Azerbaijan and China reinforced their economic cooperation on April 16 during the 10th session of the Intergovernmental Trade and Economic Cooperation Commission held in Baku, according to Azertag. The meeting was co-chaired by Azerbaijan’s Deputy Prime Minister Shahin Mustafayev and China’s Vice Minister of Commerce and Deputy Trade Representative Ling Ji.

China has solidified its position as Azerbaijan’s largest trading partner in the South Caucasus. Mustafayev noted that bilateral trade turnover reached $3.7bn in 2023, a 21% y/y increase. The upward momentum continued in 2024, with trade volume rising more than 37% in Q1 alone to $1.02bn.

During the event, officials signed a memorandum establishing a joint working group on investment cooperation, aimed at institutionalising bilateral investment dialogue. The session also concluded with a formal protocol endorsing broader strategic collaboration across industry, energy, transport, technology, agriculture and tourism.

Azerbaijan reiterated its interest in expanding agricultural and food exports to China. Ji highlighted strong Chinese consumer demand for Azerbaijani pomegranates and wine, and identified poultry, hazelnuts and almonds as other promising categories. China expressed interest in increasing imports and expanding the number of Azerbaijani trade houses on Chinese territory. Ji affirmed Beijing’s support for Baku’s World Trade Organisation accession and criticised rising global protectionism, advocating for stable, rules-based trade.

The two sides underlined cooperation in oil and gas, petrochemicals, high tech, and particularly renewable energy, calling it a “strategic priority”. Chinese direct investment in Azerbaijan has now reached $942mn, while Azerbaijani capital, primarily through the State Oil Fund, invested roughly $2.1bn in China.

Transport and transit also featured prominently, with freight volumes between the countries up 86% y/y to 378,000 tonnes in 2024. Officials hailed the growing role of the Baku-Tbilisi-Kars railway and the Port of Baku as a competitive East-West corridor within China’s Belt and Road Initiative. The Zangezur Corridor was singled out for its potential to enhance regional connectivity and geopolitical stability.

Among new projects, officials announced that a localised electric bus production facility will be launched in Azerbaijan in partnership with China’s BYD during President Ilham Aliyev’s upcoming visit to Beijing. 

The visit is also expected to yield a bilateral visa-free travel agreement to boost tourism and cross-border mobility. Tourism flows are already rising, helped by Azerbaijan’s unilateral visa waivers for Chinese nationals. Officials noted a significant y/y increase in Chinese tourist arrivals in 2023. 

Cooperation in silkworm breeding was highlighted as a symbol of high-value agricultural synergy. Over 130,000 mulberry saplings have been imported to Azerbaijan’s reconquered Khojaly region as part of a joint sericulture project.

Mustafayev presented Chinese officials with details of major reconstruction and infrastructure programmes underway in the territories retaken by Azerbaijan, inviting Chinese firms to participate in these projects. He framed these regions as offering “broad new opportunities” and a chance to showcase model cooperation.

The session ended with both sides expressing optimism that Aliyev’s upcoming visit to China will elevate relations to a new level. Discussions also touched on expanding cooperation in space technologies, IT, health and innovation.