Baku: Amid the rapid transformation of global logistics and the intensifying competition for transport routes, relations between Japan and Azerbaijan are expanding beyond traditional diplomacy. Issues of geoeconomics, technological leadership, and long-term strategic planning are increasingly intertwined. For Japan, the South Caucasus and Central Asia region is becoming part of a broader connectivity architecture, while for Azerbaijan, it represents an opportunity to strengthen its role as a key hub between East and West.

According to Azerbaijan State News Agency, mutual investment and exchange mechanisms are being considered, which could not only strengthen economic ties but also enhance Azerbaijan's strategic importance in Eurasia. Japan's role as a partner with high technological competencies is particularly relevant and promising. Taku Tamaki, an international policy expert specializing in Japan and the Asia-Pacific region and a recognized member of the Academy of Higher Education, emphasized the potential for Japanese inward FDI into Azerbaijan, especially in the development of the Middle Corridor.

Tamaki identified energy, infrastructure, and technology as the most promising areas for deepening bilateral cooperation. He highlighted that if Sanae Takaichi continues with Shinzo Abe's legacies in pursuing the Indo-Pacific Vision, Japan could compete with China through 'high-quality infrastructure' exports in these areas. Azerbaijan's active development of renewable energy and high-tech sectors presents opportunities for joint ventures and business cooperation.

Japanese inward FDI, particularly in transport infrastructure, could serve as a model for Azerbaijan. The growing interest and demand for enhancing the Middle Corridor align with Japan's Free and Open Indo-Pacific Vision, which involves 'high-quality infrastructure' investment. Tamaki sees potential for Azerbaijan to become an important partner for Japan in the Caucasus and Central Asia, especially with the demand for transport infrastructure investment.

Over the next five years, initiatives within the Japan-Azerbaijan partnership are expected to focus on transport logistics and the associated infrastructure investment, further solidifying Azerbaijan's strategic role in Japan's connectivity vision.