Economic issues are progressing hard …
Caspian Energy (CE): Mr. Ambassador, what were the results of 2016 and what are the forecasts of development of bilateral relations in 2017?
Yuris Maklakovs, Ambassador Extraordinary and Plenipotentiary of the Latvian Republic to the Republic of Azerbaijan: As before,I would like to split this issue into a political and economic dimension. I still hold on to an opinion that we have very good results of relations established in the political sphere. Latvian Parliament Speaker Inara Mūrniece visited Baku last year. She is second person in Latvia and in this regard I would like to say that it was the first visit in history of our political relations. We also had many different bilateral visits made on the level of municipalities. Meetings of deputies, working groups and intergovernmental commissions took place, which is a very good indicator. Secondly, despite the fact that improvement of the economic cooperation still remains a priority we have a contrary process running in this area. Economic relations worsened because of the economic crisis, oil price decline and there may be some other reasons, but to our regret the statistics and facts indicate that the turnover of goods between our states reduced more than twice. Unfortunately, it is the fact.
But I am trying to compose myself because reading the statistics and the information I understand that this tendency is witnessed not only in the relations with Latvia but also with many other states. This is the way things are. It is the reason why we should work and we will work to improve economic relations against the backdrop of those good relations that we have already established in the political sphere.
CE: What prerequisites do you see to improve the situation? Are there positive moments or the goods turnover will continue declining in future?
Yuris Maklakovs: You know, I think we all should be optimists, set ambitious goals and seek exits in order to obtain positive results. I see it through the prism of policy. As you know, some visits are expected to be made this year. I plan to include these economic issues concerning the goods turnover and economic relations into the agenda of the forth coming visits.
CE: When does the Latvian President Mr. Raymonds Vejonis plan to visit Azerbaijan?
Yuris Maklakovs: We are working on visits and approximate dates are already known. President of Latvia will come in the first half of 2017. The work is underway and it definitely should be positive. We rest big hopes on the Baku visit of the Latvian President and hope it will give a necessary impulse to the development of our economic relations. Unfortunately, it is hard to start anything without this impulse and I very regret to see a small progress on all these economic issues while our countries enjoy very good relations. We have a total of 12 agreements signed in the field of cooperation.
CE: Which measures must Azerbaijan undertake to improve the situation?
Yuris Maklakovs:I would like to note some restrictions. For instance, there is a ban on purchase for government agencies. There are visa problems, difficulties with a distance and availability of direct flight which runs only in summer (from May till the beginning of September). Once the visa regime is simplified, then the flow of businessmen and tourists will grow. I read the other day in Latvian Media about cancellation of visa regime for 80 countries in Belarus.
CE: Are there mutual investment plans?
Yuris Maklakovs:There were very good projects which have been suspended due to the crisis.
Gas supply diversification is of importance to all the EU states
CE: What prospects of cooperation do you see in the field of energy? Is it possible to have Baltic States linked to the Southern Gas Corridor across the European interconnectors?
Yuris Maklakovs:I know that both Azerbaijan and EU find the delivery of the Azerbaijani gas to the European market one of the important projects, including the relevant connections. Latvia is the EU member and the diversification of gas supply is of importance to all of the EU states. The competition on this market leads to a relevant pricing policy. All these issues are of importance to Latvia, Baltic States and the European Union in general. Despite Latvia, Azerbaijan and the Southern Gas Corridor are geographically far from each other, the project has a positive impact on development of market mechanisms of control over the EU’s gas market. The Baltic States are currently engaged in development of the network of interconnectors and the major priority for us is to link Lithuania with Poland which in its turn is linked with the Central Europe. We have a relevant connection with Lithuania and the construction of this interconnector is expected to be completed in 2021.
CE: By connecting Lithuania with Poland you get linked to the two European terminals in Klaipeda and Świnoujście?
Yuris Maklakovs:As far as interconnectors are concerned, it is necessary to notice the present development of the interconnector project between Estonia and Finland, found as the second priority project. We have an interconnection between the two Baltic States and as I said for us it is a matter of energy security, diversification and pricing policy because the price for Russian gas has automatically declined due to the opening of the Klaipeda LNG terminal. So these issues are of importance and priority.
Therefore, Poland is the priority number 1 for us while Finland is the second. As far as the regional gas terminal is concerned, Klaipeda gas terminal is not a facility bearing a regional status. The negotiations are underway now and the European Union is considering issues of allocation of funds for construction of the regional gas terminal in Estonia. Of course Lithuania has built an LNG terminal in Klaipeda but as I said it is not a project that EU is going to finance. There were two options under consideration: Finland and Estonia. But Finland has refused which is why the terminal will obviously be built in Estonia.
The Republican and Democratic parties of the USA have reached consensus…
CE: Ambassadors of the Baltic States in the USA, including Czechia, Slovakia, Poland and Hungary, applied to the Congress in November of the last year to accelerate LNG supplies legislatively to the countries which have no free trade agreement signed with the USA. What was the answer of the Congress?
Yuris Maklakovs:Yes you are right. The Baltic and Visegrad countries have applied to the USA Congress and I would like to say that there is a consent reached in the Congress about this issue both between the Republicans and Democrats. Unfortunately, due to the incomplete adoption of the energy bill in the Congress there was no final decision made about the provision of licenses. But in the meantime, I would say that the consensus does exist as both parties have an agreement about this issue. We are already receiving US gas via the Klaipeda terminal.
People who know the way an Azerbaijani pomegranate looks and tastes will never mix it with a pomegranate grown in any other country
CE: Latvia and Georgia has an operating transportation project “Zubr”. Are there any plans on its further integration with the Baku-Tbilisi-Kars project?
Yuris Maklakovs:Thepurpose of the ‘Zubr’ project is to link the Black Sea with the Baltic Sea. As you know, we have three ports in Latvia on which we rest big hopes. We had negotiations in this regard and as I have noted there was a session of the intergovernmental commission last year which considered and discussed this matter. I met with the Chairman of Azerbaijan Railways CJSC Javid Gurbanov. He told me that they have an agreement signed about the Lithuanian project ‘Viking’ and he finds it possible to have our ‘Zubr’ project linked via ‘Viking’. Azerbaijan has a connection between the Black and Caspian Seas which you call Baku-Tbilisi-Kars. Accordingly, we can use the potential of your cargo transportation by using ‘Zubr’ project. So both projects have an indirect positive impact on the economic relations. But as I said in reply to your first question, there have been no big achievements and results reached in this area yet.
CE: Which sector of economy do you find the most promising in the economic relations?
Yuris Maklakovs: Pharmaceutics is a very promising sector, agriculture as well. Here I see ample opportunities, great potential for work. For example, recently I set off for home to Latvia on the New Year holiday. We have a nice bazaar there, a tourist coach stops near the market and tourists can buy almost everything there. Pomegranates are also sold there, and they are marked as Azerbaijani pomegranates. Why? Because quality is behind that marking, of course, actually those pomegranates were not from Azerbaijan. People who know the way an Azerbaijani pomegranate looks and tastes will never mix it with a pomegranate grown in any other country. However, they are misrepresented as Azerbaijani pomegranates. It testifies that such products should be delivered to Latvia. Secondly, I would like to develop such industries as tourism. I would like to develop the relations between us in the field of education. At the moment about 200 Azerbaijani students are studying at various educational institutions in Riga. Latvia positions itself as a country that welcomes students. We even have opened the embassy in India to increase the number of students from India. We have a few private universities involved in international projects – joint universities, with Sweden, for example. Students are successfully getting education there, and the academic staff is from the Baltic region and the Nordic region. A lot of tourists visit Latvia for medical purposes (medical tourism). On my part, I had a meeting with the Minister of Health of Azerbaijan. We discussed the possibility to arrange visits of our doctors and specialists to Azerbaijan. However, last year I faced the situation that in connection with the crisis many government agencies were not allowed to purchase services from abroad for purposes of currency saving and cost cut. Specialists in forestry visited Azerbaijan, and there was an interest in it, but the crisis prevents everything. In the early 90s a lot of forests were cut over, and forest rehabilitation is very important for the country.
Thank you for the interview