Sectoral analysis of foreign trade between Azerbaijan and Turkey

Azerbaijan, which gained its independence in 1991 and is a country trying to become a regional and global actor in all fields. International trade relations are one of the most important activities in this sense. In the early years, Azerbaijan was conducting most of its trade with the countries in the region, especially the Russian Federation. Over time, Azerbaijan's trading partners in both exports and imports have increased and Azerbaijan has become a country that trades with the whole world. Turkey is one of the countries that contributed the most to Azerbaijan's process of international expansion. The most important factor contributing to the development of bilateral trade between Azerbaijan and Turkey is their historical and cultural background. These factors also include Turkey's status as one of the most influential regional trade actors, its experience in a market economy, and the entrepreneurial activities of Turkish firms. The aim of this study is to analyze the competitiveness of Azerbaijan's bilateral trade with Turkey on the commodity group basis according to revealed comparative advantages. In this context, it has been tried to reveal in which commodity groups Azerbaijan has an advantage against Turkey and in which commodity groups Azerbaijan is disadvantaged. In the analyses, the Revealed Comparative Advantages Index (RCA) values were calculated using SITC 1-digit and 2-digit annual data for the period 2000-2020. The results of the analysis show that Azerbaijan has an advantage against Turkey in all years only in product group number 3 "Mineral fuels, oils and alkaline products". The country became advantageous in the commodity group number 2 "Inedible raw materials excluding fuel" after 2018. In all other commodity groups, Azerbaijan is disadvantaged against Turkey.