Azeri response to financial crisis adequate - Standard & Poor`s
Azerbaijan will focus on the extensive potential
opening up in the mid-term prospective, which will support the
current level of its credit rating, international rating agency
Standard & Poor`s has said in an analysis that praised the
country`s efforts to ward off the ill effects of the world
financial crisis.
The review said Azerbaijan is most likely to continue increasing its assets and use part of its oil revenues to finance key infrastructure projects in the middle term.
The agency presumes that foreign direct investments will continue to flow to Azerbaijan due to its sound relations with foreign investors. FDI hit $3.4 billion in 2008 but were at the level of only $1 billion in the first half of 2009. About $10 billion are expected to be invested in the project on ramping up production from the country`s giant Azeri-Chirag-Gunashli oil fields in the Caspian Sea. Also, FDI at a level of $20 billion, are likely to be injected into Phase 2 of the project on developing Azerbaijan`s largest gas field, Shahdaniz.
Standard & Poor`s analysts believe that external liquidity indicators are bound to improve as well.
"We believe that the level of foreign direct investment and loans directed to the oil sector and other raw material industries will remain decent, despite a crisis in the world economy. In our view, FDI are supporting Azerbaijan`s foreign liquidity and favorably affecting mid-term prospects for the development of exports and the Azerbaijani economy as a whole, notwithstanding the challenges that might emerge in the non-oil sector," the agency said.
Standard & Poor`s said Azerbaijan`s reaction to the global financial meltdown is fully adequate, particularly its measures on monetary policy and its financial system.
The report, therefore, said there is no threat that Azerbaijan`s credit rating will be reduced in the future, primarily due to increasing oil production and crude prices.
The review said Azerbaijan is most likely to continue increasing its assets and use part of its oil revenues to finance key infrastructure projects in the middle term.
The agency presumes that foreign direct investments will continue to flow to Azerbaijan due to its sound relations with foreign investors. FDI hit $3.4 billion in 2008 but were at the level of only $1 billion in the first half of 2009. About $10 billion are expected to be invested in the project on ramping up production from the country`s giant Azeri-Chirag-Gunashli oil fields in the Caspian Sea. Also, FDI at a level of $20 billion, are likely to be injected into Phase 2 of the project on developing Azerbaijan`s largest gas field, Shahdaniz.
Standard & Poor`s analysts believe that external liquidity indicators are bound to improve as well.
"We believe that the level of foreign direct investment and loans directed to the oil sector and other raw material industries will remain decent, despite a crisis in the world economy. In our view, FDI are supporting Azerbaijan`s foreign liquidity and favorably affecting mid-term prospects for the development of exports and the Azerbaijani economy as a whole, notwithstanding the challenges that might emerge in the non-oil sector," the agency said.
Standard & Poor`s said Azerbaijan`s reaction to the global financial meltdown is fully adequate, particularly its measures on monetary policy and its financial system.
The report, therefore, said there is no threat that Azerbaijan`s credit rating will be reduced in the future, primarily due to increasing oil production and crude prices.
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