Azernews, 23 March 2005

Prime Minister Artur Rasizada presented the government's report on 2004 to the Milli Majlis (parliament) on Friday. The best indicators in the Azerbaijani economy over the past 10 years were registered last year, he said.

"Over the past decade, the GDP doubled, industrial production increased 30%, agricultural output by 61%, investments by 18.8 times, foreign trade turnover 5.5 times, income of the population 4.5 times, and average salaries 7.6 times. The state budget revenues have grown 4.6 times."

The Prime Minister said that drastic institutional reforms have been conducted in the country in these years, which resulted in setting up an up-to-date economic, financial and banking system.

GDP grew 10.2% in 2004. The GDP per capita exceeded $1,000. The growth in the non-oil sector made up 13.9%. The state budget was implemented with no deficit for the first time, said Rasizada.

Rasizada continued that 300 billion manats ($60 million) were allocated last year to improve the financial conditions for refugees and displaced persons. Strengthening the army and defense was in focus in 2004, as the country's total defense spending increased by over 30%. "Including the State Oil Fund reserves, the country's overall currency reserves amount to $1.845 billion."

Rasizada noted that the volume of Azerbaijan's currency reserves in 2005 exceeded its foreign debt.

"The overall currency reserves exceeded foreign debt by $257 million last year, which proves that Azerbaijan's economy is strengthening." Rasizada said that average wages increased 20.2% and the poverty level went down from 45% to 42% in 2004.

The investments per capita made up $659 in 2004, the highest figure in the Commonwealth of Independent States.

"In 2004, the overall investments in the Azeri economy made up $5.4 billion, or 27.3% over 2003.

Touching upon the existing problems, the Prime Minister mentioned the difficulties with electricity supplies to the population. The problem will be solved over the next two or three years, he said.

Parliament speaker Murtuz Alasgarov spoke of the progress anticipated this year. "The GDP is expected to increase 14% in 2005 compared to last year. The income per capita will make up $1,000. The state budget revenues will reach $2 billion this year."

Pro-opposition MP Gudrat Hasanguliyev negatively assessed the government's activity, saying that the poverty level makes up 42%. He accused the Tariff Council of illegally raising the prices on water and gas and levying funds from citizens, in the absence of a relevant decision of the Cabinet of Ministers. The MP blamed the Ministry of Fuel and Energy and the state-owned Azerenergy joint-stock company for this. "They should either solve these problems or resign", he said.

Parliament member Gulamhuseyn Alibayli said the government's economic policy is not balanced. The industry is developing partially, but the growth rates in agriculture and the services sector are slow. Moreover, the State Oil Fund means are spent improperly, he said. Alibayli continued that only 0.7% of oil revenues have been contributed to the Fund and the crisis in Azerbaijan's energy system persists. "Considering all this, the government should resign", he added.

Another MP, Aliamammad Nuriyev, said that although $400 million have been invested in the energy sector, the country was hit by an electricity and gas crisis last winter. The Barmek and Bayva power grids distributing electricity to consumers should report to the Azerbaijani parliament, he added.