Azerbaijani President has still not approved budget of the State Oil Fund of Azerbaijan (SOFAZ), though it is usually done in December.
On December 29, 2014 Azerbaijani President attended opening of the new administrative building of SOFAZ and on that day SOFAZ celebrated its 15th jubilee. A lot of good words have been said about SOFAZ and its role in Azerbaijan’s economy.
However, SOFAZ’s budget for fiscal year 2015 has not been approved. This is very important for Azerbaijan’s economy, because SOFAZ’s resources will make 53.5% of the state budget’s revenues. At the expense of the Oil Fund’s resources Azerbaijan is going to fund its share in the Southern Gas Corridor and important oil and gas projects, such as funding construction of SOCAR’s floating drilling rig, construction of SOCAR’s oil refinery in Turkey, construction of the gas chemical complex in Garadag and etc.
It is understandable that the government has to clarify incomes of the Oil Fund. The oil prices keep going down at the world markets and the forecasts are very contradictory: the volume of Azerbaijan’s oil export continues declining as well. Therefore, the government will have to specify the last details of incomes in conditions of low oil prices.
At the end of December 2014 Shahmar Movsumov, SOFAZ Executive Director, said that in order to ensure stable development for the upcoming years, the Fund has been working on the mechanisms to reduce the costs. The Fund has been working on various scenarios of earnings and dynamics of the Fund’s assets.
SOFAZ reported that if 2013 SOFAZ’s incomes totaled 13.6 billion AZN with the expenses of 12.3 billion AZN, in 2014 the incomes are forecast to be 11.6 billion AZN with the expenses of 10.6 billion AZN.
During 15 years the Fund’s incomes totaled $117.2 billion with the expenses of $80.1 billion.
