Modern Azerbaijan developed during the period 1993–2003, following civil unrest arising from the dangerous volatility of the post-Soviet period. This was swiftly resolved, and political stability was established.
A new Constitution was adopted in 1995; free market relations were initiated; and advantageous conditions were created to attract foreign capital investment. A broad oil exploitation strategy, including the Contract of the Century (1994), was prepared and implemented. The revenues which this created enabled the government to invest in new educational, scientific and cultural projects.
Azerbaijan is undergoing a period of national resurgence. In 2006, the country’s GDP increased by a staggering 34.5 per cent. This has resulted in a building boom across the country, particularly in Baku, the capital.
Present-day Azerbaijan is a key country in the East–West energy corridor. The Baku-Tbilisi-Ceyhan oil pipeline and Baku-Tbilisi-Erzurum gas pipeline deliver Azerbaijani hydrocarbon resources to Europe. They connect the rich resources of the Caspian basin with the world energy markets.
Azerbaijan is also poised to be a major contributor to the network of pipelines comprising the proposed Southern Corridor, which will ensure secure energy transit from Central Asia to Europe for many decades to come. The planned projects include the Nabucco Pipeline; the Trans-Anatolian Gas Pipeline; and Interconnector Turkey-Greece-Italy (ITGI).
Against the background of this economic prosperity lies a deeply traditional ethos with a strong sense of the family. The unique culture and history of Azerbaijan has resulted in an intriguing national character – moderate Muslim and essentially Turkic, yet Eurocentric. A tradition of hospitality prevails at every strata of society, and all visitors are guaranteed a warm welcome.
Armenia continues to occupy the formerly autonomous region of Nagorno-Karabakh and seven surrounding districts, amounting to nearly 20 per cent of Azerbaijani territory. This illegal military incursion has created nearly one million Internally Displaced Persons (IDPs) and refugees.
A ceasefire in the Armenian-Azerbaijani Nagorno- Karabakh conflict was negotiated in 1994, and steps were taken to resolve the conflict within the norms of international law. Following this, a balanced foreign policy was developed. The country was subsequently integrated into the international community, achieving efficient co- operation with international organisations. The concept of statehood introduced during this period remains in effective operation.
Azerbaijan is renowned for its ethnic diversity and religious tolerance. In addition, there are over 20m ethnic Azerbaijanis living in Iran, and strong relations are maintained between them and other Azerbaijani diaspora members.