BAKU — In a crowded Baku street, Gyulya Akparova talks proudly about the major transformation of Azerbaijan and its thousand-year-old capital dotted with glittering skyscrapers on the Caspian Sea.
Two decades ago, “there were not many parks, nor new buildings”, said the 56-year-old housewife.
Since then, the government “has created normal living conditions so that people can lead a good life,” she said, adding: “There used to be very few tourists, now there are lots of them.”
Another Baku resident, 46-year-old Elsa Jafarova shared her enthusiasm, saying she was proud to show her city to visitors, who explore it “with pleasure”.
But behind Azerbaijan’s glitzy facades, financed by petrodollars, lie widespread poverty and political repression, government critics say.
“Petrodollars got spent on infrastructure projects — the engines of the country’s development,” prominent economist Natig Jafarli said.
“The spending mostly benefitted central Baku, which has changed dramatically, but this is not the case for the rest of the country,” said Jafarli, who is also executive secretary of the opposition Republican Alternative Party.
Poverty and petrodollars
Under the Aliyev dynasty which has ruled the oil-rich, ex-Soviet nation with an iron fist for a quarter of a century, Azerbaijan has emerged from post-Soviet political and economic chaos to enjoy an oil production boom.
This brought years of two-digit economic growth, peaking at over 20 percent a year between 2004 and 2008 when oil prices were high.
The oil revenues have helped fund the construction, particularly in Baku, where President Ilham Aliyev has built the Flame Tower skyscrapers, a cultural centre designed by the famed British architect Zaha Hadid, as well as new roads and an airport.
The capital’s Old City quarter — a UNESCO world heritage site — has also been renovated and attracts crowds of foreign tourists.
And Baku has hosted international events such as the Eurovision Song Contest and Formula 1 Grand Prix motor race.
But poor neighborhoods outside central Baku are a sorry sight, with decrepit buildings and dismal wastelands.
Official data show that about five percent of the population lives below the poverty line but the real figure is much higher, according to Jafarli, who often appears in independent media in the Caucasus region.
“The indicators used to calculate poverty are wrong. Some date back to the Soviet Union. The reality is different,” he said.
Azerbaijan’s per capita GDP is only half of that of Russia and one tenth of France’s, according to the International Monetary Fund.
Jafarli conceded that the government had taken measures to improve living standards, increasing the minimum wage from 130 manats to 180 manats (about $76 to $106) per month about a month ago.
“Since late 2018, the dynamic has been positive but the country’s economy is suffering from chronic problems,” he added, highlighting a “dependence on oil” among other things.
Azerbaijan’s economic fortunes are closely linked to the price of crude — the energy sector represents 90 percent of exports and finances half of the national budget.
The 2014 global oil price slump led to a 50-percent devaluation of the national currency, the manat, double-digit inflation and an economic downturn.
As oil prices have since risen, the economy has modestly picked up and is now stagnant at around one or two percent.
International observers said that Aliyev’s reelection last year for a fourth consecutive term was marred by “serious irregularities”.
“Unfortunately, elections are totally falsified in Azerbaijan,” said Isa Gambar, who lead the Musavat opposition party until 2014.
“The authorities carry out a policy of repression of the opposition and all political and economic freedoms,” the veteran politician added.
Human Rights Watch describes Azerbaijan’s human rights record as “appalling”.
It said in its report for last year that “at least 43 human rights defenders, journalists, political and religious activists remained wrongfully imprisoned”.
It said that other persistent rights problems included “systemic torture, undue interference in the work of lawyers and restrictions on media freedoms”.
Meanwhile, anti-corruption NGO Transparency International ranks Azerbaijan 152 out of 180 countries.
In March, Aliyev pardoned some 50 rights activists and opponents.
But Ilgar Mammadov, leader of the Republican Alternative Party, who himself spent five years in jail until 2018, said he believed that the amnesty was part of Aliyev’s attempts to secure a cooperation agreement with the European Union and was “not a clear sign of change”.
“The stubbornness with which the regime tries to maintain this climate of fear in the population is disappointing,” said Mammadov, who is banned from running in elections until 2026.