TODAY.AZ / Business

Minister: Azerbaijan not to reconsider state budget forecast

23 May 2016 [12:54] - TODAY.AZ

/By Azernews/

By Nigar Abbasova

Azerbaijan could neutralize negative effects of the external factors on its economy.

Finance minister Samir Sharifov made the remark while commenting on fulfillment of the state budget during the meeting of the parliamentary committee on economic policy, industry and entrepreneurship.

“Increasing rising geopolitical tensions in the region and worsening external economic environment have affected Azerbaijan's economic development, resulting in a slowdown of the growth rate of national economy. Problems in the currency market and the pressure on exchange rate forced the government to pursue budgetary policy. Nevertheless the country succeeded to fulfill all the tasks related to the execution of the state budget,” the minister said.

He also mentioned that Azerbaijan is not going to reconsider the state budget forecasts for 2016. The public budget revenues are expected to reach 16,822 billion manats ($11, 202 billion), while the rate of expenditures will amount to 18.495 billion manats ($12,316 billion).

The minister also spoke about the issue of mortgage lending. “Mortgage lending as well as issuance of social mortgage will be implemented after the adoption of legal acts concerning the reorganization of Azerbaijan Mortgage Fund,” he said.

In accordance with the presidential decree, the Azerbaijan Mortgage Fund, which was previously a state-owned company, has been transformed to a joint-stock company. Main functions of AMF include improving living conditions of population, providing housing, adapting the supply with real demand and attracting local and foreign investors to mortgage lending.

The state budget allocated 50 million manats ($33 million) for the mortgage financing in 2016. The AMF realized all appropriate measures to develop the mechanisms of mortgage lending in accordance with international standards and improved the level of service. The highest amount of mortgage lending provided by the AMF is 50.000 manats ($33.295). Payback period for mortgage lending is 25 years, while social mortgage payback period is 30 years. Initial payment for social mortgage is 15 percent, while payment for general credits amounts to 20 percent. Azerbaijan Mortgage Fund was established in 2005 and started the issuance of mortgage lends in 2006.

Sharifov said that the volume of troubled assets of the Azerbaijan International Bank (AIB) will be defined after the analysis of credits to be done by by the Financial Market Supervisory Chamber. It will help to define troubled credits and establish the level of the problem. The chamber has certain legal regulations and acts in accordance with them.

“The initial analysis revealed a big number of troubled credits, making the Chamber to hold additional analysis of debt obligations,” minister said.

Azerbaijan's state budget revenues amounted to 17,498 billion manats ($11.652) in 2015, 41.6 percent of the budget revenues accounted for the non-oil sector.

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