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Presidential Aide: The primary goal at this stage is to compensate unavoidable negative effects of devaluation

The government of Azerbaijan has taken all possible steps and measures to maintain our national currency so far

Baku. 22 December. REPORT.AZ/ The Azerbaijani President`s Assistant for Public and Political Affairs Ali Hasanov has commented on the Central Bank`s decision to shift to a floating exchange rate. 

Report informs, in an interview with AZERTAC, he said: “The government of Azerbaijan has taken all possible steps and measures to maintain our national currency so far.” “Experts know very well how much it costs a government to maintain its national currency. It is also known that the shift to a floating exchange rate cannot pass without losses for the society, and it brings many socio-economic problems, has negative impact on a country`s internal life and public opinion. Everybody knows that in Azerbaijan the shift to a floating exchange rate has been unavoidable in recent days and the National Bank is forced to take this into account.” “The world is hit by the global crisis. In majority of countries, irrespective of their economic power and potential, from China, a superpower, to small countries, national currencies have depreciated. Our closest trade partners – Russia, Turkey, Iran, Kazakhstan, Georgia and other countries – shifted to a floating exchange rate long ago, and this was accompanied by economic and trade problems.”

Mr Hasanov said: “The national output had been decreasing in Azerbaijan because of stable and high exchange rate of the manat. In this circumstances, the shift to a floating exchange rate was inevitable. But the government of Azerbaijan has done its utmost to minimize and delay the effects of the negative processes on the people`s social conditions. But our country is part of the world, and we were forced to keep up with the economic processes taking place on our planet.”

The Presidential Assistant said the oil price has fallen three times this year, adding this means “a three time decrease in Azerbaijan`s oil revenues”. “Unlike other oil exporting countries , Azerbaijan, for a long time, had tried to maintain its national currency using its currency reserves. But doing this continuously could have meant more serious economic problems. Because it`s not a secret that the oil prices will not go up in the near future.”

Mr Hasanov said: “Of course, this was caused not only by objective market laws as there are also subjective reasons. The most important of them is USA-Russia relations. Against a background of tough geopolitical competition with Russia, the US began to artificially influence on global oil prices in an attempt to economically weaken its opponent. “Washington first took control of OPEC, and limited the organization`s decision-making capability with respect to oil prices.” “The US then lifted the 40-year ban on crude oil exports... The US Federal Reserve then raised interest rates... All this led to the strengthening of the dollar and weakening of other countries` currencies. As a result, the global oil prices have further fallen. Given the fact that our neighbor Iran is also going to start exporting its oil from next year, the situation does not seem to better in the near future.”

He said the Azerbaijani government will do its utmost to minimize the effects of the shift to a floating exchange rate on socially vulnerable groups. “All measures will be taken to stimulate the national output, eliminate elements of shadow economy, including monopoly, corruption, artificial barriers to entrepreneurship. The primary goal at this stage is to compensate unavoidable negative effects of devaluation with new market mechanisms. The government of Azerbaijan will take all steps to get this done.”

The Presidential Assistant also commented on an anti-Azerbaijani bill sent to the US Congress by chairman of the Helsinki Commission, Congressman Chris Smith. “I think that Smith`s move does not reflect the position of US officials and the White House. We know this Congressman very well in Azerbaijan. Since 2000s, he has regularly made pro-Armenian statements and put forward pro-Armenian initiatives in an attempt to spoil Azerbaijani-US relations…”

“He is one of the many pro-Armenian congressmen advocating the so-called Armenian genocide.” “The most important is that official Washington has not taken his ‘Armenian genocide’ or anti-Azerbaijani initiatives for serious. So we should not take this for serious. We believe that US officials will once again reject Smith`s initiative.”

“There are politicians like Smith in every country. In Azerbaijan, too, there are people who blame Washington for pro-Armenian position on the Nagorno-Karabakh conflict, for prejudice against Azerbaijan, and for being influenced by the Armenian diaspora and lobby. These people, too, demand the Azerbaijani government to end strategic partnership with the USA and give an adequate response to biased attitude towards our country. But we are interested in developing our relations with other countries, including the USA, and we do not let separate calls spoil our bilateral relations.”

However, the Presidential Assistant said, if US officials support this biased bill, the Azerbaijani government will react adequately. “And no one should be doubtful about this,” he added.

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