12:01 - 24.12.2019

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December 24, Fineko/abc.az. Expert economist Samir Aliyev has shared an interesting and useful post in the social network about the transition of the manat to floating exchange rate.

ABC.AZ reports that according to the expert, serious complication of the floating rate was the loss of the manat by 32.3% to the US dollar overnight.

Recalling what happened on the same day, the expert noted that in subsequent periods the Central Bank of Azerbaijan changed the term and introduced to the society as "regulated floating rate": "The same day the CBA increased the official rate of dollar to manat from 1.05 to 1.55 manats. This was regarded as the first step towards full transition to a floating rate.

“Strategic Roadmap on the national economy & the main sectors of the economy" adopted in 2016 was mentioned as an element of achieving one of the strategic goals. In the action plan the full transition to floating rate was aimed at 2017, but then its term was extended to 2020. This move was a kind of recognition of the haste of the government's decision to move to full floating rate. Stressing later the importance of preconditions for the transition, CBA’s head proved that the government made a rash decision.

Although at that time independent experts considered it impossible to switch to floating rate within the existing conditions. It has already been 4 years since the decision to switch to floating exchange rate was made, but discussions on the transition of the manat to this regime have not yet stopped. Although some experts consider the transition to floating regime impossible under the current conditions, there are also those who do not share this opinion. I also agree with the first group of experts and believe the transition to floating rate under the current conditions is both impossible and impractical."