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Azerbaijan's strategic currency reserves equated with state budget for two years

Business Materials 29 May 2011 17:00 (UTC +04:00)
The increase in transfers from the State Oil Fund of Azerbaijan Republic (SOFAZ) within the adjustments to the 2011-state budget at 41.7 percent (2.723.2 billion manat) up to 9.2 billion manat is an objective
Azerbaijan's strategic currency reserves equated with state budget for two years

Azerbaijan, Baku, May 29 / Trend I.Khalilova /

The increase in transfers from the State Oil Fund of Azerbaijan Republic (SOFAZ) within the adjustments to the 2011-state budget at 41.7 percent (2.723.2 billion manat) up to 9.2 billion manat is an objective, Accounting Chamber Chairman Heydar Asadov said during a discussion of a bill "On amendments to the Law on the 2011-state budget of Azerbaijan ".

"The Chamber's analysis confirms that dividends received from the placement of SOFAZ's assets on deposit in foreign banks, as well as bonds, are at a very low level and at times below the rate of appreciation of the value of the projects. In this regard, we regard as effective the funding of the urgent investment projects such as road construction, construction of schools - and other events, through the State Oil Fund," Asadov said.

He said the investment projects do not yield results immediately, as they are designed for the future generation, such as oil strategy, which was launched 18 years ago and brings benefits today.

"The main task of the government is to maintain the optimal level of the country's reserves. At a time of adopting the 2011-state budget in 2010, we decided on the conservation of SOFAZ's assets at about $ 29-$30 billion," Asadov said.

Asadov believes even if SOFAZ's transfers to the state budget increased, the preservation of this strip will be ensured by late 2011.

"This is a very high rate [SOFAZ's assets] and taking into account the reserves of the Central Bank of Azerbaijan, it is equal to the Azerbaijani state budget for two years. Therefore, we deem it appropriate to use SOFAZ's funds to finance infrastructure projects and other urgent measures, including social ones," Asadov said.

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