Azerbaijan - Country Commercial Guide
Information and Communications Technology

This is a best prospect industry sector for this country.  Includes a market overview and trade data.

Last published date: 2022-07-30

Overview

Information and communications technology (ICT) is one of the four target sectors for economic diversification.  The government established several technological parks throughout the country that offer tax breaks and exemptions for companies.  These incentives include profit, land, and property tax breaks and VAT exemptions on imports for the first seven years after a company begins operations at the technological park.  The government is also investing in ICT to create “smart villages” in the newly returned territories.  Despite these projects and government plans to liberalize the telecommunications sector, the regulatory framework governing telecommunications and information technology requires further improvement.  

Similar to other sectors, intellectual property protection is weak in the IT industry, as the ability to control or protect intellectual property rights in the private sector is constrained.  Several large multinational companies have expressed concerns about unlicensed software in both the public and private sectors.

Leading Sub-Sectors

E-governance has been a successful area of collaboration between businesses and the Government of Azerbaijan.  The State Tax Service has moved tax payments online, the Customs Committee has introduced electronic application and payment services, and the “Asan İmza” mobile electronic signature technology enables the use of mobile phones as an electronic identity card and means of signing documents.  U.S. businesses with similar solutions may find opportunities in these modernization and e-government efforts.

Azerbaijan has been actively developing its satellite services to build its regional commercial telecommunications capacity.  Azercosmos, Azerbaijan’s space agency, is a quazi-governmental organization that successfully obtained and launched U.S.-produced telecommunications satellites in 2013 and 2018 and a French-made geo mapping satellite in 2021.  Additionally, cybersecurity, personal data protection, and data analytics have been high-interest topics in Azerbaijan for the last few years.  U.S. companies with considerable experience in the field and working experience in the region might be successful in cooperating with the Azerbaijani government and private sector.    

Opportunities

E-governance and e-commerce solutions have good potential and present an opportunity for well-crafted and well-implemented solutions.  Consulting firms experienced in IT sector development may find their experience sought after by the public and private sectors in Azerbaijan.  Companies with expertise in satellites may benefit from Azercosmos’ interest in acquiring new capabilities.  The annual BakuTel IT expo provides global companies an opportunity to reach potential customers and investors throughout the Eurasian region. 

Resources