ACCORDING TO EXPERT, HIGH INFLATION TO CONTINUE IN AZERBAIJAN FOR NEXT FEW YEARS
Noyan Tapan
Ma y 23, 2008
YEREVAN, MAY 23, NOYAN TAPAN. The level of inflation is the highest
in Azerbaijan among the CIS countries, Rauf Rajabov, editor-in-chief
of the information and analytical agency "3rd View" (Baku) stated
at "The Caucasus 2007" international conferecne organized by the
Caucasus Media Institute in Yerevan on May 22. According to him, in
2007 inflation made 16.7% against the programmed 9% in Azerbaijan. This
tendency will continue for the next 2-3 years.
The expert said that one of the causes of high inflation is the policy
of "shock therapy" conducted by the government: after remaining at
the same level for several years, the prices sharply went up in early
2007. In particular, power prices grew by 300%, fixed phone tariffs
by 320%, fuel prices by 50% for the population. The expert informed
those present that in 2007 Azerbaijan’s imports exceeded exports by
420 million manats (1 manat is equal to about .1), which means that
Azerbaijan’s dependence on external markets is increasing. "Today the
country imports half the necessary foodstuffs. Unfortunately, we do not
notice wasting our oil revenues," R. Rajabov said. He stated that oil
dollars do not affect inflation as they mainly remain in foreign banks.
In his words, Baku has become the most expensive city in the CIS,
with monopolies and rife corruption. Despite the a 35% growth of
the population’s incomes last year, 20% of citizens live below the
poverty line.
The expert said that GDP per capita grew fivefold – from 714.3 to
3,474 USD in Azerbaijan in 2007 as compared with 2001. However, even
officials admit that the GDP structure does not correspond to the GDP
structure of the developed countries’ economies, and the oil and gas
sector has a leading position in the national economy. According to
R. Rajabov, this year oil production will reach its highest level
followed by a downward tendency. As a result, foreign investments
will decline in parallel with a growth of state investments.