Watch video of panel where the VNR was presented

MAIN MESSAGES FOR THE 3rd VNR OF AZERBAIJAN

OWNERSHIP OF THE SDGs

The establishment of a just, equitable and inclusive model of sustainable development for everyone is one of the key priorities for the Republic of Azerbaijan. This is the third VNR presented by Azerbaijan since the  adoption and integration of the Agenda 2030 to its national policy and development strategies. The National Coordination Council on Sustainable Development and the Ministry of Economy lead VNR process with the support of UNDP country office through the consultation with various stakeholders including the parliament, line ministries, public institutions, NGOs, private sector and academic institutions.

NATIONAL DEVELOPMENT PRIORITIES (NDP) OF AZERBAIJAN, 2030

Azerbaijan is entering a strategic phase in this new post-pandemic and post-conflict era which spans from 2021 to 2030. Acknowledging  global trends and challenges, the Government of Azerbaijan sets the country's long-term development vector and pathways to socio-economic and environmental development through five corresponding national priorities (approved by Presidental decree) for the subsequent decade. These priorities aligned with Azerbaijan commitments under the 2030 Agenda, are as follows:

• steadily growing competitive economy;
• society based on dynamic, inclusive and social justice;
• competitive human capital and space for modern innovations;
• great return to the liberated territories;
• clean environment and green growth country.

The end of the conflict between Armenia and Azerbaijan creates new economic opportunities not only for Azerbaijan but also for the region. In this regard, rehabilitation, reconstruction and reintegration of the liberated and conflict-affected areas will be one of the main directions of the development priority of Azerbaijan in coming years.

BUILDING BACK BETTER FROM THE COVID-19 PANDEMIC

COVID-19 pandemic caused massive disruption in people's lives around the world and seriously affected the implementation of SDGs in Azerbaijan in several areas – economic growth, employment, healthcare, education and tourism. Since the first quarter of 2020, spread of COVID-19 in Azerbaijan and the subsequent obligatory lockdowns naturally had a negative impact on economic activity and led to 4.3% decrease in GDP in 2020. To mitigate the impact of COVID-19, Government of Azerbaijan approved support programs to provide direct financial assistance (overall 1.5 billion USD in 2020) through wage subsidies to entrepreneurs, tax concessions, customs and insurance payments, benefits to unemployed and public works, covering education and health expenses. As a result of effective support it is assumed that 2021-2022 will be a recovery period for Azerbaijan. Parallel to internal measures, the Government actively participates in fighting COVID-19 globally through bilateral and multilateral programs and has supported 33 countries with humanitarian aid and financial assistance.

GREEN GROWTH

The Government of Azerbaijan admits that global climate change should be based on the introduction of clean technologies, encouraging the use of clean energy sources, recycling  and remediation of contaminated areas. In this regard, selected priorities include a high quality ecological environment and spaces for green energy, and building smart cities and smart villages based on NDP and SDG 11.

NEXT STEPS ON CHALLANGES

• Driven by COVID-19 challenges, strengthening health care system and enlarging the coverage of vaccination process. Meanwhile, recovering the economic activity by gradual elimination of mandatory lockdowns;
• Accelerate economic diversification and ensure dynamic development of the non-oil sector contributing to the  implementation of SDG. This will be through clustering, the formation of a favorable business environment, development of a national innovation system, and the formation of a favorable institutional framework;
• Develop competitive human capital through expand the scope of active labor market programs, increasing investment in education and ensuring full accessibility to the compulsory health insurance system;
• Strengthening the use of alternative energy sources and protecting biodiversity. Ensure govenrment agencies take measures to reduce greenhouse gas emissions in order to fulfill the obligations arising from the Paris Agreement on Climate Change;
• Ensure sustainable development through the rehabilitation, reconstruction and reintegration of the liberated territories, consideration of the SDGs and other international challenges, resources and perspectives;
• Improve  data collection and analysis on sustainable development, including stengthening capacity for analysis and generating detailed disaggregated data on  gender, ethnicity, age groups, habitats and regions/administrative districts;
• Establish of SDG Financing Mechanism with the engagement of private sectors and government institutions to achieve the selected targets of SDGs.  

MAIN MESSAGES FOR THE SECOND VNR OF AZERBAIJAN ON SDGs

Building opportunities for inclusive and sustainable economic growth for all and ‘leaving no one behind’ is a priority for Azerbaijan and we have demonstrated firm commitment to transitioning to sustainable development and aligning our national development strategy to the SDGs. The National Coordination Council for Sustainable Development facilitated preparations of VNR. Alongside with the series of meetings with all stakeholders a set of guidelines was prepared by the Working Groups of the Council and presented to each line Ministry to identify specific work falling within their respective areas of responsibility that contribute to the 2030 Agenda.

ACHIEVEMENTS TO SHARE

• Thanks to its continuous efforts at establishing a sustainable development model, Government of Azerbaijan approved a strategic roadmap for the social and economic development of the key sectors with short-term (by 2020), medium-term (by 2025) and long-term target outlooks (beyond 2025).
• Azerbaijan was one of the first countries in the region to undertake MAPS mission aimed at creating a roadmap outlining definitive steps to be taken to accelerate the implementation of SDGs.
• Azerbaijan was named among the top ten reformers in World Bank’s Ease of Doing Business Report for 2018, allowing the country to secure 25th place as a favorable investment destination among 190 countries.
• Azerbaijan is investing in innovation initiatives and innovative ideas within the spectrum of SDG accelerators. In 2018 alone, the national innovation contest attracted 220 proposals from young Azerbaijani entrepreneurs, researchers and scientists focused on solutions to some of the pressing challenges towards the implementation of the SDGs.
• In October 2018, Azerbaijan hosted the first high-level forum on sustainable development, a platform to discuss practical solutions to challenges involving inclusive economic growth, productive employment, gender equality, youth participation, peaceful coexistence and justice for all, as well as access to clean resources and tackling climate change.
• Agency for Development of SME was launched in 2018 and has already started the process of drafting regulatory acts to establish SME Development Centers.
• Active labor market policies, and social protection, play a crucial role in the achievement of SDGs. Assuring equal access of all to public and social services, Government established “Sustainable and Operative Social Protection Agency”.

LESSONS LEARNT

• Along with the nationalization of the SDGs, and alignment of the existing strategies with prioritized targets and indicators, we should work on a new development strategy (2020 to 2030) based on predefined SDG accelerators and integrate those in our state budget.
• Ensuring complete and integrated implementation of the SDGs, participation of businesses in the process is indispensable. Awareness raising, more stringent regulation of environmental issues, increasing private sector financing for SDGs and harnessing CSR funding are all therefore impending.

CHALLENGES AND AREAS WHERE SUPPORT IS NEEDED

• Statistical framework and other data-related complexities, remains a significant challenge for the country to define our targets for the prioritized SDG indicators, while we seek beneficial partnerships to increase the impact of our investments and interventions in these areas.
• The Armenia-Azerbaijan Nagorno-Karabakh conflict represents a serious threat to peace, security and cooperation in the South Caucasus. Armenia continues to use military force against Azerbaijan by occupying one fifth of its territory and preventing Azerbaijani internally displaced population from returning to their homes. It disregards the UN Security Council resolutions 822 (1993), 853 (1993), 874 (1993) and 884 (1993), which reaffirm that the Nagorno-Karabakh region is an inalienable part of Azerbaijan and call for immediate, full and unconditional withdrawal of the occupying forces from all occupied territories of Azerbaijan. Addressing the challenges associated with the conflict through its lasting political settlement in accordance with the above-mentioned UN Security Council Resolutions will be a significant contribution to the implementation of SDGs.
• Azerbaijan endeavors to protect and restore its land ecosystems and promote their sustainable use. However, low environmental awareness is one of bottlenecks to progress in fighting climate change and protecting environment.
• Implementation of the SDGs also requires widespread application of the principles of the circular economy – such as efficient and responsible resource consumption, waste management and symbiosis among the major industries currently dominating the country’s economy.

CONCLUSION
Azerbaijan will continue its efforts to implement 2030 Agenda with a view to achieve the SDGs. The country will strive to preserve macroeconomic stability by allocating resources in such a manner as to increase the share of the private sector in the overall economy, reducing economic dependency on oil and gas production thus promoting diversification of the economy, accelerating resource mobilization, and integrating sustainability practices into overall national development strategy.

1. The core elements for development model in Azerbaijan were formulated in the mid 1990-s and were gradually and consequently implemented by the Government through various integrated national programs. By 1996 economic growth resumed and in 1995-2003 it averaged at the level of 5.9% allowing macroeconomic stability and gradual restoration of industrial capacities, significant growth in employment and incomes of the population, improvement of the fiscal balance.

2. Continuous efforts of the Government, business community and civil society of Azerbaijan resulted in GDP increase 3.4-fold in 2004-2015 (average 10.6% annually) and 2.9-fold per capita GDP growth allowing Azerbaijan to move to the group of upper middle-income countries. Spurred by the oil-revenues, critical investment, both public and private, were mobilized for modernization of infrastructure, support to non-oil sectors, and financing of human development.

3. Starting from 2010 non-oil sector has been a key driving force of economic growth – while in the oil sector averaged 3.0% annually decline was observed in 2010-2014, non-oil sector growth equaled 8.8% annually.

4. Accelerated economic growth, broad institutional reforms aimed at improved public administration, as well as reforms in health, education and social protection resulted in significant improvement of the country’s global ratings reflecting its progress in achieving MDGs and pursuing wider national development agenda.

5. Azerbaijan was assessed as a “leading reformer of the world” in 2009 by the World Bank’s “Doing Business” Report. Based on the World Economic Forum’s “Global Competitiveness Report for 2016-2017” Azerbaijan is now 27 ranks ahead comparing to 2006 and is 37th among 138 countries. In accordance with this report, Azerbaijan is 39th in the world for the quality indicators of macroeconomic environment, 26th for labor market efficiency, 37th for national income to GDP ratio and 55th for infrastructure quality.

6. Poverty has decreased from 49.0% in 2001 to 7.6% in 2011 and further down to 4.9% in 2015. Azerbaijan’s food security is similar to that of the developed countries, with malnutrition affecting less than 5 per cent of the population. In recognition of Azerbaijan's outstanding achievements in implementation of the Millennium Development Goals, Azerbaijan received the 2015 South-South Award. Since 2010 Azerbaijan is in the group of countries with high human development (2015 HDI is above the average of 0.759 for countries in Europe and Central Asia).

7. Successful implementation of the oil-boom based development strategies and progress with MDGs allowed Azerbaijan to move to the longer-term development agenda. The visionary “Azerbaijan-2020” formulated by the President of Azerbaijan in 2012, foresees the country as the place where the population’s incomes are high, unemployment is minimum, human capital is highly developed, the environment is protected and every citizen has broad opportunities1. Based on the core elements of the concept of sustainable development the Vision reflects the longer-term national aspirations and goals and the key challenges on the way towards those goals.

8. Long-lasting peace, security, stability and social cohesion are the major pre-requisites for sustainable development. However, the military aggression of Armenia against Azerbaijan does not allow achieving any major progress in the region. Despite the resolutions of the United Nations Security Council 822 (1993), 853 (1993), 874 (1993) and 884 (1993), condemning the use of force against Azerbaijan and occupation of its territories, reaffirming the sovereignty and territorial integrity of Azerbaijan and calling for immediate and unconditional withdrawal of the occupying forces from all occupied territories of Azerbaijan, and in flagrant violation of international law, Armenia continues its purposeful efforts towards consolidating the current status-quo of the occupation, strengthening its military build-up in the seized territories and preventing the hundreds of thousands of forcibly displaced Azerbaijanis from returning to their homes and properties in those areas. The resolution of the conflict would not only bring stability and progress to both Armenia and Azerbaijan; it would also ensure peace and justice in the entire region.

9. Building inclusive and resilient growth, ensuring sustainable development would require moving from oil based to more diversified economy, continuing investment in human development, and ensuring greater connectivity to regional and global markets to fully unleash the exporting capacities of Azerbaijan. At the background of existing and emerging externalities, 12 Strategic Road Maps adopted by a Presidential Decree in 2016 outlining the policy measures focused on re-balancing the economy by supporting new “high-end” sectors. The structure of economy will be adjusted through (i) higher growth of non-tradable sector versus tradable sector, (ii) processing versus production, (iii) private business versus public business, (iv) high technology intensive sectors versus low technology intensive sectors, (v) sectors based on highly qualified labor versus low qualified, (vi) high return markets versus low return markets and (vii) high value added generating sectors versus low value added generating sectors2.

10. While the Government will be pursuing ambitious structural reforms program in the coming years, it considers SDGs as a comprehensive framework providing integrated approach for development complementing and reinforcing the Strategic Road Maps.

• Complex nature of SDGs emphasizes the fact that development goals are indivisible and require concerted efforts of all stakeholders, not just the Government;
• Both the Strategic Road Maps and nationalized SDGs processes would require sophisticated system of indicators and improved data collection system for policy formulation process as well as for monitoring and evaluation;
• “Leaving no-one behind” principle fully coincides with priorities of the Government to address issues of balanced spatial/territorial development and reducing inequalities, eliminating all forms of poverty and empowerment of women and youth. This particularly refers to refugees and IDPs.

11. All Government development plans and programs (both ongoing and those yet to be formulated) during the period until 2030 will be revised, harmonized and aligned to support achievement of nationalized SDGs.

12. The National Coordination Council for Sustainable Development with its Secretariat in the Ministry of Economy was established according to the Decree of the President of the Republic of Azerbaijan. The NCCSD has full authority to perform its core functions formulated as follow: Ensure broad based and inclusive stakeholder participation; Translate global sustainable development goals, targets and indicators to the national context; Identify of national priorities and sustainable development gaps; Articulate inclusive and rights-based national strategies and policies; Coordinate and promote collaboration among various government agencies and ministries; Secure coherence among development partners to align with national priorities; Design national reporting and review framework, and links to regional and global reviews; Identify needs and opportunities for capacity development.

13. To support the NCCSD in both nationalization of SDGs and further implementation of respective programs and plans the government established four Thematic Working Groups (TWGs) – Economic Growth and Decent Jobs, Social Development, Environmental Issues, Monitoring and Evaluation. The NCCSD has the power to establish additional TWGs and engage both local and international expertise to support SDG nationalization, planning and implementation of respective policy measures.

14. The State Statistical Committee (SSC) is identified as a key national agency responsible for processing and maintaining effective and responsive database to measure the progress in achievement of nationalized SDGs. The intensive consultations are still in progress for the alignment of SDG goals, targets and indicators to national priorities. All central government agencies and local governments have appointed the focal points to support SSC in its efforts to collect and process data, formulate, pilot and introduce new indicators for SDG monitoring and evaluation. Extensive use of ICT tools will be promoted at all levels of the government to enable innovative approaches in data collection and processing.

15. The Government of Azerbaijan considers the national SDG process as an opportunity to empower a broader range of national stakeholders, promote participative national dialogue and to streamline wider cooperation on the path to sustainable development. Driven by the principle of “leaving no one behind”, which is a core commitment of the SDGs, and determined to engage all stakeholders in achieving the SDGs, the National Coordination Council for Sustainable Development of Azerbaijan Republic partnered with the UN Office in Azerbaijan conducted a panel discussions on SDG implementation which brought together representatives of the different groups of society (academia, civil society, women, youth, parliament). The government, while acting as coordinator for the attainment of nationalized SDGs, will be facilitating and supporting SDG-focused initiatives of civil society institutions, academia, business and professional associations, other stakeholders and partners.

16. To maintain interactive communications with local and international partners the Government will create an interactive web-platform promoting awareness on global and national SDG goals and targets, milestones and indicators. This web-platform would be instrumental for participatory process of consultations on the national SDGs, for monitoring and reporting process.

17. Local mass media and civil society would be engaged as brokers for this on-line and off-line process, securing outreach to all the groups and segments of society. Special emphasis would be made to hear voices of women, youth, disadvantageous, particularly of refugees and IDPs.

18. Nationalization of SDGs through aligning those to the national context and to the Azerbaijan’s strategic development priorities would allow to formulate by end of 2017 National Sustainable Development Goals and Targets, strengthen a broad consensus about those.

19. Subsequently, in 2018, Government would convene a National SDG Conference with UN Country Office to discuss the means of implementation of the national SDG Agenda. The Conference would be instrumental in defining of new drivers of growth and transformation, and the entry points for interventions, which could generate the larger positive spillovers across various sector of the national economy, covering all the part of the country and ensuring that all people of Azerbaijan are engaged to and could ultimately benefit from the SDG process.

20. Success in the implementation of the 2030 Agenda would also require learning on the best international practices, particularly under the South-South Cooperation modality. Azerbaijan would remain committed for sharing its knowledge and experience in formulating and implementing of nationalized SDGs.

21. Government and its development partners would need to elaborate a system of SDG indicators, critical for monitoring and reporting. Data availably, access to data and capacities to both collect, process and disseminate data remain as one of major challenges ahead requiring dedicated efforts both at national and international levels.

22. The Government would continue relying on UNDP as well as other UN agencies on their support and guidance at the different stages of the national SDG process from the nationalization of the goals towards monitoring and reporting.