Baku, Azerbaijan, March 30
By Anvar Mammadov - Trend:
Azerbaijan's GDP will grow by 1 percent in 2017, said the Asian Development Outlook -2016 report issued by the Asian Development Bank (ADB).
Continued weakness in oil prices is projected to cause GDP to contract by 1 percent in 2016 before recovering to 1 percent growth in 2017 as oil prices revive, according to the ADB forecasts.
Earlier, the bank forecasted Azerbaijan's GDP growth at 2.8 percent in 2016.
"Plunging oil prices in 2015 cut export earnings, and sharp currency depreciation reduced household consumption and public investment, slowing growth to 1.1 percent," said the report. "The oil sector is reported to have expanded by 1.2 percent, following a 3.7-percent contraction in 2014, while cuts in public investment constrained the economy outside the oil sector, which expanded by only 1.1 percent, down from 7 percent in 2014."
ADB experts believe that the inflation rate in Azerbaijan will be 12 percent in 2016, but it will drop to 5.7 percent in 2017.
On the supply side, industry is forecast to contract in 2016 because of slowing oil production, but it could improve in 2017 and raise incomes of Azerbaijan if oil prices rebound, according to the ADB experts.
Some growth in agriculture is also anticipated each year with continued government support for farmers, according to the report.
Established in 1966, the Asian Development Bank has 67 members. Azerbaijan became an ADB member on Dec. 22, 1999. The country's share in the bank's capital is 0.5 percent.
Japan and the US (31.2 percent of the total capital), India and China (12.8 percent), Australia, South Korea and Canada (16 percent) are ADB's main shareholders.
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