Gubad Ibadoglu: ‘Tense Situation in Foreign Exchange Market Result of Inadequate Policy of Central Bank’

The reason for the USD shortage in Azerbaijan should not be looked for in the expected decision of the US Federal Reserve, the head of the Economic Research Center Gubad Ibadoglu said.

In his profile on Facebook the expert noted the reasons for this should be sought in the national economy, especially in the deplorable situation in the export of non-oil products, outflow of capital from Azerbaijan and the inadequate policy of the Central Bank.

He noted the main turnover of currency trade has moved into the black market and the difference between the official and unofficial exchange rate reaches 10%.

‘According to the information of the customs, the export earnings amounted to USD 3,000,821,500 in H1 of 2016, of which revenues from the export of non-oil products were USD 584,500,000. Compared to the same period last year, the index decreased 27%.

Thus, in H1 the export per capita was 402 dollars, of which 61.5 dollars accounted for non-oil products. So if there was no profit in the oil and gas sector, with this potential of our national economy the monthly foreign exchange earnings would be less than 100,000 dollars,’ Ibadoglu said.

According to the expert, it is necessary to pay attention to the fact that for the first 6 months in 2016 the import of products into the country was spent USD 4 billion.

Ibadoglu emphasized that we should not forget that extra currency should be earned to repay the debt of the state, companies and banks, as well as to meet the current needs of the citizens.

‘And to earn currency, we should produce competitive, high-tech and innovative products and services. This requires, in turn, modernization of the economy and high levels of education.

For the modernization of the economy we should attract foreign investment and create a favorable investment atmosphere. Unfortunately, for the short period that is not possible and, accordingly, we will not be able to pull AZN out of the intensive care. Therefore, we should immediately start economic reforms,’ Ibadoglu said.   ----71B