Full exemptions from company tax, buy tax, actual property taxes and dividends for ten years are among the many incentives on supply to Israeli startups that select to relocate to Azerbaijan, “Globes” can solely reveal.
The choice by a rustic with a Shiite Muslim majority to make such a transfer through the present conflict, regardless of the wave of anti-Israel sentiment, is phenomenal and stunning. The transfer follows the launching of a tech park presently below building in Baku though the incentives being provided by the Azari authorities can be found for Israeli tech corporations that arrange anyplace within the nation. Sources have instructed “Globes” that a number of Israeli tech corporations are already in talks over relocation to Azerbaijan.
Above and past the incentives listed above, firm workers pays 0% private earnings tax on month-to-month salaries as much as $4,700. As a way to qualify for these incentives, corporations should have been working for no less than one 12 months or have ten or extra full time workers, or annual income of no less than 200,000 manat (NIS 430,000).
As a part of this system, help is supplied for immigration to the nation, which incorporates exemptions from work permits, help in issuing residence permits and arranging logistical points corresponding to discovering workplaces and lodging.
Azerbaijan is striving to turn out to be the know-how hub of the Euro-Asian area, and a gateway to the Turkic international locations. Baku’s relationship with Ankara relies on the concept of “one nation, two international locations.” Subsequently, corporations that search broad operations in Turkey, when relations between Israel and Turkey are at an unprecedented low, will be capable to profit from the depth of the relations between Turkey and Azerbaijan.
Time to be weaned from oil
This system is led by the Innovation and Digital Improvement Company of Azerbaijan (IDDA), with the principle goal of diversifying the economic system. The oil and gasoline sector accounted for 47.8% of Azerbaijan’s GDP, 52.7% of budgetary sources and 92.5% of exports in 2022. Baku, they is conscious that the world is weaning itself from oil, and preparations are required to cut back dependence on the black gold.
Azerbaijan attracts inspiration from the Gulf international locations, which have been working tougher lately to diversify their economies and “wean” off fossil fuels. The UAE, for instance, launched a program final 12 months through which non-public corporations had been required to make use of 6% native employees in 2024 and 10% by 2026. Azerbaijan, however, doesn’t oblige the businesses that relocate to make use of a sure proportion of native employees.
Nevertheless, IDDA is already working to coach related personnel, and funds scholarships for greater than 3,000 college students for IT programs. The goal is to coach as many juniors as doable, in order that they’ll be a part of the overseas corporations. Subsequent 12 months, the variety of scholarships for locals is predicted to develop to five,000.
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IDDA regional VP smooth touchdown Pasha Aliyev, who’s in command of relocating startups in Azerbaijan, speaks fluent Hebrew. He tells “Globes” that the initiative to draw Israeli corporations is a part of a broader effort to construct a powerful tech ecosystem in Azerbaijan. He says, “Our younger and multilingual inhabitants, mixed with quite a lot of completely different cultures, creates a dynamic and modern workforce. As well as, our superior infrastructure permits corporations relocating to the nation to settle and combine shortly of their new house. This mix makes Azerbaijan an excellent location for tech corporations on the lookout for progress and innovation within the Asian market.”
Flourishing relations with Israel
Israel-Azerbaijan relations has flourished since 1992 primarily based on the sale of Azerbaijani oil to Israel and superior know-how Israeli weapons methods to Azerbaijan. Within the first half of 2024, in accordance with the Baku Customs Bureau, there was a 55% soar within the import of oil to Israel from Azerbaijan, amounting to $989 million. As revealed in Globes, regardless of the commerce embargo imposed by Turkish President Recep Tayyip Erdogan on Israel, Azerbaijani oil continues to circulate by the BTC (Baku-Tbilisi-Ceyhan) pipeline – the place it’s loaded onto tankers within the Turkish port metropolis of Ceyhan sure for Haifa. The principle cause for the dearth of harm to the oil provide is the shut relationship of Azerbaijan President Ilham Aliyev and Erdogan.
Within the different path, Azerbaijan is a significant buyer of Israel’s protection industries. It has procured, amongst different issues, Spike anti-tank missiles from Rafael, Hermes UAVs from Elbit, and Israel Aerospace Industries (IAI) Harop loitering munitions. Final October with the Azarcosmos company signed a cope with IAI for 2 OptSat500 satellites, which is able to change the Azarsky satellite tv for pc manufactured by Airbus, with which communication was misplaced in April 2023.
Thus the event of the tech sector in Azerbaijan will diversify each its economic system and its commerce relations with Israel. “We’re targeted on scale-up corporations that may come to Azerbaijan, recruit native folks – and create a vital mass,” Aliyev explains. “We’re in common contact with our bodies in Israel, such because the Export Institute, and handle common communications with related our bodies in different international locations too.”
Revealed by Globes, Israel enterprise information – en.globes.co.il – on September 5, 2024.
© Copyright of Globes Writer Itonut (1983) Ltd., 2024.
