New extractivism and failed development in Azerbaijan

Abstract

This article examines the characteristics of the resource-led development project in Azerbaijan, including the policies of the Azerbaijani government and their consequences. It makes three contributions to the literature on critical development studies. First, it fills an empirical lacuna by discussing the case of Azerbaijan. Second, it expands upon the criticisms of statist-developmentalist models raised in the literature by demonstrating how the patrimonial rent distribution strategy of the Azerbaijani government plundered resource rents through state-owned enterprises and government-connected private companies, and crippled education and healthcare through underfunding and commodification. Third, as part of an examination of the recent attempts of the Azerbaijani government to diversify the economy and move to the post-oil era, it sheds light on some of the economic development challenges faced by a unique case of a resource-rich country with a closing window of energy resources. The arguments are illustrated and supported from sources pertaining to the political and economic situation in Azerbaijan, the activities of the transnational oil corporations, and US and UK foreign policies in the Caspian Sea.