The Asian Development Bank (ADB) has raised its 2024 economic growth forecast for Azerbaijan by 1.5 percentage points to 2.7%, Report informs.
According to the ADB's previous report, published in April, forecast growth at 1.2%.
According to the bank's forecasts, the country's GDP will grow by one percentage point to 2.6% in 2025.
In the new September Asian Development Outlook (ADO) report, published today, analysts note that the main factors behind the improvement were the growth of the non-oil sector, an increase in government spending, and stronger investment activity.
In the first half of 2024, the non-oil economy grew by 6.9%, while the hydrocarbon sector showed a more modest result of 0.6%. At the same time, a 3.4% increase in gas production more than offset a 4.9% decline in oil production. As a result, economic growth accelerated from 0.5% in the first half of 2023 to 4.3% in 2024.
In contrast, growth in agriculture slowed from 3.4% to 0.2% due to lower crop production. Industry grew by 0.9%, driven by a 7.4% increase in petrochemical and food production, offsetting a 1.8% decline in industrial production in the first half of 2023, driven by a 3.7% decline in mining.
The ADB also notes that strong investment growth led to a doubling of construction growth from 9.2% in the first half of 2023 to 18.4% a year later. In services, growth increased from 1.6% to 6.1%, driven by the development of the transport sector, which grew by 15.4%.
ADB experts expect that the positive dynamics will continue until the end of the year, which will contribute to the revision of forecasts for 2024 and 2025. By the end of 2023, Azerbaijan's GDP growth rate was 1.1%. According to government forecasts, GDP growth is expected at 4.2% in 2024 and 3.5% in 2025.