A WB Leading Economist: WB Forecasts Azerbaijan Inflation Growth at a Rate of 12-15% in 2007
According to the forecast of the World Bank (WB), in 2007, the growth of inflation in Azerbaijan may reach 12-15%, Cristian Petersen, WB Leading Economist for South Caucasus, said during the today press-conference, Trend reports. According to him, WB held a deep analysis in the issue on estimation of inflation process in Azerbaijan.
Expenditures of the State Budget are rapidly increasing, and that is extremely important in the reconstruction of the infrastructure and social services in the country. At the same time, it leads to the growth of money supply in the country, and in the last quarter of the year it has increased by 80%, said Mr. Petersen.
If to base upon the researches conducted by WB and the statistic model of research institutes, it will lead to inflation. However, I do not rule out that the inflation might reach 12-15% in the next year. That will depend on the growth of budget expenditures. On one hand, the rate of inflation, on the other the increase of output in the non-oil sector, reconstruction of the infrastructure, and the balance with the increase of budget expenditures, said the WB representative.
He expressed a confidence that if the inflation growth reaches an unexpected level, then the Government of the Country will take measures to suppress the growth.