Following a rise in the internal resources of the country the Azerbaijani government does not intend to take more credits, Trend reports quoting Avez Alekperov, the Azerbaijan Minister for finances, as stating on Friday in a presentation of the new website of the Ministry - www.maliyye.gov.az; www.finance.gov.az.
According to Alekperov, first it is planned to increase the state share in the international credits attracted under the state guarantees. Earlier due to limited capacities the participation shares in every project comprised 5-10% of its total value, while it is planned to increase it to 50%.
Though Azerbaijans foreign debts are comparably low than other countries debts and does not exceed 20% of the Gross Domestic Product (GDP), it is planned to reconsider a policy of attraction of foreign credits.
On the other hand, the government is eager to implement many projects at the expense of the internal reserves. The Azerbaijani government has taken took a decision to allot 310m euros in 2006 for the construction of module stations. Alakperov also didnt rule out a probability of repayment of some foreign debts ahead of schedule. They can be credits of the IMF, WB, whereas the public organizations, which received foreign debts under state guarantees, should themselves serve them. The IMF credits were repaid by 50% and now $212-215m is left to be repaid. These credits are very profitable, as they were allocated at 0.5% annual rates when the currency deposits in the foreign banks varies from 2% to 2.5% per annum. The WB credits are more profitable for the country due to its long-term character. They are allotted for 35- 40 years at the rate of 0.75% per annum. Therefore, we should first analyze how profitable it might be to repay them ahead of schedule. We still hold an idea that the internal resources of Azerbaijan will grow this year and therefore, it is possible to reconsider the structure of foreign loans and repay them. The essence of the common strategy is that the foreign debts must not be regarded as easy one and it is necessary to hold deep analysis prior to attracting funds. They should be taken only for strategically important projects, in particular, infrastructure projects, the Minister underlined.
Benefit of the foreign credits is that international tenders are held and the international financial institutes are interested in the use of better approach and experience. In general, the Minister estimated the situation with the foreign loan as good. In some countries the special weight of the foreign debt in the GDP is reaches even 70-80%, while in Azerbaijan it comprises 15-16% and never exceeds 19%.
