TODAY.AZ / Business

Growing global financial crisis will affect the economic projects of Azerbaijan

09 October 2008 [10:16] - TODAY.AZ
Ilham Shaban, chief of the Center of Oil Researches, considers that the global financial crisis will have a negative impact on the main economic projects of Azerbaijan, connected with production and transportation of oil.
"Despite the soothing announcements of the country's leadership, the global economic crisis will have a negative impact on Azerbaijan's economy".

According to Novosti-Azerbaijan, he considers that the statements of high-ranking officials that Azerbaijani economy will not be affected prove that Azerbaijan is a country with closed economy.

"The said crisis has already affected the economies of most countries, causing a 19% meltdown in Russia. Prices on flats have declined by 10-20% in the United States, Russia and Kazakhstan. But this crisis did not affect us, as the cost of immovable property has not changed", said Ilham Shaban.

At the same time, the expert is confident that the crisis will affect Azerbaijan, slowing down the implementation of large scale projects.

"In particular, Azerbaijan planned to start construction of a new oil producing platform at the Chirag field estimated at $5 bln by 2010 and also to launch the second stage of the development of the Shah Deniz oil field estimated at $10 bln.

But now, due to the financial crisis, affecting the banking sector and loan issuing system, Azerbaijan and international oil companies will not be able to get such amounts in the banks in the near future. Therefore, we will have to put off the implementation of the project of construction of the Nabucco pipeline", said Shaban.

According to him, the continuing oil crisis will lead to the price hike on all the imported goods in Aezrbaijan, which will affect the population.

As for the changes in the oil prices, Shaban is confident that even if the cost of an oil barrel drops to $50, the state budget of Azerbaijan and budget employees will not be affected due to the existence of the Oil Fund, which is designed to compensate for all expenses, in the country.

"Moreover, Azerbaijan expects the highest gains from oil sale from 2009 until 2014, which will rescue our economy", said the expert.

Speaking of possible oil price for the near future, Shaban said it is difficult to predict, for the oil prices on the global markets have never experienced so sharp changes.

"For example, the prices of an oil barrel have dropped 10 dollars within three sessions on the London stock exchange.

He considers that the oil price drop was caused by the reduction in sale volumes, which, in turn, caused the incredibly high oil prices earlier.

"In summer the oil price for a barrel made $147, which made most states and companies reduce the purchase of oil and oil products. In the result, this led to the drop in production.

Only Toyota company announced the reduction of production of its cars by 10% throughout the world and the volumes of Toyota car sale have dropped by 15-20% in Europe", concluded Shaban.

/Day.Az/
URL: http://www.today.az/news/business/48083.html

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