Billions Spent Belie Woes as Azerbaijan Hosts European Games

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Azerbaijan will host the inaugural European Games having spent billions of dollars on the event as a sputtering economy and criticism over human rights pile pressure on President Ilham Aliyev.

The European Olympic Committee’s answer to the Pan-American Games and Asian Games will open Friday at Baku’s 500 million-manat ($476 million) Olympic Stadium. Aliyev will be joined at the ceremony by Russian President Vladimir Putin and Turkish leader Recep Tayyip Erdogan. Most European leaders including German Chancellor Angela Merkel declined to attend.

The former Soviet Union’s third-largest oil producer, ruled by the Aliyev family for more than four decades, wants to polish its image battered by clashes with rights groups. Azerbaijan broke spending records on the 2012 Eurovision song contest and was the only bidder for the European Games. Some estimates show it spent more than $3 billion even as a drop in crude prices shackled the economy, widened the budget gap and sank the currency.

The Games focus attention on “corruption, political prisoners and shortcomings” in the political system, Natiq Cafarli, executive secretary of the Republican Alternative, or Real, opposition group, said by e-mail. Azerbaijan “invested billions of dollars to expose the country’s problems to world media.”

Currency, Bonds

The manat has lost 25 percent against the dollar this year, the second-worst performance in the world behind the Belarusian ruble, because of a devaluation in February. The yield on the government’s 2024 dollar bond rose to 4.67 percent on Wednesday, the highest in more than two months, according to data compiled by Bloomberg.

The International Monetary Fund warned of “a sharp and possibly sustained decline” in economic output if oil prices fall further. Growth will slow to 1.8 percent this year from a preliminary 2.8 percent in 2014 and 5.8 percent in 2013, the Washington-based lender said in a report this week. The budget deficit will widen to 7 percent of gross domestic product in 2015 from 0.4 percent last year, it said.

As the economy slowed, Aliyev spent at least $3.3 billion on the Games, according to independent groups such as the Economic Research Center in Baku. Sports Minister Azad Rahimov put spending at 1.97 billion manat, half of it on the construction of venues.

Airfare, Buses

Azerbaijan is paying travel and accommodation costs for all teams and has bought fleets of new buses and London cabs to ferry visitors around for free. State-owned Azerbaijan Airlines is offering half-price tickets until the end of 2015 for foreigners accredited to the event.

The Games “will demonstrate the strength of our state and the talent of our people,” Aliyev said on his website on Tuesday.

Beyond the economic risks, the competitions involving about 6,000 athletes from 50 countries will kick off amid confrontation between the administration and rights groups.

Amnesty International said it’s been barred from Azerbaijan. The Organization for Security and Cooperation in Europe was ordered to close its Baku office within a month by the Azeri Foreign Ministry last week without explanation, spokesman Rashad Huseynov said by e-mail on Wednesday.

‘Wrong Reasons’

The competition opens “in an atmosphere of government repression unprecedented in the post-Soviet era,” New York-based Human Rights Watch said in a statement on Thursday. “Government repression is making the European Games historic for all the wrong reasons,” said Rachel Denber, the group’s deputy Europe and Central Asia director.

The criticism is the result of “some circles in the West” seeking to politicize the European Games and target Aliyev for his “independent will,” Ali Hasanov, a political aide to the presidnet, told reporters Thursday in Baku

“Azerbaijan is a law-governed state,” Hasanov said. “As a member of the Council of Europe for almost 15 years, we are under the jurisdiction of the European Court of Human Rights. Anyone disputing Azeri court rulings can appeal to the European court.”

Amnesty said the government told it late on Tuesday to cancel a visit planned for Wednesday to release a report on how journalists, opposition members and democracy activists have been “systematically silenced” by imprisonment, attacks and torture ahead of the games.

OSCE, Amnesty

Azerbaijan received no accreditation request from Amnesty, Hasanov said. Authorities prevented attempts by some individuals affiliated with the group to illegally enter the country, he said, without giving details.

The OSCE reported the “wide-scale persecution of independent voices” in a statement in April condemning the jailing of rights advocate Rasul Jafarov on charges including tax evasion, abuse of power and forgery.

Hasanov rejected as groundless accusations of political persecution of Aliyev’s critics in the country, saying there are no political prisoners in Azerbaijan. Those behind bars have been charged with specific criminal offences, he said.

Without democracy in Azerbaijan, “cheap tickets, free taxi and hotels, roads free of traffic jams, smiling police” will be for visitors only, opposition leader Cafarli said.

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