So­cially ori­ented ex­pen­di­tures to in­crease next year

Azer News - - Nation - By Sara Is­rafil­bay­ova

The state bud­get of Azer­bai­jan for 2018 will be tra­di­tion­ally so­cially ori­ented, Fi­nance Min­is­ter Samir Shar­i­fov said.

“Azer­bai­jan is a de­vel­op­ing coun­try and has been able to achieve many tasks over the past 10-15 years. If we an­a­lyze our in­vest­ment ex­pen­di­tures, we will see that they were quite high, while, as a rule, most of them are so­cial ex­pen­di­tures,” the min­is­ter stressed speak­ing on AzTv chan­nel.

He went on to say that the vol­ume of so­cial spend­ing in the bud­get for 2018 is 7.7 bil­lion man­ats ($4.5 bil­lion), which is more by 650 mil­lion man­ats ($382.33 mil­lion), as com­pared to the cur­rent year.

“So­cial spend­ing is pri­mar­ily wages, so­cial se­cu­rity is­sues, pen­sions, and their share in the bud­get is tra­di­tion­ally high enough. Only the ex­penses of the wage fund amount to 4.2 bil­lion man­ats ($2.47 bil­lion),” ac­cord­ing to Shar­i­fov.

The min­is­ter noted that the coun­try’s spend­ing on ed­u­ca­tion tra­di­tion­ally has a large share in the struc­ture of so­cial ex­pen­di­tures and next year they will amount to 2 bil­lion man­ats ($1.18 bil­lion), which is 211 mil­lion man­ats ($124.11 mil­lion) more com­pared to the cur­rent year.

“Next year it is planned to al­lo­cate 250 mil­lion man­ats ($147.05 mil­lion) for the con­struc­tion of so­cial hous­ing,” the min­is­ter stated.

The state bud­get rev­enues in 2018 were ap­proved at the level of 20.127 bil­lion man­ats ($11.84 bil­lion), ex­pen­di­tures at the level of 21.047 bil­lion man­ats ($12.38 bil­lion) [in­clud­ing cen­tral­ized in­comes – 19.47 bil­lion man­ats ($11.45 bil­lion) and lo­cal in­comes – 653.3 mil­lion man­ats ($384.27 mil­lion), cen­tral­ized ex­penses – 20.323 bil­lion man­ats ($11.95 bil­lion) and lo­cal ex­penses – 723.9 mil­lion man­ats ($425.8 mil­lion)].

In the struc­ture of state bud­get rev­enues, trans­fers from the State Oil Fund of Azer­bai­jan (SOFAZ) amount to 9.216 bil­lion man­ats ($5.37 bil­lion). Rev­enues from VAT are pro­jected at 4.288 bil­lion man­ats ($2.52 bil­lion) [in­clud­ing 1.705 bil­lion man­ats ($1.002 bil­lion) on VAT from im­ported goods], in­come tax - 2.320 bil­lion man­ats ($1.36 bil­lion), tax on per­sonal in­come - 1.196 bil­lion man­ats ($703.49 mil­lion), ex­cise tax - 726 mil­lion man­ats ($427.03 mil­lion) [in­clud­ing 172 mil­lion man­ats ($101.17 mil­lion) from ex­cise taxes on im­ports of goods], cus­toms du­ties - 535 mil­lion man­ats ($314.69 mil­lion), sim­pli­fied tax - 380 mil­lion man­ats ($223.52 mil­lion), tax for the use of min­eral wealth - 136 mil­lion man­ats ($79.99 mil­lion), road tax - 91 mil­lion man­ats ($53.53 mil­lion).

Shar­i­fov went on speak­ing about the na­tional cur­rency of Azer­bai­jan, not­ing that manat has sta­bi­lized.

“Since the be­gin­ning of the year, the manat rate has even slightly strength­ened [against the US dol­lar]. Com­pared to the be­gin­ning of the year, the manat rate strength­ened by 3.4 per­cent, and in com­par­i­son with Fe­bru­ary - by 10 per­cent,” he said.

Shar­i­fov noted that there is some pres­sure to fur­ther strengthen the rate of manat. How­ever, ac­cord­ing to the min­is­ter, this again shows that con­fi­dence in the na­tional cur­rency is be­ing re­stored.

The re­sults of 11 months of 2017, con­tin­ued Shar­i­fov, show that the econ­omy has sta­bi­lized and be­come even more sta­ble com­pared to pre­vi­ous years.

Touch­ing upon SOCAR, the min­is­ter pointed out that the state bud­get en­vis­ages al­lo­ca­tion of funds for the next year to in­crease the au­tho­rized cap­i­tal of the State Oil Com­pany.

These funds will be used in two di­rec­tions, ac­cord­ing to the min­is­ter.

“The first di­rec­tion is the ex­pan­sion of the ex­ploita­tion of oil and gas fields and main­te­nance of pro­duc­tion level (old de­posits), and the sec­ond is the project of re­con­struc­tion and mod­ern­iza­tion of Baku Oil Re­fin­ery named af­ter Hey­dar Aliyev,” he ex­plained.

Shar­i­fov noted that an im­por­tant fac­tor is the re­con­struc­tion and mod­ern­iza­tion of the Oil Re­fin­ery. He went on to say that for this pur­pose the state bud­get funds will be al­lo­cated for sev­eral years, adding that this should be con­sid­ered as an in­fra­struc­ture project.

SOCAR an­nounced the liq­ui­da­tion of the Azneftyag re­fin­ery and its merger with the Baku Oil Re­fin­ery named af­ter Hey­dar Aliyev, in 2015. This de­ci­sion was made in the frame­work of works to im­prove and op­ti­mize the struc­ture of the com­pany.

The com­pany plans to pro­duce high-qual­ity oil prod­ucts as part of the next stage of the re­con­struc­tion work to be car­ried out at the Hey­dar Aliyev Baku Oil Re­fin­ery. Un­der the pro­gram, the oil re­fin­ery will pro­duce Euro-5 stan­dard diesel in 2019 and the Euro 5 stan­dard petrol in 2020.

The cost of mod­ern­iza­tion of the re­fin­ery is es­ti­mated at about $1.5-1.7 bil­lion. The project of re­con­struc­tion and mod­ern­iza­tion of the Baku Oil Re­fin­ery will be im­ple­mented in three stages (bi­tu­men, diesel and gaso­line).

Cur­rently, the plant for the pro­duc­tion of bi­tu­men with a pro­duc­tion ca­pac­ity of 400,000 tons, which will be put into operation in the third quar­ter of next year, is be­ing con­structed. It is ex­pected that the diesel phase will be com­pleted in Novem­ber, 2020, and the gaso­line phase in Fe­bru­ary, 2021.

The pro­duc­tion ca­pac­ity of the re­fin­ery will be in­creased from 6 mil­lion to 7.5 mil­lion tons per year as a re­sult.

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