The International Monetary Fund (IMF) allows changes in forecasts by the National Bank of Azerbaijan (NBA) on inflation in 2007 with the consideration of a resolution on Tariff Council on increase of prices of communal services and energy resources.
Basel Zavoico, the IMF Baku Office Head, exclusively informed Trend that it would be very difficult for the Government of Azerbaijan to achieve a single-digit inflation ratio this year.
The National Bank of Azerbaijan (NBA) usually does not include into the calculations the prices of foodstuff and administratively regulated prices while forecasting and targeting the inflation processes, because they fluctuate and the NBA cannot foretell the Government's actions for next year. So, the NBA did not take into consideration rise prices while forecasting growth pace of consumer prices, but two-digit inflation is inevitable, Zavoico stressed.
The increase of tariffs and their impact on inflation and public budget will be on focus of discussions during the February mission of IMF headed by Deputy Director IMF Department for Near East and Central Asia, he added.
During the previous visit to Baku in September 2006 Mr. Kramarenko forecasted two-digit consumer inflation in Azerbaijan even in 2006. IMF assets that the public expenses with 6-month delay actually affect on inflation ratio. Therefore, fiscal outcomes of the 2006 public budget will demonstrate the results in mid 2007, even not mentioning the impact of the current price rise.