Azernews.Az

By Nigar Orujova

An Azerbaijani official said the country is set to establish some strategic gold reserves by late 2014.

Executive Director of Azerbaijan's state oil fund SOFAZ Shahmar Movsumov made the announcement after an Azerbaijani Investment Summit "2020 & Beyond: Accelerating Economic Development" on March 12.

"As it is known, we can invest in gold up to five percent. Earlier, a strategic decision was made to purchase 30 tons of gold in the next two years. Twenty tons of this volume has already been delivered to the country, and the remaining part will be delivered during the year," he said.

"These purchases are part of the process to establish the country's strategic gold reserves. They are not only for profit resale," Movsumov said.

"Therefore, the cost of the purchased gold had no special significance. On average, 300 kg of metal at a price of $1,400-1,500 was procured each week during the past period. I would like to note that the last purchase by SOFAR was cheaper - about $1,200 - which is associated with a fall in world prices for this metal," he noted.

The summit brought together policy-makers, CEOs, investors and NGOs from different countries to hold talks on opportunities for Azerbaijan to accelerate its economic development.

SOFAR has started buying gold from the first quarter of 2012. It maintains that the Fund can direct to five percent of the investment portfolio for gold purchasing.

Movsumov said some changes will be made to the budget of the Fund. "A total of $51m will be spent to build the starting capital of a newly set up company that will manage gas projects," he added.

"The funding of the projects under the South Gas Corridor will start this year, and continue until 2018-2019. The revenues from these projects will be invested in the new company, which will then return the funds to the State Oil Fund," he said.

"The projects would require nearly $2.5 billion, which will be returned to SOFAZ until 2023-2024," he said.