Manat to Remain Stable, Debts on Loans Not to Be Written Off - Head of Central Bank

A new devaluation of the manat is not a real threat, if the oil price does not drop below $ 50 and the economic stability of the partner countries continues.

This prediction belongs to the head of the Central Bank of Azerbaijan Elman Rustamov.

In an interview with AzTV, he said: "I do not see any problems with the rate of the manat to the end of the year and in the medium term, if the average oil price remains at $ 50, and there are no major developments in the economies of our trading partners," said Rustamov .

After the correction of the manat rate (meaning 21 February devaluation) the country had very important trade benefits and the competitiveness of Azerbaijani products increased, he said.

"We see the growth of exports of the non-oil sector and our own products cover the domestic demand, i.e. the competitiveness of our products increases. In such circumstances, the foreign trade balance of the country by the end of the year will be balanced," said the head of the Central Bank.

Rustamov is sure that even with an oil price of 40 dollars, the trade balance of the country will be deficit-free, and the economy of Azerbaijan is far from risk areas.

Rustamov also promised to lower rates on loans until the end of the year.

CBA recently ordered banks to reduce fees for servicing consumer loans to one per cent. However, some banks took this ambiguously and tried to compensate for the decrease in commissions by raising interest rates on loans.

According to him, in international practice, the commission for the service of consumer loans is not so high, in contrast to the commission on major long-term loans.

"We hope that by the end of the year the rates will be reduced, and the monitoring has confirmed this. We will continue to work to reduce the maximum rates on consumer loans. The activities in this direction will be implemented in stages until the end of the year. Banks will be able to get access to cheap resources, if they meet all regulatory requirements of the Central Bank and will take place in the internal system of rating," said the head of the Central Bank.

However, Rustamov has dispelled illusions that the debts on loans will be written off.

According to him, it is impossible to do so, because in this case the interests of other citizens who have deposits in banks will be affected. -06D-