Azerbaijan is one of the countries hardest hit by the oil-price slump, says the FT’s Jack Farchy. Oil and gas comprise 95% of exports and 40% of GDP. This year the economy is expected to shrink by around 3%, its worst performance in two decades.
The downturn, and the accompanying downward pressure on the currency, has forced the government to devalue the manat twice and ultimately abandon its peg to the US dollar.
The oil-induced squeeze has, however, helped international organisations persuade the government to clamp down on corruption.
Viewpoint
“More than three years after he became the governor of the Bank of England, a gentle grilling of Mark Carney [by schoolchildren] winkled out a piece of information that had eluded Fleet Street’s finest in their many interviews and profiles of him. Asked what his nickname had been as a child in Canada, a startled Carney said it had been “carnage”, an admission that will undoubtedly come back to haunt him should the economy go awry under his stewardship. Carnage Carney struggled to explain monetary policy without lapsing into jargon… Never work with children or animals, WC Fields once said. Sage advice, governor, sage advice.”
The Observer