The authorities have no strategy to overcome the economic crisis, expert

The economist Mohammed Talibli, who heads the non-governmental Institute of Economic Analysis said that the economic turmoil of the last years have proven that the authorities are not ready for a crisis. The year will be remembered by a series of economic crises: for the first time in 10 years decreased revenues and expenditures of the state budget. The profitable part was reduced by 25%, and expenditure by 22.1%. The level of the state budget  returmed to the 2011 year.

Azerbaijan, in fact,  has faced the post oil era, peak  of oil production  has left behind. Another significant event was the two devaluation of the manat, which resulted almost in doubl;e increase of the rate of dollar.  This led to a decline in reallowering incomes, caused severe blow to business, reducing the sources of government revenue. Because of the devaluation, the Oil Fund  in transfers to the state budget has saved 3.1 billion manats. However, the devaluation led to  the incrase of products on the market and reduction of public sector revenues.

According to the expert, the depreciation of the manat will continue. This is not only  due to the reduction in the cost of oil, but  due to inability  of authorities, who do not have a specific plan of action.

The channels of foreign  currency inflow  to the country also reduce, and  the Central Bank  has already spent more than $10 billion to maintain the exchange rate of manat. As a result of rising inflationary pressures, there is a rise in prices. This is particularly noticeable in the last days.

The government does not launch social protection mechanisms and the people are  face to face with the elements of the market, although  the authoriries  stated they will not allow this. Against this background, Talibli forecasts  the incrase of unemployment.

In the budget for 2016 to 4.2 billion manat  were reduced investment costs, including 3.8 billion manats in the industrial and construction sector. This means that the construction projects will be stopped, which means loss of jobs of tens of thousands people, social tensions will increase.

Talibli believes that the government should  admit  that crisis has come, and  should begin anti-crisis measures. There is a need for correction of social policies to assist the victims of the crisis, the  increase  of spending on education, health, social protection and culture. However, this should be done not in the form of investment, and providing access of people  to these areas. -06D-