AZERBAIJAN - Political Stability Prospects

There is a big question mark about Azerbaijan's future post-Aliyev. Few doubt that Aliyev will keep a tight rein on politics, the media and other aspects of society during his second five-year term after the October election. Oil wealth without governmental accountability in the coming years will lead to more corruption and an impoverished population. Although Aliyev appears genuine when he says his main concern is to see the people's living standards improved, old habits die hard. He cannot stem corruption without a true democracy.

In August 1997, when he visited the White House, Aliyev did tell President Clinton that he was committed to "political pluralism" and "the holding of free and fair elections" in October. But today his opponents say the election commission is already dominated by Aliyev backers and "the election law his supporters have approved in his rubber-stamp parliament will allow another unfair vote". His advisor Goulizadeh says Azerbaijan needs more time to create the instincts and institutions of a democratic society after enduring 200 years of subordination as part of the Russian empire and 70 years in the Soviet Union.

In October 1997, the British Ambassador to Baku, Roger Thomas, launched a swingeing attack on corruption and bureaucracy in Azerbaijan. Speaking at a conference organised by the Baku chamber of commerce, he spoke of "the hijacking of assets and wealth by a few people while a large part of the country goes empty-handed". He said foreign companies were being "frightened away" from Azerbaijan by excessive and arbitrary taxation. He said corruption, in the form of "unofficial overheads", provided "a further disincentive to invest".

Thomas' unusual remarks, for such a ranking diplomat en poste, were significant in view of the important stake held by British companies in the Caspian oilfields. BP leads the two main E&P consortia and is about to sign a PSA for a third one.

Sabit Bagirov, an opposition economist who used to head Socar under the previous regime, says Aliyev reads and understands every IMF and World Bank proposal but will not clean up and liberalise the economy or the political system. He warns that there would be chaos unless Azerbaijan has a government permanently under the control of society and parliament. Bagirov, now president of the Entrepreneurship Development Foundation, says the present parliament (with only four opposition politicians among its ranks) serves as a rubber stamp for presidential dictates. It is dominated by Aliyev's party, Eni Azerbaijan (new Azerbaijan).

Critics says Aliyev is preparing to create his own dynasty, grooming his only son, Ilham for the top post. Ilham, now 1st vice president at Socar, has been

more visible in recent months, standing at official functions. But he does not have the steel or charisma of his father.

In 1997, Aliyev designated June 15 as a new holiday called National Salvation Day and, like Ataturk in Turkey, his portrait is in every school or office. Along many roadsides, billboards bear quotations from his speeches, such as, "I have devoted my entire life to my country". There are doubts about Aliyev's health, however. Rumours have been circulating for some time about his diabetes, which is said to be complicated by a problem with his lungs. But physically, he seems to be in good health, travelling regularly and appearing energetic in the media.