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Akbar Novruz

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U.S. President Donald Trump has signed an executive order imposing reciprocal tariffs on multiple countries, including Azerbaijan. Under this new policy, a minimum customs duty of 10% has been set for Azerbaijani exports. While the move is aimed at addressing trade imbalances and protecting U.S. industries, it also raises important questions: How will these tariffs impact Azerbaijan’s trade with the U.S.? Will they slow down the country’s growing non-oil and gas exports?

Azerbaijan’s trade relationship with the United States has seen significant changes in recent years, particularly with the sharp rise in non-oil exports over the past two years period. Despite a negative trade balance, the country has been expanding its exports to the U.S., and the new tariffs could introduce challenges for Azerbaijani businesses.

Azerbaijani MP Vugar Bayramov shared his perspective with Azernews:

"Despite the increase in trade turnover between Azerbaijan and the United States in recent years, our country imports more goods from the other side of the ocean. Thus, in 2024, Azerbaijan imported goods worth $1 billion 617 million from the United States, while our exports to the United States amounted to only $135 million 30 thousand. This means that we have a negative balance of $1 billion 482 million in foreign trade with the United States."

He noted that while Azerbaijan’s exports to the U.S. remain small, their growth rate is notable:

"Last year, compared to the previous year, our imports from the United States increased by 1.8 times, and our exports to the United States by 8.4 times. In other words, despite our low exports, the growth dynamics are very high. This means that the United States has become a new export destination for our businessmen."

The new tariffs, however, will have a greater impact on non-oil and gas products.

"In 2024, our exports to the United States on non-oil and gas products amounted to $134 million 663 thousand. Exports of non-oil and gas products of Azerbaijani origin reached $55 million 949 thousand. Considering that in 2024 our total exports of non-oil and gas products were $3 billion 356 million, and total exports of non-oil and gas products of Azerbaijani origin were $2 billion 883 million, our cooperation with the United States in this area does not have a high share."

Despite their relatively small volume, Azerbaijan’s exports to the U.S. are quite diverse:

"In 2024, we exported to the country with the world's strongest economy $6 million 508 thousand in other substances in primary forms resulting from polymerization, $593 thousand in animal intestines, bladders and stomachs, $410 thousand in tropical and other fruit juices, $279 thousand in sturgeon caviar, $242 thousand in unrefined, excellent first-pressed olive oil, $177 thousand in fruit jams, fruit jellies and marmalades, fruit purees and pastes, and other products."

The lawmaker emphasized that while the tariffs may not drastically affect Azerbaijan’s export volume, they could influence growth trends:

"As can be seen, Azerbaijan's non-oil and gas exports to the United States, although not in large amounts, are diversified by commodity groups. Therefore, even if Washington's tariffs do not seriously affect Azerbaijan's exports to the United States, they may affect the overall growth dynamics. Of course, in all cases, a new tariff means new costs."

Looking ahead, the introduction of reciprocal tariffs marks a new phase in global trade, with potential consequences for Azerbaijan’s expanding export markets.

"That is, it is not excluded that the growth rate of our total exports to the United States will decrease. At the same time, since the products we send to the United States are more specific, a 10 percent tariff may not affect the market position of those products. But in any case, the new tariffs will mean the beginning of a new phase in the world economy."