Structure of Recession of Imports Indicates Decline in Economic Activity - Expert

Baku / 14.04.17 / Turan: For the first three months of this year, the average quarterly export price of Azerbaijani oil increased by 25% compared to the same period last year. The increase in oil indices naturally affected overall export growth by $ 825 million. It is noteworthy that 807 million dollars of this volume fell to the share of exports in the oil sector, and in non-oil exports there was an increase of $ 18 million. Simply put, 96% of the increase is attributable to the export of hydrocarbons.

Non-oil exports are mainly represented by the export of fruits and vegetables. In this position there is an increase of $ 13 million. In the meantime, official sources note a drop in imports and present this as a consequence of state policy aimed at the development of local production. But is it really so?

“Official propaganda explains the decline in imports by positive economic development and the expansion of local production. However, the import structure does not confirm this argument,” the economist Rovshan Agayev said. According to Agayev, imports as a whole fell by $ 313 million. However, the decrease in imports is observed in segments that do not have an analog of domestic production, and for these positions the Azerbaijani market fully (100%) depends on foreign supplies. We are talking about vehicles, household and industrial equipment, and electrical appliances. The import of these goods, indeed, declined from the previous 713 million dollars to 391 million dollars in the current year. The drop in imports in this segment exceeded $ 320 million.

Is it worth explaining that the reduced importation of these positions cannot be due to the growth of the local production? On the contrary, this circumstance is a direct consequence of the decline in economic activity within the country, the expert believes.  -01B--