Azartac news agency, Azerbaijan
Dec 31 2007


AZERI LEADER ATTACKS ARMENIA, VOWS CONTINUED MILITARY BUILD-UP


Azerbaijan's president has blamed Armenia for the failure to end the
long-standing territorial dispute between the two countries.

In a New Year address to the nation, carried by the state-run news
agency Azartac, Ilham Aliyev said that the conflict could not be
resolved in the outgoing year due to Armenia's "non-constructive"
position.

"I regret to say that Armenia's non-constructive position and
occupation policy prevented us from resolving this issue in 2007,"
Aliyev said.

The president stressed that the predominantly ethnic
Armenian-populated region of Nagornyy Karabakh, which broke away from
Azerbaijan following a separatist war in the early 1990s, would never
be granted independence.

"We will never make a concession on our territorial integrity.
Azerbaijan's territorial integrity is inviolable," President Aliyev
said. "Nagornyy Karabakh will never be granted independence. Neither
Azerbaijan's leadership, nor its people would agree to this, and the
international community would never recognize Nagornyy Karabakh's
independence."

Aliyev dismissed Armenian statements that Azerbaijan has agreed to
holding a referendum in Nagornyy Karabakh to define the region's
final political status.

"We will never allow [Armenians] to establish a second Armenian state
on Azerbaijani territory. If the Armenians living in Nagornyy
Karabakh want to determine their future, they should do so either
within Azerbaijani borders or leave Nagornyy Karabakh and build a
second state for themselves anywhere else," Aliyev said.

Military spending

President Aliyev expressed commitment to peace talks mediated by the
USA, Russia and France, saying that Azerbaijan still hopes to find a
diplomatic solution to the conflict. At the same time, the president
said, Azerbaijan is building a strong army and a defence industry to
regain control of Nagornyy Karabakh and the surrounding occupied
territories by force if peace talks fail. He said Azerbaijan's
military spending would amount to at least 1.2bn dollars next year.

"We are buying new weapons and equipment. We are raising the
professionalism of our army. We have established a defence industry,
which has already started producing weapons and ammunition necessary
for our army," Aliyev said.

The president also praised Azerbaijan's economic performance over the
past three years, saying that the economy has seen an "unprecedented"
economic growth during these years. The country's gross domestic
product (GDP) grew by 26 per cent in 2005, 35 per cent in 2006 and 25
per cent in 2007, Aliyev said, adding that Azerbaijan's budget
spending has increased tenfold since he was elected president in
2003.

"Azerbaijan's consolidated budget will amount to 12bn dollars [in
2008]. This is a very big number which will enable us to successfully
implement all tasks set for the country," he said.

[translated]