Economic reforms and achieved results in focus of Baku conference

By Azernews

By Amina Nazarli

Azerbaijan’s economy is currently undergoing a period of transformation, said Vusal Gasimli, the director of the Center for Analysis of Economic Reforms and Communications.

He made the statement during a conference titled “Economic reforms: the achieved results and recommendations” in Baku on May 30, organized jointly by the Center and American Chamber of Commerce in Azerbaijan (AmCham).

The indicator of Azerbaijan's actual GDP was for the first time lower than potential GDP in 2016, due to which the Strategic Road Maps were adopted, according to Gasimli.

The Strategic Road Maps up to 2025 and beyond cover almost all sectors of the economy. Proper and timely implementation of measures envisaged in the documents is planned to require some 27 billion manats ($14.79 billion), while the sum will be provided through the state and private sources.

“The technological update, institutional development and formation of human capital were defined as the main directions for ensuring the competitiveness of the Azerbaijani economy. The first results are apparent. As a result of the first four months of 2017, non-oil exports grew by 22 percent, reduction of gold and foreign currency reserves stopped, and the stability of the manat rate was ensured. Currently, the amount of money supply in circulation is 13 percent of GDP, while in Kazakhstan this figure is 11 percent, in South Korea is 8 percent, and in Turkey is 6.5 percent,” he explained.

Gasimli further stated that dialogue and cooperation of public-private sector created favorable opportunities for strengthening the role of the private sector in ensuring sustainable economic growth.

Speaking at the same event Rufat Aslanli, Chairman of the Financial Market Supervisory Body (FMSB) said that the agency offers expanding access to finances for small and medium-sized enterprises (SMEs).

Aslanli said financing of SMEs cannot be maintained only at the expense of traditional bank lending, noting that this will positively affect the economy.

In turn, Deputy Minister of Economy Sahil Babayev said that inspections of business activity in Azerbaijan decreased more than a thousand times.

During the last 19 months, there were only 89 inspections in the country, while over the previous similar period of time – 99,000 inspections.

He added that the possibility of prolonging the moratorium on business activity inspection is under discussion.

The inspection of entrepreneurs' activities in Azerbaijan has been suspended for the period of two years from November 1, 2015. The exceptions from the law include check-ups which are held by State Commission to Combat Corruption under Prosecutor General’s Office as well as cases which endanger health or life, pose hazards to the state security or economic interests.

In his remarks, Nuran Kerimov, President of AmCham, said that Azerbaijan hosts systematic events on the development of entrepreneurship and improvement of business climate. He also stressed that, AmCham is closely involved in and contributes to the ongoing economic reforms in the country.

Speaking at the event, Azerbaijan’s First Deputy Prime Minister Yagub Eyyubov highlighted the ensuring macroeconomic stability, in particular, the stability of manat and manageable levels of inflation, as well as economic growth rate in non-oil sector and increasing of export volume, due to the complex economic reforms.

The Central Bank of Azerbaijan (CBA) has prepared a package of proposals on economic reforms in the country, CBA head Elman Rustamov said at the event.

The package of proposals will soon be submitted to the Azerbaijani Financial Stability Board, according to Rustamov.

“The proposals cover the establishment of an active money market in Azerbaijan, strengthening the trust relationship between credit institutions, application of the guarantee mechanism, development of non-cash payments and full transition to cash-free settlements,” he noted.

 Ivana Duarte, head of the European Bank for Reconstruction and Development resident office in Baku, speaking at the event said that he EBRD suggests that Azerbaijan creates a centralized agency for work with foreign investors.
 
Such an agency could provide legal and consulting assistance to investors, according to Duarte.