Page 142 - Azerbaijan State University of Economics

THE PUBLIC INVESTMENTS IN AZERBAIJAN: THEORETICAL AND PRACTICAL ASPECTS

Establishment of such companies provides great opportunities for the public

investment activities. This increases the importance of project evaluation. It
is very important to attract local private sector, foreign investors and

international financial institutions to the investment activity in our county.

Conclusion

Application of different definitions for “fixed capital investment”
in public organizations in Azerbaijan hampers the process of economic

analysis. Thus this terminology is called “capital investment” in the

investment legislation, “investment to fixed capital” in statistical data,
“capital expenditures” and “fixed capital investment” in budgetary

classification. Therefore, Azerbaijan State Statistical Committee,

Ministry of Finance and Ministry of Economic Development should
generate the common approach in identification of this terminology.

Identification and definition of “public investment” is also
complex process. Thus the Organization for Economic Co-operation and

Development public investments is defined as the sum of gross fixed
capital formation and capital transfers payable to business or households.

This approach is similar to adding up investment funds generated both

by the state budget and non-budgetary funds. At the same time approach
considering only these two sources does not consider the investments

implemented based in debt financing. At the same time according to
Azerbaijani practice, all investments realized under the Public

Investment Program are further transferred to the ownership of the
public agencies. Thus investments implemented under the indicated

program can be designated as public investments, while some part of

investments implemented by such organizations may e not public ones.

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