Azerbaijan to review its 2016 budget due to weak oil

"Ongoing decline in oil prices in the world and the central bank's move to a new rate policy determine changes to the state budget for 2016," Samir Sharifov told a closed government meeting on Sunday.

Azerbaijan took in 11.6 percent less in budget revenue than it had expected last year because of the decline in oil prices fall, Sharifov said.

Economic growth in the oil-rich country slowed to 1 percent last year from 2.8 percent in 2014, well below official forecasts.

Baku withdrew support for its currency, the manat, on Dec. 21, triggering losses of 33 percent against the dollar. It had burned through more than half its foreign currency reserves trying to defend it against the effect of falling oil prices.

The 2016 budget sees total government revenues of 14.6 billion manats ($9.3 billion), down from 19.4 billion manats in 2015. Spending of 16.3 billion manats is forecast, down from 21.1 billion manats last year.

Sharifov said the government would be reducing spending in 2016-2019 and taking steps to develop the country's non-oil sector.

 

(Reuters)