We solve: Your company's next export destination Azerbaijan?

22.4.2024Mikko Pakkasela & Mikko LehtonenWe solve

What would the Azerbaijan market sound like as a new export destination for your company? And why Azerbaijan in the first place? That's what we were asking two years ago, but not any more.

Picture from Baku. There is old building in the front of the picture and far on the background there is two skyscrapers.
Baku is a mix of old and ultra-modern.

Azerbaijan is an important trading partner for Europe, having become a major supplier of natural gas to the EU as Russian imports decline. Azerbaijan also plays an important role in terms of its geographical location, which is why the EU has launched a number of cooperation projects with it in various sectors over the last two years. Since the beginning of the war in Ukraine, Azerbaijan has also sought to distance itself as far as possible from its former main partner Russia. This is evidenced, inter alia, by the fact that, unlike many other countries in the region, there has been no significant increase in merchandise exports to Russia since the start of export restrictions. Azerbaijan has also supported Ukraine, inter alia by donating anti-mine equipment.

Picture of a map, where you can see the locations of Turkey, Georgia, Armenia and Azerbaijan.
Azerbaijan is an important partner for Europe.

Baku, the capital of Azerbaijan, is located on the shores of the Caspian Sea in the east of the country and has a population of about 4 million. The city centre is a modern European-style business centre with pedestrian streets, shops and restaurants, but as you move further out, the landscape quickly changes to oil rigs and clusters of houses along the roads.

From our experience, we can say that Azerbaijanis are very friendly and helpful. Baku is also a safe and clean city, where you can get around by car (we strongly recommend using the Bolt app) or on foot. There is an excellent choice of restaurants and cafés in the city centre and prices in Baku are affordable for a European. The country's economy is heavily concentrated in Baku, where income levels are reasonable. In contrast, incomes in the rest of the country are modest.

Business and industry

From an industrial point of view, Azerbaijan is far behind Europe and offers a significant opportunity for Finnish companies. Azerbaijan is interested both in skills development in general and in technological investment in manufacturing. It also offers substantial subsidies and tax breaks to companies setting up a production unit in the country.

Traditional industries in the country are mining and process industries. Despite - or rather because of - its large oil and natural gas reserves, Azerbaijan has both the interest and the financial capacity to invest in green industry and energy production. And as these investments are in their early stages, it is also a great opportunity for Finnish companies.

Picture of a man standing in a talking booth talking to a microphone. Next to him sitting lower are two persons.
Arvo Nerman, Project Director of the Finnish Water Forum, speaks at Baku Water Week.

Education and training cooperation

Azerbaijanis value European education and are very interested in cooperating with their respective institutions at all levels of education. Indeed, education plays an important role for Azerbaijanis and this is reflected, for example, in the strong emphasis on mathematics. Indeed, a significant number of young Azerbaijanis go to European universities and colleges each year to pursue a degree.

There is also a growing awareness of Finland, of Finnish education and its high quality in the region. Similarly, other great values associated with Finland, such as nature, cleanliness, security and our reputation as the happiest country in the world, have all increasingly reached Azerbaijan. These also offer a lot of potential for our educational exports.

Group picture of nine people standing next to each other.
Finnish representation on the last trade mission - education and greentech representation at its best.

LEF Network Azerbaijan project

Satakunta University of Applied Sciences, together with the Estonian and Latvian Chambers of Commerce and supported by the EU Central Baltic funding programme, has launched a three-year export project to Azerbaijan in spring 2023. The aim of this project is to help companies discover Azerbaijan as a new export market. A total of six export promotion missions will take place during the project, each involving five companies from each country. The first two trips have already been carried out with companies involved in educational exports and have proven to be successful! The two export promotion missions in autumn 2024 will bring together not only edu-tech and other educational organisations, but also green technology experts. Other sectors can also apply. The themes of the last two tours in 2025 are still open.

Mikko Lehtonen and Mikko Pakkasela standing next to each other for a picture.
Export promoters from SAMK - Mikko Pakkasela (right) and Mikko Lehtonen.

If you are interested in this project and feel that it could also solve your company's export challenge, please contact us. Thanks to EU support, this is an opportunity worth seizing! Contact us and we will tell you more about the opportunities!

Mikko Pakkasela
Head of Research, Business Intelligence Center
+358 44 710 3189

Mikko Lehtonen
Project Manager  / Head of Research
+358 44 710 6362


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