COP29: Azerbaijan's green transition and China's BRI initiative
Pakistan Observer article

ECONOMICS  29 May 2024 - 14:23

Pakistan Observer newspaper has published an article on the COP29 climate conference to be held in Baku in November this year. Caliber.Az reprints the piece.

The ongoing global heatwave has burnt souls, societies, systems and has once again emphasized on the immediate persuasions of green technologies in the world. It seems that “Green Transformation” has become the only hope for the survival of communities, countries and continents around the globe.

The paradigm shift in the Chinese Belt and Road Initiative (BRI) has already geared up green plans, policies, plants, projects and constant persuasions in its 152 members in the world, changing miseries into opportunities, increasing heat spells into soul healing agents, deforestation into massive forestation, sandy lands into green fields and polluted environment into holistic and comprehensive concept of ecological civilization.

China being the champion of green technologies is expected to continue to green-align its overseas BRI projects, with a broader and more transformative focus on environmental sustainability. Greening the BRI emphasizes China’s firm commitment to encourage a low-carbon global economy as a responsible international stakeholder. China’s endeavours to increasingly green-align the BRI are, in fact, the cumulative outcome of its sagacious policy measures put in force over the last several years. The share of green energy engagement is expected to see a radical rise in 2024.

On its part, Azerbaijan has chalked out a new grand strategy that aligns with national interests, encompassing a competitive economy, climate justice and innovation. Among these priorities, emphasis is placed on achieving a clean environment and promoting ‘green development.’ Harmonizing national environmental policies with international best practices is crucial in this endeavor. Azerbaijan’s hosting of the 29th session of the Conference of the Parties to the UN Framework Convention on Climate Change (COP29) in November further underscores this commitment. Azerbaijan is an important player in the South Caucasus region, which is also a crucial part of the Silk Road Economic Belt. China and Azerbaijan signed a MOU on construction of the Silk Road Economic Belt.

The two countries are diversifying economic cooperation to various sectors including green transport and logistics, agriculture and other areas. China’s advanced experience and technologies in the field of alternative energy would be a value addition for its macro-economy.

The Azerbaijan President’s decree declaring 2024 as the ‘Year of Solidarity for the Green World’ vividly reflects a continuation of the transition to a green economy strategy. It seems that the COP29 offers an opportunity for Azerbaijan to integrate its efforts and strategies to diminish environmental impact while amalgamating best practices for climate change adaptation.

The COP29 has broad scope and relevance and also carries significant socio-economic implications. Hopefully, hosting COP29 will further enhance Azerbaijan’s transition to a green economy and attract foreign investments.

Azerbaijan has initiated investments in green energy projects in collaboration with foreign investors. The role of COP29 in Azerbaijan as a platform for attracting long-term investments and fostering advancements in the field of green energy cannot be overstated.

According to Azerbaijan’s official data, China-Azerbaijan bilateral trade reached $3.1 billion in 2023, a year-on-year increase of 43.5 per cent, with both imports and exports seeing double-digit growth. China remained Azerbaijan’s fourth-largest trading partner. China also became Azerbaijan’s second-largest source of imports for the first time, ahead of Türkiye, and accounting for 17.5 per cent of the country’s total imports.

Azerbaijan, the country’s strategic geographical location also positions it as a critical transportation hub for the China-Europe freight train. The demand for the cargo train has seen a significant increase thanks to its competitive advantages as a reliable transportation tool, particularly following the Red Sea crisis, which resulted in a substantial extension of transportation time and costs for sea voyages.

Azerbaijan plays a crucial role in the trans-Caspian international transportation corridor, serving as a dynamic new market at the crossroads of Europe and Asia. It’s not only a vital node in the BRI but also a significant gateway for Chinese enterprises to access the markets of the Caucasus and the EU.

China is now the world’s largest producer of clean energy equipment. In 2021, the output value of the energy conservation and environmental protection industry exceeded 1.13 trillion dollars. China’s export of three tech-intensive green products, namely solar batteries, lithium-ion batteries and electric vehicles, registered a 66.9 per cent increase in the first quarter of this year, official data showed. Together they contributed 2 percentage points to the overall export growth, up from 1.7 percentage points for 2022.

Green energy has great prospects in Azerbaijan. It has already announced to generate 30 per cent of its electricity from renewable sources and to export 4 GW of energy to Europe through the cables passing the Black Sea by 2030, which has great trans-regional socio-economic, geopolitical, and geostrategic multiplier effects.

Azerbaijan has committed to reducing its greenhouse gas emissions by 30 percent from 1990 levels by 2030 and by 40 percent by 2050, as part of the Paris Climate Agreement. To achieve this strategic goal, it has formed the Renewable Energy Agency, which ensures the active participation of the private sector in the country. Ultimately, it has increased the share of installed electricity generation from renewable energy sources.

In summary, the commissioning of the 230 MW Garadagh Solar Power Plant (GES) with the participation of the President of Azerbaijan which is the first industrial-scale solar power plant in the Caspian Sea region with the assistance of Masdar” company of the UAE, works on the construction of the 240 MW Khizi-Absheron wind power station (KES) project and the 240 MW Shafaq GES project in Jabrayil district will commence from the second half of the current year witnessing rapid green transformation of Azerbaijan.

The hosting of COP29 in Azerbaijan will emerge as a pivotal opportunity to showcase the nation’s economic potential and attract long term investment, particularly in the realm of green energy. Hopefully, COP29 will serve as a catalyst for advancing these efforts and positioning the country as a key player in the global transition to renewable energy.

Caliber.Az