THE POLITICAL ECONOMY OF TRADE REFORM IN AZERBAIJAN: MACROECONOMIC RISKS AND OPPORTUNITIES OF WTO MEMBERSHIP UNDER GLOBAL UNCERTAINTY

This study explores the political economy dimensions of trade reform in the Republic of Azerbaijan, focusing on the macroeconomic risks and opportunities associated with the country's prospective accession to the World Trade Organization (WTO) amid increasing global economic uncertainty. By analyzing Azerbaijan's foreign trade policy evolution, institutional frameworks, and structural dependencies – particularly in hydrocarbons – the paper evaluates how WTO membership could reshape national economic resilience, fiscal sustainability, and long-term diversification strategies. The research employs a mixed-methods approach, combining econometric modeling with policy analysis to assess the compatibility of Azerbaijan’s macroeconomic structure with WTO commitments. It further investigates the geopolitical implications of global transformation, such as shifting trade blocs, rising protectionism, and regional competition, and how these factors affect Azerbaijan’s WTO negotiation dynamics. The findings suggest that while WTO accession offers access to new markets and legal protections, it also imposes adjustment costs and policy constraints that require careful sequencing and domestic reform. The paper concludes with policy recommendations tailored to Azerbaijan’s unique political economy and development trajectory.