By Akbar Novruz

Baku's trade turnover has shown steady growth from January to August 2024, reaching a total of 21,521.0 million manats, a clear indication of the city’s economic resilience. According to data from the Baku City Statistics Department, both food and non-food sectors contributed to this increase, reflecting the broadening scope of consumer demand in Azerbaijan's capital. This positive trend reflects a robust economic performance in the capital city.

Food products, beverages, and tobacco sales reached 11,722.1 million manats, reflecting a robust demand for essential goods. On the other hand, non-food product sales, which rose to 9,798.9 million manats, demonstrate an expanding market for goods like electronics, apparel, and household items. With that, investors can capitalize on a wider array of industries, such as retail, distribution, and logistics, due to the diversification in consumer spending patterns.

The growth in Baku’s trade turnover is not just a reflection of increasing consumer purchasing power but also a sign of the city’s maturation as a regional economic hub. The strategic positioning of Baku within the Caspian region, coupled with rising demand for both essential and luxury goods, is setting the stage for long-term commercial viability.

Prospects for foreign and local investors

The trade structure in Baku clearly underlines its investment potential. A significant 37.2% of consumer goods were sold through legally recognized enterprises, while individual entrepreneurs accounted for an impressive 47.8% of the trade. Even though the city's commodity markets are responsible for a smaller 15% share of the trade, they still play a crucial role in the local economy. This distribution unequivocally indicates that there are ample investment opportunities for both large enterprises and smaller-scale businesses, providing a versatile platform for different types of investors. Foreign investors, in particular, might find these statistics encouraging as they present Baku as a city with a growing middle class and rising consumer demand. The non-food sector, which recorded the largest percentage increase, could be desirable to international brands looking to enter the Azerbaijani market.

The growth in trade turnover also underscores the need for enhanced infrastructure, particularly in terms of distribution networks, storage facilities, and retail spaces. In that case, Baku will require upgraded logistics and warehousing to maintain supply chain efficiency.

Furthermore, Baku's active participation in regional trade corridors, such as the Belt and Road Initiative and the Middle Corridor, firmly situates the city as a strategic link between Europe and Asia. Investors seeking to capitalize on these geopolitical advantages can confidently anticipate significant returns, especially in sectors related to transportation, logistics, and cross-border trade. While Baku expands trade turnover rates, it reflects the city's dynamic growth and the increasing sophistication of its economy. Baku is undoubtedly a key player in the region's economic landscape, offering diverse and promising avenues for investment.