Freedom of speech and press in Azerbaijan

Tuesday, June 8, 2010

Gates courts put-out Azerbaijan

BAKU, Azerbaijan — U.S. Defense Secretary Robert Gates tried on Sunday to soothe the put-off president of this former Soviet republic that helps move supplies and soldiers to the U.S.-led war in landlocked Afghanistan.

Tens of thousands of war-related flights have crossed over Azerbaijan since the Afghan war began in 2001, and last year alone about 100,000 U.S. and allied personnel passed through the country. Azerbaijan also is part of an overland supply chain that is a critical alternative to the primary land route through Pakistan. About one-quarter of all war goods come through the oil-rich Caspian Sea nation.

President Ilham Aliyev has complained that he gets too little attention from Washington and that U.S. officials have not done much to resolve a festering ethnic conflict between Azerbaijan and Armenia. He is also irritated by mild U.S. criticism of his track record on human rights, press freedom and elections.

Gates met with Aliyev after attending a defense conference in Singapore, where he told reporters that his stop in Baku was meant to reassure the president that the United States does not take him for granted.

"It's important to touch base and let them know they do play an important role," said Gates, who was the highest ranking U.S. official to visit since President Barack Obama took office in January 2009.

Gates carried a letter to Aliyev from Obama. More high-level visits are in the offing, the Pentagon chief said.

Aliyev succeeded his long-ruling father in 2003 after an election that the opposition said was rigged. He won a landslide re-election in 2008 that international elections monitors called flawed. A referendum last year set him up to rule indefinitely. The country functions more as a monarchy than a republic.

The imperatives of fighting a long war in a country without seaports has forced the United States and NATO to cut deals with unsavory leaders and sometimes unscrupulous businesses that get goods and soldiers in and out.

The supply dilemma has been most apparent in Kyrgyzstan, home to an air base that is the main air transit hub for the war, but involves deals with other former Soviet republics and sometimes uneasy cooperation with Russia.

"I don't feel that anybody in particular has us over a barrel," Gates said. The transit routes "are the most efficient and cost-effective way" to supply the war. The U.S. isn't overlooking undemocratic practices in the interest of expediency, Gates said.

"If you ask the leaders of these countries they'd say we have not ignored these issues," he said.

Concern about creeping authoritarianism in Azerbaijan was one reason top U.S. leaders stayed away. Aliyev's protests include postponing a joint military exercise with the U.S. and demanding that the U.S. go over its books to ensure Azerbaijan was properly paid for allowing commercial overflights.

The accounting turned up about $2 million in back fees owed by contractors, a U.S. official said. The official spoke on condition of anonymity because the payments have not been completed. The Pentagon will pick up about $900,000 of that because some of the contractors it hired are no longer in business or are insolvent.

Strategically located between Russia and Iran, Azerbaijan is a crucial link in Western efforts to reduce reliance on Russian energy exports and a target in Moscow's tug-of-war with the U.S. over regional influence.

The U.S. and European Union have cultivated warm ties with the country beyond its utility in Afghanistan. Azerbaijan has abundant oil and gas and provides an energy export route bypassing Russia and Iran.

Russia has done the same, sealing a deal a year ago to buy 500 million cubic meters of gas annually.


Thursday, June 3, 2010

Azerbaijan's oil boom

It is more than 100 years since Azerbaijan's first oil boom, but in the glitzy centre of the capital, Baku, it looks like the glory days never ended.

Concert halls, caviar restaurants and car showrooms stand alongside the turn-of-the-century apartments built on oil money at a time when British, Dutch and Russian extractors were rushing to the city.

Then, the prime beneficiaries were the local and foreign oil barons. These days, a new Azeri upper crust has most to gain from Azerbaijan's fortune.

The government controls the prices of most energy products and owns key enterprises.

In its 2009 corruption perceptions index Transparency International placed Azerbaijan at 143 out of 180 countries.

But it is the widening gap between rich and poor which is the most obvious result of the new energy boom.

The rich businessmen who preside over the city live in polished stone and marble mansions nestled among Soviet-era concrete blocks.

The Azeri elite keep themselves to themselves, but most people know who they are.

The Minister for Emergency Situations, Kamaladdin Heydarov, Transport Minister Ziya Mammadov and the president's security chief are the wealthiest and most powerful in the governing elite, according to some analysts.

The glamorous first lady of Azerbaijan, Mehriban Aliyeva, is a known sponsor of major cultural projects and elite tourism ventures in Baku.

Hunting for information

However, the precise wealth of these powerful Azeris is not known. The BBC made contact by letter with the offices of each of them, but did not receive a reply.

I did get through to the son of the Emergencies Minister, Tale Heydarov. His official title is president of Gabala Football Club, the very same one where Tony Adams, the former England and Arsenal star, has signed a lucrative contract as coach.

But Mr Heydarov's personal fortune is cloaked in mystery.

His powerful family is believed to run a huge company called Gilan - which owns the football club - although he prefers to keep the exact details quiet.

As he sits in a large office with plush carpets, marble lamps, four telephones and a large desk, I ask him whether the widening wealth gap and talk of corruption is a problem.

"As a normal citizen, I can say that any country faces challenges [after its] independence. We are a very new and independent country and among the ex-Soviet countries, Azerbaijan is one of the most developed," he says.

Corruption questions

Investors - particularly in construction - also appear to be reaping handsome profits while the energy boom lasts.

Baku-based Turkish businessman Yavuz Keles, director of Tusiab - a construction company based in Baku with $3bn (£2.1bn) of assets - says corruption is not unique to Azerbaijan.

"It is a regional problem," he says. "Officials are already talking about the problem, that is a start."

A feature of this boom is the concentration of oil revenue in the hands of the political elite, one local expert says.

"Azerbaijan's oil is monopolised by the state, so of course the state benefits," says Ilham Saban, an analyst at Turan news agency.

"The spending of oil money is only done with the approval of the president."

The situation is unlikely to change in the very near future.

President Ilham Aliyev's second five-year term is due to expire in 2013, but a referendum in 2009 made it possible for him to run for office as many times as he wants.

Critics say this will allow him to preside over Azerbaijan's oil production as it reaches its peak. With new explorations being launched in the Caspian Sea by BP and others, the expected decline in production might yet be postponed.

Recently, the Washington Post reported that nine waterfront mansions in Dubai, worth a total of $44m, were purchased in the name of President Aliyev's 11-year-old son.

A senior official, Ali Hasanov, would not answer questions about the story when he was contacted by the BBC in March by phone.

But, later, to local media, he did not deny it.

"Every person may possess anything. This is normal as long as he gets it within law and the constitution," he told the Azeri newspaper, Yeni Musavat.

Them and us

Outside Baku, there are signs of widespread unemployment and poverty.

The way Azerbaijan spends its money is frowned upon by Western governments.

A Baku taxi driver, calling himself Farhad, drove me towards villages just 20km (12.4 miles) from the capital which have limited gas and water supplies.

"The rich rule society and that means we don't have access to the same parts of the city as they do. They drive the four-by-four cars and have access to big social events. We don't," he says.

The divide is as clear-cut as the glass-and-metal skyline of booming Baku.