Referendum Sanctioned Reforms: What Changes Are in Store for Azerbaijan? Interview with MP Vahid Ahmedov

After the constitutional referendum, the beginning of serious reforms in the country is the main topic of discussion. Vahid Ahmedov, deputy of the National Assembly, commented on topics that many in society are concerned about, and solutions to these issues.

After the constitutional referendum, the beginning of serious reforms in the country is the main topic of discussion. Vahid Ahmedov, deputy of the National Assembly, commented on topics that many in society are concerned about, and solutions to these issues.

— Bey Vahid, everyone in the country is now awaiting reforms. What information do you have, what do you suppose will happen regarding this topic? Can we expect the abolition of the Cabinet of Ministers after the institution of the vice president comes into force?

— The referendum will bring very serious events in the socio-political life of the country, I would say that it will become a turning point. Azerbaijan is entering a new period. Because the political and economic processes taking place in the world forced the head of the government to resort to a referendum. The hegemon governments, the superpowers, are fighting to carve up the world. The president of Azerbaijan knows and correctly assesses all this. Seeing as Azerbaijan is free to pursue its own external and internal policies, the decision was made to hold a referendum. Abolishing the Cabinet of Ministers in the present period would be an incorrect decision. Because the Cabinet of Ministers is an executive organ, highly competent staff have earned their stripes there. Thousands of regulatory acts are prepared in this structure, in connection with the implementation of decisions, decrees and laws. Because of this, it’s very important that the Cabinet of Ministers remain for a certain period. It’s possible that, in 3-5 years, when the institute of the vice presidency has been adapted and begins to function normally, then the Cabinet of Ministers might be abolished. But at present this structure needs to remain.

— What spheres will be administered by the vice president?

— I believe that one of the vice presidents must handle the Karabakh question. For us this is very important. It should be seen in the international community how much attention Azerbaijan is giving this problem.  The second-most important question for us is Nakhchivan. Nakhchivan is an indivisible part of Azerbaijan, but there are certain problems, including its years-long blockade by Armenia. This sphere could also be handled by a vice president. At the same time, there should be a vice president who will handle the economy. This will aid implementation of economic reforms in the country, the launch of the executive mechanism of the prepared ‘road map’ and implementation of the process together with the government. For us this is very important. Because, if we can preserve our economy in a normal state, then we will be more confident in the Karabakh question, the president will have more levers.

— Experienced and energetic staff are needed to implement reforms. Do we have people that are up to the task?

— There’s sufficient talent. Moreover, it’s normal to bring in foreign staff for implementing reforms. But even in Azerbaijan there’s enough talent for this, and we need to use them. Such people are in the parliament, in the opposition, and among the free economists. Azerbaijan doesn’t need to search for human resources. We need to create a bank of talent and make use of them.

— There have been presidential decrees or parliamentary decisions that were considered to have been implemented unsatisfactorily. Is it possible that ‘worn-out’ civil servants, who can’t keep up with the times, will impede implementation of the reforms?

— The president will directly manage the implementation of the reforms. Moreover, the Head of the Presidential Administration, Ramiz Mehdiyev, is very seriously working on reforms in the agricultural sphere. Over the past 1.5-2 years very important decisions and laws have been adopted to prepare the country for the post-oil period. There have been certain, positive moments, but we still haven’t been able to bring the preparations to a close, serious problems remain. As such, it’s possible that the old personnel might impede the implementation of reforms. I’ll say directly, there are those civil servants who have major funds, and they are afraid of losing them. Like what happened with the Mezhbank, for example. Certain disturbances are possible from this point of view. But Azerbaijan is a well-established government, it has enough strength, the national security forces are strong enough, there are highly-qualified staff in the systems of the Ministry of Internal Affairs and the Office of the Public Prosecutor. I don’t think that someone will want to do something, using their own funds or post. The Azerbaijani people wouldn’t allow this to be done. We also won’t allow it. We want for our country to develop. The head of the government also has a resolute disposition as regards this.

— In one interview you said that six vice prime ministers is a lot, that two would be enough. Should structural changes be expected in this regard?

— On the whole, political as well as economic and institutional reforms should be undertaken. Reforms should also be implemented in the command structure. The Cabinet of Ministers of Azerbaijan has retained the same composition over the course of 25 years. Very serious changes have taken place in the country over the past 25 years, progress has occurred in certain spheres, reforms have taken place. Of course, there’s no need for six vice premier ministers. Several ministries and committees should be unified. For the government of ten million such a government structure is too big, it’s bloated. Most likely the individuals that will be implementing the reforms and the vice presidents who will be handling these spheres will put forward proposals and implement reforms. Without structural changes, these reforms cannot be enacted in Azerbaijan. One of the most important questions is that of reforming government positions, but here we don’t need to look at age. Regardless of age, if personnel are giving their all to develop the country, to implement smart reforms, they must be left at their posts. But if they appoint young staff who do nothing but make the situation in the country worse, this is impermissible. Posts should be filled by people who know the economic and political stages well and who are capable of representing our country abroad on a high level.

— The situation in the banking sector is getting steadily worse, Bank Standard recently had its license revoked. President Ilham Aliyev recently said that the Central Bank is responsible for the situation in the banking sector and for the crisis in the financial market. What do you see as the way out of the present situation?

— I have said several times, and will say again, that if serious reforms are not made in the banking sector, we will be in a bad situation. The head of the government instructed that the banking system be reformed. Why was the Financial Market Oversight Board created? In order to rehabilitate the country’s banking system, create the conditions for implementing serious reforms. As a deputy, I was never a supporter of bank closures. Because in the case of bank closures, you encounter problems. Now they closed Bank Standard, which has holdings of 560 million manat, 460 million of which are guaranteed, the rest not. Who will recuperate the non-guaranteed deposits? We must undertake a process of consolidating the banks. They must be unified, and 15-20 banks created. They say that they don’t want to, and so on… Everyone knows who the banks belong to. The Financial Market Oversight Board has been active for about eight months, it has performed a diagnosis of the banks. This is really massive work. But we won’t see further steps.

— You and your colleague, Ali Masimli, presented the government with concrete proposals; four months have passed. What is the reaction?

— Yes, we presented fourteen pages of proposals connected with the rehabilitation of the banking sector, including connected with dollar credits. These proposals were examined both in the Financial Market Oversight Board and in the Central Bank, as well as by the president’s assistants on reform. But there is not a positive decision. The chairman of the Financial Market Oversight Board sent me a letter. Actually, he sent me the exact same answer as he sent the president’s assistant, Natiq Amirov. The opinions stated therein are very divisive. They don’t want to help the banks, nor people. The amount of overdue loans exceeded 1.5 billion manat, think about that. There are people who can’t repay the credit. If we intimidate people and bring lawsuits against them, will this help them find the money? We know people’s present situation. The president must be provided with truthful information on the condition of people and the banks. The banks aren’t giving loans at the moment. The Central Bank raised the interest rate to 15 percent. If a bank borrows from the Central Bank at 15%, then what rate is it going to provide credit at? They want to reduce the supply of money in the country, in order to save the manat. But in order to rehabilitate the banking system, the population also needs help, and the banks themselves. It was the banks that drove the population into such a situation, providing loans at 30-35%. But the present situation demands that banks also receive help, in order to work with people.


This article was originally published in Russian on

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