The Executive Council of the International Monetary Fund (IMF) reviewed the fifth survey on Azerbaijan in the framework of the poverty reduction and development of facility program (PRGF). The council approved fulfillment of commitments on criteria of pure international reserves, internal payments management, adoption of costs and revenues plans of the state enterprises in the framework of the annual budgetary process. The government of Azerbaijan has not applied with the inquiry for the last PRGF financing tranche, which could be produced on the results of the fifth survey (SDR 12,87 million or $18,8 million).
During the discussion the IMF deputy managing director, Agustin Carstens noted the prospect for doubling the growth tempo of the Azerbaijani economy since 2003. Meanwhile, the inflation tempo has also doubled, which is the response for the expansive development policy. The Azerbaijan’s government took important decisions on inflation decrease recently. In terms of the currency and monetary policy, the National Bank of Azerbaijan refused to support the manat rate and raised the discount rate, which is directed on the inflation stabilization till the year-end. The government is also ready to accelerate the structural reforms for diversification of the economy and ensure of macro-economic stability.
"In the future, reforms in tax and financial sphere, the quality of the corporate management and taxation of state enterprises, development of the business environment and management will be important”, Carstens noted.
The executive Council adopted PRGF on 6 July 2001 with the SDR budget of 80,45 million (about $117,7 million), which was reduced on 22 December 2004 to SDR 67,58 million. As the result, Azerbaijan realized only SDR 54,71 million (about $80 million). The PRGF funds are granted at the yearly rate of 0,5% for 10 years with the delay payment of 5, 5 years. The program will be completed on 4 July.