Baku, Azerbaijan, Aug. 20
By Anvar Mammadov - Trend:
Depreciation of the tenge rate in Kazakhstan will not cause a rise in prices for grain imported by Azerbaijan from this country, expert economist Farhad Amirbayov told Trend August 20.
He said that the foreign trade of Azerbaijan is framed in such a way that prices in contracts are fixed in foreign currency, and none of the parties undertakes currency risks.
"There cannot be any changes in the prices for grain, as the prices in the foreign trade contracts of Azerbaijan are set in the currencies of third countries, usually in US dollars," said Amirbayov.
"Therefore, the change in the tenge rate will not affect the price for grain exported to Azerbaijan."
Another expert, doctor of economics, former head of the pricing, economic and fiscal policy department of the Azerbaijani Cabinet of Ministers Oqtay Ahverdiyev told Trend that the depreciation of the tenge rate will not cause strong growth in grain prices that Azerbaijan imports from Kazakhstan, because grain prices are regulated not by Kazakhstan but the world grain market. At the same time he said that in case of increase in grain prices, the Cabinet of Ministers decides to exempt the imported grain from VAT, which allows regulating prices and preventing the rising cost of grain.
On Aug.20, Prime Minister of Kazakhstan Karim Massimov announced that Kazakhstan has launched a new monetary policy based on a free-floating tenge rate, and canceled the currency corridor. The weighted average rate of tenge fell to 255.26 tenge per dollar (from 188.38 tenge on Aug.19) on the Kazakhstan Stock Exchange (KASE) at the first trading after this announcement.
The trade turnover between Azerbaijan and Kazakhstan decreased by 2.76 times for the year and amounted to $63.64 million on the results of January-July 2015, according to the State Customs Committee (SCC) of Azerbaijan. At the same time, goods worth $56.06 million were imported, while $7.58 million worth goods were exported to Azerbaijan from Kazakhstan.
Edited by CN
Follow the author on Twitter: @Anvar_Mammadov