"Azerbaijan is facing an additional challenge in the form of the fall in the oil prices. Given the share of the oil and gas sector in the economy, falling oil prices naturally impact Azerbaijan negatively, as the external trade balance and consolidated fiscal balances are hurt. However, foreign exchange reserves accumulated over the previous years to the tune of 100 percent of GDP must help to ease pressures from these factors. For example, in case oil prices remain low and/or pandemic lasts longer, Azerbaijan might face consolidated budget deficit both due to the oil price and to weak economic activity. At the same time, unlike most countries of the region, Azerbaijan can finance these deficits with the accumulated reserves, rather than resort to debt instruments. So, Azerbaijan has substantial buffers that it can use in case of need. Still, we believe that rather than to exhaust the reserves, Azerbaijan will likely adjust its economic policy and adapt necessary measures, so that the reserves are saved for the long period ahead, which is the purpose of the Oil Fund," he said.

Pankin went on to add that most countries are doing what needs to be done .

"Given that lives of people are at stake and public health priorities determining economic policies, there are too many uncertainties to be able to say what to do and when to do it. From the economic perspective, it is necessary to provide support and devise mechanisms so that enterprises remain afloat and are able to start operations as soon as restrictions are lifted. Azerbaijan has done a lot in that direction. Measures have been taken to support people in need with cash payments, tax reliefs incentivized companies not to fire employees, etc.," he said.

To sum up, first, policies should be in place to protect public health and, second, emergency measures should be implemented to help people, enterprises, and all economic agents to overcome the pandemic and to restart their activities, noted the BSTDB President.

The Black Sea Trade and Development Bank (BSTDB), an international financial institution with headquarters in Thessaloniki, Greece, was established by Albania, Armenia, Azerbaijan, Bulgaria, Georgia, Greece, Moldova, Romania, Russia, Turkey, and Ukraine.

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