is good compared to the neighbor countries Georgia and Armenia that had 21.3 percent and 29.4 percent of their populations, respectively, below the national poverty line in 2016.
- The Bank also reported that in 2016, 5 percent of the country’s population was unemployed. This is low compared with higher numbers in Armenia (18.4 percent) and Georgia (11.8 percent).
- In 2001 the State Statistical Committee of Azerbaijan estimated that 49 percent of the population was below the national poverty line. This fact is a good illustration of the rapid decline in poverty that Azerbaijan has experienced during the 2000s.
- People living in rural areas have lower income. In a report done by the State Statistical Committee of Azerbaijan in 2017, rural households achieved monthly income per capita of 151 USD, compared to 163 USD achieved in urban households.
- The number of households without access to a water was decreased from 37.6 percent in 2002 to 11.3 percent in 2018. In the same time, the percentage of the population connected to the sewage system increased from 86 percent in 2002 to 98.2 percent in 2018. These two figures reflect the macroeconomic trend of massive reduction in material deprivation in the country in recent decades.
- Internet access rose sharply from just 16.6 percent of household’s having internet access in 2005 to 77.2 percent in 2016.
- The number of graduates from higher education institutions increased in the country from 24,488 in 2000 to 37,506 in 2017, a figure that is extremely well for an economy that is trying to reduce its reliance on oil exports.
- Economic growth forecast of the country in 2018 expressed in GDP is projected to be 2.0%. This was reported by Azerbaijani news source in 2018. IMF increased this number for a GDP growth from 1.2% to 2.0%. This is an encouraging sign for an economy that suffered recent hardship and perhaps a realignment on the multi-decade long trend which has seen Azerbaijan experience much less material deprivation.
These ten facts about poverty in Azerbaijan show that the country stands at both a physical crossroad and at a metaphorical one. Extreme poverty in the country has been drastically reduced, but a continuance of the country’s economic dependence on oil makes the country susceptible to the economic crashes, similar to the one that happened in 2015, and the potential for poverty increase again. The country must decide how to diversify its economy and carry out its progress further into the future.
– William Carlos Menchaca