NOT A SINGLE MANAT MORE

Perhaps for a long time the Azerbaijani economy has not seen so much negative impact from the outside like over the past year. The problems were mostly provoked by a sharp decline in oil prices, political unrest in neighbouring countries and related infringement of the trade-economic balance, the crisis in Greece and so on, which, as we know, ended in the 33-per-cent devaluation of the manat in February this year. The fall in the rate of the national currency, of course, could not but affect all sectors of the economy. At the same time, there appeared a number of problems that were previously resolved through additional state expenses.

At a meeting of the Cabinet of Ministers dedicated to the results of socio-economic development in the first half of 2015 held at the beginning of last week under the presidency of Azerbaijani President Ilham Aliyev, the head of state strongly criticized problems in a number of sectors of the economy and public life.

Stability is preserved

We must say that, despite all the negative factors, the economy of Azerbaijan withstood the blows with credit in the first half of 2015 and showed growth again - by 5.7 per cent, while the non-oil sector grew by 9.2 per cent. At the same time, inflation continues to be as low as 3.5 per cent, while the income of the population was traditionally ahead of inflation and increased by 6.2 per cent. Agriculture grew by 7.3 per cent - these are the highest growth rates in recent years.

Also, according to Finance Minister Sarifov, the crisis did not affect the performance of the country's budget, and according to the results of the six months, the amount of revenues was 1.2 per cent higher than the forecast.

At the same time, for the first time in recent years, the first half of 2015 saw a change in the volume of domestic and foreign investment in favour of the latter. On the one hand, this means a decline in domestic capital investment due to the lower volume of state incomes and on the other - the fact that Azerbaijan continues to be an attractive country for foreign investment.

In short, figures speak about the absence of a serious cause for concern regarding the disruption of economic stability.

At the same time, positive statistics do not always reflect the real situation in some areas. It was pointed out by President Ilham Aliyev after he announced information about the creation of about 60,000 new jobs in the first half of the year, of which 48,000 are permanent. The thing is that during this period there were reports about cuts in the operating personnel in a number of companies and organizations allegedly because of the crisis. "I know that in some places, jobs closed. Therefore, it is first of all necessary to examine the reasons for this. On the other hand, these statistics must be submitted together with the statistics of new jobs so that we conduct a correct analysis," the head of the state fairly said.

A correct analysis of the situation helps to avoid social unrest on the one hand and unnecessary state expenses on the other. Thus, according to Aliyev, quite positive changes have taken place in the programme of targeted social assistance. "The number of people who receive social aid has decreased by about 20 per cent. At what expense? Not because someone's aid was cut off, but because those who do not need help do not receive it any more. This aid is provided to 112,000 families, 490,000 people, and each family is paid a monthly average of about 150 manats," the head of state said.

Treat, do not cripple

However, how much importance Azerbaijan attaches to the solution of social issues is proved by the fact that, despite the sharp decline in oil prices, the revenues from which form the bulk of government incomings, no social programme has been reduced.

Moreover, on the instruction of the president, control over the settlement of existing problems, in particular, the chaotic situation on the market of medicines has been tightened. A few months ago, the president had already touched on the topic of high drug prices, and the situation was analyzed by relevant agencies.

"There is irresponsibility and in some cases greed on the part of doctors. They write out unnecessary prescriptions and say you have to buy this medicine in this place. They even issue prescriptions for vitamins that are sold without a prescription. This is a large business network. At whose expense is this business carried out? At the expense of ordinary people. Ordinary people are forced to buy medicines on prescriptions written out for them. They do not even know what they are buying. After that, unfortunately, no one is interested in whether the medicine helped them," Aliyev said.

Minister of Health Oqtay Siraliyev earlier said that his ministry has prepared a new financial mechanism for the regulation of prices for medicines and will apply it by autumn. In June, the Cabinet approved rules of regulating the prices of medicines that have state registration and of overseeing prices, according to which they will be corrected by the Tariff (Price) Council. A list of 10 countries has already been approved to determine the base price of medicines, including Turkey, France, Italy, Spain, Portugal, Greece, Poland, Hungary, Bulgaria and Slovenia. Wholesale pharmaceutical enterprises and pharmacy organizations will determine the level of surcharges to the price of medicines in relation to the sale price.

At the last meeting of the Cabinet of Ministers, President Ilham Aliyev drew particular attention to the moral component of the problem. "Medicines are people's lives and health. People who allow violations in this business are unscrupulous. Therefore, we will eliminate these social and moral violations," the head of state promised.

Stop "protection"!

One must say that some experts considered the violation of the principles of free market economy to be the flip side of the coin in the fight against corruption on the market of medicines. However, Aliyev immediately foiled these assumptions, noting that the goal is to eliminate the negative phenomena, not to oppress entrepreneurs.

On the contrary, the head of state sharply criticized any attempts by state institutions, especially the Ministry of Taxes, to impose additional levies on businessmen and strictly prohibited illegal harassment of entrepreneurs for the umpteenth time.

However, at the same time, he called on the latter to be more responsible and pay the taxes in a timely manner. "Unfortunately, the culture of paying taxes is not developed fully and in a transparent way in our country. Government agencies pay taxes. Of course, getting this tax does not require much skill. But does the private sector pay taxes in full? No, it does not," the head of state said.

Even so, the president strictly stressed the need to clearly separate two questions. The Ministry of Taxes should definitely try to ensure that taxpayers pay taxes legally and fully. However, no unreasonable demands should be put forward. "That is why entrepreneurs, simply put, have to pay state money in full, that's all. Apart from that, they do not have to pay anyone a single manat," the president clearly defined.

He warned that he was aware of the outrageous unlawful actions of a number of government agencies with respect to businessmen. "The Ministry of Taxes, the law enforcement agencies and local executive authorities in Baku and regions set a fee, demand a share and provide protection. This is an intolerable phenomenon, this must end. If they believe that no one knows about it, they are wrong. This is a very serious matter, and I receive signals that in some places it has taken on a mass scale. It is necessary to stop it completely. Therefore, today I give instructions to all relevant entities and entrepreneurs. Let them report to me, not fear, send messages, write letters and send e-mails. If such facts exist, then those who are engaged in these nefarious deeds will be punished immediately," the president said.

He reiterated that the future of the Azerbaijani economy will be based precisely on the activities of the private sector in the country, and therefore, the head of state perceives any illegal actions in this area as a betrayal of the state.

By the way, about the future. According to Finance Minister Sarifov, the process of drafting the state and consolidated budgets for 2016 and for the subsequent three years has already begun. According to him, the main goal of the authors is gradual reduction in transfers from the State Oil Fund to the state budget and keeping the assets of the Fund at the highest possible level. On the other hand, the focus is on basic social tasks in further improving the efficiency of budget spending, continuing the balanced development of the regions, strengthening the military capability and food security of the state, economic diversification and support for the development of the non-oil sector. Thus, it is expected that this year's budget will be more adapted to the current and forecast situation in the global and domestic economy. The main thing is to keep the balance and stability.

FIRSTHAND

"The Ministry of Taxes, the law enforcement agencies and local executive authorities in Baku and regions set a fee, demand a share and provide protection. This is an intolerable phenomenon, this must end. If they believe that no one knows about it, they are wrong."

Ilham Aliyev, President of Azerbaijan