Page 47 - Small Stans and Causcasus Outlook 2022

Karabakh. Shakhbazov also mentioned back in October that the plans
for the next five years include the creation of at least 200 MW of new
production capacities for hydroelectric power plants and small
hydroelectric power plants, as well as an increase in the capacity
connected to the grid by another 10,000 kW for active consumers.

A series of deals were made with Iran in 2021, mainly regarding gas
transit. Iran, Azerbaijan and Turkmenistan have signed a trilateral gas
swap deal that covers a volume of up to 2bcm/y in November. Iran,
Azerbaijan and Georgia have agreed to create a transit route running
from the Persian Gulf to the Black Sea in December 2021. Azerbaijan
will probably play a big role in transport of Iranian oil and gas to Europe
in 2022.

3.1.5 Construction
Several government figures described 2022 as a year of large-scale
construction. This is especially important considering rebuilding efforts
to be taken in Karabakh. According to the Special Envoy of the
President of Azerbaijan Emin Huseynov in the Karabakh economic
region (except Shusha region) the preparation of detailed plans is
nearing completion in both Füzuli and Aghdam.

A special mobilization zone in Aghdam Industrial Park is ready. The
foundations of the plants of the first companies to gain resident status
are being laid. According to the plans, Aghdam will be built according to
the smart city concept. 20% of the city will be covered with greenery.
The city will have four forests, 23 urban parks and roads in the city.

A large settlement is being created in Dovletyarli village in Füizuli on the
basis of the "Smart Village" concept. The project, which unites five
villages, is expected to be handed over to its former owners by the end
of 2022. In the first stage, it is planned to build 450 houses. After that, it
is planned to build an additional 300 houses, which will be the first
residential center in Füzuli.

In the real-estate sector, one should mention that in the first 10 months
of 2021, real estate registration increased by 22.4% compared to the
same period 2020 and amounted to 247,308. Of these, 53,738 are
initial and 193,570 are re-registered properties. Of the property
registered in January-October 2021, 39,836 were individual houses and
cottages, 75,224 were apartments, 122,073 were land plots, 2,877
were non-residential buildings, 6,631 non-residential area, 630 real
estate complexes, and 37 multi-storey residential buildings. During the
first 10 months of 2021, 85,092 of the real estate registered in the state
is in the city of Baku, and the rest in the regions.

Azerbaijan's construction sector is projected to grow by an average of
3% in 2022-2025. This is reflected in the concept and forecast
indicators of economic and social development of the state budget for
2022 and the next three years.

This figure is projected to be 2.9% in 2022, 2.8% in 2023, 2.9% in 2024
and 3.3% in 2025. The country's construction sector is expected to earn
AZN13.7bn (~$8bn) in 2022. This figure is expected to reach

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