ADB forecasts acceleration in Azerbaijan’s economic growth 

Growth in Azerbaijan is forecast to return in 2021 at 1.9% and accelerate to 2.5% in 2022 as demand improves at home and abroad, Report says referring to Asian Development Outlook (ADO) 2021: Financing a Green and Inclusive Recovery.

As consumer confidence is restored and petroleum receipts become available for public investment, growth in the petroleum industry is expected to be outpaced by expansion in the rest of the economy. Azerbaijan has diverse providers of COVID-19 vaccines and has started inoculations, expecting to vaccinate 20% of the population by the end of 2021.

On the supply side, the industry is forecast to expand by 2.1% in 2021 and 2.9% in 2022, led by higher gas production and recovery in construction. Agriculture is expected to grow by 3.5% in both years on state support and easy farmer access to finance, including a new subsidy to cut production costs. Government plans to reconstruct territory scarred by the Azerbaijan–Armenia conflict will boost construction in 2021 and 2022. Recovery in retail trade and tourism is projected to boost services by 2.8% in 2021 and 4.0% in 2020.

“On the demand side, consumption is expected to grow by 2.1% in 2021 and 2.5% in 2022 as higher wages and public spending boost household income. The end of COVID-19 containment and sustained government support to private firms will increase private consumption. Higher outlays will raise government consumption, particularly in 2021, but increased revenue will allow the government to raise public investment, and private investment will also expand with an improved macroeconomic outlook,” the document said.