Baku, Azerbaijan, June 21
By Anvar Mammadov, Maksim Tsurkov – Trend:
There is rationality in Azerbaijan’s state budget, the World Bank Regional Director for South Caucasus Mercy Tembon said in an exclusive interview with Trend.
She was answering a question regarding the necessity to review Azerbaijan’s state budget due to the increase in oil prices.
“Defining the state budget is responsibility of [Azerbaijan’s] ministry of finance,” Tembon said. “And before they prepare it they take into consideration many things: revenue, expenditure, capital expenditures, investment and the current expenditure. Taking all of that in consideration they do prepare the project. I never doubt the judgment of the ministry of finance.”
In February 2016, Azerbaijani government reconsidered the state budget’s parameters taking into account the oil price of $25 per barrel due to the sharp decline in oil prices in the world markets.
But starting from the second half of April 2016, global oil prices began to rise gradually.
As of June 21, the price of Dated Brent oil, produced in the North Sea, was $48.8 per barrel. The price of Azeri Light crude oil rose to $50.8 per barrel.
According to the adjusted state budget, its revenues are projected at 16.822 billion manats (including centralized revenues of 16.056 billion manats and local revenues of 766.35 million manats) and expenses at 18.495 billion manats (including centralized expenses of 16.954 billion manats and local expenses of 1.541 billion manats).
The state budget deficit is expected to be 1.673 billion manats.
Samir Sharifov, Azerbaijan's finance minister, told reporters earlier that Azerbaijan does not plan to reconsider the state budget forecasts for 2016.
“Of course, the last year's experience showed that the fluctuations in the currency market, the pressure on the exchange rate, the sharp decline in foreign exchange reserves of the Central Bank of Azerbaijan force the government to collect a large amount of currency,” said the minister.
“Therefore, taking that into account, we must conduct a more frugal budgetary policy," added Sharifov.