Like many other countries, Azerbaijan is considering becoming a member of World Trade Organization. But the road to the WTO membership can be long and difficult. Azerbaijan has to think about its competitive advantage in today's global world, and compare cost and benefits of becoming a WTO member. Azerbaijan submitted a formal request to join the WTO in July 1997. Currently, Azerbaijan holds an observer status within the WTO.
If Azerbaijan wants to become a WTO member, Azerbaijan's WTO strategy must:
-Meet national economic interests.
-Protect, support and develop the national market.
-Attract appropriate expert and technical assistance.
-Create a competitive environment for manufacturing development.
-Meet the interests of national producers and consumers.
For sure, there would be huge challenges that Azerbaijan would have to face. WTO standards would probably force Azerbaijani manufacturers to deliver consistently high-quality products, which would elevate local goods' reputation and price. This progress might cost some local industries their futures, as Azerbaijan would have to lift import restrictions on certain goods. The minister of economic development of the Republic of Azerbaijan, Farhad Aliyev, told reporters upon returning from Geneva in June 2003 that citizens should understand the gains and losses that WTO membership would bring.
The following conditions are most often cited as the possible impediments to Azerbaijan's accession to the WTO: high custom tariffs, lack of transparency and enforcement of commercial laws, corruption, and lack of enforcement of intellectual property rights. It is obvious that these issues are barriers to WTO membership and contradict some of the main principles covered by the WTO's multilateral agreements.
As a matter of fact, in order to satisfy the WTO members, Azerbaijan adopted a uniform tariff schedule, a law on protectionism of foreign investment and the privatization law. Besides, countries like the United States, United Kingdom and Japan support Azerbaijan to become a WTO member. In fact, The United States Trade and Development Agency has granted Azerbaijan more than $2 million as a technical assistance to help Azerbaijan's accession to WTO since 1997.
Azerbaijan's membership in the WTO would create favorable conditions for foreign investors and is therefore beneficial to the most developed countries. Azerbaijan's desire to become a WTO member gives these countries an opportunity to push the Azerbaijani government to implement political and economic reforms that would further improve the trading environment for the foreign companies in Azerbaijan. The increase in the foreign investment and the entrepreneurial activity will also create jobs for the population of Azerbaijan.
In conclusion, I want to say that membership in the WTO is certainly one of the most significant factors in Azerbaijan's route to successful integration into the global market. Azerbaijan has an enormous untapped economic potential, not only in oil and gas, but also in agriculture, tourism and many other sectors of commerce, which could give Azerbaijan a great chance to have a competitive advantage. Being a WTO member will encourage the foreign investors to invest in Azerbaijan. Moreover, the WTO membership will take Azerbaijan one step closer toward being a true market economy. It will boost the investment in the region, provide jobs for the local population and subsequently increase the overall prosperity of Azerbaijan.
Emin Teymorov is a master's student in the Kogod School of Business.
