BAKU, Azerbaijan, May 17. There is still substantial growth potential in terms of direct investments by German companies into Azerbaijan, and a certain level of interest already exists among foreign investors looking at infrastructure and construction projects, Nargiz Uiek, Executive Director of the German-Azerbaijani Chamber of Commerce (AHK Azerbaijan), said during the Business Assembly session titled "Private Sector Leadership Across the Housing Value Chain: Delivering Results Against the Odds," held within the framework of WUF13 in Baku, Trend reports.
She stated that compliance requirements and risk-sharing issues faced by foreign companies in their home countries also remain significant factors.
"I see serious opportunities for investment in Azerbaijan. This view was further strengthened particularly after my recent trip to the Karabakh region. We are witnessing massive state-led restoration and reconstruction work being carried out in Karabakh. Currently, about 30 percent of the territories have been cleared of landmines, and urbanization is being implemented precisely in these areas. The notable point here is that this model works if the planning is conducted in the form of 'smart villages' or urban development from scratch. In other words, the system operates effectively when there is strong interest from the state, utilities, investors, and developers," Uiek said.
She added that the real challenge arises in upgrading existing infrastructure, namely within decarbonization processes.
"In terms of technology, investors show great interest in renewable energy solutions, battery storage systems, and decentralized energy models as a whole. The problem is no longer whether the technology exists—it does. The main question is: how are these technologies integrated into the overall project system? It is not about bringing in isolated solutions, but rather incorporating them into a unified project planning framework," the executive director explained.
She emphasized that the industrial potential of cities is also a crucial factor.
"Critical criteria for investors include whether a city possesses industrial infrastructure and whether it is feasible to establish decarbonized industrial zones. Alongside this, digital infrastructure and the interconnectedness of urban services represent key directions. Overall, several critical factors exist for investors. First and foremost are bankable projects—meaning that the return on investment, profitability, and risk profile must be clear. Risk-sharing carries particular importance. A public-private partnership (PPP) model is needed for urban development. Another vital issue is the speed of permitting processes—how quickly the approvals required to start a project can be obtained. Finally, regional connectivity comes to the forefront. The visibility of projects and the ability to source resources like energy within or outside the region must be more flexible. For this reason, regional cooperation is highly significant in the Caucasus and Central Asia region," Uiek concluded.
