MEETING OF CASPIAN CONSTRUCTION CLUB WITH THE CASPIAN INTEGRATION BUSINESS CLUB RESULTED IN DRAFT OF AZERBAIJAN'S QUALITY CONSTRUCTION PROGRAM

 

The problems in construction sector were discussed today (September 4) during the meeting of Caspian Construction Club with the Caspian Integration Business Club (CIBC).

 

"Today's meeting of the Caspian Integration Business Club (CIBC) is taking place in terms of enforcing the Decree of President of Azerbaijan Ilham Aliyev on reinforcement of control in construction industry. The primary objective of the meeting was to listen to opinions of construction companies and organizations related to this segment of market. By the results of five-day meeting and consultation among managers of Azerbaijan's state and private-owned enterprises and organizations operating in construction industry the proposals package will be prepared to submit to the Cabinet of Ministers and other state agencies with the purpose of having them account for the private sector opinion", said President and CEO with CIBC Telman Aliyev.

He said the companies represented in the Club have worked in Azerbaijan's construction sector over 10-15 years and it would not be right to judge the whole construction sector of Azerbaijan by one company. 

Speaking at the meeting, President Caspian Construction Club and Chairman of Board with AzRosPromInvest Natig Shirinzadeh said CIBC approached the events taking place in the country most efficiently and objectively.

Speaking of problems, he said the country's construction sector faced several problems, such as a lack of qualified personnel and deviation from standards in use of construction materials.

Mr. Shirinzadeh said the market today faces lack of cement, and Azeri government is considering three projects of cement plants to compensate for it. He said annual demand for cement in the internal market is 4MT and the cement plant in Garadagh can produce some 1MT per annum. The remaining cement is produced from processed clinker delivered from Russia or imported directly from Georgia or Russia, which, in turn, supply the internal markets demand at 60% and 80%, respectively.

Speaking in the meeting, Vice-President Caspian Finance Club and Chairman of Board with MBASK Insurance Company Jamil Malikov stated the necessity in insurance at all stages of construction, from design to erection. He said insurance companies were eager to assess and accept construction risks, including third party liability risks. "Experts will be invited to assess risks correctly", he said. Insurance companies shall be allowed to monitor the work of construction companies.

In general, said Mr. Malikov, the companies engaged in construction shall realize their responsibility. Today all kinds of insurance are available in Azerbaijan's market, including that of professional liability, which will enable to avoid problems in construction sector. 

Vice-President of CIBC and Representative Director of Kron Shipšing Abulfaz Hajiyev underlined the importance of compliance with safety standards during the construction. "It is necessary to create a safety control system", he said. According to him, the professional liability insurance shall reduce the losses of construction market.

Shirin Shirinov, Deputy Chief of Machinery-Building and Energy Department with the Cabinet of Ministers of Azerbaijan, stated the necessity in solving the problems in construction sector and importance of topics discussed at CIBC meetings. He said the analysis of such topic at CIBC meetings with participation of specialists would allow solve a number of problems in construction sphere.

Tehran Iskanderov, Chief of Construction Material Quality Control Department, State Agency for Standardization, Metrology and Patents, said the State Agency performed onsite checkup of construction materials produced in the country and did not reveal any noncompliance. He said the change in concrete quality occurs during the transportation and grouting.

Orkhan Hasanov, Head of Basak-Inam Insurance Company, said this type of insurance is not profitable. For his company, he said, this statement was at a loss as it had to make big payments on two insurance events in construction sector, a fire and an accident.

Isfandiyar Akhundov, Head of Sharur Inshaat Construction Company, said Azerbaijan's insurance companies did not offer any profitable transactions and, therefore, construction companies had to decline such services. He also said his company had special equipment enabling to determine concrete grade and it was ready to give it to authorized authorities in order to perform checkups at newly erected buildings.

Elvin Bayramov, General Director, Rapid Solutions LLC, suggested arranging a special meeting of Club members that are by any means involved in construction business, in order to ensure uniform application of advanced standards and enforce construction work quality. He also said his company started solving the common problem for Azerbaijani business related to professional staff. In this respect, it has already launched trainings for students of Azerbaijan State Oil Academy. "The company's plans include opening up of its own Training Center. We expect to implement these plans during 2008", said Mr. Bayramov. Still, students are involved on the basis of two-month short-term contracts in summertime.

By the results of the meeting, in order to ensure quality construction and avoid negative trends, the Club members put forward a program of five statements:

The members of the Club also advocated adopting the Law on "Mandatory Insurance of Civil Liability during Construction Operations" and enforcing international safety systems for construction operations.