Economic and Political Analysis of Azerbaijan-Turkey Energy Relations

Elçin Suleymanov, Cihan Bulut, Farhad Rahmanov

Abstract

Thus Azerbaijan became one of the countries, which balances economic and political relationships in the region. This characteristic comes from the geopolitical position of Azerbaijan. Located in the region of the Southern Caucasus, Azerbaijan has huge natural resources, which triggered the development of economy. The integration of Azerbaijan economy with the world economy and transition to free market economy were the choice of Azerbaijan. Cooperation between Turkey and Azerbaijan in the energy has a multi-faceted structure. It is now widely recognized that Turkey-Azerbaijan relations have always been strong and described with the phrase "one nation with two states”. Energy has a special place in the relationship between the two countries. Azerbaijan’s economy, energy sectors of Azerbaijan and Turkey has been assessed. Moreover, this paper gives a comparative analysis on economic relationship between Turkey and Azerbaijan. This study finally discusses the main trends and contributions of energy projects on Turkey-Azerbaijan relations. This research evaluates the investments of rich oil and natural gas source owner and the most blooming country of the world- Azerbaijan’s investments in Turkey energy sector and its impacts on both these economies. After giving brief information about economy of Azerbaijan, the research analyzes SOCAR’s investment on petrochemical institution in Turkey Petkim which was purchased under Turkish privatization master plan. Star Refinery which began to be built on Petkim peninsula, electric power-plants and port investments were examined under several titles. Additionally, the research gives entire information about the investments on Trans Anatolia Natural Gas Pipeline (TANAP) which was signed at the end of 2011 and evaluates its impacts on Azerbaijan - Turkey Economic Calibrations.


Keywords

Azerbaijan Economy, Turkish Economy, Energy Sector, SOCAR, TANAP, PETKIM

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