Azerbaijan draws $1.4 bln direct investment, injects $4 bln abroad in Q1
By Gulgiz Dadashova
The Central Bank of Azerbaijan (CBA) has said the total amount of foreign capital in Azerbaijan in direct investments hit $1.4 billion in January-March 2013. The share of the oil and gas sector stood at 83.2 percent.
According to the balance of payments released by the CBA, the investments were mainly directed to financing the work carried out in the territory of Azerbaijan, particularly under the energy projects on the part of BP Exploration Ltd at the Shah Deniz gas field and the Azerbaijan International Operating Company (AIOC) on the Azeri-Chirag-Guneshli (ACG) block of oil and gas fields.
Azerbaijan is an important current and future supplier of both oil and natural gas. ACG and Shah Deniz are the country's largest hydrocarbon deposits, which are located in the Caspian Sea.
The country received $2 million in bonuses for oil contracts in 2012, against $20 million in 2011.
According to the CBA estimates, the volume of direct investments attracted to the non-oil sector totaled $238.1 million, accounting for 16.8 percent of the total amount.
The CBA reported that the share of oil and gas products in exports stands at 94.5 percent.
In January-March 2013, Azerbaijan exported $7.4 billion worth of petroleum products. The share of refined oil products totaled $0.4 billion, while oil exported by the country was worth $7 billion.
The AIOC produced oil products worth $6.6 billion of the total volume of exported oil. Other companies exported $0.4 billion worth of oil, of which $42.7 million fell to the share of condensate from the Shah Deniz field, and $332.5 million - to the share of the Azerbaijani state energy company SOCAR.
Total value of exports attributable to the non-oil sector amounted to $452.1 million, increasing by 28.6 percent over a year.
Azerbaijan's exports during the reporting period amounted to $8.3 billion.
The country invested $4 billion abroad in January-March 2013.
According to the balance of payments, the funds were formed through direct investments ($184.8 million), portfolio investment ($53.7 million) and other investments ($3.74 billion).
Other investments included trade loans and advances ($1.59 billion), loans and advances ($14.6 million) and deposits and cash ($2.13 billion).
During the reporting period, liabilities in the amount of $1.34 billion, of which $1.01 billion fell to portfolio investments, formed in Azerbaijan.
The analysis of the balance of payments by sectors shows that as in previous years, foreign trade operations in the oil and gas sector had a positive balance, while red ink was observed in the non-oil sector in January-March.
The total foreign trade turnover in Q1 2013 amounted to $10.7 billion, and the trade surplus made up $5.9 billion.
During the reporting period, trade relations were maintained with 125 countries. 9.4 percent of the trade turnover accounted for the CIS countries, and 90.6 percent - other foreign countries. Intensive trade relations were observed with Italy, the UK, Turkey, the United States, Russia, Thailand, Indonesia, Germany, Japan, and Taiwan. They accounted for 67.7 percent of export and import transactions in Azerbaijan.
In January-March, the current account surplus amounted to $4 billion or 13 percent less than in the same period last year.
Current account surplus of the oil and gas sector of Azerbaijan amounted to $5.8 billion.
However, according to the balance of payments, current account surplus of the oil and gas sector fully covers the current account deficit in the non-oil sector in the amount of $1.8 billion.
Overall balance of payments surplus amounted to $1.67 billion, a decline of 31 percent.