Baku, Azerbaijan, Oct. 9
By Azad Hasanli - Trend:
The World Bank (WB) forecasts that Azerbaijan's annual GDP growth will stand at an average of 2.4 percent between 2015 and 2017.
Earlier, the bank said in its June report that the growth of Azerbaijan's economy was projected to stand at 1.5 percent in 2015, at 2.6 percent in 2016, and at 2.7 percent in 2017.
Azerbaijan's government expects that in 2015 the real growth of the country's economy will be 3.3 percent.
Oil output will continue to decline, while capital expenditures of the government will be limited due to the decrease in world oil prices, the WB said in its new report released Oct. 8.
The bank also said that the share of Azerbaijani state's investments in GDP will fall to 10.3 percent in 2015-2017, bringing down the non-oil GDP growth to four percent.
Meanwhile, the WB analysts expect that in connection with construction of major gas pipelines (TANAP and TAP) between 2016 and 2017, the investments in oil and gas sector will significantly rise.
At the same time, according to the bank's expectations, the state budget deficit is projected at 1.4 percent of GDP in the medium term.
The deficit of the balance of payments is forecasted to reach 3.4 percent of GDP in 2015, which reflects the influence of low oil prices and increase of state expenditures due to holding the First European Games, implementation of the projects for constructing TANAP gas pipeline and the second phase of development of Azerbaijan's Shah Deniz gas and condensate field, said the report.
Nevertheless, the government doesn't intend to reduce the level of reserves of Azerbaijan's State Oil Fund, according to the forecasts.
The oil prices will gradually recover in 2016-2017 and the government will consolidate the expenditures, its fiscal position will improve, said the report.
The WB report said that the revenues of the consolidated budget have dropped by 22 percent in H1 of 2015. Due to the low oil prices, the revenues from the oil sale have decreased to 19 percent of GDP, according to the report.
The revenues of Azerbaijan's State Oil Fund and the tax payments from oil companies have dropped by 38 percent, said the report.
Nevertheless, the WB report said that the decrease in oil revenues was partially offset by the significant growth in non-oil GDP.
Edited by SI