Oil, Geopolitics, and Economic Growth in Azerbaijan
Date of Graduation
Master of Science in Geospatial Sciences
Geography, Geology, and Planning
Burl Self Jr.
The Republic of Azerbaijan, like most newly independent states, must establish its own goals and policies. One of the primary goals of Azerbaijan is achieving economic growth. Experts estimate that the Azeri sector of the Caspian Sea contains approximately three billion barrels of proven oil reserves. Azerbaijan has been extremely successful in attracting foreign investment in its oil sector. There are currently five contracts signed between the government of Azerbaijan and consortiums of international oil companies for development of this oil, and more are under negotiation. If these contracts are brought to fruition, Azerbaijan could reemerge as a major oil producer in the next century, dramatically increase revenue for the country, and achieve economic growth. However, Azerbaijan has a high level of political risk that threatens the achievement of economic growth. Economic growth cannot be assumed to follow the increase in political risk and lower Gross National Product per capita. The relationship between geography and foreign relations in the region creates geopolitical risk that threatens development of Azeri oil resources. Much of this risk stems from interference by foreign governments, especially Russia, Iran, and Turkey. Geopolitical issues will limit the economic growth potential otherwise available to Azerbaijan because of its oil resources.
© Cynthia Marie Croissant
Croissant, Cynthia Marie, "Oil, Geopolitics, and Economic Growth in Azerbaijan" (1997). MSU Graduate Theses. 787.