OFFICIAL DOCUMENTS

The resolute and purposeful measures undertaken in Azerbaijan in 1993-1995 under the leadership of President Heydar Aliyev have put an end to the arbitrariness and chaos prevailed in the country, and ensured social and political stability, created favorable conditions for all-sided development of the country, its integration into the international economic system. Due to the reforms successively carried out since 1995, considerable advancement has been achieved in the development of economy, including growth in economic figures, foundation of the entrepreneurship playing a decisive role in forming economic potential has been laid and considerable progress in its development has been gained, important steps have been taken for improvement of the welfare of the population, state’s care about the people need in social protection has been increased. For the last 5 years the GDP has increased by 60%, investments 2,8-fold, and average salary 2,2-fold. For the mentioned period, the state budgeted deficit has not exceeded 2%, and the inflation rate – 2,5%. The share of the private sector in the GDP has increased from 59,5 in 1998 up to 73% in 2003 including from 26% up to 54% in the industry. Today, over 10 state programs are being implemented for all-sided solving of the existing problems.

For more effective use the oil revenues growing every year due to the successful oil, the State Oil Fund of the Azerbaijan Republic has been founded in the country. Until now, over 800 million dollars have been accumulated in the Fund, which are spent for realization of social and economic projects of paramount importance to the country.

The Baku-Tbilisi-Ceyhan construction works and implementation of the “Shahdaniz” project are being successfully continued.

All this, due to more effective use of the existing possibilities, has created a reliable foundation for Azerbaijan to transform to economically string state, its integration into the global economic system and ensuring worthy place in this system, solving social problems in the country and further improvement of the population’s well being.

For the purpose of reinforcing and further development of the positive tends observed in the economy, and acceleration of the problems existing in social sphere, I hereby decree:

1. The Cabinet of Ministers of the Republic of Azerbaijan in collaboration with related state bodies shall be assigned to

- intensify control over the continuation of the dynamic development achieved in socio-economic life of the country, undertake relevant measures aimed at timely elimination of the problems existing in this sphere, and submit a report on the work done to the President of the Republic of Azerbaijan twice a year;

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- study the course of implementation of the state programs adopted for the last years on development of various fields of the economy (development of small and medium entrepreneurship in the Republic of Azerbaijan /2002-2005/, poverty reduction and economic development of in the Republic of Azerbaijan for 2003-2005, application of the norms foreseen in the European social charter, development of tourism in the Republic of Azerbaijan for 2003-2005, ecologically stable social-economic development in the Republic of Azerbaijan and other programs), ensure taking the measures envisaged by the mentioned programs in time, and inform the President of the Republic of Azerbaijan on the work done;

- prepare within a month and submit to the President of the Republic of Azerbaijan a plan of actions directed to the unemployment reduction in the country and increase in employment of the population, in particular young people in useful labor;

- prepare within a month and submit to the President of the Republic of Azerbaijan for approval the special state program on ensuring construction of new temporary settlements and houses for refugees and displaced people placed in encampments, improvement of their living conditions and employment opportunities;

- draw up within a month and submit to the President of the Republic of Azerbaijan a project of relevant state program on socio-economic development of regions taking into consideration local resources and other factore;

- prepare and submit to the President of the Republic of Azerbaijan relevant proposals on use and development of alternative energy resources put in global practice (solar energy, wind energy, thermal waters’ energy ans small hydroelectric stations);

- carry out work for speedy development of non oil sector to achieve all-sided economic progress, take purposeful measures for stimulation of making investments in this sphere, and inform the President of the Republic of Azerbaijan on the results every quarter;

- take relevant measures stimulating manufacturing products meeting international standards and their export to the world markets;

- prepare and take measures ensuring manufacturing and import of high quality products and medicines (including strengthening material and technical basis of quality control) for health protection of the population;

- prepare within a month and submit to the President of the Republic of Azerbaijan proposals to launch the second phase of the reforms in agrarian sector and accelerate taking related necessary measures (organization of technical service centers, provision of farmers with equipment to larger amount, development of seed-growing base, creation of new reprocessing enterprises etc).

- submit within a month to the President of the Republic of Azerbaijan proposals related to completion of the reforms in economic management system including improvement of the structure of the Cabinet of Ministers of the Republic of Azerbaijan and specifying tasks and authorities in a number of executive bodies;

- prepare and submit within two months to the President of the Republic of Azerbaijan proposals on long-term strategy on control over revenues from oil and gas industry;

- take measures providing purposeful use of the funds allocated in the frame of budget expenditures from the State Oil Fund for them to remain transparent;

- prepare within a month and submit to the President of the Republic of Azerbaijan relevant proposals on reinforcing financial discipline in state establishments, increase of incomes and efficient use of expenditures;

- prepare and submit within two months to the President of the Republic of Azerbaijan proposals on improvement of budget expenditures structure;

- carry out relevant work in the sphere of improvement of salary and stipends system aimed at increasing the living standard of the population, and submit the President of the Republic of Azerbaijan proposals on their raising in accordance of the results of the second half of 2004;

- draw up and submit within two months to the President of the Republic of Azerbaijan a new draft law on provision of citizens’ pensions;

- prepare and submit within two months to the President of the Republic of Azerbaijan for consideration a mechanism of conducting jointly with relevant state bodied municipal reforms in the country.

2. The Cabinet of Ministers of the Republic of Azerbaijan in collaboration with the Ministry of Education of the Republic of Azerbaijan, the Ministry of Health of the Republic of Azerbaijan, the Ministry of Culture of the Republic of Azerbaijan and other state bodies shall speed up reforms in social spheres and prepare appropriate measures aimed at radical improvement of the social services to population, elimination of the existing shortcomings and regularly inform the President of the Republic of Azerbaijan on the work done.

3. The Ministry of Economic Development shall be assigned to:

- speed up implementation of the resolutions adopted earlier on development of entrepreneurship, take under the legislation relevant measures on elimination of obstacles put, regularly inform the President of the Republic of Azerbaijan on the work done.

- speed up privatization of the state-owned enterprises announced open for privatization in accordance with the second State program of Privatization of the State Property, and their transfer to the management, and submit related proposals to the President of the Republic of Azerbaijan with a month.

- take in the framework of the legislation necessary measures for restriction of monopolist activity and suppress of unfair competition;

- prepare in collaboration with the National Bank of the Republic of Azerbaijan and submit to the President of the Republic of Azerbaijan with a month proposal on improvement security of credits given to meet entrepreneurs’ demands in financial resources.

- ensure conducting purposeful work in the sphere of further expanding the country’s cooperation with international and regional financial and economic structures.

4. The Ministry of Finance of the Republic of Azerbaijan shall be assigned to:

- intensify the control over efficient use of the funds of the State Budget and purchases at the expenses of the state’s funds, take within the frame of the legislation appropriate measures against the organizations financed from the budget and break financial discipline;

- speed up preparation of the scientifically grounded standards for drawing up the state budget and submit proposals on improvement of the budget system in accordance with modern requirements to the President of the Republic of Azerbaijan within two months;

5. Heads of state enterprises, companies, joint stock companies and other organizations shall be assigned to reinforce financial discipline, eliminate existing shortcomings, prepare and implement concrete actions to solve problems of nonpayment; update quarterly the Cabinet of Ministers on the work done.

The Cabinet of Ministers of the Republic of Azerbaijan shall keep constant control over implementation of the given issues, study existing situation and take appropriate measures, and quarterly inform the President of the Republic of Azerbaijan on the results.

6. The National Bank of the Republic of Azerbaijan shall prepare and submit within a month to the President of the Republic of Azerbaijan proposals on acceleration of the reforms in banking system and improvement of banking services.

7. The heads of the central and local executive bodies shall ensure reception of citizens in accordance with schedule, timely consideration of their appeals, applications and complaints, solving their fait demands, take necessary measures for intensifying discipline at the administrations of the relevant executive bodies.

8. The present Decree comes into effect since the day of signing.

Ilham Aliyev

President of the Republic of Azerbaijan

The city of Baku, November 24, 2003