Inflation to reach 5% in Azerbaijan in 2015 - EBRD
Baku, Azerbaijan, Nov. 11
By Azad Hasanli - Trend:
The European Bank for Reconstruction and Development (EBRD) forecasts five percent inflation in Azerbaijan in 2015, Transition annual report said Nov. 11.
According to the Azerbaijani government's forecasts, the consumer prices will increase by 6.2 percent in 2015.
EBRD expects that inflation in Russia to reach 15.5 percent, Belarus - 15.1 percent, Tajikistan - 6.4 percent, Turkey - 7.5 percent, Ukraine - 50 percent, Turkmenistan - 6.9 percent, Uzbekistan - 8.8 percent, Kazakhstan - 6.8 percent, Egypt - 11 percent, Georgia - 3.5 percent, Kyrgyzstan - 8.5 percent, etc.
According to the bank, the diversification of the economy in Azerbaijan remains weak.
"Oil and gas is an important part of the country's economy, budgetary revenues and exports," the report said. "The diversification through the structural reforms aimed at the private sector becomes more important amid low oil prices."
EBRD said that the devaluation of the national currency increased the competitiveness, but also revealed the vulnerability of the financial and real sectors.
The bank stressed the existence of a strong liquidity buffer through the Central Bank's international reserves and assets of the State Oil Fund of the Azerbaijan Republic (SOFAZ).
According to the report, the total assets of the Central Bank and SOFAZ as of the first half of 2015 amounted to approximately 56 percent of GDP for 2014 and correspond to the volume of imports for 26 months. This is the sufficient protection against the risks of refinancing and foreign currency liquidity.