About the shadow economy in Azerbaijan

An Azerbaijani Government assessment states that the shadow economy accounts for 10.2% of GDP. From January-September 2009 Azerbaijan's GDP was USD 29.3 billion. This would make the shadow economy worth around USD 3 billion.

Independent Azeri analyst Parkhad Omarov thins that this figure is incorrect. He believes there is a much bigger shadow economy in Azerbaijan. He draws the attention to the fact that in Azerbaijan many deals are conducted in cash and this gives the shadow economy a big chance to flourish.

The analyst thinks that this situation hinders investors from conducting transparent business and this in turn hinders the development of the non-oil economy in the country. He says cash deals are the biggest problem in the country.