IMF: Level of dollarization makes difficult to predict course

Baku. 9 June. REPORT.AZ/ Azerbaijan's GDP could be reduced up to 3% this year.

Report informs,overview of the International Monetary Fund (IMF) declares.

According to the report, for the first time in last 15 years double-digit inflation is expected in Azerbaijan, which will fluctuate in the range of 10-15%. The reason stated the national currency devaluation by almost 100%.It is noted that the devaluation adversely affected financial performance of banks.This is due to the mismatch of foreign exchange positions of banks and the formation of unsecured foreign currency debt. In countries of Caucasus and Central Asia, the level of dollarization is very high, that in the future will create certain problems for the implementation of exchange rate policy.

The IMF report also noted that the devaluation has created opportunity for Caucasus and Central Asian countries to obtain a short-term fiscal revenues: "Although as a result of the devaluation, sales of goods decreased, income from their sales in local currencies increased. At the same time due to the fact that wages are not increased after the devaluation in dollar terms, load on the state budget decreased. "

In the "Global Competitiveness Report 2015-2016," of IMF Azerbaijan is located on the 40th line, while in the report for 2006-2007, the country ranked 62th.

The IMF predicts a significant reduction in public spending. At the same time the country's leverage ratio is low.