TODAY.AZ / Business

Debt management strategies to be drafted

30 December 2016 [16:22] - TODAY.AZ
By Azernews


By Nigar Abbasova

Azerbaijan’s Cabinet of Ministers will prepare a draft of medium- and long-term strategies on public debt management in 2017. Under the presidential decree the Cabinet is entrusted with preparing of the draft strategies and submitting it to the head of state within six months.

Some 1.642 billion manats will be spent to service public debt in 2017. The figure is 133.3 million ($ 75.47) or some 7.5 percent less than in 2016.  A lion’s share of the sum will be used to cover foreign debt, while some 61.16 million manats will be used to service domestic debt.

As of July 1, 2016, Azerbaijan's foreign debt amounted to 7.6 billion manats ($ 4.30) (20 percent of the country’s GDP). The volume of foreign debt that falls per capita is $782.6 ($412.5). The growth of external debt in relation to GDP is associated with a reduction of GDP in dollar terms, while the external debt itself, which is denominated in dollars, remains stable.

The budget law stipulates the limit of government borrowing for 2017 at the level of 1.5 billion manats with the limit of 1 billion on internal and 500 million on external debt, while the limit of governmental guarantees is determined at the level of 10 billion manats.

The main part of the funds borrowed for implementation of various projects is attracted from the World Bank, the Asian Development Bank, the Islamic Development Bank, the European Bank for Reconstruction and Development, the Japanese International Cooperation Agency and other international financial institutions.

Effective public debt management is deemed to be the cornerstone of financial stability and sustainable fiscal policy. The main objective of public debt management is to ensure that the financing needs of the government and its payment obligations are met at the lowest possible cost and consistent with a prudent degree of risk.

The Public Debt Management Agency under the Finance Ministry is responsible for assuring the implementation of public debts, carrying out emission of public securities, registering public debt, public bonds and debt of foreign states to Azerbaijan.

URL: http://www.today.az/news/business/157366.html

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