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IMF, AZERBAIJAN STILL DISAGREE
ON PROCEDURES FOR IMPLEMENTING BANKING SYSTEM
LAW
Baku, IAA "Trend" April 1 corr. R.Abbasov
Substantial differences remain between
the International Monetary Fund
(IMF) staff and the government on a number of issues,
including on the procedures for implementing
the recently adopted Banking System Law,
says a statement issued by a staff mission of IMF.
The IMF staff was also concerned about delay
of the fourth review of the Azerbaijan's performance
under the Poverty Reduction and Growth Facility
(PRGF), as well as slow implementation of policies
that have been earlier agreed upon, including
the privatization of the International
Bank of Azerbaijan (IBA), the adoption of a
long-term oil revenue management
strategy, the design and implementation
date of an oil product price adjustment mechanism,
the adoption of the revenue and expenditure
plans for 2004 of state-owned enterprises,
and the submission of the draft National Bank Law
to Parliament.
The staff voiced the fear that if not resolved
these policy problem could have adverse
consequences for future economic growth
and poverty reduction.
The staff is awaiting proposals from the government
on ways to bridge these policy differences
and to accelerate reforms. It is
hoped that these issues can be in position
to recommend completion of the fourth
review of the PRGF arrangement, the statement
underlines.
The mission visited Baku in late February
for discussions on the fourth review of Azerbaijan's
performance under a three-year, SDR 80-45 million
(about US$119m) PRGF arrangement. Consideration
of the review by the IMF Executive Board had tentatively
been planned for early Amy 2004. The mission welcomes
the continued strong economic growth and maintenance
of prudent macroeconomic policies.
PRGF credits are allotted with annual rates
of 0.5% and are to be cleared off within 10 years with
5.5 years grace period.
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