Ilham Aliyev approves SOFAZ budget for 2017

Ilham Aliyev approves SOFAZ budget for 2017
The budget of the State Oil Fund of Azerbaijan (SOFAZ) for 2017 has been approved by a decree of Azerbaijani President Ilham Aliyev.

The decree approves SOFAZ revenues for 2017 at 8,370,589,800 manats and expenditures at 14,483,856,000 manats.

In the SOFAZ incomes, revenues from the sale of profitable oil and gas are forecast at 7,550,705,300 manats, acre payments are forecast at 3.465 million manats, income from oil and gas transit through the territory of Azerbaijan is expected to amount to 16.83 million manats.

In addition, revenues of the Fund from the placement and management of assets are forecast at 799,094,600 manats. Bonuses paid by investors within oil and gas agreements, or in connection with their implementation are forecast at 495,000 manats.

Transfers worth 7.5 billion manats to the Central Bank of Azerbaijan in order to ensure macroeconomic stability in the country will be the largest expenditures of the Fund. Its transfers to the state budget of Azerbaijan will amount to 6.1 billion manats.

Expenditures for the improvement of living conditions of refugees are forecast at 90 million manats, expenditures for the reconstruction of the Samur-Absheron irrigation system are forecast at 70 million manats, costs within the Baku-Tbilisi-Kars railway construction project will amount to 165.825 million manats, costs for financing the state program on education of Azerbaijani youth abroad in 2007-2015 will be 29.304 million manats.

In addition, the State Oil Fund’s budget for the next year provides for the expenditures for financing the state’s share in the Southern Gas Corridor projects worth 496.155 billion manats.

Costs of the Fund management are approved at 32.572 million manats.

In accordance with the budget of expenditures on the management of the State Oil Fund in 2017, labor payment will amount to 6,872,008 manats, the costs for procurement of goods and services will amount to 5,004,640 manats, expenditures for grants and other payments will stand at 674,460 manats.

Expenditures for pensions and social benefits are provided in the amount of 80,000 manats, costs for the purchase of non-financial assets are envisaged at 6,126,100 manats, and 13,814,792 manats will account for other expenses.

SOFAZ was established in 1999 with assets of $271 million.

Based on SOFAZ’s regulations, its funds may be used for the construction and reconstruction of strategically important infrastructure facilities, as well as solving important national problems.

The main goals of the State Oil Fund include: accumulation of resources and placement of the Fund’s assets abroad in order to minimize the negative effects on the economy, prevention of "Dutch disease” to some extent, promotion of resource accumulation for future generations and support of current social and economic processes in Azerbaijan.