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Central Bank of Azerbaijan unveils impact of Russia-Ukraine conflict on Azerbaijani banks

17 October 2022 18:20 (UTC +04:00)

The Central Bank of Azerbaijan (CBA) announced the impact of the Russia-Ukraine conflict on Azerbaijan's banking system, APA-Economics reports citing CBA.

In the first half of this year, the low funds of domestic banks in the sanctioned Russian banks limited the impact of the sanctions on the financial stability of the Azerbaijani banking system.

"While banks face certain obstacles in conducting operations with correspondent accounts as a result of the Russia-Ukraine conflict, this conflict has limited impact on the operations of Azerbaijani banks with correspondent accounts," CBA said.

Noted that as a result of the current geopolitical tension, the increase in prices in the global energy carrier market has a positive effect on the country's balance of payments as an oil and gas exporter. Growth in energy prices and potential growth opportunities in gas exports to Europe could increase exports and fiscal revenues in the medium-term perspective.

Rising food prices due to geopolitical processes and difficulties in the supply chain continue to increase the level of global inflation. The increase in global food prices increases the transmission of high inflation to domestic prices through the import channel.

Noted from the CBA that although our country has close trade relations with Russia and Ukraine, currently, there is no significant impact of geopolitical processes on trade and economic relations between these two countries and Azerbaijan.