Baku, the capital city of Azerbaijan, has been examined in this volume.
BY FATİH EREN | DECEMBER 11, 2011
Azerbaijan stands at the crossing point of Western Asia and Eastern Europe. It is a resource-rich country and it is located on very important energy and transportation corridors; so Azerbaijan is one of the most attractive centres for global investors in the Eastern European and South Caucasus Region. Almost all foreign direct investments are made in Baku in the country.
Azerbaijan made a fortune and started to extract oil and gas from the Caspian Sea in 1995. After this date, due to revenues coming from oil and gas extraction, the country’s economy started to grow rapidly (the annual average GDP growth of Azerbaijan became 13% between 2000 and 2011). The government of Azerbaijan changed its national economic policy in 2001 and passed from planned-economy to a market-oriented system. Many liberal reforms were committed in this context. Thanks to these reforms, global investors became involved in some sectors of the country. Global investors were mostly invested in oil and gas industry, construction and transport sectors. Recently, global investors started to interest in agricultural and tourism sectors as well.
The government of Azerbaijan gives weight to big transportation and energy projects very much. For example, three big projects (Baku-Tbilisi-Ceyhan Pipeline, Baku-Tbilisi-Erzurum Pipeline and Baku-Tbilisi-Kars Railway) were put into practice after 2006 in the country. After the realisation of these large-scale projects, the strategic importance of the country increased significantly. Azerbaijan’s political ties with international organizations are being stronger every year. The country is a member of many international organizations such as United Nations, the Organization on Security and Cooperation in Europe, European Council, Organization of Islamic Conference and Commonwealth of Independent States. Importantly, Azerbaijan was one of the cofounders of the Organization for Democracy and Economic Development (GUAM). The government also gives weight to international partnerships in its foreign policy. Azerbaijan has concluded 35 bilateral treaties on the mutual protection of Investments up to now. According to 2009 data, the leading investor countries for Azerbaijan were UK (45,6%), USA (15,8%) and Japan (8,3%) in turn.
- The impact of global concern for Baku: Analysis
The globalisation and liberalization processes firstly and mostly had a physical impact on Baku. Gorgeous sea fronts, wide and brillant boulevards, impressive skyscrapers and buildings emerged in the city in just 10 years. Many large-scale residential, commercial and cultural property development projects for Baku are in the pipeline, now (For example Baku Eco-Cultural Master Plan, Zira Island/Nargin Project, White city and so on). The size and ostentation of planned projects are increasing day-to-day in the city.
International commercial property development and investment companies are using a common campaign slogan in Baku, today: ‘build it bigger!’. This slogan should be changed with this slogan: ‘build it smaller!!’ because most of things are getting smaller in the world, today. For example, today’s mobile phones and computers are smaller than the past ones. Smilarly, smaller cars are now produced by automobile factories for easy drive in crowded cities. Again, people are moving to smaller houses for energy efficiency and low management costs. More importantly, it is very common to see small-sized and middle-sized global companies who have worldwide networks but also who use very small office units and buildings in every country. In short, technological developments let global companies to run their businesses in smaller office spaces. Therefore, public authorities should promote global investors to develop small-scale commercial and business buildings for efficiency in Baku.
Baku’s new projects are oftenly designed by European Architects and are developed/financed by American-based or European-based property development and investment companies so the city is under the strong influence of occidental (western european) urban developments, now. Here is a proof for this influence. Interestingly, the street names of London (such as Belsize Park, Notting Hill, Pimlico, Broadgate, Canary Wharf, Paddington, Covent Garden, May Fair) were given to the names of buildings in one of the prestigious large-scale project of Baku (the White city). It is very hard to understand why they did so.
In the context of the market-oriented policy, Mayoralty of Baku does not intervene the planning and design processes of the city’s new projects in general. In other words, it can be said that decisions about the content and context of Baku’s new development projects are made by global companies in a free way, today. As a result of this situation, highly ambitious residential and business complexes emerges in Baku but they are all in western style. Azerbaijan is going on the way of being a regional power. In 2022, it will be involved in the category of developed countries (Fourth United Nations Conference on Least Developed Countries, 2011) so Baku, the leading city of the country, should produce/create a unique and brand new urban planning system which is based on the deep-rooted history and rich culture of Azerbaijan. This new planning perception and approach can be a model for the other cities of both the country and the world. Azerbaijan’s intellectuals, planning and property professionals have to start considering on this matter from now on without being late.
Baku’s new development projects incorporate luxury and environmentally-friendly complexes; that is fine but these projects target only higher-income class in the city. It should be noted that all citizens belong to either higher-income or lower-income classes in Baku at the moment ( middle-income class is absent). However, the wealth of Azerbaijan society is increasing every year so probably most of today’s lower-income families will rise to middle-income class in the future. A very large middle-income class may emerge in Baku in the 2020s. Therefore, the needs and expectations of today’s lower- but future’s middle-income families should be met (at least) to a certain extent in every new project in the city. In order to do this, Mayoralty of Baku has to be involved in the planning and financing processes of all urban projects using public-private partnership tools. Solely market-oriented and private sector-led development may damage the social peace in Baku in the middle/long term.
Fatih Eren is Doctoral Researcher in Department of Town and Regional Planning, University of Sheffield.