JULY 22 2013 (The Conway Bulletin) — Azerbaijan has been on something of a spending spree. Whether through SOFAZ, the state’s oil fund, or through SOCAR, the state energy company, Azerbaijan’s government has spent millions of dollars on overseas investments.

These included properties in some of the world’s most expensive cities — SOFAZ bought an office block in London’s St James’ for $286m in 2012, then spent $180m on property in Paris and $133m on a building in Moscow — as well as large currency deals and gold purchases.

Property prices in London and Paris are soaring and gold is seen as a sensible long-term bet so these appear solid investments. Azerbaijan’s latest investment, though, strikes an off-beat cord.

Azerbaijani and Russian news website reported comments made in Moscow by the visiting PM of Montenegro, Milo Djukanovic, on July 12. He said SOCAR had agreed to spend 500m euro building a new luxury resort on Montenegro’s attractive Adriatic coast.

Various websites have since reported that two private companies, Triangle Investments and Developments Limited and Azmont Investments LLC, will pursue the project on behalf of SOCAR.

For most countries, spending 500m euro on building a luxury resort in Montenegro is a risky investment choice.

ENDS
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(News report from Issue No. 144, published on July 22 2013)