Baku. Musa Ahmedov - APA-Economics. Azerbaijan is conducting cautious policy regarding government borrowing, Finance Minister Samir Sharifov made the remarks during the discussion of draft state budget for 2016 conducted by the committees of Economic Policy, Agrarian Policy, Natural Resources and Energy, Social Policy, Security and Defence of the Azerbaijani Parliament, APA-Economics reports.
The Minister said that Azerbaijan's external public debt is not so high: “Azerbaijan's external public debt does not exceed internationally accepted standards and criteria. The external public debt is higher than 10% because of it is in foreign currency. However, as a result of the correction of the manat exchange rate, the value of GDP in foreign currency declined. Therefore, our external public debt/GDP ratio increased a little. Today, the external public debt is higher than 12%. But we must assess the real situation. There should be access to financial sources for development of any country and any sector. For instance, a certain part of funding the construction of Baku-Tbilisi-Ceyhan oil pipeline was provided by Azerbaijan, another part by Azerbaijan’s partners and the third part by funds borrowed from foreign banks. About 70% of funds were borrowed from the foreign banks. On one side, I don’t agree with increase of the debts. On the other side, I don’t think we conduct a dangerous policy in this regard. We must borrow when we needs. But these debts should be directed to significant projects”.
The minister also said several state bodies’ activities on borrowing are not so good. Sharifov stressed that several state bodies cannot repay the funds borrowed with the guarantee of government: “Now, we have to repay these debts through state budget. Therefore, this was reflected in our state budget for 2016. So, our expenditures fopr service to public debt increased. A part of these debts increased due to devaluation, another part due to such factors”.
However, the minister underlined that Azerbaijan’s public debt is at a low level.
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