Ilham Aliyev signed an order to combat the crisis caused by the coronavirus (COVID-19) pandemic. The order envisages allocating 1 billion AZN from the 2020 state budget to the Cabinet of Ministers of the Republic of Azerbaijan. This amount is 1.2% of GDP and 4.14% of state budget revenues for the current year. For comparison, the United States, which allocated $ 1.3 trillion for the same purpose, spends 43% of federal budget revenues, 32.5% of budget expenditures, and Canada, which allocated $ 82 billion, 3% of GDP to neutralize the effects of the coronavirus pandemic.
According to the presidential order, the preparation of proposals and the start of funding will take at least 3 weeks, and even this period will be extended to 1 month for employment measures.
I would like to touch upon two points related to this order.
1. Given that some portion of the allocated funds will fall to the share of corruption, this will not be enough to recover the costs and losses and feed the real economy.
2. The extension of the time allotted for the execution of the tasks arising from the order indicates that either the government is not ready for this process or the government prefers to gain time by extending the deadline.
In general, I think that the costs of this crisis and the losses should not be compensated only with financial assistance from the state budget, it must also be reduced by the social responsibility and solidarity of the public companies and the private sector.
Therefore, I suggest that:
1) From April 1, the main food products, medical supplies, and medicines that will be imported in the next quarter should be exempted from customs duties and VAT on imports.
2) A moratorium should be imposed on the payment of credit debts to commercial banks and the payment of taxes withheld from the source to the state budget within 6 months from the next month.
3) A long-term and low-interest credit line, which will start to be returned from next year, should be opened to small and medium-sized businesses.
4) From April 1, direct monthly payments should be made to employers and employees in the areas affected by the crisis.
5) 90 percent of salaries of those who lost their jobs starting from this month should be paid directly in cash for the next month.
6) From April 1, in order to determine the targeted state social assistance, the limit of the need criterion for 2020 should be increased from 160 AZN to the cost of living for the current year in the country, to 190 AZN. The scope of targeted social assistance should be expanded.
7) From April 1, the minimum amount of pensions should be increased from 200 to 250 AZN, the minimum wage from 250 to 300 AZN, and benefits for the disabled by 50%.
8) From April 1, all unemployed people with official unemployment status should be paid a minimum wage - 300 AZN per month.
9) The work of employees in pharmacies, shops, banks, post offices, state companies and private enterprises providing public services (in the provision of Internet and other means of communication) should be stimulated and they should be provided with the necessary protective equipment - medical masks, medical gloves, and other equipment at the expense of budget funds.
10) Transparency of spending of 1 billion AZN allocated from the budget should be ensured and the population should regularly be informed in this regard.