Baku, Azerbaijan, May 10
By Azad Hasanli - Trend:
The European Bank for Reconstruction and Development (EBRD) has improved the forecast for Azerbaijan’s economic growth for 2018, according to the bank’s updated report.
Thus, the bank increased its forecasts for Azerbaijan’s GDP growth from 2 percent to 2.5 percent for 2018. This is while the bank forecasts a 3.5 percent increase in Azerbaijan’s GDP for 2019.
The EBRD noted a general improvement in the economic conditions in Azerbaijan.
Economic growth in Azerbaijan accelerated to 2.3 percent year-on-year in the first quarter of 2018, driven by a 2.9 percent year-on-year growth in non-oil GDP, according to the report.
Inflation fell from 12.9 percent in 2017 to 4 percent year-on-year in the first quarter of 2018, paving the way for monetary policy relaxation, reads the report.
The Central Bank of Azerbaijan (CBA) has recently lowered the refinancing rate two times from 15 percent in February 2018 to 11 percent in April 2018.
The current account switched from a deficit in 2016 to a surplus of 4.1 percent of GDP in 2017.
“Official foreign exchange reserves of the CBA increased from $4 billion in December 2016 to $5.5 billion in March 2018,” the report said. “As of the first quarter of 2018, the combined assets of the State Oil Fund of Azerbaijan (SOFAZ) and of the foreign exchange reserves of the CBA stood at $43.1 billion, which is approximately equivalent to the country’s 2017 GDP.”
As for the region as a whole, the economies of countries of Eastern Europe and the Caucasus will continue to grow in 2018 and 2019, according to the EBRD. This is while the average growth will accelerate from 2.3 percent to three percent in 2018 and to 3.3 percent in 2019.
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