Details added (first version posted on 16:21)
Baku, Azerbaijan, Nov. 30
By Anvar Mammadov – Trend:
The deficit in Azerbaijan’s payment balance will amount to $5 billion in 2016, Elman Rustamov, chairman of the country’s Central Bank (CBA), said.
He made the remarks Nov. 30 during a discussion on the draft state budget and the concept of social and economic development for 2017 and the next three years.
The discussions on the draft state budget began Nov. 30 at a joint session of Azerbaijan’s parliamentary committees on defense, security and fight against corruption, economic policy, industry and entrepreneurship, agricultural policy, public unions and religious structures, as well as natural resources, energy and ecology.
Rustamov said the biggest part of deficit of Azerbaijan’s balance of payments, that is 88 to 90 percent, is associated with problems in the capital flow balance.
“It cannot be said that the balance of payments has been fully adapted to the new, lower oil prices,” Rustamov said.
The CBA head added that many problems are associated with the past and current debts.
“There are accumulated problems in the form of companies’ loans attracted under state guarantees, as well as external debts of the International Bank of Azerbaijan, and we have to repay all of them,” said Rustamov.
“In general, there is a problem with accumulated debts, which currently has a major impact on the market,” Rustamov noted. “On the other hand, we are implementing the giant international project, the Southern Gas Corridor, and Azerbaijan’s government has to use its own financial resources with regard to it. This all affects the component of the balance of payments relating to the capital flow balance.”
He said the exchange rate policy of Azerbaijan’s Central Bank is aimed to neutralize the impact of these problems on the current account balance.
The current account deficit of Azerbaijan's balance of payments amounted to $801.9 million in January-June 2016. The current account surplus of Azerbaijan's oil and gas sector stood at $2 billion in January-June 2016.