Public budget of Azerbaijan (January-August 2015)

The deficit of the Azerbaijani state budget amounted to 127 million manat (0.4 percent of GDP) in January-August 2015. The state budget was executed with a surplus of 938.4 million manat in the same period of 2014.

The state budget has been executed with a deficit for the sixth month. The state budget was executed with a surplus of 421.6 million manat in January or 11.6 percent of GDP.

It increased by 16.9 times compared to the same period of 2014. The surplus amounted to 80.1 million manat in January-February or by 61.8 percent more than last year.

The deficit of the Azerbaijani state budget amounted to 251 million manat in January-March 2015 compared to the surplus worth 108.4 manat in 2014, the deficit worth 822.5 million manat in January-April compared to the surplus worth 402.6 million manat, the deficit worth 905.8 million manat in Janaury-May compared to the surplus worth 654.5 million manat, the deficit worth 770.9 million manat in January-June compared to 615 million manat, the deficit worth 595.7 million manat in January-June compared to the surplus worth 774 million manat.

The actual income in the revenue part of Azerbaijan's state budget amounted to 10.67 billion manat in January-August 2015, which is 14 percent less than in the same period of 2014.

The state budget expenditures decreased by 5.9 percent and amounted to 10.79 billion manat.

Some 42.8 percent (4.57 billion manat) in the structure of revenues were ensured through the Ministry of Taxes. The Azerbaijani State Customs Committee transferred 1.02 billion manat (9.6 percent) to the state budget.

The tax revenues reduced by 5.8 percent, while customs deductions increased by 2.2 percent per annum.

Some 42.9 percent or 4.63 billion manat in the structure of budget expenditures accounted for the expenditure connected with the economic activity or by 8 percent or 404.8 million manat less than in the same period of last year.

Some 3.95 billion manat of this amount (a 6.6 percent decrease) was allocated to the sphere of industry, construction and minerals, 266.5 million manat (a 17 percent decrease) - agriculture, forestry and environmental protection.

Some 11.7 percent (1.26 billion manat with 2.1 percent decrease), health care costs - 3.7 percent (403.8 million manat with a 0.5 percent growth) accounted for the social security and protection costs in January-August 2015.

The state budget revenues for 2015 were approved in the amount of 19.438 billion manat, expenses - 21.1 billion manat. The budgetary projections have been formed upon an oil price of $90 per barrel.

Execution of public budget in January-August 2015

Source: State Statistics Committee and Ministry of Finance

· Review of construction sector in Azerbaijan (January-August 2015)

Some 64.8 percent of the total volume of construction work accounted for primary construction, reconstruction and expansion, 17.4 percent - overhaul, 5.5 percent - current repair and 12.3 percent - other construction work.

Around 130,300 square meters of housing were commissioned in August 2015 compared to 168,835 square meters in July. Around 11,639,500 square meters of housing were commissioned in January-August or by 2.1 percent more than in the same period of 2014 (1,145,500 square meters).

Housing market

According to MBA Group consulting company, the Azerbaijani real estate market faces stagnation. No transactions are carried out. Currently, the Azerbaijani real estate market actually took a wait-and-see attitude, which is primarily connected with the fall in oil prices.

These two areas are closely related to each other. So, the decline in oil prices causes a reduction in real estate prices. But real estate prices can not fall forever. So, stagnation is observed on the market. But if oil prices continue declining, then the real estate prices may fall below the prime cost. This will completely stop the construction operations and paralyze the market.

Baku's real estate market as a whole decreased by 10 times compared to the same period of last year. Some 50 transactions were conducted on the real estate market in August 2014, but 5-6 transactions this year. In general, one can expect slight activity on the real estate market in the second half of September.

The slight activity was observed on the rental market, which is associated with the beginning of the school year. The reason is that the students admitted to the higher educational institutions are coming from Azerbaijani regions to Baku. This slightly affected an increase in the cost of rental housing. In August, the cost per square meter of rental housing increased by 5-6 percent. The prices per square meter of rental housing decreased by 30.26 percent in dollar equivalent during a year (from $12.03 to $8.39 per square meter). The prices reduced by 3 percentage points - from 9.4 to 9.12 manat per square meter in manat equivalent.

Table of secondary housing prices in different parts of Baku

The extended table of average prices per square meter of housing has been prepared on the basis of the data of the "Expert real estate center" LTD. The prices are set as of August 2015 and indicated in manat.