Azerbaijan targets 4 million tourists per year On the verge of big travel boom

Azerbaijan's tourism saw steady progress last year: the number of foreign visitors has exceeded 1.602 million and almost doubled. However, this is not the limit, and the plans of the State Tourism Agency of Azerbaijan (STAA) indicate the possibility of increasing the volume of inbound tourism up to about 4 million by 2026. To achieve these goals the country is implementing a number of plans, including those related to the development of tourism in Karabakh. The key trends contributing to the growth of the domestic tourism sector were discussed at a public debate on the theme "Tourism business: current situation and prospects", organized by the Agency for Small and Medium Business Development (KOBİA), STAA and the National Confederation of Entrepreneurs of Azerbaijan (ASK).

The long-term task to be solved by state authorities and participants of the tourism market of the country is related to the need to increase the external tourist flow into the country as soon as possible to the indicators of the prosperous pre-crisis year (in 2019 the tourist flow made a record 3.170 million), and then to exceed this bar. Such a task is set out in the Strategy for Socio-Economic Development of Azerbaijan for 2022-2026: in particular, it is planned to increase the share of tourism in non-oil GDP of the country by 1.5 times compared to 2019, while the share of revenues from the industry in the next four years should grow by an additional 20 per cent. Moreover, according to STAA's calculations published last December, Azerbaijan eyes to bring the inbound tourist flow to 4 million people by 2026 and the number of local travelers vacationing inside the country to 6 million people. In case of such growth, according to the STAA's forecasts, in 2026 the total revenue from tourism could quadruple in comparison with 2021 and reach 11.2 billion manats, including 5.5 billion manats (49 per cent) income from foreign tourists.

How are these high-flying goals to be achieved in a relatively short period of time? Specialists of profile structures, as well as the Public Union "Association of Travel Agencies of Azerbaijan" and other market participants, tried to present their vision of the near-term prospects of the recreational industry during the public discussion on "Tourist business: current situation and prospects" held in Baku.

"Azerbaijan's tourism sector has seen a revival - the number of foreign tourists visiting our country in 2022 was 1.602 million. The comprehensive development of this industry is important for the country's economy, and in this regard, Azerbaijan provides for the strengthening of strategic institutional and financial mechanisms to ensure the sustainable development of the tourism sector," KOBİA board chairman Orkhan Mammadov, who attended the forum, said. According to him, in the recent period the entire world, including our country, is in a stage of rapid development and overcoming the negative aspects of the post-pandemic period. Azerbaijan has created favourable conditions for the development of the recreation sector and the competitiveness of national tourism complexes as a result of purposeful measures taken in tourism sphere.

Of course, obstacles related to the special quarantine regime have not been fully overcome yet. For example, the country's land borders have recently been closed again until July 1, a factor that is preventing the flow of inbound tourism into the country from accelerating. "Nevertheless, under the conditions of closed land borders, Azerbaijan has given impetus to the development of domestic tourism: appropriate measures should be taken by travel agencies and the private sector to promote domestic tourism and encourage the local population to use the recreational opportunities of the republic. But in all cases the complete removal of restrictions in the relevant direction will lead to more rapid development of the tourism sector and the growth of income in this area," Mammadov said.

In order to approximate the potential of cross-border road traffic for tourism development, it is appropriate to quote some statistics. Thus, in the most prosperous year for tourism development in 2019, around 58.7 per cent of tourists arrived in the country by road and partly by rail. In other words, once the pandemic restrictions have been lifted and tourist exchanges with neighbouring countries are restored, the potential for cross-border travel alone by bus, train and car can be estimated at two million foreigners. If we were to add our republic's citizens travelling by road, these figures could be increased even further.

The development of tourism in the Karabakh and East Zangazur economic regions has a very high potential for the expansion of the country's recreational opportunities and the development of new destinations. "The liberated areas of Azerbaijan have great tourism potential, and the ongoing construction work in the region and the return of displaced people create the conditions for the use of recreational opportunities in Karabakh in the near future," KOBİA's head said, underlining that the situation holds great prospects for business entities involved in the tourism sector. In this regard, KOBİA and STAA, the profile associations working in the field, should unite their efforts and expand opportunities for cooperation to implement new projects in the liberated areas. "The Fгzuli and Zangilan international airports are currently in operation, and the Lachin airport is expected to open at the end of this year or early next year. All this sets opportunities for the development of international tourism in the region," Mammadov emphasized.

In recent years, Azerbaijan's relevant structures have intensified their efforts to attract investors at tourism forums in Europe, Türkiye, China and post-Soviet countries. This interest is mutual, with many domestic and foreign private companies showing interest in the development of thermal, mountain (mountaineering), winter, hunting, agricultural and "green" tourism in the Karabakh region. As a matter of fact, some tourism projects are already being implemented within the framework of public-private cooperation: in particular, significant tourism infrastructure is being created as part of the establishment of hotel complexes in Shusha, and the construction of recreation areas in Sugovushan, Hadrut and Tug has begun.

It is possible that Shusha, which has been declared the cultural capital of the Turkic world, will be the first town in the region, where the relevant infrastructure and primary tourism potential will be completed by the end of the year, thus creating the conditions for receiving tourists as early as next year. As the other liberated districts are cleared of mines and the road, energy and municipal infrastructure is formed, the development of the recreational potential will begin. As the liberated areas have great tourism potential, in addition to the general tourist benefits, a portion of the VAT paid for lodging and accommodation services (excluding other ancillary services) provided by hotels and hotel-type facilities will be refunded to consumers. Taking into account fiscal and other preferences in general, it is expected that by 2030 in Karabakh Economic Region alone about 1,500-2,000 permanent jobs will be created in the tourism sector.

It should be noted that within the framework of the Strategy of Development of Regional Tourism for Karabakh, in order to turn the region into a new tourist destination, a number of initiatives covering cultural heritage, natural landscapes and historical monuments are envisaged. Thus, these directions cover the heritage of the Karabakh Khanate, the "Silk Road", including Hadrut, Fuzuli, Khojavand, Aghdam, Sugovushan, etc. In turn, projects have been prepared under the "Victory Routes" concept, including "YolumuzAğdama", "YolumuzFüzuliyə" and "YolumuzXocavəndə", etc.

New destinations are planned to be developed in other regions of Azerbaijan in order to enhance the country's tourism potential. In this regard, the STAA has developed a new industry development plan. According to the document, within the framework of cooperation with UNESCO and other international organisations it is planned to prepare various tourism products on the theme of the Silk Road based on the elements of material and cultural heritage of Azerbaijan, create regional Silk Road centres, and hold various events and festivals. "There are also plans to establish regional tourism councils and regional tourism departments in Azerbaijan. In order to improve accounting in the tourism industry, a tourism register will be launched in the coming days," said another public discussion participant, Fuad Nagiyev, chairman of STAA.