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Non-oil deficiency of Azerbaijan to reach 5% of GDP by 2009 Ministry of Economic Development

Business Materials 27 June 2006 13:54 (UTC +04:00)

If today non-oil deficiency of Azerbaijan makes 14% of non-oil GDP and nearly 8% of total GDP, by 2009 this deficiency will be equal to 8% and 5%, respectively, Trend reports quoting Adalat Muradov, head of macroeconomic analysis department with the Ministry of Economic Development.

В"41% of Azerbaijans GDP and over 76% of the countrys export fall for oil sector. 34% of the state budget is formed from oil revenues. Lion share of investments is in oil&gas projects. But Azerbaijans future is linked to the non-oil sector, though its development will also depend on oil sector, i.e. on use of oil revenues that shall amount in total $140bn within 20 yearsВ", - Muradov said.

Foreign countries experience, he said, shows the smaller the country the higher the risk to use oil revenues inefficiently. To prevent such a misuse, Azeri government implements the long-term oil revenues use strategy approved in 2004 and lasting till 2025.

The basic principles of efficient use of oil revenues are the following:

- permanent actual expenses: Azerbaijan shall spend one amount each year till 2005;

- invariability of permanent actual expenses;

- account of non-oil deficiency

- transparence in oil revenues usage.

Muradov stated that the project financed from oil revenues shall be included in state investment program and approved in Milli Medjlis.

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