Page 133 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE

condition provides an opportunity to implement the investment projects

on account of internally generated funds.
We would like to notice that internal debt sources are not used in

financing of the investment projects. This factor eliminates the situations
when public investments replace the private ones. In recent years most of

investments are financed through oil revenues. At the same time increase in

investments made the private sector assist the government in technical
realization of these projects. Thus in most of cases, private sector was able to

invest into the expansion of its capacity through public orders and projects.
Table 7. The capital expenditures in the state budget of Azerbaijan

Republic (mln. AZN)

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Capital expenditure 68.6 54.3 99.1 168.0 193.1 316.8 1,428.7 2,920.4 5,170.3 4,538.9 5,027.9
Investment to fixed
capital 26.5 25.3 31.9 86.9 96.9 159.9 879.6 1,902.2 4,275.2 3,553.4 4,132.4

As we can see from the table above, effective from 2006 there is
increase growth temp in both capital expenditure and investments. Thus in

2010 the nominal amount of capital expenditures of the state budget

increased by 92.6 times in comparison with 2001, while investment into
the capital expenditure increased by 163.5 times. We have also noted that

expenditures directed to the repair works decreased from 53.3% to 17.8%
of total capital expenditure, which is explained by the fact that more funds

are directed to construction of new objects, rather than to repair of existing
ones. Such a great increase caused increases the portion of capital

expenditures both in gross domestic product and the state budget. Thus

during the period from 2001 till 2010 the portion of capital expenditures
increased from 1% to 12%, during the indicated period its portion in the

state budged changed from 6.7% to 42.7% respectively (picture 2).

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