World Bank: Azerbaijan should more efficiently use spare funds

Baku. 22 January. REPORT.AZ/ "Despite the decline in per capita income, Azerbaijan is still a member of the International Bank for Reconstruction and Development (IBRD, member of the WB Group). There are few countries in the world that funds accumulated in sovereign funds equal to one year of GDP. The resources of the International Development Association (IDA) are for poorer countries, Azerbaijan is no longer among these countries. The government has enough money. It can be used for other purposes. It is about spending them wisely.

World Bank (WB) Country Manager for Azerbaijan Naveed Hassan Naqvi told Report. 

"At the last meeting of the Cabinet of Ministers, the head of state has rightly pointed out that the country should borrow from abroad only for technically complicated projects. I think that borrowing money for project must be done very carefully and if I were an Azerbaijani I would say the same words. It is necessary to look at which areas there is a need for technical assistance. We need to pay attention to partners which have technical skills and experience in that area. You are asking, which areas should be invested in? Easy things have already done. I mean, If we talk about the areas easy to borrow money for, I would say it is time for solving difficult questions.”

WB official also commented on the allocation of some of the funds of the State Oil Fund of Azerbaijan (SOFAZ) to the national currency - rate of Azerbaijani manat: “As a rule, the sovereign fund serves to preserve the country's wealth. We know that most of the resources of sovereign fund were used for stable exchange rates before the first and second devaluation, and many funds were lost. It would be better to use that funds for other purposes. When using the funds of the sovereign fund, it is always necessary to look at other alternatives: are these funds directed to the best field?!”

Naqvi noted that Azerbaijan, which invests in cotton-growing, should pay attention to a number of important issues: "Another country that grows cotton in the region is Uzbekistan. In general, when growing cotton, you should pay attention to its prices. Yes, historically it was grown, but is it economically significant in modern conditions? On the other hand, it should be borne in mind that Azerbaijan is a country with shortage of water. Cotton loves a lot of water. The second problem is related to the ability of Azerbaijani cotton to compete with other major cotton producers. In my opinion, in agriculture it is necessary to focus on investments in vegetable growing, fruit growing, livestock and fishing”.