Chief priorities of 2014 budget known in Azerbaijan

Source: AzerNews

Azerbaijan developed rapidly over the first six months of 2013 and high economic indicators were recorded in the fast-growing South Caucasus republic.

The gross domestic product grew by 5 per cent and the non-oil sector grew by almost 11 per cent, which provides grounds to say that the country will achieve the goal of doubling the non-oil sector over the next 10 years, Finance Minister Samir Sharifov said at a board meeting on July 31.

Sharifov said modernization and diversification of the economy, further improvement of the investment climate, increase of revenues from taxes and duties, as well as the objectives of the Development Concept "Azerbaijan 2020: A Look into the Future" will be the key areas upon which the state budget projections will be focused for 2014 and the following three years in Azerbaijan.

"The social policy, which is considered one of the priorities of budget expenditure, will be continued in 2014. Also, financial provision will be created to improve the well-being and living standards of the population, increase the country's defense capabilities, strengthen the energy potential, build modern systems of water and gas supply, sewage and irrigation, rural roads, ensure agricultural development and food security, implement social and investment programs," the minister said.

Sharifov suggested that structural subdivisions of the ministry take a conservative approach in forecasting expenditure, taking into account the real financial potential of the state budget. He also instructed local authorities on the timely completion of the process of the formation of the state budget and to submit budget drafts.

Also, local authorities were instructed to ensure stable financial performance of the 2013 state budget, effective use of resources, and improve the level of primary control, and provide the budget drafts after analyzing data on the revenues and expenditures of districts and cities for 2014 and the following three years.

"Over the past 10 years the country's nominal GDP grew 7.6 times, and in some years the real growth reached 34.5 percent. As a result of compliance with the principles of the market economy, liberalization of the economy, stimulation of the development of the non-oil sector, the private sector's share in GDP increased from 73.3 percent to 83.5 percent. $100 billion has been invested in the country's economy from all sources," Sharifov said.

According to Sharifov, over the past 10 years the consolidated budget expenditures increased 13-fold and expenses per capita - 11.6 times. State budget spending increased by 14.1 percent -- from 1.2 billion manats to 17.4 billion manats -- and the share of GDP was 32.3 percent, with an increase of 15 percent. During the mentioned period, nominal income of the population increased by 29 billion manats, or more than six-fold, reaching 34.7 billion manats in 2012.

"All these achievements have created confidence in further continuation of the purposeful policy on the management of public funds through the state and consolidated budgets, through the improvement of the fiscal and taxation policy," he said.

The state budget revenues in 2013 are expected to amount to 19.159 billion manats and expenses are projected at 19.85 billion manats.

The limit of the budget deficit was set at 691 million manats, while that of the internal debt at 133.35 million manats, and external debt at 647.336 million manats.

Revenues of Azerbaijan's budget in 2012 amounted to 17.282 billion manats, and it was executed by 101.4 percent, which is 10.1 percent over 2011.

The share of budget revenue in GDP amounted to 32 percent, which is 1.9 percent more than in 2011.

In 2012, within the implementation of the state budget, stable financing of all the envisioned projects, in particular, social financing -- pensions, salaries, allowances, etc. -- was carried out.