Azerbaijan plans register of housing under construction
Published on 07/08/2015
Azerbaijan has seen a significant increase in foreign direct investment (FDI) over the past two decades. From attracting just over $330 million back in 1995, the country - which is the largest in the Caucasus region - saw FDI climb as high as $5.3 billion in 2012.
For overseas building materials suppliers looking to sell their products in the Azeri market, this is almost certainly a positive sign. More foreign investment in the construction sector - which generates more than 11 per cent of Azerbaijan's total GDP - creates greater opportunity for suppliers, particularly as foreign-backed projects are often built to a higher standard, requiring quality materials that may not be available domestically.
New housing construction register to encourage property investment
Any steps taken by Azerbaijan to encourage foreign investment in its construction projects are likely to be welcomed by the international building materials trade.
One such measure is the plan to implement an official register of housing under construction. Designed to provide greater clarity around the construction and ownership of new residential properties, the register is the brainchild of the country's anti-corruption department.
In a new report from Azeri business information portal ABC.az, Kamran Aliyev - deputy general prosecutor and chief of the main anti-corruption department - explains the purpose of the new register. Intended to crack down on property fraud, it would include information on apartments in under-development residential buildings, preventing multiple fraudulent sales of one apartment to several different buyers.
Azerbaijan has already taken major steps to clean up its property market. In the past two to three years, the number of complaints about housing fraud have dropped significantly, says Mr Aliyev.
"Citizens should be vigilant with regards to housing issues. Thus, vigilance is necessary if you have a deal with an unknown housing cooperative," he adds.
"The anti-corruption department has already developed its proposals on [the] introduction of the housing under construction register and submitted them for consideration."
By providing an official record of residential property construction in Azerbaijan, the planned register should give greater encouragement to businesses and individuals looking to invest in the Azeri construction industry, which in turn represents good news for the building materials trade.
Why Azerbaijan is already a major target for building materials suppliers
Of course, Azerbaijan is already very much on the radar for companies across the world looking to export building materials. Several major residential construction projects are underway or in the pipeline, creating significant opportunity for the building materials trade.
One of the biggest current projects is Khazar Islands. This planned development of 41 artificial islands in a 30 sqkm plot of the Caspian Sea is ultimately expected to have enough housing for a million residents. Once completed, the $100 billion island city will also house the $2 billion Azerbaijan Tower - expected to be the tallest in the world - along with several shopping malls, a Formula One-quality race track, and a municipal airport.
Another, Baku White City, is intended to provide enough residential space for 50,000 people - approximately equal to the size of Andorra. Described by the developers as one of the world's largest modern projects, it is being built entirely on reclaimed industrial land in the south-eastern suburbs of Baku, in an area generally known as Black City. In total, White City is expected to provide 18,000 residential and commercial units, 48,000 workplaces, and the largest retail and entertainment centre in the region.