Page 53 - Azerbaijan State University of Economics

Bahruz Babayev: Studying the Case of the UAE in Economic Diversification and Non-Oil
Export Growth: Public Policy Lessons for Azerbaijan

capacity of national exports (ag riculture, tourism, small and medium-sized
entreneurship) in Azerbaijan (Hajiyev, Rasulova, Bakshaliyev and Rzayev, 2004: 2).

ECONOMIC DIVERSIFICATION THROUGH STRENGTHENING
COMPETITIVENESS
Economic diversification is important. But, it is also important to strengthen the
competitiveness of firms and non-oil export products. Without these firms and products
will not be able to compete in the international markets dominated by advanced
products and companies. “Under the condition of increasing of globalization and
liberalization, raising the competitiveness of the country’s economy is the most
important problem. In high globalized and competitive world markets, states have great
role in increasing the competitiveness of products”. (Adalat, Hasanli, Hajiyev, 2019:
1070). Development of competitiveness also requires the implementation of institutional
reforms, increasing the effectiness of state bodies and financial openness in Azerbaijan
(Babayev, 2015: 87). The development of competitiveness is crucial for the government
of Azerbaijan too mentioned in most strategic development papers of Azerbaijan
adopted in the recent years. Naturally, the development of competitiveness depends on
the global openness of the economy.

DEVELOPMENT BASED ON INNOVATION AND KNOWLEDGE ECONOMY
Economics in the modern world is based on innovation and knowledge-based
product development, as well as the development of an innovation base of the
economy and research and development. Even though starting from recent years,
building a knowledge economy remains important for Azerbaijan too, it is important
to strengthen these policies and coordinate it in a more professional way. A well-
coordinated state policy is required from this point of view. It must be mentioned
that “ the establishment of a favourable innovation ecosystem remains an essential
policy priority for the government of Azerbaijan as a part of a global trend and
requirement of a modern economic system” (Babayev and Hajiyev, 2019: 312,
Babayev, 2019:1). However, the policies of the government of Azerbaijan have to be
supported by the adaptation of relevant laws and working mechanism in this
direction, and international experience must be learnt and applied.

CONCLUSIONS
As a conclusion, it can be deduced that the UAE is one of the countries which
became successful in terms of economic diversification and the provision of balance
between its non-oil and oil exports. It has been achieved as a result of oil revenues as
well as correctly adopted policies of the government of the UAE. Azerbaijan has
also enjoyed oil and gas revenues in the past decades. But, it is lagging for its
economic diversification despite similar policy objectives are also must for
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