The outlook for Azerbaijan's banking system has been changed from "stable" to "negative." This is the opinion of the international rating agency Moody's, the review of which noted that it was a result of the influence of falling world oil prices and the February devaluation of the national currency. It will also affect the operating environment, the quality of assets of banks in Azerbaijan, their capital, profitability and funding.
Moody's forecast has been released for the coming year or 1.5 years in the expectation that by the end of this year, the share of problem loans in total loan portfolio will increase from 11.4% in 2014 to at least 15% by the end of this year.
The agency experts believe that due to the revaluation of assets in foreign currency following the devaluation, the capital adequacy of banks in the country may be reduced by 2% (by March 31, the Central Bank estimated the capital adequacy of banks at 17.3% with a minimum requirement of 12%).
According to forecasts of the agency, the growth rate of GDP in Azerbaijan in 2015 will slow to 1% and in 2016 it will be 1.7%. --17D-
Economics
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On July 26, the Ministry of Economy hosted a meeting with entrepreneurs from the non-oil industry to explore ways to stimulate local production and enhance export potential.
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Azerbaijani internet service providers Aztelekom and Baktelekom will introduce substantial changes to their pricing structure starting August 15, the companies announced today. Under the new tariffs, the minimum internet speed will rise to 100 Mbit/s, with the cost per Mbit/s decreasing from 0.45 AZN to 0.25 AZN. As a result, monthly charges will be set at 25 AZN for 100 Mbit/s, 30 AZN for 150 Mbit/s, and 36 AZN for 250 Mbit/s.
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Independent experts suggest that Azerbaijan may be on the verge of another devaluation of its currency, the manat, due to a shrinking trade and payment surplus. The anticipated economic adjustments come amidst a decline in foreign currency inflows and reduced oil production.
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Azerbaijan’s Foreign Minister Jeyhun Bayramov met today with Ahmed Moallim Figi, the Minister of Foreign Affairs and International Cooperation of Somalia, at the Azerbaijani Foreign Ministry. This meeting followed a discussion held the previous day between Figi and Azerbaijan’s Economy Minister Mikail Jabbarov.
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