“On February 21, 2015 and December 21, there was a change in exchange rates. Firstly, tne dollar was equal to 0.78 AZN, then 1.05 AZN, and on December 21 it became 1.55 AZN. This led to problems with the solvency of individuals who took out a loan in foreign currency”, - the executive director of the analytical and communication center for economic reforms, Vusal Gasimli, said this at a press conference in connection with the decree signed today by President of Azerbaijan Ilham Aliyev "On additional measures to address the issue of problem loans to individuals", ONA reports.
The executive director said that according to the Decree, from February 21 to December 21 of 2015, a compensation of 0.25AZN per dollar will be made, and following December 21, it will be 0.60AZN per dollar.
"Imagine that before February 21, 2015, a physical person received a loan of $ 10,000. At that time, 10 thousand dollars was equal to 7 800 AZN. After the exchange rate change on Feb. 21, 2015, $ 10,000 was equal to 10,500 manat. That is 2700 manat difference. The first compensation amount, that is, 0.25AZN per dollar - 2500 manats to eliminate this difference. Second, the exchange rate was 1.55 manat on December 21, 2015. It means that 10 thousand dollars was equal to 15 500 manats. The difference in the exchange rate was 7,700 manats. The President's decree envisages removing this difference. In other words, the government compensates the difference in manat as a result of devaluation. As if citizens will return money back with the same course that they borrowed from the bank, as a result of government support."