Allow me first of all to sincerely congratulate the President on his unanimous election to the presidency of the General Assembly at its fifty-third session, and to express confidence that under his efficient leadership the Assembly will cope successfully with the complex issues before it. I would like to express our special gratitude to Mr. Hennadiy Udovenko, whose vast experience and great professionalism greatly contributed to the success of the previous session, and whose work as President during the fifty-second session epitomized the United Nations commitment to the process of transformation aimed at enhancing the effectiveness of the Organization. All aspects of life in Azerbaijan are covered by the process of radical reform directed at creating a democratic, secular society governed by the rule of law and based on a market economy. In spite of the current objective difficulties caused by the consequences of armed conflict and the problems inherent in the transitional period, Azerbaijan does not see any alternative to the course of democratic transformation it has taken, and considers the strengthening of its democratic institutions a priority of its State policy. Respect for fundamental political and civil rights and freedoms, the functioning of the multi-party system, the protection of the interests of each citizen in our society irrespective of ethnic origin, independence of the judiciary, as well as the advancement of other elements of democratic society, are guaranteed by the Constitution of the Republic of Azerbaijan, which was adopted on 12 13 November 1995 in a national referendum. A great deal has been done to bring the legislative system of the country in line with relevant international standards. Presidential elections that are to take place in Azerbaijan on 11 October this year will constitute a milestone in the process of further strengthening the democratic foundation of the society. Actions already undertaken by the leadership of the country have laid the foundation for genuinely free and just elections. A new law on presidential elections in the Republic of Azerbaijan was thoroughly examined by the Office for Democratic Institutions and Human Rights of the Organization for Security and Cooperation in Europe (OSCE) and the Council of Europe and meets the most rigorous international standards in this field. The election process will be observed by 300 international monitors from the OSCE, the Council of Europe and other international organizations, as well as from institutions of individual countries, such as the National Democratic Institute for International Affairs in the United States. The widest possible participation of national monitors has been provided for. The leadership of the country has declared its commitment to conducting free and just elections, considering it a significant event in the history of the Azerbaijan State. Positive developments resulting from current reforms can also be observed in the country?s economy. At the initial stage of its formation the young Azerbaijan State faced internal instability, lack of a progressive legislative basis for the market economy, disintegration of traditional economic and trade relations, economic recession and a huge budget deficit. These elements have created serious obstacles to economic development. Armed aggression by neighbouring Armenia has had the most negative impact on the situation in Azerbaijan. It has resulted in the occupation of one fifth of its territory, the emergence of about 1 million refugees and internally displaced persons and the continuance of the 10-year-old blockade of the Nakhichevan region of Azerbaijan by Armenia. The course of building a democratic society based on a market economy, taken by the leadership of the country, has created the prerequisites for drastic economic reforms. Since 1995, the Government of Azerbaijan has been implementing a comprehensive programme of economic stabilization. Fiscal, monetary and credit policies have been streamlined and structural reforms to liberalize the economy have been completed. We have achieved macroeconomic stability, as well as stability of the national currency. In fact, inflation rates have practically been reduced to zero, and since 1996 steady growth in the gross domestic product has been restored. Internal stability achieved as a result of the leadership?s consistent policy, as well as reforms implemented, have provided a favourable climate for investments in the country. Today, Azerbaijan continues with the reform of its banking system and privatization of State-owned enterprises. I would like to take this opportunity to thank the International Monetary Fund and the World Bank for their support to the stabilization programme in Azerbaijan and for financing the structural transformations in its economy. I would like to offer our assurances of the irreversibility of the course of economic reforms taken by our Government and to express the hope that these important financial institutions will increase their assistance to Azerbaijan. In its economic policy, our country attaches the highest priority to its integration into the world economy. Situated at the junction of Eastern and Western civilization, and having been for centuries a link between Europe and Asia, Azerbaijan is implementing a systematic programme aimed at its smooth integration into the world economy, and attaches great importance to the development of fruitful and mutually beneficial regional cooperation based on mutual respect for the sovereignty and interests of all States, as well as on the principle of non-interference in internal affairs of other countries. In this connection, the country?s leadership regards as strategically important the concept of creating an East- West corridor, and in particular the development of the Europe-Caucasus-Asia transportation link. The Transport Corridor: Europe-Caucasus-Asia (TRACECA) programme, established by the Commission of the European Union in 1993, is designed to promote the development of interconnected national and regional transportation infrastructures to enhance cooperation between countries in Europe, the Black Sea region, the Caucasus, the Caspian Sea region and Asia. Implementation of this programme will provide reliable access to the trans-European and trans-Asian transportation systems for the landlocked countries of the Caucasus and Central Asia. During the last five years close interaction between the States involved in the programme and active support by the Commission of the European Union have contributed to substantial progress in modernization and construction of communications, the development of relevant laws and codes and the 14 improvement of the customs and tariff policies of participant States. The results of five years of work were reviewed at the International Conference on the Restoration of the Historic Silk Route, held at the capital of Azerbaijan, the city of Baku, on 7-8 September this year. That Conference brought together delegations from 32 countries, including nine heads of State, and representatives of 13 international organizations. The major outcome of the Conference was the signing of the Principal multilateral agreement on international transport for development of the corridor Europe-Caucasus-Asia, which is an important institutional mechanism for promoting the development and regulation of international transportation, as well as for coordinating and harmonizing transportation policies and legal frameworks in this field of transportation. The Baku Conference has become a major cornerstone in terms of strengthening and enhancing cooperation aimed at the further development of the Europe-Caucasus-Asia transportation corridor in the interests of the economic progress of all the participating States. The delegation of Azerbaijan is counting on the support of the other Member States for this programme. We are convinced that the restoration of the historic silk route and the involvement of other countries and regions in this project would provide a strong impetus to the process of rapprochement and reciprocal enrichment of our peoples, a strengthening of their independence and sovereignty, as well as the successful implementation in those States of democratic and market-oriented reforms. Carrying out plans to deliver carbohydrate resources produced by Azerbaijan and other countries of the Caspian basin to world markets by means of multiple pipelines is an integral part of the East-West concept, which is of inestimable importance for strengthening the independence and security of sovereign States, as well as for their economic and other development. We expect international financial institutions and other investors to show due interest in these projects, which can rightly be called a bridge to the third millennium. Unfortunately, however, we are obliged to admit that the model of the progressive development of sovereign States of the region proposed by Azerbaijan is not accepted by all. The position taken by Armenia in the region still remains a serious obstacle to this process. The question of a settlement of the conflict between Armenia and Azerbaijan, which has lasted for more than 10 years now, is a key issue in Azerbaijan?s foreign policy. Relevant resolutions of the Security Council and the decisions of the OSCE have made it possible to create a necessary normative legal basis for the settlement of this conflict. In this context, it is necessary in particular to stress the codifying role and universality of the principles contained in the Lisbon statement made by the Chairman- in-Office of the OSCE. These principles, namely, recognition of the territorial integrity of Armenia and Azerbaijan, a high level of autonomy for Nagorny Karabakh within the Azerbaijan State and the provision of security and safety for the entire population of Nagorny Karabakh, are fully in keeping with the principles enshrined in the Helsinki Final Act of 1975 and are comprehensive in nature, which makes possible their application with an equal degree of effectiveness not only to the conflict between Armenia and Azerbaijan, but to all other regional conflicts as well. A positive balance has recently been achieved. An institute of mediation has been created, comprising the Minsk Group of the OSCE and its Co-Chairmen. The parameters for the settlement process have been established, providing for the elimination of the consequences of the armed conflict and, on this basis, a resolution of the political problems. As a result of Azerbaijan?s persistence, it was possible in October 1997 to find points of contiguity with Armenia?s position, and real opportunities for progress have emerged. The subsequent internal political events in Armenia, however, and the resulting drastic revision of its attitudes led to a decline in the dynamism of the Minsk process. A just and lasting settlement cannot be achieved by Armenia?s military pressure on Azerbaijan, by its continuing occupation of parts of the territory of the Republic of Azerbaijan and by increasing its military potential there, by putting forward preconditions for the resumption of negotiations on the basis of the results of Armenia?s aggression, or by imposing new procedural frameworks on the negotiations process, in order to perpetuate the situation resulting from the conflict. Illegal transfers of arms from Russia to Armenia, worth more than $1 billion, and regular joint military exercises of those countries designed to increase the offensive potential of the Armenia?s armed forces not only prevent a facilitation of the settlement, but also have a direct destabilizing impact on the situation in the region. Azerbaijan once again states its commitment to a peaceful resolution of the conflict and the strict 15 implementation of the ceasefire regime, until an agreement on the settlement of the armed conflict is reached, in the hopes that the same approach will be taken by the Armenian side. Azerbaijan calls on Armenia to accept the proposals of the Co-Chairmen of the Minsk Conference as a basis for negotiations within the format of the Minsk Group. Today, as never before, it is important for the international community to preserve its consistency, determination and persistence in upholding its declared position on the settlement of the conflict between Armenia and Azerbaijan. Nobody should be in any doubt that progressive development of the States of the region can only be achieved through the establishment of just and lasting peace and stability in the southern Caucasian region on the basis of respect for sovereignty and the territorial integrity of its States. Azerbaijan believes that international organizations, as well as the entire international community, should more actively utilize their potential to further promote the peaceful negotiation process and the achievement of a political settlement to the conflict. During its last session, in response to the recommendations of the Secretary-General, the General Assembly adopted important decisions aimed at reforming the Organization. Azerbaijan regards the work already done to this end as a solid basis for further adaptation of the Organization to the quickly changing needs and imperatives of today?s world. We stand ready to further contribute to the implementation of these decisions intended to prepare the world Organization better to meet the challenges of the twenty-first century. Undoubtedly, in this regard, the reform of the Security Council is of special importance. In our view, it is expedient to adopt relevant decisions on this extremely sensitive issue on the basis of the broadest support of Member States and in accordance Article 108 of the Charter. Asia, Africa and Latin America should be represented in both categories of membership of the Security Council in a manner appropriate to current political realities. Given the fact that the number of countries in the Eastern European Group has doubled, we once again point out the need to allocate to that Group an additional non- permanent seat on the Security Council. Addressing the question of the reform of the Security Council and the enhancement of the efficiency of its work, we cannot fail to draw attention to the fact that the four Security Council resolutions on the conflict between Armenia and Azerbaijan have still not been implemented. We have repeatedly stressed that a review of the personnel policy of the United Nations should be an integral part of the Organization?s reform. We remain extremely concerned by the fact that the Republic of Azerbaijan is still not represented in the Secretariat. It is unfortunate that emergencies arising from military conflicts and acts of military aggression are still a pressing issue today. Millions of people continue to lose their homes, health and property, and are becoming internally displaced persons. The people of my country have experienced the pain and misfortune of such a loss, having fallen victim to the Armenian aggression of which I have spoken. Every seventh citizen of Azerbaijan bears the burdens of the refugee?s life, deprived of his home in his native land, suffering from heat in summer and cold in winter in temporary tent camps. In occupied Azerbaijani territory, hundreds of towns and villages have been destroyed, practically all of the houses, schools, hospitals and industrial facilities have been burned down or plundered and ancient cultural monuments have been razed. Coping with the refugee emergency and the restoration of what has been lost are two of the main concerns of the Azerbaijan State. These problems cannot be resolved until the occupying forces are withdrawn from Azerbaijani territory and all the refugees and displaced persons have been returned to the places from which they were expelled by force. The Azerbaijan Government is doing a great deal to alleviate the situation. The role of the United Nations and its agencies in this process can scarcely be overestimated. In addition to providing direct humanitarian assistance to refugees and internally displaced persons, at the present time a project is under way to restore a part of the Fisuli district, which was freed from the occupying Armenian units. This project is being carried out by the Government of Azerbaijan, the World Bank, the United Nations Development Programme (UNDP), the Office of the United Nations High Commissioner for Refugees and other agencies and organizations. However, the emerging trend of reduction in the volume of humanitarian assistance to Azerbaijan cannot fail to disturb us. While expressing our most sincere gratitude to the United Nations, its specialized agencies and donor countries for their support and concrete assistance, we call on them not to decrease in the future the volume of their humanitarian aid to the people in Azerbaijan who are suffering from aggression and who live in the most unbearable conditions. 16 I should like to advantage of this opportunity to briefly refer to our cooperation with UNDP, which is playing a very positive role in the social, political and economic development of our country. Assistance from UNDP, the major source of subsidies necessary for carrying out development activities, is vital to resolve a number of serious problems in Azerbaijan that were mentioned earlier. We welcome the system of Resident Coordinators and highly commend the activity of the Resident Coordinator in Azerbaijan, designated by the Secretary-General, who is acting as the leader of the United Nations team in the country. At the same time, given the difficult financial constraints facing UNDP, I should like to call upon all Member States to increase their voluntary contributions to the budget of the Programme so that the recipient countries, including Azerbaijan, can more effectively use its potential to their advantage. The consolidation of efforts of Member States with a view to launching a decisive attack against crime, drugs and terrorism continues to be a priority. Combating these phenomena can be successful only if all countries truly join forces. Azerbaijan, which has had to confront these real threats to its sovereignty and territorial integrity, in particular from Armenian terrorism, considers itself an active participant in the fight against these evils. Azerbaijan welcomes the results of the Rome Diplomatic Conference to establish an International Criminal Court. We are convinced that an efficient, capable, independent and authoritative court will contribute to strengthening international cooperation for the effective prosecution and suppression of aggression, genocide and military crimes, which are the most heinous crimes constituting a threat to international peace and security. As a State that is experiencing all the sufferings and tragedy of aggression by Armenia, Azerbaijan is deeply interested in the establishment and effective functioning of international legal mechanisms for the prosecution of those responsible for the aforementioned crimes. There are fewer than 500 days remaining until the end of this century, and we have no time to relax, no right to rest on our laurels. Approaching the end of the historic nineties, the United Nations, bringing together both the prosperous States and those who have overcome numerous calamities but have gained their independence and stability, must take all necessary measures to justify the efforts already made and to achieve the objectives that have been set. Fulfilment of the tasks at hand and finding solutions to the problems we face constitute the baggage that this respected Organization and its Member States will take with them into the twenty-first century.