SOFAZ not to cut expenditures
Azerbaijan’s oil fund SOFAZ has no plans to cut budget
expenditures for 2016, the fund told Trend.
“The budget of the fund, as well as the state budget, is approved
by the decree of the president of Azerbaijan in manats and is a
financial document, expenditures of which should be executed,” the
fund said. “In this regard, regardless of income level in the next
year, SOFAZ is obliged to fulfill the expenditure budgeted.”
The revision of the budget expenditures of the fund due to the fact
that expenditures of the SOFAZ are linked to expenditures of the
consolidated budget, the limit of which is approved by law on the
state budget, will be possible only in case of revision of the
state budget of the country, according to the fund.
The SOFAZ budget project has been submitted for approval to the
president of Azerbaijan. SOFAZ budget revenues for next year are
projected at 6.712 billion manats, expenditures – 8.261 billion
manats, including expenses for running the fund estimated at 24,420
million manats.
The structure of the fund expenditures includes transfers to the
state budget of Azerbaijan, expenses for the improvement of living
conditions of refugees, reconstruction of the Samur-Absheron
irrigation system, within the framework of the Baku-Tbilisi-Kars
railway project, expenditures for financing the state program on
education of Azerbaijani youth abroad, financing the state's share
in the projects of the Southern Gas Corridor and the construction
of the new generation drilling rig of SOCAR.
SOFAZ was established in 1999 with assets of $271 million.
Based on SOFAZ's regulations, its funds may be used for the construction and reconstruction of strategically important infrastructure facilities, as well as solving important national problems.
The main goals of the State Oil Fund include: accumulation of resources and the placement of the fund's assets abroad in order to minimize the negative affect on the economy, the prevention of "Dutch disease" to some extent, promotion of resource accumulation for future generations and support of current social and economic processes in Azerbaijan.
As of October 1, 2015, SOFAZ assets reduced by 6.38 percent compared to early 2015 ($37.1 billion) and were estimated at $34.74 billion.
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