BAKU, Azerbaijan, Aug. 9
By Eldar Janashvili - Trend:
The most significant event in the field of finance in Azerbaijan this week was the recalculation of the budget parameters of the state budget by the Ministry of Finance, as well as subsequent proposals on amendments to it and their further adoption in the third reading of Azerbaijan's Parliament, Trend reports.
Thus, in connection with the worldwide coronavirus pandemic (COVID-19) and other world events that led to a drop in global demand for oil and its cost reduction, the execution of the state budget became less and less consistent with the forecast of its execution, calculated on the basis of the oil price of $55. Accordingly, on August 3, the budget parameters were revised and began to proceed from the new average oil price of $35.
According to the new indicators, when the budget parameters are recalculated based on the forecast of the average annual oil price of $35 for 2020, the expected expenditures of the consolidated budget and the transfer from the State Oil Fund of Azerbaijan (SOFAZ) to the state budget will decrease by about 2.5 billion manat ($1.4 million) each or by 8.4 percent and 21.7 percent, respectively.
In addition, the revenues and expenditures of the State Social Protection Fund of Azerbaijan were revised, which, according to the new approved forecast, will decrease by 40.8 million manat ($24 million) - to 4.78 billion manat ($2.8 billion), and the income and expenditure of the Unemployment Insurance Fund - increase by 238 million manat ($140 million), to 151.2 million manat ($88.9 million) through investments. It was determined that the Ministry of Finance will allocate 600 million manat ($352.9 million) for the implementation of support programs within amendments to the state budget.
The planned changes in the state budget will be ensured as a result of optimization, and will not have any negative impact on the population, especially amid the fact that all the planned social projects will be implemented strictly in order.
At the same time, precious metals and currency began to rise in price in Azerbaijan. The euro exchange rate for the first time since May 18, 2018 crossed the mark of 2 manat, and the prices for gold and silver broke historical records altogether - gold came close to the mark of 3,500 manat ($2,058) per ounce, and silver - to the mark of 50 manat ($29.4) per ounce.
Also this week, the volume of strategic foreign exchange reserves of Azerbaijan, which amounted to $51.1 billion, and turnover at the Baku Stock Exchange (BSE), more than half of the transactions of which fell on government securities, and about two-thirds of turnover - on the Pasha Capital investment company, became known.
(1 USD = 1.7 AZN on Aug. 9)