When key executives at Global Infrastructure Partners met with Azerbaijan’s president, Ilham Aliyev, in Baku on 8 December last year, deepening their burgeoning relationship was top of the agenda.

Adebayo Ogunlesi, GIP’s chairman and CEO, told Aliyev that he was interested in collaborating with Azerbaijan On.Energy transition, transport, and digital infrastructure. They also discussed “cooperation on international initiatives” such as artificial intelligence technologies.

The meeting took place amid a flurry of deals between the mega manager and the oil rich state that are creating a fast-developing partnership.

The meeting shines a light on growing capital flows from the region into the infrastructure finance sector as a whole, including commitments, direct investments and co-investments. It also took place at a time of geopolitical change in the region, evidenced by growing US ambitions in Azerbaijan and neighbouring countries

Over the years there has been little evidence of Azerbaijan investing alongside or into infrastructure funds. Azerbaijan’s State Oil Fund of the Republic of Azerbaijan (SOFAZ) has invested in several infrastructure and energy projects spanning oil and water pipelines, social housing and railway lines, but only domestically and in neighbouring countries like Georgia and Turkey. Back in 2013 it agreed to commit some USD 200m to the IFC Global Infrastructure Fund.

International expansion

All this changed recently. Last summer, SOFAZ bought a minority stake in a 402 MW portfolio of solar assets in Italy owned by Enfinity Global, a renewables developer owned by Intermediate Capital Group with operations in the US, Europe and Asia. Arjun Infrastructure Partners had competed earlier in the process.

Since then, the USD 70bn oil fund has agreed a string of deals with infrastructure funds, including snapping up smallish stakes in Gatwick Airport and Italian high speed rail operator Italo from GIP, and also partnering with CVC DIF to invest in a co-investment vehicle for its UAE district cooling platform PAL Cooling Holding.

SOFAZ, meanwhile, is also looking further to the future, including considering investing USD 1.4bn over the next four years in infrastructure projects managed by Brookfield. Also, on the heels of that 8 December meeting with Ilham Aliyev in Baku, SOFAZ agreed on the sidelines of the January 2026 Davos summit in Switzerland to invest up to USD 1.5bn in digital and infrastructure projects alongside GIP.

Meanwhile, several European mid-market infrastructure managers told Infralogic that have had their first calls with SOFAZ in recent weeks.

SOFAZ is clear about its pivot to infrastructure, with a source close to the fund saying that it is “increasing its focus on infrastructure as part of its long-term portfolio diversification strategy”.

In a similar vein to its deals with Brookfield and GIP, it is “actively exploring partnerships with a broad range of global infrastructure managers”, the source close said, adding these include “both established large-scale platforms and select mid-market opportunities”. SOFAZ may also look to “broaden its manager relationships and sector exposure over time”, said the source.

Its “engagement” with infrastructure managers reflects SOFAZ’s “disciplined approach to accessing long-term, stable, and inflation-linked return profiles across geographies and sectors”, said the source, adding that its strategy is “globally orientated”.

SOFAZ’s deputy CEO, Rovshan Javadov, told Euronews recently that “our strategy is to diversify our investment portfolio and investment in renewables plays an important role in this strategy.” Renewables, he added, “offers sometimes good and sometimes predictable and stable cashflows” and they also “help us to reduce risk in terms of oil price volatility”. The fund also invests in digital infrastructure and “networks” as doing so helps it to build a “more resilient and stable portfolio”.

Azerbaijan’s economic situation is meanwhile improving, not least on the back of the ending to longrunning hostilities between Azerbaijan and neighbouring Armenia, giving it more scope to invest abroad.

S&P, which last December upgraded Azerbaijan’s rating to BB+ from B and revised its outlook to positive, highlighted that SOFAZ’s assets are expected to exceed external debt until 2028, a typical indicator of long-term fiscal health.

But Azerbaijan’s growing ties with infrastructure funds look deeper than just balancing portfolios. GIP-backed container terminal giant, Terminal Investment Limited (TIL), agreed to acquire last September a 50% stake in SOCAR Terminal, a container terminal in Izmir, Turkey from SOCAR, the Azerbaijani state oil company.

TIL clearly has strong strategic interests in Turkey, where it also owns stakes in container terminals at the ports of Asyaport, İskenderun and the Ambarli Port Complex in Istanbul. “TIL is in a strong position to bolt on mid-sized terminals such as the SOCAR Terminal into their existing portfolio,” said Eleanor Hadland, a senior associate at maritime consultancy Drewry.

Road TRIPP

On the heels of this agreement, in January the US’ State Department launched plans for a new 43km rail and road route, dubbed the Trump Route for International Peace and Prosperity (TRIPP), linking Azerbaijan with Armenia. Bypassing Iran and Russia, the US hopes for TRIPP to serve as a new East-West trade axis connecting the Caspian Sea directly to Turkey.

All this took place around the same time that GIP was forging its own early ties with Azerbaijan leadership. Similarly, a consortium led by TIL and BlackRock last year agreed to acquire a 90% stake in the Panama Ports Company from CK Hutchison as part of a much broader USD 22.8bn deal. This followed pressure from US President Donald Trump over Hong Kong-based Hutchison’s alleged Chinese influence on the Panama Canal.

SOFAZ’s position is that its move into infrastructure is “part of a structured portfolio allocation process, rather than a response to short-term macroeconomic or geopolitical factors”, according to the source close to the fund.

Either way, the oil fund’s interest in infrastructure might well cascade eastwards into central Asia. Indeed, BlackRock is among cornerstone investors in the London listing of the Uzbekistan National Investment Fund (UzNIF).

UzNIF has since its launch last year been managed by Franklin Templeton, marking the US fund manager’s own foray into this region.

2025 was the year infrastructure funds focused on Middle East opportunities. This year they could do worse perhaps than booking a trip to Baku.

Brookfield, CVC DIF, ICG and SOFAZ declined to comment. The Government of Azerbaijan, GIP and SOCAR did not respond to requests for comment.