Azerbaijan doesn't agree with WTO on liberalization of foreign capital at local insurance market
The Azerbaijani Finance Ministry does not regard the liberalization of the participation of foreign capital at the local insurance market till 2010 as expedient. The World Trade Organization (WTO) proposes to Azerbaijan to exclude the item on possible participation of foreign insurance capital in correlation 49% to 51% from the Law on insurance, Baybala Khankishiyev, the head of the State Insurance Supervisory Division of the Finance Ministry, told Trend. It is impossible, as such step will lead to merging of local companies with big world insurance giants. The item will not excluded from the new version of the Law to be presented to the Parliament in 2006, he stressed.
According to Khankishiyev, insurance is considered as one of the profitable business branches, which annually gives around 400bn manats premium. The funds are put in the development of the economy and development of the country.
The liberalization will be possible after some progress in development of local insurance companies. The Ministry annually increases demand on statutory capital in this regard. At present the growth comprises 500m old manats per year, while the minimal statutory capital must comprise 5bn manats till 2010. The Supervisory Division does not plan to restrict itsel by it, as the more statutory capital, the more insurance risk.
The liberalization of the foreign capital at the Azerbaijani market was repeatedly raised by the United States at the Azerbaijani-U.S. intergovernmental working group.