FINAL REPORT: DEFINITIONAL MISSION TO AZERBAIJAN:
AZERCOSMOS – AZERSPACE-2 FEASIBILITY STUDY
August 07, 2013
Space Partnership International
51
sector by the Azerbaijan government in 2011, with 22% directly from the state budget.
35
Internet Background and Growth
The Internet in Azerbaijan remains largely free from direct censorship by the government.
Azerbaijan has
a growing Internet population, supported by a national strategy to develop
the country into an information and communication technology (ICT) hub for the Caucasus
region.
The Internet is also beginning to surface as an important forum for
political communication,
and there are some indications that restrictions on content may emerge in the future.
The Internet in Azerbaijan remains for the most part ‘‘free and open’’ as a result of the
government’s strong interest in converting the country into an ‘‘ICT hub’’ for the region.
New Satellite Capacity to allow Azeri operators to move off of foreign satellites
Azercosmos currently plans to migrate strategic satellite customer’s traffic to Azerspace-1
and Azerspace-2 when contracts expire.
Azeri communication companies currently lease the equivalent of two transponders.
35
Source; MCIT, SSC
FINAL REPORT: DEFINITIONAL MISSION TO AZERBAIJAN:
AZERCOSMOS – AZERSPACE-2 FEASIBILITY STUDY
August 07, 2013
Space Partnership International
52
3.11 IMPACT ON U.S. LABOR
The Contractor shall submit an assessment of the impact of the project(s) on U.S. labor, addressing
the legislative prohibitions on the use of Foreign Assistance Funds described in Annex I.
Impact of Azerspace-2 on U.S. Job Creation
Azercosmos indicated in a 2011 press release that the Azerspace-1 project created approximately
1,500 U.S. jobs. Based on job numbers supplied by the satellite exporters and aggregated by the
U.S. Ex-Im Bank
36
, Contractor estimates that the financing of the Azerspace-2 project can be
expected to generate between 1,200 and 1,800 jobs at the U.S. exporters’ facilities and those of
their suppliers. This estimate is based on three (3) Ex-Im approved satellite programs, which were
closest in scope to the planned Azerspace-2 design. See highlighted rows in following table.
Table 1: US Export Jobs Created from US-Exim Approved Satellite Projects
US JOBS
CREATED
US
COMPANY
DATE
CUSTOMER
COUNTRY
MISSION
MISSION DESCRIPTION
Source:
1,500
Orbital
Sciences
2012
Azercosmos
AZ
Azerspace-1
Orbital GEO STAR-2, 5 KW, 36
transponders
Azercosmos
80
Orbital
Sciences
2012
Mexsat
Mexico
Mexsat3
Orbital GEO Star-2, 3.5 KW,
12 ext Ku-band,12
ext C-band
transp.
EX-IM
600
Orbital
Sciences
2013
Hispasat
Spain
Amazonas
4A
Orbital GEO Star-2, 24 Ku-
band transponders
425
Lockheed
Martin
2013
Vinasat
Vietnam
VINASAT-2
GEO LM Lockheed
Martin A2100A bus,
24 Ku-band transponders
3,700
Loral, Aon
2013
ABS
Hong Kong
ABS-2
GEO FS1300, 87 active C-
band, Ku-band
and Ka-band
transponders
Boeing, Aon,
SpaceX
ABA
Project 2
(2) GEO 702SP C, Ku-band,
launch on SpaceX on Falcon
9; Insurance
480
Boeing
2012
Mexsat
Mexico
Mexsat1,
Mexsat2
2
L-band MSS satellites
900
Lockheed
Martin
2012
Jabiru Sat.
Australia
Jabiru-1
8.1 GHz 50 Ka-band; Ku-
band; Jobs: 250 aerospace,
650
suppliers across USA
U.S. Legislative Restrictions
The primary U.S. legislative restriction for Azerbaijan is Section 907 of the United States Freedom
Support Act, which bans any kind of direct United States aid to the Azerbaijani government only
for military and specific energy projects. Section 907 is unique to Azerbaijan and makes it the only
exception to the countries of the former Soviet Union in receiving direct financial aid from the
United States.
37
The Act was originally passed in response to Azerbaijan's blockade of Armenia.
36
Source: US-EXIM 2011
annual report;
www.exim.gov/about/library/reports/annualreports/2011
37
Under the Freedom Support Act to facilitate economic and political stability.
FINAL REPORT: DEFINITIONAL MISSION TO AZERBAIJAN:
AZERCOSMOS – AZERSPACE-2 FEASIBILITY STUDY
August 07, 2013
Space Partnership International
53
Since its creation, Congress eased many Section 907 restrictions on a year-by-year basis until the
terrorist attacks on the United States in September 2001, after which it approved an annually
renewable presidential waiver would provide the President with ability to waive the Section 907.
The waivers continue to be conditional on Azerbaijan’s cooperation with the United States in
combating terrorism. Historically, Congress has called for equal funding each year for Foreign
Military Financing and International Military Education and Training for Armenia and Azerbaijan.
Exclusion of Defense and Energy Department Funds
Historically, annual aid excludes Defense and Energy Department funding. However, ongoing
rumors continue to circulate regarding the lessening of these restrictions. Contractor has not been
able to substantiate these rumors.
Other Congressional Initiatives
Other congressional initiatives have included the creation of a South Caucasus funding category in
FY1998 to encourage a Nagorno-Karabakh (NK) peace settlement, provide for reconstruction, and
facilitate regional economic integration. Congress also has called for humanitarian aid to NK,
which has amounted to $30.8 million expended from FY1998 through FY2008.
The Obama Administration aims to develop democratic institutions and civil society, support the
growth of the non-oil sectors of the economy, strengthen the interoperability of the armed forces
with NATO, increase maritime border security, and bolster the country’s ability to combat
terrorism, corruption, narcotics
trafficking, and other transnational crime.
Cumulative U.S. assistance budgeted for Azerbaijan from FY1992 through FY2010 was $976
million (all agencies and programs). Almost one-half of the aid was humanitarian, and another fifth
supported democratic reforms. Budgeted aid to Azerbaijan was $26.4 million in FY2011 and an
estimated $20.9 million in FY2012 (including “Function 150” foreign aid excluding Defense and
Energy Department funds). Under the Continuing Appropriations Resolution for FY2013, signed
into law on September 28, 2012 (P.L. 112-175), regular foreign aid accounts are funded until late
March 2013 at the same level as in FY2012, plus an additional 0.612%, and most country
allocations may be adjusted at agency discretion.