BAKU, Azerbaijan, February 10. There are certain challenges with the structure of investments, as state investments still occupy a large share, and to strengthen diversification, it is essential to increase the participation of the private sector in investments, said Samad Bashirli, Azerbaijan's Deputy Minister of Economy, at the presentation of the World Bank's "World Development Report (WDR)" in Baku, Trend reports.
Addressing the event, Bashirli emphasized the need to take measures to stimulate commercial sectors to avoid the "middle-income trap."
"Only 34 countries successfully transitioned from being middle-income countries to high-income countries as of 1990. Most of them are coastal nations. We need to support our oil industry to avoid the middle-income trap and diversify our economy. Since we do not have direct access to the world’s oceans, this is also one of the obstacles.
We fully agree with the approach to investments, infusion, and innovations. In Azerbaijan, some elements of the second phase related to infusion are already observable, such as the localization of the automobile industry and others. However, its share of GDP is less than 25 percent, and measures need to be taken to increase it.
Increasing private non-oil investments can help avoid the middle-income trap to some extent. In this direction, we are focusing on large local corporations, especially in the banking and service sectors.
We understand that to diversify the economy and foster growth in non-oil industries, changes need to be made in the structure and composition of investments. We must increase the private sector’s share, work more actively with private companies, and involve them in the development of the non-oil sector," he said.
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