2024-05-03 13:39:34
The International Monetary Fund (IMF) is ready to cooperate with the Azerbaijani government in preparation for Azerbaijan could double gas exports to Europe as it prepares to host the next Climate Summit in 2024″>COP29.
As Day.Az reports, Jihad Azur, Director of the IMF’s Middle East and Central Asia Department, said this in an exclusive interview with Trend on the sidelines of the IMF Spring Meetings in Washington.
“We have been cooperating with Azerbaijan since the country gained independence on all reforms carried out over the past 30 years. And as an institution, we are ready to cooperate with Azerbaijan in preparation for COP29 in order to ensure the success of this event. We conduct regular political consultations, as well as provide technical assistance to Azerbaijan,” he said.
Azur noted that in general, as part of its mission, in addition to financial support, which Azerbaijan does not need, the IMF provides regular political advice under Article IV.
“One third of our global activities at the Fund are to provide technical assistance in various areas such as fiscal, monetary policy, financial sector, and some specific issues such as statistics. This activity is expanding. We recently opened a new Regional Capacity Development Center for the Caucasus, Central Asia and Mongolia (CCAMTAC). This center provides technical assistance as well as a platform for equal cooperation between countries in the region,” he explained.
Azur noted that the Azerbaijani economy has recovered from the shock caused by COVID-19 in 2021.
“In 2021-2023, growth slowed down and inflation decreased. Real GDP increased by 1.1 percent in 2023. This was mainly due to the non-oil and gas sector, namely such areas as transport, construction, and the hotel business. It is expected , that in the medium term, growth and inflation rates will slow down. We expect growth in 2024 to improve compared to 2023 and reach 2.8 percent, and in 2025 to remain at almost the same level – 2.3 percent. is that inflation will remain at about 5 percent this year and next. And the debt to GDP is 18 percent, which is a pretty good indicator. Therefore, the economy is improving, albeit at a moderate pace,” he said.
Jihad Azur added that the IMF actively interacts with the government of Azerbaijan, missions of the financial institution regularly visit the country.
“Therefore, we have active cooperation. During the spring and annual meetings, we have the opportunity to discuss several issues that are important for our bilateral relations, as well as for the region. Azerbaijan now has an important mandate – to organize COP29. COP is an important undertaking. I I think this will be one of the important moments in the current year. And the Fund is ready to help. As you know, the Fund has expanded its work on climate in various areas. We look forward to working with the government in preparing for COP29 and bringing a regional dimension to the priorities that the world is contemplating. to discuss this in November of this year,” he said.
Cooperation in the field of green transition
Jihad Azur noted that the Fund does not finance projects, but helps countries implement a “green” transition.
“We have launched a new Sustainability and Sustainability Fund. The project aims to help countries make major changes, both in terms of policy and structural reforms, that will help countries move beyond their current state and into a greener one.” economy. We are working at three levels for the region, and also with Azerbaijan on the issue of adaptation. Although our region is not among the largest emitters, it is still one of the most affected. And therefore it is important to help countries develop through a certain number of policy measures. and investment potential for adaptation and mitigation of climate shocks.
The second level is the reduction of emissions and the development of a certain number of new sectors, renewable energy, solar energy, etc., which will increase the share of non-carbon energy production. The third level is to help countries identify new investment opportunities. This is a sector that will be one of the fastest growing, and therefore, this is an opportunity for countries to use these sectors to increase investment. Azerbaijan is a country that has the potential and resources to develop new activities in the environmental sector,” he said.
Uzbekistan
Jihad Azur noted that over the past few years, Uzbekistan has carried out important reforms to ensure openness of the economy, attract investment and liberalize its financial system.
“In addition, they are working hard to attract direct investment and develop their economy. Uzbekistan’s economy has shown good levels of growth over the past few years, with growth of 6 percent in 2023 and growth of 5.2 percent projected this year. Uzbekistan has suffered from various shocks such as COVID-19, the war in Ukraine and the consequences of geo-economic fragmentation, it is therefore important for Uzbekistan to accelerate its transformation in the future through reforms that will accelerate the flow of investment, as well as strengthen ties between Uzbekistan and some key economic partners, starting with China and Europe,” he said.
The head of the IMF’s Middle East and Central Asia Department noted that it is important to continue the process of structural reforms, further open the economy to foreign investors, accelerate the transformation of some state-owned enterprises, while at the same time maintaining macroeconomic stability through tight fiscal policies, which may require some additional consolidation, and improve the social protection system.
Turkmenistan
Jihad Azur noted that Turkmenistan has large gas reserves and potential for growth.
“The way to expand this potential is to undertake additional reforms to create a strong and established market economy, improve institutional capacity to attract foreign investors and strengthen the social safety net to provide additional social assistance and social inclusion. This is an energy-producing economy and therefore it is important carry out further diversification beyond the gas and oil sectors,” he concluded.
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