BAKU, Azerbaijan, September 22. Our main
approach is not only to extract raw materials, but also to process
them more actively within the country and create higher added
value, Economy Minister Mikayil Jabbarov said at a meeting chaired by President Ilham Aliyev dedicated to
the State Program on the development of the mining and
metallurgical industry.
According to the minister, by 2030, the plan is to increase the
mining and metallurgy sector’s contribution to gross domestic
product from 700 million manat ($411.8 million) to 1.8 billion
manat ($1.06 billion), and its annual export potential from 1.3
billion manat ($760 million) to 3.4 billion manat ($2 billion).
Mikayil Jabbarov noted that a total of 5.3 billion manat ($3.1
billion) will be required between 2027 and 2030 to achieve these
goals.
“The main objectives of the program are simple: it is not about
extracting more raw materials, but about processing them more
actively within the country and creating higher added value,” M.
Jabbarov noted.
He stated that the main priorities of the State Program are
expanding the mineral resource base, increasing existing production
capacity, and implementing new projects. Iron ore, aluminum,
copper, and gold have been identified as the key focus areas. At
the same time, plans are in place to bring new deposits into
economic use.
The minister noted that, as part of the program, in addition to
the government’s regulatory and supportive role, investment
opportunities from state-owned enterprises and the private sector
will be utilized.
According to him, the program aims to establish, to the greatest
extent possible, a domestic value chain from ore to the final
product. This process will cover all stages: from exploration and
mining to beneficiation, processing, and the production of
semi-finished and finished products.
In the first phase, the plan is to realize the potential of
local raw materials and increase production at existing deposits.
There are plans to expand the raw material base by utilizing the
“Demirli,” “Soyudlu,” and “Filizchay” deposits in Nakhchivan, as
well as other promising regions.
As part of the “Dashkasan” iron ore mining project, plans
include the creation of facilities for the mining, beneficiation,
and production of iron ore pellets, as well as a plant for the
production of hot-briquetted iron. The goal is to use the mined
iron as raw material for domestic metallurgical enterprises,
thereby establishing a local production chain. Plans call for
increasing the annual production capacity of the aluminum
electrolysis plant from 50,000 metric tons to 100,000 metric tons,
and rolled steel production from 20,000 metric tons to 50,000
metric tons. In addition, there are plans to build a workshop for
the calcination and firing of anodes, as well as to produce carbon
anode blocks.
Jabbarov noted that Azeraluminium’s exports are expected to
increase from 252 million manat ($148.2 million) in 2025 to 510
million manat ($300.04 million) in 2030.
The extraction and production of copper, gold, and silver are
also planned to increase. Total exports in these sectors are
projected to grow from 600 million manat ($352.9 million) in 2025
to 1.6 billion manat ($940 million) in 2030. This figure is based
on average global prices for 2025.
The minister reported that the total investment requirement
under the State Program for 2027–2030 is estimated at 5.3 billion
manat ($3.1 billion). It is anticipated that 1.1 billion manat
($650 million) of this amount will be financed from the state
budget, 2.2 billion manat ($1.2 billion) from state-owned
enterprises, including loans, and 2 billion manat ($1.1 billion)
from private sources, including borrowed capital. Thus, the plan is
to attract approximately 80% of the total investment from
non-budgetary sources.
M. Jabbarov emphasized that projects in the mining and
metallurgical sectors require significant capital and long-term
financing. He noted that for such projects, the period from
decision-making to the start of production can be five years or
more. In this regard, it is important to expand lending options
with terms of 10 years or more, as well as to increase the
participation of local banks in financing large-scale and long-term
projects.
The minister stated that, to this end, it is proposed to develop
policy measures for long-term financing and to establish
appropriate mechanisms involving the Cabinet of Ministers, the
Ministry of Finance, the Ministry of Economy, the Central Bank of
Azerbaijan, the State Oil Fund, and other relevant
institutions.
The state program also provides for the modernization of the
legal and institutional framework, the drafting of a new bill “On
Subsurface Resources,” the adoption of international reporting
standards, and the creation of a unified electronic database of
geological information.
In addition, there are plans to improve tax, customs, and
investment incentives to attract large-scale projects, expand
support for industrial and transportation infrastructure, support
scientific research and development, and foster cooperation in the
fields of education and industry.
According to the minister, the potential for transforming
Azerbaijan into a regional hub for the processing of strategic
minerals in the long term is also being evaluated. He noted that
the Port of Baku, the Baku-Tbilisi-Kars railway, the Alat Free
Economic Zone and other industrial zones, as well as energy and
transportation capabilities, create additional potential in this
direction.
Jabbarov noted that the program’s impact will not be limited to
the mining and metallurgy sector. Increased production will boost
demand for freight transportation and logistics services, create
new opportunities for local contractors and suppliers, lay the
groundwork for the development of new industries, and increase
employment in the regions.
“Our main approach is not only to extract raw materials, but
also to process them domestically and create higher added value,”
the minister emphasized.
