Azerbaijan, Baku / Trend corr U. Ismayilova, I. Khalilova / Changes in the investment policy of the State Oil Fund of Azerbaijan Republic (SOFAR) will only be possible after a year or two, the Executive Director of the SOFAR, Shahmar Movsumov , reported on the 7th of June.
The assets of the Fund are suggested to be divided into the following three parts,
- expenditures portfolio, which will be defined respectively to the budget of the Fund,
- stabilized and emergency situations portfolio,
- deposit portfolio intended for the future generation.
"Division of the portfolio will be possible only in the case that SOFAR has enough money. Today, our annual budget makes up some $1.2bln, while assets comprise $1.8bln. There is nothing in between. For this reason the project can be implemented only in a year or two," Movsumov said.
The aforementioned division of assets was suggested due to the expected increase in oil income within the next 2-3 years. A corresponding investment strategy is suggested to be developed due to this connection.
Funds from the 3rd portfolio will be intended for long-term investments (10 years) and shares. The portfolios which are intended for short terms may experience some changes.
Other oil funds (in Alaska, Norway) also make use of a similar practice.
In accordance with the acting investment policy, SOFAR can transfer up to 40% to management by foreign managers.