Building bridges for President Aliyev's re-election?

Infrastructure projects will account for a staggering 87 percent of this year's government investment programs, recently revised to total $2.2 billion (1.9 billion manats), according to Oktai Ahverdiyev, chief of the Cabinet of Ministers' finance department.

Under this plan, by the end of 2007, Azerbaijan will have five new airports – some in the remotest parts of the country. Aside from existing international airports in the western town of Ganja, Azerbaijan's second largest metropolitan area, and the exclave of Nakhchivan (bordering Armenia and Iran), an international airport is planned for the southern town of Lenkoran, close to the Iranian border. Airports in Sheki, a popular tourist destination in northern Azerbaijan, and Zaqatala, a small nearby town, will handle smaller planes. The cost for these facilities has not been made public.

Extensive highway and bridge projects are also in the works. In 2007, the government plans to spend $500 million on the construction and repair of highways – a figure that is 80 percent higher than 2006 expenditures, APA news agency reported, citing the Ministry of Transportation. Ten new bridges and 18 underpasses are planned for Baku to lessen the city's growing traffic congestion. In addition, repairs will be carried out on 40 bridges between Baku and the Russian border, and a new highway will be built from the Azerbaijani capital to the Iranian border.

At an opening ceremony for one of Baku's new bridges in March, President Aliyev declared that the bridge building shows Azerbaijan's economic muscle. "It means that we are becoming strong," media outlets reported him as stating. The 200 million manat ($232 million) allocated for the bridges and underpasses "will not be to make a profit," he elaborated, stressing that "[a]ll of this is done for the people's welfare."

Senior government official Ahverdiyev has stated that "poverty reduction" will also be included in the campaign. Planned expenditures will target improvement of "the water supply, sanitation systems, education [system] and healthcare," Aheverdiyev told Trend news agency recently.

Some questions, however, surround the details.

"Azerbaijan's infrastructure needs to improve, but first it should be seriously studied to define priority highways and bridges [for work], which of them can really eliminate problems with traffic jams," argued economist Azer Mehtiyev, deputy chairman of Baku's non-governmental Center for Economic Research. Money for these improvements has so far been allocated without such a hit list, he added.

That leaves particular questions about the viability of the five new airports, observed Zohrab Ismaylov, head of the non-governmental Center for Market Economy Assistance in Baku. "I am not sure that airports in Zaqatala or Lenkoran can give a profit even in the mid-term future," Ismaylov said. Zaqatala has a population of around 26,000 people, according to official statistics. Lenkoran's population stands at under 50,000. Both towns are in non-industrial areas with no emphasis on exports.

Both Mekhtiyev and Ismaylov, however, contend that the large-scale investment projects have as much to do with the 2008 presidential elections as they do with infrastructure improvements.

Decisions about the infrastructure projects "come suddenly during [Aliyev's] trips to the regions and in meetings with residents," observed the Center for Economic Research's Mehtiyev. "There is no clear… policy."

Mehtiyev holds that the construction projects will be used to let Aliyev show that he has met a 2003 presidential campaign promise to create 600,000 new jobs by 2008. At an April 13 speech to government ministers, Aliyev reported that 535,000 jobs – the majority allegedly permanent and outside of Baku – have been set up during his time in office.

Public tenders for the projects have also not been held, a fact that has spurred concerns that money for the projects, derived from Azerbaijan’s sizeable oil income, is being misappropriated. Mehtiyev charges that companies "close to high-level officials" act as project contractors; Ismaylov of the Center for Market Economy Assistance claims that a recent 371 million manat (about $369 million) increase in state investments was approved by parliamentarians without detailed information about the funds' intended use.

"From the point of view of efficiency and of transparency in spending oil revenues, the construction industry is not the best sphere," Ismaylov stressed. Many construction companies are unregistered and operate wtihout paying taxes, he noted.

One pro-opposition political analyst agreed. "[Information about] implementation of these projects is closed to the public," charged Rasim Musabekov. "It is out of public control and gives the government an opportunity to misappropriate oil revenues."

Government officials could not be reached for commentary.

But for President Aliyev, what matters is that signs of change are beginning to appear.

"New business have opened, roads are paved, neighborhoods improved and modernized," the Azerbaijani leader told reporters in April. "The main goal is to reduce the gap [in living standards] between urban and rural population centers. And we can achieve this."

By Mina Muradova and Khazri Bakinsky

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