Azerbaijani economist Natig Jafarli says the country is moving toward an increasingly burdensome regulatory environment, echoing what he describes as the “worst practices” of both the Soviet era and today’s European Union.
In a widely shared Facebook post, he argues that excessive state intervention and a rapid expansion of mandatory standards are weighing heavily on small and medium-sized businesses.
Jafarli’s critique comes amid rising concerns in the business community that new regulations – often introduced under the banner of aligning with European norms – are creating additional financial pressure at a time of economic slowdown.
Two new announcements spark renewed debate
On Thursday, two official announcements drew particular attention:
Azerbaijan held discussions on 33 draft state standards covering a wide range of food products, including table olives, olive oil, wheat flour, canned fruits and vegetables, chocolate and butter.
The Azerbaijan Standardization Institute (AZSTAND), which operates under the State Service for Antimonopoly and Consumer Market Control, said it may adopt five new national standards in the tourism sector.
These developments, Jafarli argued, reflect a broader pattern: “Instead of stimulating economic players, the government is adopting new ‘standards’ that create fresh obstacles for business.”
Pressure on small producers
The economist points to what he sees as a growing imbalance between regulatory ambition and the real capabilities of local producers. Traditional small-scale vendors – such as dairy sellers in Lankaran markets – could face penalties if they fail to meet newly introduced technical or production standards.
“What kind of standards should someone follow if she is producing butter by hand using knowledge passed down through generations?” Jafarli wrote, warning that such measures risk penalizing long-standing artisanal practices.
Regulation becomes “another tax” in weak institutional environments
A recurring theme in Jafarli’s commentary is the link between regulation and corruption. In countries where judicial systems are slow and trust in institutions is limited, he argues, new standards often become an unofficial revenue source for oversight bodies – either through formal fines or through informal payments.
“While none of this encourages production or entrepreneurship,” he wrote, “it does create new levers of pressure.”
A structural problem, not a single decision
Jafarli’s criticism underscores a deeper debate in Azerbaijan about the balance between improving quality controls and avoiding excessive bureaucracy. Supporters of tighter standards argue they help protect consumers, align industries with export markets and raise product quality. Critics warn that rapid, poorly sequenced regulation strains small businesses and discourages investment.
For now, the government continues to pursue standardization initiatives across multiple sectors, while concerns from entrepreneurs and economists – including Jafarli – highlight the need for clearer communication and more predictable policy design.
