Ministry: Growth of budget expenditures no obstacle to maintaining single-digit inflation in Azerbaijan
Azerbaijan, Baku, June 2 / Trend N.Ismayilova /
The Azerbaijan Finance Ministry does not believe that the growth of budget expenditures and an increase in the country's wages will prevent maintaining a single-digit inflation rate, Deputy Finance Minister Azer Bayramov told reporters on Thursday.
"Based on the preliminary estimates, increases in wages are expected in all spheres. Naturally, the growth of budget expenditures along with salary increases, will affect the level of inflation," Bayramov said.
He said the main goal now is to reduce this impact to a minimum.
"I do not think that inflation rates will differ significantly from those projected. It will remain at a single-digit rate," Bayramov said.
The CBA predicts preservation of an annual inflation at 7-8 percent.
Consumer prices and tariffs for services in Azerbaijan decreased by 0.3 percent in April compared to the previous month. Inflation remained at 9 percent in January-April compared to the same period last year.
While food prices were reduced by 0.7 percent, monthly, tariffs for paid services rendered to the population and prices for industrial goods increased by 0.1 percent.
Food prices rose by 3.1 percent, non-food prices by 2.8 percent, and tariffs for services rose by 3.7 percent as compared to January-April 2010.
The average monthly salary in Azerbaijan amounted to 348.6 manat in January-April, which is 12.5 percent higher than the same period of 2010.
Under amendments to the Law on the 2011-state budget of Azerbaijan, the budget revenue forecast increased from 12.061 billion manat to 15.554.2 billion manat (an increase of 3.493.2 billion, or 29 percent), which means a 36.4-percent increase (4,151.2 billion manat) compared to the actual index of 2010.
The share of budgetary revenues in GDP is expected to increase up to 34.7 percent by late 2011, which exceeds the forecast by 4.7 percent and actual growth rate for 2010 by 7.3 percent.
Budget expenditures are projected at 15.941.2 billion manat (an increase of 3.193.2 billion, or 25 percent), which means a 35.5 percent increase compared to the actual index of 2010. The budget deficit is projected at 387 million manat, or 0.9 percent of GDP.