President Ilham Aliyev has initiated amendments to the Law “On the Central Bank”. An appropriate bill was submitted to Milli Majlis signed by the Head of State and is presently discussed in the Parliament of Azerbaijan. The document primarily provides for an increase in the number of members of the Board of the Central Bank from 7 to 9, including the Chairman. For this purpose it is proposed to increase the number of permanent members from 4 to 6, and to leave the number of external members at two (to keep it permanent). At present, only 3 persons are represented on the Board. These are Chairman Taleh Kazymov, his first deputy Rashad Orudzhev and deputy Aliyar Mamedyarov. That is, the position of 4 out of 7 members of the Central Bank is vacant, and domestic experts refer to this fact as saying that the decisions of the Central Bank are illegitimate. Besides, the bill also reflects an increase in the number of Central Bank functions from 7 to 9, redefining them and giving the regulator economic autonomy. According to other proposed amendments, the Central Bank will be able to conclude contracts and agreements and establish legal entities. Commenting on the amendments above, economist Rovshan Agayev said that in the current reality of Azerbaijan the Central Bank cannot be independent, even if the most ideal laws and mechanisms are written. “It is impossible in the absence of real separation of powers, political participation, independent media and civil society. Among the proposed changes I did not see the most important issue – transparency in the work of the Central Bank. Today, the number one issue that the investor community and the society as a whole needs is transparency of the Central Bank. This institution is responsible for interaction with financial institutions (in particular lending, operations with securities), intervention in the foreign exchange market, management of own foreign exchange reserves, the international investment position of the country etc. The CB should create a system of accountability which is very operative (daily and weekly if necessary), it should create a detailed and clarifying system of accountability which nobody would question”.
Source: Turan News Agency