Experts: Azerbaijan's joining TL-zone - unpromising

Experts: Azerbaijan's joining TL-zone - unpromising

Azerbaijan, Baku, Nov. 1 / Trend I.Khalilova /

It is unlikely that any country will agree to enter a group of countries to create a common currency zone, the head of the Azerbaijan Bank Training Center Javanshir Abdullayev told Trend on Thursday, commenting on yesterday's statement of Turkish Prime Minister Recep Tayyip Erdogan on plans to create a TL-zone which will be an alternative to the euro zone.

"All around the world there is the only practice of creating the euro zone, which wasn't successful. Countries in the euro area still can not come to agreement on a common tax and budget policy. Today, the only adjustable policy is monetary, which is not enough to regulate all the economic relations in the European Union, "Abdullayev said.

He said, based on this practice it is unlikely that any currency, which will become convertible, can be introduced as a single for the group of countries in the near future.

However, he thinks, provided creation of a balanced trade and payments balances, the use of national currencies in trade relations between two countries is promising.

"If these relations are not balanced, and the currency is inconvertible, it can cause serious problems," Abdullayev said. "So, a balanced trade and payment transactions are required for functioning of this system."

Azerbaijan received an offer to join the Eurasian Economic Community (EEC) and other organizations, but the country refused to participate in such associations.

Five countries have been EEC member states since the signing of the agreement on the creation of EEC on October 10 2000 in Astana.: Belarus, Kazakhstan, Kyrgyzstan, Russia and Tajikistan

A protocol on accession of Uzbekistan to the organization was signed on January 25 2006 . Since May 2002, Ukraine and Moldova have a status of EEC observers, Armenia received an EEC observer status in January 2003.

The Counselor of the Turkish Economy Minister Alparslan Uymaz told Trend on Thursday, that according to the project of TL-zone creation, the trade transactions among the member countries in the zone will be carried out in ​​Turkish liras.

"Along with the local currency, the countries joining the TL-zone, will be able to trade with each other in liras," Uymaz said.

However, according to other Azerbaijani experts, the situation in foreign trade, when the share of the euro in importing countries is growing, and euro depreciates against the manat, is advantageous for Azerbaijan. Thanks to the interventions, the Azerbaijani manat continues annual trend of strengthening against the major currencies, the dollar and the euro.

And experts even do not exclude the probability of Azerbaijani Central Bank intervention in euro. [Today CBA intervention in the foreign exchange market of the country is carried out through manat and dollar interventions].

The Central Bank made the transition to the maintenance cost of the Azerbaijani manat march 11, 2008, by introducing a currency basket of U.S. dollar and euro. The structure of the basket in 2008 was determined at a ratio of 70 to 30 percent in dollars and euros, respectively. and in 2010 it was changed and defined in a ratio of 90 to 10 percent in dollars and euros, respectively.

This suggests that the central bank of the country continues to take steps to preserve the stability of manat, and the entry into a single currency zone on this background is unpromising for Azerbaijan.

Today, Azerbaijan's export operations in the vast majority are held in dollars, the euro's share is gradually increasing in imports. However, domestic banks virtually don't carry out transactions in euros because of the instability of the euro in the past two years.

"Given this situation, the question of entering of Azerbaijan into TL-zone or another currency area is not relevant. Besides the financial impact of the Turkish authorities on Azerbaijan is slight, and the use of the Turkish lira in the calculations still did not specifically discussed, we in fact do not need it as Azerbaijani manat is much stable than Turkish lira, at least for now.

Cooperation in other areas of financial activity also isn't discussed," the expert said.

According to them, this idea may be relevant to Azerbaijan in case of an active joint stock operations. And it is impossible for our securities to get on the Istanbul Stock Exchange unlike the Moscow Interbank Currency Exchange. Although the Istanbul Stock Exchange is a shareholder of BSE, it is a formality, since it does not consider the volumes of Azerbaijani stock market so serious, experts say. It is explained by the fact that the annual turnover of the Baku Stock Exchange accounts for two-day turnover of Istanbul Stock Exchange. Turkish investors can enter Azerbaijani stock market in case of quotation of strategic enterprises' shares, whereas today mainly emission shares of banks and insurance companies to raise capital are placed through the trading system of the stock exchange.

Furthermore, the impact of the global financial crisis on the economy and the banking system in Turkey was much stronger, while the Azerbaijani economy has only its consequences. This factor also speaks about the inexpediency of Azerbaijan's entering the TL-zone.

Subscribe to Trend in Google News! Subscribe
Weekly actual topics in Azerbaijan (April 16-20)
Weekly actual topics in Azerbaijan (April 16-20)
Weekly tenders in the region (April 16-20)
Weekly tenders in the region (April 16-20)
Last week’s laws, orders and decrees in Azerbaijan (April 16-20)
Last week’s laws, orders and decrees in Azerbaijan (April 16-20)
Loading Bars
India better placed to meet challenges: Ram Nath Kovind
Iranian president expresses openness to direct talks with US
Azerbaijan's MFA congratulates India on occasion of India's Republic Day
Azerbaijan's TABIB recommends booster COVID-19 vaccination to further strengthen immunity
Azerbaijani defense minister continues official visit to Iran (PHOTO)
No one should doubt that new legislation on media in Azerbaijan will meet modern developments - Azerbaijani Media Dev't Agency
Azerbaijan's Rabitabank discloses net profit for 2021
SOCAR’s production union overfulfills production plan
Armenian PM Pashinyan tests positive for COVID-19
Iran reveals trade turnover with Caspian Sea countries
Hualing FIZ CEO talks new projects launched in 2021 (Exclusive)
SOCAR Carbamide’s revenues grow six-fold
STAR Refinery, Petkim see significant increase in recycling rate
Turkmenistan's Halkbank opens tender for audit
Russian companies submitted 14 applications for participation in restoration of Azerbaijan’s liberated territories - ambassador
SOCAR Turkey talks on prospects for new line of production at Petkim
Baku preparing to host FIG Trampoline Gymnastics World Cup
Uzbekistan notes overall increase in exports within 2021
Ambassador Bocharnikov talks increased number of Russia-Azerbaijan flights
Remains of Armenian soldier found in Azerbaijan’s liberated Jabrayil district
Moscow shares Azerbaijani President Ilham Aliyev's approach, vision on trilateral working group - ambassador
Kazakh project for copper-gold deposit dev't may receive nuclear-powered icebreaker
Ambassador talks expected visits of Russia's businessmen to Azerbaijan
Bank of Georgia allocates funds to local shoemaking company for exporting goods to US
Russian ambassador talks upcoming 20th anniversary meeting of Russia-Azerbaijan intergovernmental commission
Russian ambassador assesses work of LUKOIL in Azerbaijan
Turkmenistan's Turkmenhimiya to buy equipment via tender
Meetings of Azerbaijani, Armenian public figures to contribute to normalization of ties – Russian ambassador
Russian ambassador talks trade-economic cooperation between '3+3' countries (PHOTO)
Turkmenbashi oil refineries extends tender for hydrogen production unit construction
Russian ambassador comments on possibility of Azerbaijan joining EAEU
India Emerges as a Global Actor during the Pandemic Crisis
Russia highly appreciates Azerbaijan's position on normalization of regional situation - ambassador
Uzbek Commodity Exchange announces weekly quotes of commodities for export
Georgia’s Hualing FIZ to sign agreement on area expansion (Exclusive)
S.Korea's daily COVID-19 cases surge as new testing scheme begins
Uzbekistan proposes initiative to ensure free trade
Volume of Russian investments in Azerbaijan unveiled - ambassador
Blast in Greek capital damages buildings, one injured
JV in Kazakhstan to engage electric engine repair services via tender
Kazakhstan’s oil producing company opens tender to remove hazardous drilling waste
Kazakhstan’s vice minister of ecology, head of "Operator ROP" company detained
Turkmenistan launches unified trading platform for entrepreneurs
Azerbaijan discloses districts with highest cotton yield
Power outage in Uzbekistan leads to decrease in gas production
Kazakhstan shares data on Samruk-Kazyna Sovereign Wealth Fund's debt
Axpo Holding places first sustainability-linked bond
Azerbaijani oil prices up
Uzbekneftegaz JSC resumes operation of its enterprises and plants following large-scale blackout
‘Nar’ takes the title of Azerbaijan champion (PHOTO)
Georgia reports new record high COVID-19 cases
Germany to support development of Azerbaijan's private sector
Turkmenistan ready to boost natural gas supplies to China
Uzbekistan's Tashkent Metro resumes operations
Kazakhstan introduces anti-terrorist operation regime in Almaty's district
ITU talks areas of cooperation with Turkmenistan
Azerbaijan proves to be reliable partner in large scale energy projects – GECF
Azerbaijan to export saffron to Arab countries
Russian stocks open higher on Wednesday
Azerbaijani Central Bank receives ISO/IEC certificate on information security management
Liabilities of Georgia’s commercial banks up
Azerbaijani currency rates for January 26
Azerbaijani transport, communications sector lending down in 2021
Azerbaijan records increase in number of loans issued in trade and service sector
Azerbaijan preparing bill to further strengthen material and technical base of armed forces
IGB joins PRISMA platform
Volume of problem loans decreases in Azerbaijani banks in 2021
Subsidies for poultry farms to increase in Uzbekistan
Oil dips on profit-taking ahead of Fed update
Iran to support women's empowerment plans
Peru PM tests positive for COVID-19
Georgia, Poland to co-op in railway sector under EU-funded project
U.S. Coast Guard searching for 39 missing off Florida
Turkey confirms 76,341 daily COVID-19 cases
US approves major arms sale to Egypt
Scientists take aim at Omicron
U.S. House Speaker Pelosi announces reelection bid in 2022 midterms
James Webb Space Telescope reaches observation post a million miles from Earth
Microsoft offers strong forecast, lifting shares
Americans need to lift sanctions before call for direct talks
Over 10 mln children in U.S. infected with COVID-19
Number of COVID-19 cases worldwide exceeds 350 mln
Qatar's emir to visit Washington on Jan. 31
Airbus to create own airline to rent out whale plane
Closure of Istanbul Airport extended
White House says Biden is open to engaging with Putin but no talks are planned
Kazakhstan unveils foreign trade structure with EAEU countries for 11M2021
Israel's president says to make "historic visit" to UAE
Uzbekistan sets up government commission to study major power outage
IMF downgrades 2022 global growth forecast to 4.4 pct amid Omicron surge
Turkey starts giving Turkovac as booster shot to BioNTech recipients
Azerbaijan, Iran discuss prospects for development of military cooperation (PHOTO)
Azerbaijan Defense Minister meets with Chief of General Staff of Armed Forces of Iran (PHOTO)
Pfizer, BioNTech start clinical trial of Omicron-specific COVID-19 vaccine
Number of infections with Omicron COVID-19 strain keeps growing in Azerbaijan
Azerbaijan's servicemen honor memory of martyrs in Dashalty village of liberated Shusha - Trend TV (PHOTO/VIDEO)
Embassy of India in Baku celebrates National Tourism Day as part of 73rd Republic Day of India and 75 years of India’s Independence (PHOTO)
Bridge construction over Astarachay River to be funded by Iran and Azerbaijan - Iranian minister
Iran's foreign trade increases
New bridge construction over Astarachay River to promote freight traffic growth
All news