Doing Business in Azerbaijan

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By Ludmila (Mila) Rusakova Golovine

With the current economic situation in the former Soviet sphere, most businesspeople are hesitant to expand and invest there. Although this suspicion may be well-founded in many former Soviet republics several are actually developing at an astounding rate and becoming stable places in which to do business. One of these rare gems is the Republic of Azerbaijan. For the past twenty years this country has striven to reinvent itself. Although blessed with abundant oil and natural gas reserves, Azerbaijan has consciously decided not to give in to the so-called “curse of oil” and become merely a petro-state. The government has made considerable investment into non-petroleum sectors to diversify its economy and also passed legal and tax reforms encouraging investment. By slashing through red tape and easing the registration process for new businesses, Azerbaijan has made itself very attractive for new entrepreneurs. Consequently, opportunity abounds here but it can only be attained by those who are cognizant of the cultural differences between Western and Azeri business cultures.

Above all else, it is crucial to recognize that Azeri culture is an amalgamation of several distinct cultures. Located on the west coast of the Caspian Sea, Azerbaijan is a natural crossroads between Central Asia, Russia, and Iran. Thus, the culture has assimilated aspects and influences of all of these. Although physically cut off from Turkey, there are still strong cultural and linguistic ties to that country as well. In fact, it was not until recently that the people began to refer to their language as Azeri instead of calling it simply a form of “Turkish.” It is also important to note that the Azeri diaspora is quite spread out as well. More Azeris live in northwestern Iran than in Azerbaijan itself while there is also a sizeable minority presence in Turkey as well. Consequently, it is important not be taken off guard by the multi-cultural mosaic of the culture.

Communication is done quite differently in Azerbaijan than in the United States. As in many countries, Azeris employ indirect communication in many cases to avoid offense or negativity. For example, “yes” does not always mean “yes” and “no” does not always mean “no.”  In this case, you will have to rely on body language and non-verbal cues to determine the true meaning of the response. Nevertheless, if the relationship becomes more developed and a level of trust is established then the level of communicative directness will increase as well. Therefore, it is necessary to demonstrate patience until such time as the communication becomes clearer.

Importantly, the level of formality is much higher in Azeri culture than in American culture. Much more deference is given to elders. Therefore, when a senior Azeri businessperson enters the room it is customary to rise. Also seating is done in a special way according to status, rank, and age. In this case, it is best to follow the Azeri lead to avoid offense. In addition, maintaining eye contact is crucial. Azeris are unlike East Asians who view sustained eye contact as impudence. To Azeris eye contact indicates sincerity. Therefore, if someone looks away while speaking it means that they are being insincere or hiding something. This cultural aspect must always be taken into account during any interaction.

As with many other cultures, business deals develop slowly. This is due to the fact that Azeris like to get to know their business partners before engaging in serious business. Typically business meetings will begin discussing topics that have nothing to do with the business deal. This is the Azeri way of gauging their counterpart’s personality. As the negotiations continue it is imperative not to push your Azeri counterpart into making a decision on the spot. Azeris like to take time and thoughtfully consider a proposal before making a decision.

Although many Azeri businesspeople do speak English it is important to find out ahead of time if an interpreter will be needed for business meetings and conferences. Regardless of whether or not interpretation will be necessary, translation into Azeri of any business documents, especially contracts, will be mandatory. Also it is a good idea to have business cards translated into Azeri on one side and either English or Russian on the other. This gesture will be taken as a sign of respect.

Although Azerbaijan does not pop up very often in the news, it is one of the brightest rising stars on the economic horizon. Through better governance and a will to succeed it will only rise higher in the coming years. Therefore, there is much opportunity in this country but only for those who are cognizant of its cultural idiosyncrasies and flexible enough to adapt to them.

Ludmila (Mila) Rusakova Golovine , Founder, CEO and President, MasterWord Services, Inc., can be reached at mgolovine@masterword.com or 281-589-0810 or via www.masterword.com .

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