The potential impacts of Brexit on Azerbaijan’s economy

Abstract

As one of the centres of the global economy and financial sector, the exit of Great Britain from European Union made significant impacts on different countries in one way or another, and Azerbaijan was not an exception. This paper analysed the short and long-term impacts of Brexit on Azerbaijan by looking at State Oil Fund of Azerbaijan, UK-Azerbaijan relationship and potential benefits for Azerbaijan. The study found that the impacts of Brexit are difficult to gauge now as the referendum took place quite recently, thus, making it necessary to wait for some time in order to reach conclusion on the effects of this political event on Azerbaijan. However, it was found that Brexit’s impact on the exchange rates of certain currencies is likely to be important for SOFAZ. Moreover, Brexit can also positively affect Azerbaijani businesses and individuals that have or are planning to make a presence in Britain. The paper also discusses the potential impact of Brexit on Azerbaijan-EU relationships because the political event in Britain has many implications for Europe as well.