The speech of President of Azerbaijan Republic Heydar Aliyev at the ceremony of commissioning of "Caspian Fish Co." enterprise - February 10, 2001

Dear ladies and gentlemen!

Dear guests!

I congratulate you with establishment of new private company in Azerbaijan, with opening of a complex built by "Caspian Fish Co -Azerbaijan" on account of its capitals, which will produce fish products in our country, and I wish success to this new private enterprise.

Today we see a new example of continuous development of private sector in Azerbaijan. Naturally, it is a pleasant fact and it should please everybody. Because, Azerbaijan develops its economy on the basis of market relations being independent state. The main importance in this process belongs to privatization, realization of social-economic reforms and creation of private sector.

Recently, few such production enterprises have been set up in our country and we were witnesses of their commissioning. Obviously, the main works are executed by investors, businessmen, entrepreneurs, and representatives of private sector. The task of state and government bodies is assisting to this process in the framework of current legislation of our country, creation of required conditions for them. Unfortunately, despite the fact that we had undertaken steps for promotion in this sphere for last years, in some cases, and even may be in many instances, we see various hinders, preventions here which are created by government bodies in the development of private sector. But we struggle and will struggle further against it, as the development of private sector in Azerbaijan led to drastic changes in economy of Azerbaijan recent years.

At the result of handing over lands to peasants of Azerbaijan - all lands, which were under state and collective property, the intensity of agricultural production has grown in sphere of land reforms. Our country almost meets all requirements in food stuff. If 98 percent of agricultural production for last years in Azerbaijan were produced thanks to private sector and we could increase agricultural production in 2000 for 10 percent, it says that privatization, creation of private sector should not cause doubt in somebody. I mean, it will develop all sectors of our economy, will ensure consecutive improvement of welfare of our citizens and our nation.

From this point of view, I highly appreciate the establishment of big scientific-production complex here. I really do not know, perhaps some peoples were interested previously in the work of this enterprise and they knew about it. But I could not imagine it was as huge enterprise as that. A big work has been done. It was informed here that 56 millions USD have been spent for building of this enterprise and 30 millions USD will be spent furthermore.

So, unprecedented huge scientific-production complex will be created here in Azerbaijan.

I have repeatedly said it and I am reiterating it now that the entrepreneurs should not fear or abstain from the development entrepreneurship. Today a new stage of creation of private sector is to start and it has already started. We just privatized property in the first years of reforms and followed this course only, as this way is important today and will be important in future too. Privatization, first of all, for example, distribution of lands to peasantry in towns and cities, but not only there, as a whole in Azerbaijan Republic, privatization of trade network, liberalization of trade contacts with foreign countries, barter of goods, creation of liberal economic system as a whole, all it gave its results in Azerbaijan.

But our aim should not be limited only in creation of private trade network, conduction of import operations, importing and selling of goods produced in other countries to our citizens and thus to meet by the demands of population. Naturally, this way will be followed. But besides, it is more important that our entrepreneurs are engaged not only in trade, delivery and sale of commodities imported from abroad, but create production spheres in Azerbaijan using their own means as well and potential of foreign investors.

The positive sides of creation of production spheres in our country are well known to everybody. By creating private manufacturing enterprises, first, Azerbaijan will manufacture product, meet requirements of our country with it by using inner potential. If commodity is competitive, we will gain more profits by exporting it and will bring benefit to the state as well. Secondly, opening of new workplaces with creation of such kind of private enterprise now is one of the most important and major tasks in Azerbaijan.

We have unemployment in our country. It disturbs us and will disturb further. Some people say, that yes, it is true, there is unemployment in Azerbaijan. But why it is existing? Having not found the reason, they try to use it against policy of government and state. The problem of unemployment exists in all independent states, previously formed the Soviet Union and it appeared due to the collapse of socialist economy, the USSR, gaining of independence by republics, breakage of economic integration links among republics, as a result of which manufacturing enterprises, which were once created for meeting the requirements of Soviet economy, now can not operate or operate with no full capacity. To eliminate unemployment problem, we can not create again state enterprises, because we want everything to be private. In some cases, the state creates and will create such enterprises. As an example, we may take our energetic system, provision of Azerbaijan with electric power.

You know that due to foreign privileged credits, we create new electric power stations. Naturally, it will provide work for some of unemployed persons. We have other such potentialities. But it is insufficient for liquation of unemployment. The main task is to develop private sector. The more the growth of production in private sector, the more, first, will be increase of economic potential of Azerbaijan, secondly, the income of Azerbaijan increases, profits increase in favor of state from this production. This profit will be used for improvement of peoples` welfare. More people will be involved, employed in created manufacturing enterprises.

Today while viewing workshops of this complex, I talked with some workers at their working places. I talked with one young person. When I headed Azerbaijan, we annually used to send young people to study on privileged basis in higher educational centers of various cities of the USSR for training of young specialists. He told me that he was one of them, who had been sent to study in one of USSR higher educational centers on my initiative and graduated from Astrakhan fishery institute. Now he is a specialist in the field of fishery. When this enterprise was opened he joined it.

At that time we had no opportunities to train specialists with higher education in Azerbaijan in the field of fishery, because we had no such institute. It meant that we had to do it in other republics of the USSR, where such institutes were available. We did it in that way in many fields. Let`s mention one fact, like how it is important to train various specialists in all spheres of the independent Azerbaijan. I was very pleased. I told him that he was a cadre trained by me. He is an engineer and works here with pleasure.

I talked to another young man. I asked him why he worked here and if he was a specialist too. He replied in negative, he was not a specialist and came here to learn working. By these two facts I want to explain you what a big importance for economy of Azerbaijan, for its present and future has the creation of new manufacturing and production enterprises in private sector.

I met here with two fellows. One of them was a qualified specialist with high education in fishery field, who found job on his own specialty, and the second one had no education in this field, but he also found a job for himself here, he learns and masters this specialty now. Naturally, respected director did not mention while made speech here about the salary, probably it will be higher here than in other places. Ask him, what will be the average salary?

Yanke Hansen (director of "Caspian Fish Co" in Azerbaijan) - Mr. President, the average salary is USD 200.

Heydar Aliyev -200 USD, average monthly salaries of workers and employees will be same.

Average salary here is 200 USD. It may be said that this is well enough salary for working person in present Azerbaijan. So, I see the main meaning of our today`s event that the private sector is being developed, and thanks to it the new local production fields are opened and developed. Once again I am repeating that this is the second and the main stage in development of private sector.

We should try to meet requirements of our country in all commodities using big potential of Azerbaijan, due to the production of private sector. To complete my thought, I would like to repeat over and again whatever was said previously. Care of private sector is to be taken. But there is no need to interfere into their activity, and ask them from where from and how they got this money. If a person invests money and creates production area, the law enforcement bodies or inspectors and others should not try to find out what do they have and what they don`t, and what may they earn from it. It is in contradiction to our policy.

Law enforcement bodies should not interfere into activity of private sector. If somebody committed crime in private sector, it should be investigated. But unfortunately, law enforcement bodies interfere in the activity of private sector. Now we could reduce the number of such cases and prevented it. Some years ago, there was no such firm or company where our prosecutor`s bodies, as well as other law enforcement organs, I am sorry for this expression, "pried their noses" into their affairs. What was the purpose of such action? To assist to private sector? To assist in development of private sector? Never they just wanted to get illegal income for themselves. This is a corruption and bribery. We had been fighting and will fight decisively against it. Corruption and bribery can not exist together with development of private sector. I told repeatedly that all these matters should be regulated by the Ministry of Taxes.

All who had speeches here did not tell what taxes would this enterprise pay? I think if there is a big production, it means taxes also would be high. This is a main fact required by us.

I will tell you one thing that the fact of engagement of this company in fish sector is very interesting and very appraisable. As usual our private sector does business in this field with no reluctance, because this filed is quite complicated. We face cases of illegal fishery, illegal production of caviar and its sale in markets. But I think this company has made a right choice of direction. The director who made speech just now said correctly that Azerbaijan has huge potentialities in this field.

The Caspian Sea is one of unique seas in the world. There are a lot of mineral resources at the seabed of Caspian, oil and gas deposits, bio-resources, many species of fish. It is true that our people used to eat only sturgeon, beluga, and caviar. Many people got accustomed to eat fish kebabs. There are various kinds of fish in Caspian Sea. If all they were processed with high technology as foodstuff, naturally, it would take significant place in provision of Azerbaijan with foodstuff.

Azerbaijan being Caspian littoral country since the ancient times was engaged in fishery. At one time the state had been dealing with it. I remember the fishing in average made 60 thousand tons in 1970-1980-s. But this figure went down up to 8 thousand tons in 1996. Now it seems to have gone up and it is said that it makes 22 thousand tons. But it is still less. If that time the catch were 60 thousands, then why did it decrease now? First, probably because illegal fishery and illegal income of it became wide spread in Azerbaijan. At that time, it was impossible to find caviar in our shops in 1970-s. We have had a special fund, from where we used to get it for visiting guests. To find caviar in retail sale was impossible, as it was very little in quantity.

Nowadays there is enough caviar, sturgeon, beluga, and long-nosed fish. But not in city only, these fishes are taken out to other countries by smuggling. I know exactly that it is delivered to Georgia and from there even to Armenia, where its is sold. In Armenia the Caspian caviar is sold quite openly. It is not because of Armenia purchases it on legal basis from Baku, not at all, it is sold in bazaars. Sale of rare kinds of fishes like sturgeon, beluga, long-nosed fish and others in Georgia, it is another matter, but it is sold in Armenia, in Yerevan too.

It testifies that so many illegalities, crimes are committed in sphere of use of wealth of Azerbaijan, its fish products. Yesterday I got familiarized with figures, being a country, which has such fish resources, Azerbaijan had exported through state line legally 600 tons of fish products last year. But 2 thousand 200 tons of fish products were imported to Azerbaijan from abroad. It does not seem to be correct. The main part of fishes, which were caught in Azerbaijan by various means, moreover whatever are sold in markets, are taken out to other countries illegally, by smuggling and its causes a big damage to our state, our economy. It is also to be prevented.

I remember we had created many enterprises in sphere of fish industry in 1970-s. At that time they worked well and that is why we could produce 60 thousand tons of fish products. But now these enterprises are in a poor state. Part of them was privatized, and another belongs to state. The privatized part almost does not produce anything too. It is produced but used illegally. Therefore they do not pay taxes and do not sale it as required by law. So, our big potential is squandered.

The fishes in the Caspian Sea, in lakes and rivers of country, indeed is a big potential among the wealth of Azerbaijan.

I once again remind that many artificial lakes were created in 1970-s. While building of hydroelectric power stations, we created reservoirs as well. Other reservoirs are created for irrigation purposes. There were artificial lakes as well. Then there were a lot of fish, and they are available now.

I remember, we even had separated this field in order to organize this work better i.e. set a special organization which was dealing with fishery in lakes and rivers of Azerbaijan, separated it from the system of Caspian Sea fishery. I don`t know what happened with them, what is their state now? Sooth to say it is our fault too that the fish industry was let to run itself.

One fish concern was established but its work was also unsatisfactory during many years too. It is unsatisfactory today either. I should admit that our government bodies did not pay serious attention to it up to date. They did not just pay serious attention on it, moreover, they let it to run itself. Therefore today I specially charge the Council of Ministers to analyze within a short time the condition of all fish sector, to find out all potentials and to submit proposals on establishing of order in this field.

That time the trend of decreasing of sturgeon, beluga, long-nosed fish in the Caspian Sea was observed. Therefore in order to increase a quantity of fish, we built a big plant in Neftchala. Now this plant works with a half capacity. To rise its level, we got credit from the WB. This is a case of state, as the state has to deal with it to organize artificial breeding of fish resources in the Caspian Sea. It will be done and today I once more instruct the Prime Minister to take serious actions in this regard. But we can`t keep all fish industry under monopoly of state. Therefore necessary steps are to be taken. Due to the absence of actions, control in fish concern and in all fish enterprises, it could be said that arbitrariness was firmly established there. It disturbs me much. I wanted to tell about it long time ago. I think it is the right place to speak about it here.

To organize this work is necessary in particular, because now a system of fishery created here with the help of processing technology, produce of various fish products, delivery of ready made products to markets. Today we viewed workshops and according to the given information, indeed high world technology was installed here. They have occupied a big territory, built many workshops here and invested huge amounts and I could even say that they have established beautiful hall. It means this enterprise sees its economic efficiency so perspective that it even did not spare means for building of such hall, maybe unnecessary in production. Therefore, I think the enterprise can play a central role in production of fish products, in field of scientific researches. If we take care of this enterprise and render assistance, certain possibilities of a rise of fish industry, fish sector would be created up to desired level in Azerbaijan. That is why today`s event is very gratifying.

Naturally, the initiative of "Caspian Fish Co" that brought to Azerbaijan the most advanced technology in the world and began to process here various species of fish on high level, is very important for us. I have seen here herring. I remember herring was not eaten in 1940-1950-s, it lied around unsold in shops. Herring was always available in Baku shops. Then it escaped in 1960-1980-s. This fish was always called by us as "seledka". Then this fish disappeared. I remember when some guests visited Baku, we requested them to bring herring. But it was said that this fish was not caught, there was no herring in the Caspian Sea. But it seems it was there and I saw it today. By the way, it was so well processed that involuntarily appetite was whet. I repeat again that it is a very positive fact. We have to favor it and assist to this enterprise and develop it.

I see that our ministers, representatives of power are taking part here. I call all to help in such initiatives and namely to this enterprise, because it is said that 30 USD millions would be invested to its second stage. To assist in its soonest construction and putting it into operation is one of main terms.

So, foreign investment inflows not only to oil sector in Azerbaijan, some people very often repeat it, but to other sectors too. If our businessmen could establish required ties with various world companies and inform them about potentials of Azerbaijan, it might have helped for increase of investments.

The Ministry of State property has big task in this field. The Ministry of State property should deal not only with privatization of state property, but with establishment of private sector and attraction of foreign investments. They deal with it. For instance, now the process of selling and leasing of some enterprises to foreign companies is on in Azerbaijan. Moreover, the Ministry of State property should inform foreign investors about potentialities of our country, assist them, direct them and so provide establishment of such companies.

The Ministry of Economy should also seriously deal with it. I don`t want to go into details, because I generally do not see the activity of the Ministry of Economy. But according to its functions and duties, the Ministry of Economy should seriously deal with these cases. Other ministries should also follow it. Briefly, it is our common task.

I once again congratulate the "Caspian Fish Co-Azerbaijan" with current event. I wish success to Azerbaijani citizens working in this enterprise and to all those who will find jobs here in the future. Today I declare that the main task facing us is an increase of foreign investments in Azerbaijan, creation favorable conditions for enterprises of our country to deal seriously with it, and increasing domestic production.

I congratulate you once again and wish you success in all your deeds.