Policy responses for Azerbaijan - HSRM

Azerbaijan


Policy responses for Azerbaijan

6. Measures in other sectors

6.1 Measures in other sectors

Many MEASURES IN OTHER SECTORS beyond the immediate scope of the health system are being taken to prevent further spread of the virus. This section contains information on many of these areas, including border and travel restrictions and economic and fiscal measures, among others.

Borders & mobility
 All borders were gradually closed apart from freight transportation – there are no passenger flights in or out of the country and rail services between Azerbaijan and the Russian Federation were suspended from 31 March. All airports were closed for passenger flights until 1 July 2020. Border closures have serious implications for the livelihoods of small traders working in the communities on the border with the Russian Federation and Iran. The Operational Headquarters under the Cabinet of Ministers (OHCM) has announced the extension of the Special Quarantine Regime and the entry-exit restrictions on state borders until 1 August, except for freight and charter flights.

Automatic visa extensions for foreigners were offered via the State Migration Service. Foreigners who cannot leave Azerbaijan at present may complete a one-time payment to extend their migration status within Azerbaijan. 30- and 60-day extensions cost 15 AZN and 30 AZN, respectively. These guidelines apply to foreigners whose legal stay in Azerbaijan will expire by 30 April. From 1 April Azerbaijan temporarily suspended issuing of e-Visas and entry to Azerbaijan is temporarily suspended for all citizens of the People’s Republic of China and the Islamic Republic of Iran.  

On 29 March entry into Baku, Sumgait and the Absheron peninsula was suspended.  As was all transport between cities and regions. For the weekend of 6-8 June, there was a complete lockdown in the cities of Baku, Sumgayit, Ganja, and Lankaran, as well as the Absheron district, following an increase in new infections (see Section 1.2). After 45 residents of Pirili village (Kurdamir district) tested positive for COVID-19 following a funeral, the local executive authorities plan to declare a lockdown.
Air passengers arriving in Azerbaijan need to present a certificate showing a negative COVID-19 test result with the test conducted no later than 48 hours prior to departure in order to check-in. For routes consisting of several different flights, “departure” refers to the departure time of the flight going directly to Azerbaijan. When departing from Heydar Aliyev International Airport in Baku on Azerbaijan Airlines (AZAL) flights, passengers can be tested for COVID-19 only in specific clinics and laboratories in Azerbaijan. AZAL only accepts certificates with PCR testing results.

Domestic flights to the Nakhchivan Autonomous Republic resumed on 15 June. For domestic flights, the State Agency on Mandatory Health Insurance of Azerbaijan has launched an electronic service for COVID-19 testing for air passengers. To support this initiative, the agency has launched a new online-queue for passengers (COVID-19) electronic service, through which those with air tickets can book a COVID-19 test.

From 21 June to the 1 August international flights and land border crossings were once again closed.

Economy
Four working groups were established to develop proposals for tax breaks, benefits and easing credit conditions for the 12 areas of the economy most affected by the epidemic, including: tourism, hotel business, catering, entertainment, transport, and retail. The greatest challenge will be protecting the livelihoods of the large number of people in informal employment. Informal employees are not eligible for state financial assistance and as a result, 85,000 previously informal employees have been given formal contracts since the Special Quarantine Regime began. A financial stimulus of 588.2 million USD in loan subsidies for SMEs has been made available: 294 million USD to guarantee 60% of new loans (and subsidise half the interest rate) as well as unsecured microloans in the agricultural sector. 

On 4 April, the authorities announced AZN 3.3 billion of support to businesses and individuals affected by the pandemic (the equivalent of 4.1 percent of GDP).  Measures include: partial coverage of salaries (AZN 215 million); support to microentrepreneurs (AZN 80 million); temporary public jobs (AZN 54 million); subsistence and unemployment payments (AZN 230 million); pensions (AZN 200 million); targeted social assistance (AZN 4.5 million); energy and education subsidies (AZN 20 million); allocation of additional funds to the Entrepreneurship Development Fund (AZN 50 million) (https://www.imf.org/en/Topics/imf-and-covid19/Policy-Responses-to-COVID-19).

As of 20 August, the State Tax Service had provided financial aid to 44,329 small businesses (using all the AZN 12.3 million additional financial support) and was planning to provide additional financial aid to 49,421 more small businesses.

On 2 June, full exemption for property and land taxes for one year was introduced for selected sectors of the economy including tourism, public transport and cultural facilities. Income tax payers will also receive a 75% exemption and taxpayers filing under simplified procedures are eligible for a 50% reduction; rental property tax in the COVID-affected areas has also been reduced from 14% to 7%.

The Central Bank of Azerbaijan (CBA) and commercial banks have moved to a seven-day work week, to allow individuals and businesses to convert their manat holdings into foreign currency. On 27 April, the CBA appointed temporary administrators in four banks. Two of the banks were closed on 28 April, the other two closed on 12 May.

State aid
State employees are on paid compulsory leave and have been encouraged to work from home. Their long-term job security has been ensured. The Government has advised against small- and medium-sized enterprises laying off staff and it has promised to provide support. By the end of April, the Government was covering the wages of up to 1 million public and private sector employees and paid a USD 111 lump sum to an estimated 600,000 unemployed individuals and USD 130 assistance to 80,000 households (about 333 citizens). The Government is looking to create 50,000 new [public sector jobs to create temporary employment opportunities.

Food and medical products are temporarily VAT free, and the upper limit on discounted electricity consumption by low-income households has been increased. 

A Fund to Fight COVID-19 was established by the government, with a lump sum of USD 12 million, with public donations this grew to USD 45 million by 25 March and USD 66 million by 23 April. The President announced that budgetary funding for mitigation measures will increase from USD 1.4 billion to 2.1 billion (this would be 4.3% of forecasted GDP for 2020).

On 23 June, the Cabinet of Ministers announced a one-time extension of social assistance announced as part of the April 4 relief package for the unemployed and low-income people who lost earnings because of the Special Quarantine Regime. An additional lump-sum payment of AZN 190 (USD 111) to residents of the orange zone in April, May and June who received social assistance under the April 4 relief package. This applies to 287,000 people in 16 cities and regions where the special quarantine regime has been tightened; 55 million AZN has been allocated for this purpose. 53 million AZN was allocated to pay the lump-sum to approximately 278,000 people, in 13 cities and districts under “strict quarantine regime” in August. However, a COVID-19 impact assessment survey conducted by Unicef between 13 April and 5 September found that only 12% of respondents said they had received any COVID-related government assistance in the previous month and 27%  of respondents said they had to borrow money or sell assets to buy food.

Since the schools were closed, the Ministry of Education has been providing online and TV lessons for schoolchildren. University fees have been subsidised by the state.

Civil protection
A state of emergency has not been formally declared, but a ‘Special Quarantine Regime’ has been in place since 24 March (initially until 20 April, then extended to 31 May, then 1 August). Some units of the Azerbaijani Army have also been involved in the patrol service organized in order to help officers of the Ministry of Internal Affairs in implementation of control over compliance with the special quarantine regime applied on the country’s territory according to the decision of the Task Force under the Cabinet of Ministers of the Azerbaijan Republic in June and July.

Cross-border collaboration
Azerbaijan has also received external aid: USD 15 million assistance from the EU, USD 1.7 million from USAID, and medical aid from the Alibaba Foundation and Jack Ma Foundation.