The rich Azeri countryside boasts a bountiful harvest that has righted the country’s economy

Long considered a purveyor of fruits and vegetables, Azerbaijan had never taken agribusiness seriously. That changed dramatically with the collapse of the Soviet Union in 1991. During the worst of the post-Soviet crisis, Azersun Holding helped instill new confidence in the Azeri countryside. Today, with over 3,000 employees, it is one of the main players in the non-oil economy—even though vegetable oil is one of its star products.

“When I came to Azerbaijan, the entire system had broken down and there was no economy,” says Abdolbari Goozal, the group’s president. During the first half of the 1990s, Azeri GDP contracted by 58 percent. Paying for factories in cash, Goozal opened the country’s first food processing factories. By branching into tea and vegetable oils, he gradually helped dismantle psychological barriers. The Azersun manufacturing units were some of the first to obtain ISO 9000, ISO 14001 and ISO 18001 certification. “My character is that I always seek the best. I believe quality is our lifeline,” says Goozal.

Azersun currently runs two cannery operations and opened its first sugar mill at Imishli. A US-based company, Valmont, provided it with machinery and know-how. Part of the 7,000-hectare Imishli operation involves changing local mindsets. Tractors and seeds are provided for free to entrepreneurial smallholders in exchange for future profits. Together with foreign partners like Unilever, Goozal is convinced that Azerbaijan will become a regional powerhouse in foodstuffs. “As a businessman, you need to understand the responsibility to your country and the environment,” says Goozal.

But reviving agribusiness at a time of sky-high oil prices is no easy task. Minister of Agriculture Ismat Abasov likes to think of it as a key tool in economic diversification. There are 22 international programs involved in refloating agribusiness, including the World Bank and the European Commission. After all, about 48.5 percent of the population lives in rural areas and the sector employs 39 percent of the labor force. “More than 100 laws, decrees and regulations related to agriculture were adopted between 1995 and 2004,” says Abasov. Today, farmers are tax-exempt through January 2009. Technological inputs, as well as seeds, can be imported duty-free.

With land reform, about 99.7 percent of agricultural production is now in private hands. As prices become liberalized, Azersun Holding will begin to carve a niche in global markets. Goozal’s tea products have so far garnered 16 medals at international competitions, finishing far ahead of traditional tea exporters like India and Sri Lanka. Because of his focus on quality, technology underlies the group’s success. Setting up a consortium with multinational food companies is Goozal’s next ambition. “We’ve already started working with companies in Singapore and Malaysia. In the future, we hope to work with European and North American firms,” he says.