SOFAZ derives profit from manat devaluation

/By Azernews/

By Nigar Abbasova

Azerbaijan State Oil Fund (SOFAZ) has managed to raise its revenues due to strengthening of foreign currencies against the Azerbaijani manat.

The Fund's extra-budgetary revenues related to revaluation of foreign exchange totaled 354.1 million manat ($230 million).The Fund has obtained 22.501 billion manat ($14.61 billion) in additional income as a result of the increase in value of USD, Euro, and GBP.

The assets of SOFAZ as of April 1, 2016 have increased by 2 percent as compared to the beginning of 2016. The revenues from managing assets amounted to 148.8 million manat ($96.6 million) in the first quarter of 2016.

Budget revenues of the fund for the period of January-March, 2016 reached 2,023 million manat ($1,314 million), while budget expenditures amounted to 1,946 million manats ($1,264) million.

CBA switched to a floating rate of manat, the national currency of Azerbaijan on December 21, 2015 following intensifying external economic shocks. The exchange rate between the manat and US dollar changed from 1.0499 to 1.5500 after the shift.

The decision was taken because of the necessity to bring the currency market and the exchange rate of the manat into line with oil prices. The value of manat is currently determined by demand and supply on the forex market.

SOFAZ was established in 1999 with assets of $271 million.

Official exchange rate of the US dollar and euro to Azerbaijani manat was set at 1.5425 manats and 1.7119 manats, respectively, on July 1.