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Begin New Search Topic Oil Author Vugar Bayramov

1. Managing Resource Revenues in Oil-Rich CAREC Countries: The Case of Azerbaijan

Author:
Vugar Bayramov, Tim McNaught, and Elchin Rashidov
Publication Date:
04-2011
Content Type:
Working Paper
Institution:
Center for Economic and Social Development (CESD)
Abstract:
The high inflow of oil revenues to Azerbaijan in recent years has led to large and unsustainable increases in government expenditures in the state budget and State Oil Fund of the Azerbaijan Republic. Given that oil revenues are exhaustible, volatile, and unpredictable, a sustainable fiscal policy must be enabled that allows for intergenerational equity, diversification in the economy, and predictable annual revenues that reduce pressures of appreciation. This paper aims to describe the recent and current management of oil revenues in Azerbaijan, provide a summary of international practices of natural resource management, and to make policy recommendations for future management of oil revenues. Recommendations include isolating oil money from the Azerbaijan economy, collecting it in the State Oil Fund, using permanent income hypothesis to employ a smooth distrubution function, and other investment considerations.
Topic:
Oil, Natural Resources, Budget, Investment, and Fiscal Policy
Political Geography:
Azerbaijan and South Caucasus

2. Azerbaijan’s Accession to World Trade Organization (WTO); Pros and Cons

Author:
Vugar Bayramov
Publication Date:
07-2010
Content Type:
Working Paper
Institution:
Center for Economic and Social Development (CESD)
Abstract:
Center for Economic and Social Development (CESD) together with Konrad-Adenauer-Stiftung (KAS) have published new policy paper titled as “Azerbaijan’s accession to the WTO: Assessing the macroeconomic consequences for the economy of Azerbaijan”. The paper analyzes the macroeconomic consequences for Azerbaijan’s economy in case the country joins the World Trade Organization (WTO ). Existing studies primarily draw on qualitative methods, while for this study a Computable General Equilibrium (CGE) model of the economy is calculated to simulate the consequences of WTO accession. The authors are able to generate numeric forecasts for macroeconomic variables as a measure for welfare and elaborate how WTO accession, interpreted as an external shock to the economy, would affect these variables. This study is, therefore, a unique contribution to the public and academic debate as it is the first study to quantitatively gauge the effects of accession beyond qualitative arguments. To contextualize the quantitative findings, several independent experts were interviewed to compile their opinions on WTO accession. The results of this study suggest positive welfare effects of WTO accession through increases in income, consumption and savings. However, the forecasts generated through our model reveal that exports would plummet as a consequence of accession. This must be of particular concern for the Azerbaijani economy with its oil and energy sector currently being the main driver of gross domestic product, foreign direct investment and exports. As a consequence, the Azerbaijani economy needs to diversify rapidly and decrease its dependence on oil to realize positive effects on general welfare that could be triggered through WTO accession. Whether these positive effects will materialize in the long run is hard to predict, although the qualitative evidence cited in this study suggests that accession would bring along important incentives for diversification.
Topic:
Economics, Oil, World Trade Organization, and Trade
Political Geography:
Azerbaijan and South Caucasus