15:49 - 3.04.2020

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April 3, Fineko/abc.az. The anchor of monetary policy should gradually switch from the monetary base to short-term interests, as the lower are short-term interests, the larger investments will be.

ABC.AZ reports that the relevant statement was made by Vugar Gasimli, the executive director of the Center for Analysis of Economic Reforms & Communications.

According to Gasimli, the real interest rate on loans in Azerbaijan is 11.1%, taking into account inflation. Gasimli noted that currently the State has undertaken subsidizing of 10% of the load of existing business loans, as well as half of interests and 60% of the guarantee of new loans, which, in fact, is a significant reduction of the real interests for business: "The state support of AZN 1.5 bn provided within these two programs is an investment to be made in the economy in the form of business loans.

Moreover, given the monetary multiplier, support for AZN 1.5 bn may grow even more. While loans to the private sector worldwide made up 129.7% of GDP, this figure in Azerbaijan reached 20.8% (for 2018). Thus, there is great potential for lending to the private sector."