by Guy Chazan
EDITOR'S NOTE: The AGBU quarterly, continuing its coverage of Armenia, communities in the Diaspora and the former republics of the Soviet Union, takes a close look at Azerbaijan - the country most directly effecting day-to-day life in Armenia.
After devoting special segments to Armenian community life in the Middle East, South America, Russia and Georgia, the AGBU quarterly dispatched Moscow-based special reporter Guy Chazan to Baku to have a look at conditions there. Mr. Chazan's reports focus on various facets of Azerbaijani life from the perspective of an independent reporter who spent a week in Baku talking to government officials and ordinary citizens alike.
Our readers may find some Azerbaijani opinions contrary to their own understanding of present Armenian politics and policies but we feel it is important to be aware of the thinking that exists in Azerbaijan today.
Baku - When the Popular Front of Azerbaijan came to power in a democratic revolution last May, unseating the discredited former President Ayaz Mutalibov, Azeris began to hope for a new and better future.
When the Front's leader, Abulfaz Elchibey, the bearded professor of oriental studies at Baku University, was elected Azeri President by an overwhelming majority in June, these hopes seemed even nearer fulfillment.
But change has been slow to come. Azerbaijan has made depressingly slow progress towards building the kind of political and financial institutions worthy of a newly-free state striving for a democratic renaissance.
Government leaders are quick to remind critics of the situation the Caspian republic was in when Elchibey came to power. Democratic reform was not the first priority last June, they say. "Azerbaijan was on the brink of extinction, of disintegration," says Parliament speaker and Popular Front co-founder Isa Gambarov. "All our initial efforts were directed towards preventing the slide into civil war."
Political stability came quickly with the Popular Front takeover. The many armed bands and vigilante groups roaming the small Transcaucasian state were disarmed and either disbanded or incorporated into the National Army.
Certain market reforms were also pushed through by the Mili Mejlis or National Assembly, the rump parliament which continued to meet after the old Communist-dominated Supreme Soviet was dissolved.
Azerbaijan now has anti-monopolies legislation, as well as laws creating a new market-oriented banking system, and protecting foreign investment. But so far it lacks the sine qua non of market reform - laws on privatization and land reform.
Opposition figures say the government has done nothing to lay the foundations for private property, without which all talk of creating a Western-style democracy is merely hot air.
In fact, critics say the confidence of Azerbaijan's newly-emerging business class has been dashed, not raised, by Popular Front policies. "The state should play a big role in promoting the idea of ownership among the population, and guaranteeing the inviolability of property," says lawmaker and opposition leader Ittibar Mamedov. "But at the moment they are doing the opposite."
When Elchibey came to power, he dealt with the chronic cash shortage plaguing Azerbaijan by demanding donations from all businesses in the private sector. The Interior Ministry raised 1.2 billion rubles in this way. "These were illegal confiscations," says Mamedov. "The state was effectively running an extortion racket." The Interior Ministry's campaign led to a flight of capital out of Azerbaijan. Businessmen deposited money in Russian bank accounts, where there were better guarantees against confiscation and higher interest rates.
The Azeri authorities take 60 percent of all foreign currency deposits and exchange it for rubles at a rate of 50 rubles to the dollar-when the market rate in Russia is eight times higher. Businessmen claim commercial loans from Azerbaijan's Central Bank cost them millions of rubles in bribes to bank officials. But the scarcity of free market institutions pales beside the failures of land reform. Without breaking up inefficient collective and state farms and boosting the tiny private sector, Azerbaijan will never have a healthy capitalist economy.
In fact, a small land privatization experiment was carried out this year, but the results were disappointing. Agricultural production fell by 28 percent compared to figures for 1991, with harvest figures for cotton and grapes down a dismal 50 percent. The experiment was abandoned: the state farm won a reprieve. Azeri officials blame poor production figures on the old Soviet centralized system which left the republic with a legacy of monocultures and little hope of full self-sufficiency in food, an anomaly in such a fertile, bountiful country.
"The cultivation of cotton and grapes was dictated by the Soviet central authorities and was not geared to our own domestic needs," says Presidential economic adviser Vahid Akhundov. "Azerbaijan now has a food crisis as a result."
The slow pace of change is in many ways understandable. Reforms of the "shock therapy" kind have led to a catastrophic decline in living standards in Russia, and Azerbaijan, already lumbered with an ethnic and cross-border war, can explode under such strong social pressures.
"The fear of social unrest is very real," says one Western diplomat. "If there is mass unemployment coupled with high inflation, people will take to the streets."
The Azeri authorities, then, are merely showing a caution quite justifiable for a nation at war. But the government's critics claim the inertia shows not chariness, but the complacency of a new political elite that prefers clan loyalty to reformist zeal. With Elchibey's accession to power, most government structures were purged of Mutalibov's corrupt henchmen. But they were often replaced by Popular Front protégés with proven allegiance to the new regime but little or no administrative experience.
"All these new appointments are boys who are still wet behind the ears," says journalist Elmira Askerova. "The old Communist Party nomenclatura at least had 70 years' experience of governing and were well-educated. But the Popular Front's support base was always the crowd."
"The Front has usurped power," says Ittibar Mamedov. "They did not prepare for power, they do not know what to do with it, and so they rule using the old administrative methods."
The authorities, to their credit, have been quick to recognize ineptitude among the new appointees, and there have been some bewildering personnel changes in recent months. Some ministries have had three different heads in the space of five months. Critics say this belies government claims that the domestic political situation has stabilized since last spring's power change.
But one of the strongest opposition concerns is the creeping authoritarianism they note in the Elchibey administration.
Parliament recently threw out a bill which would have given police the right to enter and search any house and detain individuals for up to 30 days without pressing charges.
Critics also point to Interior Minister Iskander Gamidov's disturbing penchant for beating up newspaper editors who publish articles critical of the President.
Gamidov also stands accused of trying to stage a coup in the autonomous republic of Nakhichevan in October, when the man he appointed police chief of the enclave over the heads of the local legislature stormed and occupied the Interior Ministry and the regional television center, together with a group of extremist Popular Front supporters.
In a country under such immense political and economic strain, real stability remains a far-off dream. But despite the setbacks and faux pas, Azerbaijan's new leaders at least on paper remain committed to democratic values. Only time will tell if their critics are right and the new elite is as resistant to change as the Communists they replaced.
