Poor management of oil revenues

The conference "Preparing for post-oil period and the problems of economic diversification of Azerbaijan" was held the day before, stressing inappropriate management of oil revenues. The event was held at the initiative of the public association "Promoting Economic Initiatives" (PEI) and with the support of an international organization Revenue Watch ?nstitute ( Research Institute of income ) under the Transparency Initiative .

Deputy Chairman of the PEI Rovshan Agayev told Turan the situation. According to him, despite the availability of electronic services to citizens, there are no institutional changes - budget expenditure is opaque, not accountable to the public and even the Parliament, the inflation generated by corruption and monopolies in all areas of import, eats meager savings of the general population. In comparison with 2005 (the beginning of the flow of petrodollars) share of investment projects in the state budget expenditures in 2013 increased 43.2 times. For comparison - the growth of public investments in education during this period was 3.9 times, in health - 5.4, and in science - by 4.3 times.

Diversification of the economy should be carried out not only in terms of regional energy projects, and in general - the government should decide on the ultimate goals - he said. In normal countries, governments are investing oil revenues in human capital and innovation, while the local students studying abroad, try to stay abroad by all means, resulting in the State Oil Company money spent on wind. In the world of science centers, automotive, aircraft, space exploration many experts from Azerbaijan work. They could work here at normal conditions. This factor would allow the state not only to be proud of tolerance and ancient cultural background, but really to develop within a few decades.

Almost all the oil capital is spent on development of Baku and its suburbs, and local specialists settle in the capital, so that the regions objectively lose from this exodus. Azerbaijan has the prerequisites to be not only a raw materials appendage (including tax payments and customs expenses of subjects of oil business, budget revenues of the country at 75-80 % are formed by hydrocarbons) . Past experience shows that you can not only produce oil equipment, use of global demand , as well as consumer electrical engineering , furniture , clothes, shoes , food and a wide range of other attributes of the real economy, the expert believes .

Diversification of the economy involves the creation of a competitive environment at all levels of business - from the preparatory period and the creation of the resource base to the sale of products to the final consumer. In addition, the backbone of the economy should be the interests of the mass of business and not bureaucrats - the oligarchs. And yet, the government should reduce the share of services in favor of industrialization to the promotion of private initiative, abandoning absolute monopoly in the energy and industry. - 17D-