Baku. 6 April. REPORT.AZ/ Azerbaijan will be able to increase fiscal expenditures with the support of rising oil prices, while one-time devaluation of national currency led to rise of net exports.
Report informs, says the 2017 Outlook released by Asian Development Bank (ADB).
"GDP is forecast to decline by a further 1.1% in 2017 and then recover by 1.2% in 2018. Inflation is projected to moderate to 9.0% in 2017, then slow further to 8.0% in 2018. The current account balance is forecast to record surpluses equal to 5.9% of GDP in 2017 and 11.4% in 2018. Total exports are projected to grow with the projected improvement in oil prices", the report says.
Economic prospects in GDP is projected to contract by 1.1% in 2017 with a further decline in oil production. However, GDP is forecast to turn up by 1.2% in 2018 with the onset of production from the Shah Deniz gas field.
On the supply side, industry is forecast to contract by 0.5% in 2017 as oil production, which accounts for 65% of total industry, declines further. However, gas condensate from new Shah Deniz gas field will help industry expand by 1.0% in 2018.
Construction is projected to fall by a further 10.0% in 2017, reflecting planned cuts in public investment, and then expand by 1.0% in 2018 as the economy recovers and the government accelerates the implementation of its social housing program. Government efforts to stimulate non-oil exports, in particular through its Made in Azerbaijan promotion, should catalyze growth in agriculture at 3.0% in 2017 and 4.0% in 2018. Services are projected to show little change in 2017, then expand by 1.0% in 2018.
Fiscal policy will aim to limit deficits in the next 2 years. The government anticipates state budget deficits equal to 1.0% of GDP in 2017 and 0.9% in 2018. Expenditure is projected at 26.2% of GDP in 2017 and at 26.4% in 2018.
Total exports are projected to grow by 22.6% in 2017 with the projected improvement in oil prices and expand by a further 15.0% in 2018. Imports are expected to contract by 6.2% in 2017, then expand by 12.5% in 2018.
According to ADB report, GDP per capita will contract by 2.2% in 2017 and recover by 0.1% in 2018.
Azerbaijan’s trade surplus is forecasted at $8.078 billion in 2017 and $9.483 bln in 2018.