IMF expects no budget-related challenges
An International Monetary Fund representative has
said there were no challenges in store with the execution of
Azerbaijan`s budget next year.
"The government proceeded very cautiously in drafting the 2009 state budget. We believe this budget is stable, and believe that Azerbaijan will confidently meet its obligations in 2009," said Valeria Fichera, who heads an IMF budget mission on its week-long visit to Baku.
According to Fichera, the Fund experts have concluded that the South Caucasus republic`s execution of the 2008 budget was satisfactory. She also dispelled some concerns that setting the oil price at $70 a barrel in the 2009 state budget, which has already been approved, could cause problems for the Azerbaijani economy.
"This figure was estimated at this level because the prices were high when the budget was being drafted. Many think that this may cause a budget deficit. However, the funds transferred to the budget from the State Oil Fund [the body that holds revenues from the exports of oil] are sufficient to compensate the shortfall," Fichera said.
She called the policy of the Azerbaijani government on Oil Fund contributions as normal. "Only if oil prices remain at $30-40 over three years will a need arise to adjust this policy."
Further, the IMF executive noted that the global economic crisis could reduce inflation in Azerbaijan.
Also, the IMF predicts that the Azerbaijani economy will grow by 12% in 2009, while inflationary levels are expected at 9%. In the non-oil sector, the growth will make up 6% with agriculture accounting for most of the increase, according to the projections.
"The government proceeded very cautiously in drafting the 2009 state budget. We believe this budget is stable, and believe that Azerbaijan will confidently meet its obligations in 2009," said Valeria Fichera, who heads an IMF budget mission on its week-long visit to Baku.
According to Fichera, the Fund experts have concluded that the South Caucasus republic`s execution of the 2008 budget was satisfactory. She also dispelled some concerns that setting the oil price at $70 a barrel in the 2009 state budget, which has already been approved, could cause problems for the Azerbaijani economy.
"This figure was estimated at this level because the prices were high when the budget was being drafted. Many think that this may cause a budget deficit. However, the funds transferred to the budget from the State Oil Fund [the body that holds revenues from the exports of oil] are sufficient to compensate the shortfall," Fichera said.
She called the policy of the Azerbaijani government on Oil Fund contributions as normal. "Only if oil prices remain at $30-40 over three years will a need arise to adjust this policy."
Further, the IMF executive noted that the global economic crisis could reduce inflation in Azerbaijan.
Also, the IMF predicts that the Azerbaijani economy will grow by 12% in 2009, while inflationary levels are expected at 9%. In the non-oil sector, the growth will make up 6% with agriculture accounting for most of the increase, according to the projections.
Here we are to serve you with news right now. It does not cost much, but worth your attention.
Choose to support open, independent, quality journalism and subscribe on a monthly basis.
By subscribing to our online newspaper, you can have full digital access to all news, analysis, and much more.
Subscribe
You can also follow AzerNEWS on Twitter @AzerNewsAz or Facebook @AzerNewsNewspaper
Thank you!