Interview to “Business Time” magazine

After publication of “Azerbaijan–Anonymous” Report by Global Witness on 10 December 2013 focused on Azerbaijan’s oil industry a lot of attention arose in Azerbaijani society on who is Anar Aliyev. Mr Anar Aliyev contacted us and expressed his interest to give an interview to our magazine. Our interlocutor gave us detailed answers about his background and activities. In the course of our discussion he shed a light on many previously unknown topics and issues. 

 

Anar Aliyev

 

Mr Aliyev, first of all we would like to thank you for your readiness to give the interview to our magazine. Could you please clarify why you have decided to give the interview to our magazine?

First of all, I would like to thank you for the possibility to give me a forum to speak and shed a light on many issues of interest to our community, and answer your questions honestly to put and end to rumors about my background and business activities. I have chosen your magazine because it is a purely objective business journal. In fact, I could give an interview to any political media and address all topics related to my personality and business activities. However, since I have nothing to do with politics I prefer to give an interview to an independent local business magazine.

Some local media sources claim that my Personal Statement of 19 December 2013 placed on the official website of top parent company of my group of companies is not from me. I believe that this interview will confirm without doubt that the referred Statement belongs to me and there should be no doubts that I am a real person.

Frankly, I am not intending to give any other interviews at the moment. I have witnessed recently how my Personal Statement was negatively interpreted or let me say it was misinterpreted by the local media. For these reasons, to correct and clarify my situation and position, I believe that this interview must be the only one at the moment.

 

Mr Aliyev, we saw another surname “Alizade” in square brackets in your Personal Statement. Could you please clarify this issue?

It is true and indeed I have recently changed my surname’s suffix to “-zade”. I have changed the surname’s suffix under the relevant law and the recommendations of the Academy of Sciences (Ed: The reference is made to the Law of the Republic of Azerbaijan No 495 of 2 February 1993 and Decision of the Presidium of the Academy of National Sciences of the Republic of Azerbaijan No 20/30 of 24 December 2010). Moreover, the previous suffix and “Aliyev” surname is a common surname  in our country and while bearing this surname I was always facing many questions about my family relations to powerful people in Azerbaijan. Moreover, my ancestors were bearing “Alizade” surname and such suffix replacement is my desire to return to my original roots rather than to bear a surname with Russian suffix.

Mr Alizade, could you please provide us detailed information about your background. In other words where you were born, studied, etc. Moreover, everyone is interested whether Anar Aliyev has any family relations to any powerful persons. Could you please address this question?

I am 36 years old and I was born in Nakhchivan. I graduated from the Nakhchivan State University and on part-time basis I also graduated from the Academy of Public Administration.

As I have already mentioned in my Personal Statement I have no family relations with any powerful representatives of the Nakhchivani clan referred to by Global Witness. Taking this opportunity, I would like to stress again that have no close family relations with any of the referred persons or anyone else who holds high Government position in Azerbaijan.

An approach of mutual support by Azerbaijani businessmen to each other always has the result of raising suspicions by the radical local media which claims that all these supports and cooperation are family relations based cases. I don’t know for what reasons, but negative stereotypes have been formed by some factions in Azerbaijan. If a local Azerbaijani businessman is successful and he doesn’t hold any foreign passport or surname he would be necessary blamed in a corrupted practice. The fact that local successful businessmen are subject to groundless criticisms by the local media is actively used by outside unfriendly powers for their hostile campaigns against Azerbaijan.

How and when did you start you business activities? Could you please give us detailed information?  We believe that the more detailed information you provide about your business activities the more likely you will be able to help put an end to rumors about you and your activities.

I started my business activities in my teenage period. When the borders with Turkey were opened I was actively involved in import of Turkish textile and food products to Nakhchivan, Azerbaijan and Russia. I was supported in this business by my family. At the same time I was active in car import business. Afterwards with a generated capital in early 2000-s I came to Baku and was actively engaged into trading of lands and private properties located in luxurious Gyandjlik metro station area. For information purposes I would like to stress that in early 2000-s within 2-3 years the prices of property in that area dramatically increased several times. Transactions with gradual sale of those properties allowed me to generate a substantial initial capital for my further business activities. Trading with construction materials and equipment was one of other my initial business activities. In the same time I started construction of residential premises through the advance crediting by the purchasers actively used in Azerbaijan. It also substantially increased my capital.In 2003-2004 I set up “Aztrans” LLC which owned 17 cargo trucks and was quite successful in cargo transportation of local fruits and vegetables to Russia.

Several years later through my local counter partners I entered into UAE market. Due to the high demand in computer electronics in Azerbaijan at that time I set up UAE based companies and I was one of the first Azerbaijanis establishing such companies there. All those companies are still working in Azerbaijan. Within a short time period I gained a considerable success in this field. Using my strong presence in the UAE I started paying attention to other fields in Azerbaijan. I found that there are certain demands in oil industry. In line with such demands I started importing various pipe coatings, oil equipment, spare parts, technologies and computer electronics for the local and foreign oil and service companies as well as some local factories.

During the same period using my initial capital I opened “Grand LLC” belonging solely to me and I provided services to major oil and services companies including the local ones. Since SOCAR is the key player of Azerbaijan’s economy the cooperation with this company in Azerbaijan is unavoidable.In 2003-2004 “Grand” LLC was one of the first local companies which imported modern equipment and provided oil pipes’ x-ray services and started an active cooperation with SOCAR. All these years my companies provided various services, supplied goods and rendered construction services to SOCAR and its subdivisions. Therefore, my long-term cooperation with SOCAR and other local and foreign companies upgraded me from an ordinary service provider and supplier up to a reliable partner. I believe that it was possible due to the strategy of our State and the Government on supporting the local businessmen. It also allowed me to participate in some, I would even emphasize that in some, but not many projects with SOCAR.

SOCAR Trading SA was set up as a result of the offer came from me and well-known oil trader Mr Valery Golovushkin. At that time SOCAR sold its crude through foreign companies. Both from political and economic points of view it was not admissible for Azerbaijan. From political perspectives it gave certain tool for pressure on Azerbaijan. As a result a proposal was made to set up a company in Switzerland a world centre for oil trading. This centre was to be professionally staffed and expanded to become the main hub for trading Azerbaijani oil. At that time SOCAR did not have the resources or know-how to establish this centre and as a result a proposal was made and accepted and SOCAR Trading SA was established. The traded price for Azerbaijani crude has increased across the world market. The resulting success of this venture has benefited Azerbaijan in that it now receives a more favourable price for its crude and this entail has benefited the whole economy of the country. Based on our offer SOCAR Trading SA should be financed by us during the firs years of its activities. According to the initial arrangement such cooperation should be lasting 5 years and in case of positive results and achievements of the company SOCAR would have a right of purchase of all shares of the company in 5 years and as minority shareholder we took an obligation to sell all of our shares pursuant to the current market value. According to all agreements SOCAR had all control functions and as minority shareholders we took an obligations not to interfere into SOCAR Trading’s activities, especially over the strategic field such as crude trading. I invested substantial funds into this company and the figures referred by Global Witness in its Report are not accurate. For example, in 2008 when the global financial crisis hit the entire world and SOCAR Trading SA faced serious financial difficulties and SOCAR was hesitating to provide the financial assistance, it was me who as one of the shareholders provided necessary financial assistance to SOCAR Trading SA and did not allow it to become insolvent.

Moreover, as I mentioned earlier I was never involved in Azerbaijani crude trading. This right belongs to Azerbaijani State and SOCAR which uses its Marketing and Operations Department for these purposes. I never interfered into these processes and I have no doubts that I could not be allowed to do so by the State

It is already clear that London based Global Witness’ 10 December 2013 Report has changed your normal calm life. What is your attitude to the Report?

The position taken and claims made by Global Witness in the referred Report still remains mysterious for me. We can only guess on whose initiative this Report was compiled. However, there are no doubts that publication of this Report right before the signing of the important energy agreements in Baku (17 December 2013) had the intention to damage SOCAR and Azerbaijan’s reputation. In fact, they are trying to use me as a negative instrument against SOCAR and Azerbaijan. I believe it is completely useless and ineffective in the light of lack of any inappropriate activities from my side and taking into account that I am not hiding, I am speaking openly. I have already stressed in my Personal Statement that all the allegations submitted in the Report are groundless, false and inaccurate. Without any grounds and no evidence they seek to name me in involvement into corrupted practice. I also have counter questions for Global Witness to answer in this case “since when is the cooperation with SOCAR and assisting it in implementation of international projects are considered as corrupted activities?” and “since when is it a crime to be an Azerbaijani businessman?”

It is still not clear for me why in its Report Global Witness from the one hand claims that my activities are the part of corruption mechanisms in Azerbaijan, and from the other hand suggests that it could be not the corrupt practice, but simply the hidden business activities. In fact, I cannot understand what stands behind such position.

You aptly mentioned that after issue of this Report there are numerous attempts to interfere and pry into my personal life and this kind of invading behaviour should not be directed against any citizen of our country has seen the great support of the local media, which has created for the moment a biased, distorted and negative image against me. They publish false information about my family and relatives Moreover, they published my passport photo and spread it actively and put under it flimsy amounts creating an image of a criminal who is wanted by the law enforcement agencies. Definitely, such cases seriously violate my privacy and such wrong attitude of the local media is a real threat to my personal and my family’s security. As it concerns the issues of my personal and family security in case I certainly refer to our security abroad while we are on trips.

 

Global Witness claims that you refused to answer their questions. Moreover, they claim that all information about you is hidden.

I was very busy this year and had an extensive business trips schedule, and no letters or requests from Global Witness were brought to my attention. Our Baku office and its contact details have been changed a while ago and the ones which were mentioned on our website are currently belong to one of our subsidiaries.

The letter from Global Witness sent by email to my top parent company in Singapore was brought to my attention a couple days before the issue of the Report. When I received the letter I gave the relevant instructions to prepare the answer. Since a considerable number of questions were addressed in Global Witness’ letter, indeed we needed some additional time to prepare the reasonable response. However, the Report was published even before we started our preparations. Now I am confident that even had we replied on time to Global Witness it could not change the biased position in the Report against Azerbaijan.

They claim that all information about my companies and me are confidential and hidden. It is really untrue and even funny to claim. If you carefully read the Report you can see that all sources that they used are publicly available sources. Just think about this! If I had any intention to hide my ownership structures ways could be found to do this. I could easily use any overseas offshore, trust or nominee structures for these purposes. That is why I became officially a member of the Board of Directors of SOCAR Trading SA and my name was recorded with all publicly available official state registries. Moreover, I did not set up my top parent company in BVI or any other hidden offshore jurisdictions, but chose Singapore which is transparent and reputable jurisdiction open to the public, and where anyone can easily get any information including the company’s financial statements. Do you think that it can be considered as hiding information? Do you think that publication of all this information including the one about my companies at the official website of SOCAR can be considered as hiding of information? Moreover, do you think that disclosure of all your overseas structure in Azerbaijan and setting up a representative office of your top parent company in Azerbaijan can be considered as hiding information from anyone? I believe that if there were any elements of corrupted practice or any wrongdoings in my activities the developed democratic and transparent states such as Switzerland and Singapore would never allow me and my companies to effectively run businesses in these jurisdictions. I think it is worthy addressing all these questions to the authors of the Report and to those who initiated it.

The main question disturbing minds is how such successful person like Anar Aliyev was not known to the public. How you can shed a light on this?

In my opinion, one of the main reasons for my success was the lack of publicity in my business activities. I believe in this case I was able to pay more attention to my work and activities and indeed I benefited from this. As it can be seen in nowadays being young and successful businessman from Azerbaijan you can face a situation when such status of working hard for yourself, society and the country in a quiet way can lead to creation of a negative image.

Due to my young age and early success I refrained from appearing publicly for the sake of our comfortable life and security. However, now it is necessary for me to be seen more publicly due to the requirement any person would feel in such a position to protect my honour, dignity and business reputation. Indeed, if there was anything to hide I would not give this interview to you.

Some local media sources claim that you are actively involved in sale of Azerbaijani crude. Could you please share your thoughts on this?

As I mentioned earlier this right belongs to our state and SOCAR, and it can be expressly seen in SOCAR’s statements. I believe that I have already addressed this question earlier when we discussed the issues related to SOCAR Trading SA. I would like to stress again that I have relation neither to crude nor to its trading.

Azerbaijani Society and Global Witness which is known for its provocative statements and reports is interested whether you are a true owner and ultimate beneficial owner of the companies registered in your name? What can you say to us in this regard?

I do believe that I have already replied to this question in my Personal Statement made on 19 December 2013. However, I would like to state again that I am the sole and ultimate beneficial owner of these companies. Payment of huge income taxes by me in Azerbaijan and other jurisdictions can be evidence that my businesses belong only to me. For instance, only in 2013 as a result of declaration of my profit earned overseas to the tax authorities in Azerbaijan I have paid many dozen millions manats of personal income tax. Upon necessity I can provide the necessary evidence on payment of taxes in Azerbaijan. More over, I would like to clarify that the numbers referenced in Global Witness’ Report is nothing more than figures related to the profits of major groups of my companies for a couple of years – 5 years for the activities in energy and non-energy sectors, whereas as in case of active companies such funds are always in operational use and my personal income in this case is several times less. In fact, these figures are not hidden and publicly available in Singapore and even disclosed to the tax authorities and the relevant income taxes are paid in Azerbaijan.

Do you have any intention by legal means to protect your honour, dignity and business reputation affected by the Report issued by Global Witness?

Currently a team comprised of local and international specialists and lawyers are looking over this issue. We believe in civilized professional methods of disputes’ resolution. We are pleased to hear Global Witness’s most recent declaration that they are ready to correct their statements if they are provided the relevant evidences. Any way, I will use all possible means to protect my honour, dignity and business reputation. Undoubtedly, the court proceedings are not excluded for these purposes.

There are some rumours that you have problems with the law and you escaped abroad?

This is not true and it is a false statement invented by the local media. Together with my family I am in Baku and I have no any problems with the law. If I had such problems we would not definitely have a possibility to sit and freely chat here. In fact, I never had any problems with the law in Azerbaijan or elsewhere.

 

What are your activities in Azerbaijan? From your Personal Statement we can see that you basically pay a huge attention to re-investing your profit into Azerbaijan. What is the format of such activities?

Yes, this is a reality. I am closely tied to Azerbaijan. In fact I do have businesses in both energy and non-energy sectors abroad. However, in contrast to some others I never heavily invested in foreign countries. Most part of my profit I have invested in Azerbaijan. We have many projects in Azerbaijan, where thousands of local people are employed. The “White City” Project is one of such projects.

The “White City” Project is an attractive major project declared to the whole world and open for any local or foreign investors. In my own turn I did express an interest to this Project and after bidding and assessment procedures I was awarded a contract on construction of the office building. A substantial part of my profit has been already invested in this Project. I do believe that the effective implementation of this Project would be a great success for Azerbaijan. Thousands of new jobs are expected as a result of this Project’s implementation.

One of the other successful projects is the concrete cement factory effectively operating in Baku since 2004 and having over hundred employees. Another big project is the construction of the concrete pipes factory. It would be a factory equipped with modern German technologies and equipment. Hundreds of local people will be working at the factory.Moreover, I have preserved oil equipment and spare parts supply, the business which formed my initial capital and which is quite active with local and foreign oil and service companies in Azerbaijan as a result of participation at competitive tenders and bidding processes.

Since I am bound by commercial confidentiality obligations on some other local projects basically in non-oil sector in Azerbaijan, unfortunately, I cannot disclose more information on this now. However, I will do my best to bring sometimes soon information about my activities to the attention of the public.

What can you say to our readers about your business relations with SOCAR?

As you can see from the SOCAR’s Statement I am treated as a reliable and trusted business partner. It proves that we have transparent business relations. As I mentioned earlier my relations with SOCAR started from a basic service provider level and upgraded up to the level of the reliable business partner. I would like to stress that there were other local partners working with SOCAR, and even now some other locals are working with SOCAR. As I stressed before this is a result of our State and Government’s strategy to support the local businessmen.

Indeed, I did not participate and I am not currently involved in a large number of joint projects with SOCAR. As far as I remember Global Witness referred to 48 joint projects and companies. Currently, only up to 10 companies belonging to me are involved in joint projects with SOCAR. We had a couple other joint projects with SOCAR before, but from the commercial perspectives they were not interesting for me and I withdrew from them. In general, there is a trend on reducing my cooperation with SOCAR. There are objective grounds for such trend which are connected to strengthening SOCAR’s financial and international position, whereas there is no such demand for this company in any local investors anymore.

Yesterday, I saw a video produced by one of the local media networks belonging to overseas owners. They were analysing who is Anar Aliyev and what are his activities. One of the invited specialists alleged that a number of companies cooperating with SOCAR  cannot get payments from them on time, whereas I am benefiting from the priority rights and getting payments on time. If this is the case can they explain to me why most of payments from SOCAR to me are still pending for a long time. Let’s take the example with SOCAR Trading SA, whereas despite a long time I have not still received the full payment for the sale of shares in this company. I believe this is because of the fact that SOCAR is a state owned company which should comply with certain bureaucratic procedures.

I am criticized for actively working with SOCAR and I am accused in benefiting from the preferential rights. I believe it is worthy addressing the same question to the Western oil companies who work with SOCAR  in very attractive major projects in Azerbaijan. There is an impression that some overseas forces are doing their best to convince the Azerbaijani society that without a foreign support we are not able to be successful in energy sector. Reports such as the one issued by Global Witness serve for these purposes through damaging the business reputation of local investors like me and other entrepreneurs who are doing their best and investing in our country.

What are your plans for the nearest future?

My main aim is to continue my business activities and actively participate in economic development of my country. As I mentioned before I am intending to reduce my involvement in the energy industry and concentrate on the non-oil sector in Azerbaijan. I will continue heavily investing my proceeds earned in my country and abroad into Azerbaijan thereby creating opportunity and employment domestically and abroad. Moreover, I am planning to expand my favourite charitable activities.

What else you can wish to our readers to know about you?

I would like to make a special appeal to all Azerbaijani citizens and warn them not to believe in groundless reports accusing local businessmen of corrupt practice. We can say in truth these kinds of reports when they rely on false accounts and speculations that have no evidence work against the public good and national interest. I do believe that this interview will address most of the questions of our society made about me. Taking the moment, I would like to congratulate Azerbaijani people on the occasion of Azerbaijanis’ Solidarity Day and New Year.

 

 

P.S.      Mr Alizade proved that it is he, his name and person, by producing the relevant documents and we saw the documents in the name of Mr Anar Alizade. We are pleased to bring to your attention a censorship free interview. Despite his young age our interlocutor positively impressed us by his self-confidence, experience, accuracy and patience. We did not observe any third parties interference during our interview, nor did we have feeling that his answers were rehearsed and prepared in advance. Our conversation took place in free and sincere environment.

 

Chief Editor              Mammad Hajiyev