Value of state package to support Azerbaijan’s economy in 2022 revealed

Azerbaijani government will introduce a $3 billion package to support economic activity, including investment plans to reconstruct Karabakh, Report informs referring to the updated Asian Development Bank’s Asian Development Outlook (ADO) 2022.

Expenditure is forecast to rise to equal 31.3% of GDP in 2022, then decline to 29.2% of GDP in 2023.

“The central government deficit is projected to widen to equal 3.1% of GDP in 2022 before narrowing to 1.5% in 2023, with revenue rising slightly in nominal terms but falling to 28.1% of GDP in 2022 and 27.6% in 2023 as nominal GDP growth again outpaces revenue,” reads the report.

Transfers from SOFAZ are expected to rise by 12% in 2022 to compensate for lower tax revenue, providing half of all revenue, and decline by 9.5% in 2023 following the adoption of new fiscal rules.

Investment is projected to expand by 2% in 2022 and 3.5% in 2023 as the government develops green energy and invests in core infrastructure in Karabakh, and as private investment also expands.