Azerbaijani Oil Fund: Fiscal Consolidation, Volatility and Oil Wealth
Development, Center for Economic and Social | May 2017
The execution of the State Oil Fund of Azerbaijan's (SOFAZ) 2016 budget has been approved. According to a Presidential decree, SOFAZ's revenue was 9.410 billion manat ($5.881 billion USD) and expenditure was 9.022 billion manat ($5.638 billion USD). Initially, SOFAZ's revenue for 2016 was forecasted as 4.6 billion manat, while expenditure was expected to be 10.7 billion manat. The latest figures show that SOFAZ's actual income for 2016 was over 2 times higher than forecasted. Meanwhile, SOFAZ's actual expenditure for 2016 was 15.4% less than forecasted. The reason behind SOFAZ's increased revenue was that in 2016, oil prices were higher than expected. Due to the stabilization of the price of oil in the second half of 2016, SOFAZ was able to increase its income. At the same time, SOFAZ had also undergone a fiscal consolidation process, whereby certain expenditure items were cut. It serves to remember that the assets of the State Oil Fund of Azerbaijan (SOFAZ) decreased by 9.5% during 2015; as of 1 January 2016, they reached $33.57 billion, as compared to the $37.1 billion of the previous year (as of 1 January 2015). At that time, SOFAZ's press release stated that budget revenues for 2015 amounted to 7.7 billion manat and expenditures 9.187 billion manat.
CitationDevelopment, Center for Economic and Social. 2017. Azerbaijani Oil Fund: Fiscal Consolidation, Volatility and Oil Wealth. © Center for Economic and Social Development. http://hdl.handle.net/11540/7034.
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