Central and West Asia
Sum of Measures 1—5 (Total Package)
|Measure||Amount (Local)||Amount (USD)||Details||Update||Source|
|01 - Liquidity Support info_outline|
|01A - Short-term lending info_outline|
|01B - Support policies for short-term lending info_outline|
|01C - Forex operations info_outline||
April, The Central Bank of Azerbaijan (CBA), with the participation of the State Oil Fund, conducted scheduled and extraordinary foreign exchange auctions, and satisfied all demands for foreign currency at the announced 1.7AZN/USD rate.
|02 - Credit creation info_outline||AZN500,000,000||USD294,117,647|
|02A - Financial sector lending/funding info_outline|
|02B - Support policies for long-term lending info_outline||
No amount/estimate: March 19: (i) The CBA left the refinancing rate unchanged at 7.25%, but raised the floor of the interest rate corridor (within a de facto floor system) by 125 basis points (bps) to 6.75%. May 1, the CBA lowered the ceiling of the interest rate corridor by 100 bps to 8%; (ii) The authorities have announced their intention to extend the blanket deposit guarantee until December 4, 2020 (the interest rate cap for national currency denominated deposits 10% and for foreign currency denominated deposits 2.5%) irrespective of deposits’ amount, currency and banks’ financial standing; (iii) A relation of capital requirements (systemwide and the countercyclical capital buffer) and risk weights on mortgage loans; (iv) April 23, Suspension of inspections of credit institutions; (v) June 19, CBA decided to reduce the discount rate from 7.25% to 7%. The lower limit of the interest rate corridor was set at 6.5%, and the upper limit of the interest rate corridor was set at 7.5% [update].
|02C - Loan guarantees||AZN500,000,000||USD294,117,647||
April 6, Entrepreneurs get state guarantee for 60% of their new bank loans and the government subsidizes half of the interest on guaranteed loans from the state budget; overall state support at AZN500 million (USD294 million); (ii) No amount/estimate: May, The CBA also announced that it will extend its guarantees on insurance premiums.
|03 - Direct long-term lending info_outline|
|03A - Long-term lending info_outline|
|03B - Forbearance||
No amount/estimate: April 23, The CBA announced a moratorium on late fees and interest rate penalties.
|04 - Equity support info_outline|
|05 - Government support to income/revenue||AZN1,085,000,000||USD638,235,294|
|05A - Health|
|05B - Non-health||AZN1,085,000,000||USD638,235,294||
(i) April 6, AZN1 billion (USD588 million) for the government's subsidization of 10% of the interest for one year of existing company loans; (ii) No amount/estimate: April, Tax exemptions for micro-enterprises and value-added tax (VAT) exemption for some food and medicinal products, as well as the raw materials that are necessary for making such stuff; (iii) No amount/estimate: Lump-sum payments in the amount of living wage - AZN190 (USD112) to 200,000 unemployed citizens of the country. The payment is considered for two months. The social package aims to relieve the impact of the novel coronavirus on the social life of people by multiple tools, including creation of 50,000 paid public jobs, tuition support program for students from socially vulnerable families, financial support program for mortgage and credit guarantee mechanism, program to support communal fees, primarily for electricity consumption of the population, and financial support program for vital passenger transport activities; (iv) May 19, USD50 million, or about AZN85 million (of the USD200 million swap with the European Bank for Reconstruction and Development (EBRD)) is allocated as support to local firms, including smaller viable enterprises experiencing temporary difficulties.
|06 - Budget reallocation info_outline|
|07 - Central bank financing government|
|07A - Direct lending & reserve drawdown|
|07B - Secondary purchase: government securities|
|08 - International Assistance Received||AZN346,970,000||USD204,100,000|
|08A - Swaps info_outline||AZN340,000,000||USD200,000,000||
May 19, The CBA and the EBRD have signed a USD200 million swap agreement to increase access to financial resources for the real sector during the coronavirus pandemic.
|08B - International loans/grants||AZN6,970,000||USD4,100,000|
|08B1 - Asian Development Bank||AZN850,000||USD500,000||
April, Country Support under TA 9950-REG: Regional Support to Address the Outbreak of COVID-19 and Potential Outbreaks of Other Communicable Diseases (USD0.50 million).
|08B2 - Other||AZN6,120,000||USD3,600,000||
(i) No amount/estimate: Testing and personal protective equipment supplies from WHO; (ii) May, USAID provided USD3.6 million in total assistance, of which (a) USD3 million in health assistance, which is helping prepare laboratory systems, activate case-finding and event-based surveillance, support technical experts for response and preparedness, bolster risk-communications, and more; (b) USD0.565 million in MRA humanitarian assistance that will help vulnerable people and host communities during the pandemic (grant); (iii) No amount/estimate: June 22, A shipment of medical equipment arrived in Azerbaijan to help healthcare workers on the frontlines of the COVID-19 pandemic. The protective equipment is funded by the EU and procured by the WHO [update].
|09 - International Assistance Provided||AZN8,500,000||USD5,000,000|
|09A - Swaps info_outline|
|09B - International loans/grants||AZN8,500,000||USD5,000,000||
(i) March, Azerbaijan is contributing to global efforts to address COVID-19, coordinating with neighboring countries, and has pledged USD5 million to World Health Organization's strategic preparedness and response plan.
|10 - No breakdown||AZN1,000,000,000||USD588,235,294||
March, AZN1 billion is part of the announced support amounting to AZN2.5 billion (3% of GDP) to reduce the negative impact of COVID-19 outbreak on the national economy, the entrepreneurship and banking sectors, as well as for strengthening the social protection of the people.
|11 - Other Economic Measures||
(i) March, Establishment of the Coronavirus Response Fund under the Decree of the President of the Republic of Azerbaijan of March 19, 2020. The government itself is asking for donations from citizens, organizations, and businesses to help it deal with the disease in Azerbaijan. According to President Ilham Aliyev, the basic goal of the fund is for the people of Azerbaijan to within the limits of their capability, demonstrate their civil solidarity and generosity which are foundations of their society. The fund has raised AZN112 million as of April 19; (ii) April, The CBA and commercial banks have shifted to a seven-day work week, including to allow individuals and businesses to convert their manat holdings into foreign currency; (iii) April 23, The CBA also announced that it will extend its guarantees on insurance premiums.
|12 - Non-Economic Measures||
(i) To contain the spread of COVID-19, the authorities have introduced a special quarantine regime (until June 15). It includes border closures, required quarantine of returning citizens, prohibition of mass gatherings, and restriction on domestic movements; (ii) The COVID-19 Operational Headquarters has been created under the Cabinet of Ministers, and working groups within various ministries and the CBA have been tasked with developing specific measures. These restrictions are being slowly relaxed starting May 4.