Anti Money Laundering (AML) in Azerbaijan
The criminal funds in the country are generated primarily through drug trade, theft and fraud. Illicit funds also result from robbery, tax evasion, smuggling, and more recently, human trafficking. Country officials believe that money laundering and terrorist financing operate primarily in the banking sector.
In 2008, the Council of Europe Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEVAL) issued a statement regarding concerns with Azerbaijan’s lack of a strong AML regime. The statement was withdrawn in 2009 with Azerbaijan’s institution of a legal system to combat money laundering and the financing of terrorism.
The Central Bank of Azerbaijan (CBA) is the supervisory authority for banks and credit unions in the country. The CBA conducts regular inspections of financial institutions for money laundering compliance. The CBA has issued guidance to financial institutions regarding money laundering prevention; however, the guidance documents are not laws and are therefore not enforceable or binding.
Azerbaijan currently does not have an operating Financial Intelligence Unit (FIU).
The Economy of Azerbaijan
Azerbaijan's recent economic growth has been attributed to large and growing oil exports, but some non-export sectors also featured double-digit growth, spurred by growth in the construction, banking, and real estate sectors.
In 2009, economic growth dropped as oil prices leveled out and the construction sector slowed. The current global economic slowdown presents some challenges for the Azerbaijani economy as oil prices remain below their mid-2008 highs, highlighting Azerbaijan's reliance on energy exports and inadequate attempts to diversify its economy.
Azerbaijan has made minimal progress on instituting market-based economic reforms. Public and private sector corruption and structural economic inefficiencies remain a pull on long-term growth, particularly in non-energy sectors. Other obstacles impeding Azerbaijan's economic progress include: the need for increased foreign investment in the non-energy sector and the continuing conflict with Armenia over the Nagorno-Karabakh region.
Banking in Azerbaijan
The Central Bank of Azerbaijan (CBA) serves as the central bank as well as the monetary authority in the country. The CBA was established in 1992 following the institution of the Law on Banks and Banking Activity and the Law on the National Bank.
The CBA’s first objective is price stability followed by a secondary objective of supporting banking and payment stability.
Azerbaijan's Currency
The currency in Azerbaijan is the manat (AZN). The first series of the manat was issued between 1919 and 1923 before it was replaced by the second Transcaucasian ruble when Azerbaijan became a part of the Transcaucasian Soviet Federal Socialist Republic.
The second manat was introduced in 1992 at the rate of 10 rubles to one manat.
Coins are issued in denominations of 5, 10, 20 and 50 qəpik.
Banknotes are issued in 1, 5, 10, 50, 100, 250, 500, 1,000, 10,000 and 50,000 manat.
In January of 2006 a new manat was introduced at a rate of 5,000 old manat to one new manat.
Other Key Statistics about Azerbaijan
Time Zone: UTC+4 (9 hours ahead of Washington, DC during Standard Time).
Daylight savings time: +1hr, begins last Sunday in March; ends last Sunday in October.
Location: Southwestern Asia, bordering the Caspian Sea, between Iran and Russia, with a small European portion north of the Caucasus range.
Population: 8,238,672 (July 2009 est.).
Labor Force: Approximately 38.3% works in agriculture, 12.1% in industry and 49.6% in services industries. The unemployment rate is 6%.
Languages Spoken: Azerbaijani, Lezgi, Russian and Armenian.
Trade Organizations: Azerbaijan is a member of the United Nations (UN) and an observer of the World Trade Organization (WTO).
