Tourism support package: Can Azerbaijan reach its target of 3.8 million visitors?
State support for tourism in Azerbaijan
A new state programme, approved by a decree from President Ilham Aliyev, sets out plans to develop the tourism sector in the coming years, attract more foreign visitors and expand tourism beyond Baku.
The programme comes into force as the tourism sector faces declining figures. In the first half of 2026, 1.09 million foreigners and stateless people arrived in Azerbaijan. This was 10.3% fewer than in the same period last year. Arrivals from the Gulf countries fell by 31.4%, while hotel stays declined by 8.3% and hotel revenues by 3.8%.
Target for 2030: 3.8 million tourists
Under the State Programme, the value added generated by industries directly linked to tourism — in other words, the sector’s actual contribution to the economy — should rise from 6.96 billion manats (about $4.1 billion) in 2025 to 8.51 billion manats in 2027 and 12.17 billion manats (about $7.2 billion) in 2030.
The programme targets real growth of around 40% in the tourism sector by 2030. “Real growth” means an actual increase in the volume of production and services, rather than a nominal rise caused by higher prices.
The government plans to increase the number of foreign arrivals from 2.57 million in 2025 to 3.8 million by 2030.
The target for 2026 is 2.42 million arrivals. Given the 10.3% decline recorded in the first half of the year, the figures will need to improve significantly in the second half to meet this target.
Competition is also intensifying. Azerbaijan ranks 56th among 119 countries in the World Economic Forum’s 2024 Travel and Tourism Development Index. Georgia ranks 45th, Kazakhstan 52nd and Uzbekistan 78th.
In 2025, Georgia reported 5.5 million tourist trips, Uzbekistan 11.7 million foreign tourists and Kazakhstan 15.7 million foreign visitors. The countries use different methods to count tourists and visitors, so these figures cannot be compared directly. Nevertheless, they show that Azerbaijan’s tourism sector faces strong regional competition.
Subsidies, new flights and easier visa rules
The programme provides for extensive government support. Authorities plan to offer subsidies to local tour operators that bring tourists to Azerbaijan, as well as to micro and small businesses operating in the tourism sector.
The measures also include partial compensation for charter flight costs, incentives to open additional scheduled flights to Azerbaijan from priority markets, and financial support for concerts and other entertainment events.
Another area concerns easier entry into the country. The programme provides for expanding visa-free access to citizens of 34 target markets, widening access to e-visas and introducing a “digital nomad” visa in 2027-2028. It will target people who work remotely and want to live in another country for an extended period.
The plan also calls for the development of regional tourism zones, walking routes, health tourism and gastronomic tourism. These measures could help reduce Azerbaijan’s tourism sector’s dependence on Baku, expensive hotels and major international events.
A 2026 World Bank analysis also highlights shortcomings in transport links, accommodation infrastructure, local tour operators and the quality of services in the regions.
At least on paper, therefore, the programme correctly identifies many of the sector’s existing problems.
The problem is not just a lack of subsidies
The key question is whether government support alone can make Azerbaijan a more affordable and competitive tourist destination.
The State Programme itself also highlights the high concentration of the air travel market, meaning that a relatively small number of companies provide most of the services. It also points to limited hotel supply, high prices, and problems with hygiene and service quality.
At the same time, budget airlines have expanded their presence in Baku compared with previous years. In July, Heydar Aliyev International Airport said that around 20 low-cost and hybrid airlines operated flights from Baku to more than 20 international destinations.
The problem can therefore no longer be reduced to the claim that “Azerbaijan has no budget airlines”. Other questions have become more important: how frequently do these airlines operate, which cities do they serve, and does competition between airlines actually affect ticket prices?
The position of major business groups in the tourism and hotel markets also matters in this context.
According to publicly available information from PAŞA Holding, whose shareholders include the president’s father-in-law and daughters, its wholly owned subsidiary Absheron Hotel Group operates hotels including Four Seasons Baku, JW Marriott Absheron and Ritz-Carlton Baku. Another group company, PAŞA Travel, brings tourists to the country, books hotels and provides transport services.
This means that companies belonging to the same business group operate at different stages of the tourism chain. Economists call this model “vertical integration”.
Vertical integration is not in itself illegal or necessarily harmful. However, even without complete public data on market shares, an important question remains: what rules will govern the distribution of subsidies among companies of different sizes?
The main question is this: will government support help new and small companies enter the market, or will it mainly benefit companies that already have significant resources?
Who will receive the money, and for what?
Under the presidential decree, the Cabinet of Ministers must develop rules for awarding subsidies within three months. So although the programme has already been approved, one key question remains unanswered: which companies will receive public funds, according to what criteria and in return for what results?
The Centre for Analysis of Economic Reforms and Communication has been tasked with monitoring and evaluating the programme.
However, effective oversight will depend not only on which institution is responsible for it. It will also depend on how accessible information is to the public about the companies receiving subsidies, the amounts they receive and the results they achieve.
Previous audits of other government support programmes by the Chamber of Accounts have identified problems such as insufficient justification for spending on individual projects and a lack of data needed to assess their results. These findings do not directly concern the tourism programme, but they highlight the importance of building the new subsidy mechanism around clear and measurable criteria from the outset.х.
A tourist’s decision is not based on price alone
Entry requirements also directly affect the competitiveness of the tourism sector.
At present, travellers can enter Azerbaijan by air, while crossing the land border remains largely restricted and subject to special rules. Since 25 May, exceptions have applied to rail travel with Georgia for Azerbaijani citizens and some foreign nationals who can enter the country without a visa.
The country’s overall reputation also affects tourists’ choices. The UK Foreign Office generally considers crime levels in Baku to be low, but notes that there are occasional reports of foreign nationals being asked for unofficial payments.
In Reporters Without Borders’ 2026 World Press Freedom Index, Azerbaijan ranks 171st out of 180 countries. In Transparency International’s 2025 Corruption Perceptions Index, it ranks 130th out of 182 countries.
These rankings do not directly determine whether tourists will visit Azerbaijan. However, they form part of the broader picture that shapes international perceptions of the country, assessments of the predictability of its legal and business environment, and investors’ perceptions of risk.
State support for tourism in Azerbaijan
