Press Review April 7, 2018

The significance of the Non-Alignment Movement for Azerbaijan, the situation with interest rates on loans, problem loans are the leading topics of today's press.

The newspaper "Azerbaijan" writes about the Baku 18th Ministerial Conference of the Non-Aligned Movement, noting that this conference will contribute to the cause of international peace and sustainable development. The author cites quotes from President Ilham Aliyev's speech at the conference, which became a historic event for Azerbaijan.

The newspaper "Echo" together with the expert discusses the absurdity of the situation in the country from the economic point of view. In Azerbaijan, from an economic point of view, an absurd situation has developed. Not so long ago - until 2016 - the discount rate of the Central Bank of Azerbaijan was at the level of 3%. However, after two devaluations of the national currency of the Azerbaijan Republic, the discount rate rose to 15%. The discount rate sets the value of money, which, in turn, affects lending volumes. The increase in the discount rate led to an increase in interest rates on loans for citizens and business structures. Naturally, this lowered the overall demand, and economic activity fell markedly. Consequently, the rate cut stimulates economic activity, gives rise to production, so the Central Bank decided to slowly lower the rate two years later.

The Yeni Musavat newspaper published an article on problem loans, believing that banks do not want to solve this problem. The bulk of loans were issued to officials, with no collateral. As of February 1 this year, the volume of problem loans is 1 billion 695.9 million manats.