With its favourable climate, diverse natural resources and rich historical heritage, Azerbaijan has a great potential for tourism development. In 2011, foreign tourist arrivals were about 1.5 million and the sector’s contribution to GDP around 1.8%. The World Travel & Tourism Council (WTTC) forecasts a 7.5% annual growth in the sector’s contribution to GDP by 2022.
Business visits account for a major part in tourist arrivals. The main origin countries are other CIS countries, Iran, Turkey, Europe and Japan. Most foreign visitors never leave Baku and its luxury hotels. Thus, the regions are largely underutilised assets for the tourism sector.
Besides, the increasing purchasing power of the population and strong growth in outward tourism indicate a significant untapped potential for internal tourism development.
Strategic direction/ specific schemes and incentives
Key sector for the diversification of the economy, tourism is considered as a priority in the State Program on Poverty Reduction and Sustainable Development (2008-2015) and is at the centre of several initiatives:
State Program on the development of tourism 2010-2014
: improvement of the infrastructure according to international standards, attraction of domestic and foreign investments, tourism promotion, establishment of a National Tourism training centre under the Institute of Tourism;
State Program on the Development of Resorts 2009-2012;
2011 designated as the ‘Year of Tourism’: opening of 5 new five-star hotels;
Priority sector for Azerbaijan Investment Company
, which invests in greenfield and brownfield projects along with local and foreign co-investors;
Azerbaijani Travel Agencies’ Association created in 2009 with the assistance of the Ministry of Tourism and Culture.
Hospitality: development of hotels (luxury to 3-star) and villas for rent, especially in the countryside and the islands;
Business, cultural and entertainment tourism: development of tourist sites and tourism complexes;
Rural and eco-tourism: development of projects in partnership with local companies;
Spa, wellness and medical tourism;
Mountain tourism: development of mountaineering activities and supply of equipment, notably at the Shahdag ski resort
Travel agencies: organisations of Silk Way tours, outgoing tourism (agreements with hotels abroad, development of websites);
Catering and restaurants;
Training (hotel staff, cooks, guides, etc.);
Production and distribution of national souvenirs, gifts, etc.
List of concrete opportunities in Azpromo’s catalogue of investment projects
Some success stories
Dia Holding, a JV between IC Holding (Turkey) and Intersun Holding (UAE), is the developer of major tourism and real estate projects in Azerbaijan: Baku Flame Towers, Heydar Aliev Centre, Shahdag ski resort, etc.
ISR Holding (Russia) is the owner of the Hilton Hotel Baku.
Jumeirah, the hospitality subsidiary of Dubai Holding (UAE) is the developer of Bilgah Beach Baku, the first international luxury city resort in Azerbaijan, which will comprise 176 luxurious rooms and suites, and 14 stand-alone cottages along with extensive business and leisure facilities.
Pasha Group (Azerbaijan) is the developer of Four Seasons Hotel Baku (opening scheduled for 2012), to be managed by Canada’s leading hotel chain Four Seasons, and of Absheron JW Marriott Hotel, to be managed by US Marriott.