Baku, Azerbaijan, January 28
By Zeyni Jafarov – Trend:
Azerbaijan's ‘BB+’ rating has been confirmed by the Standard & Poor's Global Ratings (S&P) due to continued macroeconomic stability and a high level of international reserves, sufficient to support the current rate of the national currency manat in the medium term, Gulnara Khaidarshina, Deputy Head of Russian Gazprombank’s Market Research Department, said, Trend reports.
According to Khaidarshina, the revision of the S&P forecast was facilitated by the recent settlement in the Nagorno-Karabakh region (10 November Trilateral Statement between Azerbaijani, Russian presidents, and Armenian prime-minister on ending the 44-day war (which lasted from late Sept. through early Nov.2020) in the region between Armenia and Azerbaijan), following which large-scale infrastructure projects are planned in the region.
“This, in, turn, will minimize risks for the external liquidity of position and growth of the Azerbaijani economy,” she added.
"Indeed, S&P identified the conflict parties' observance of the ceasefire after the conclusion of the agreement on November 10, 2020, as a key factor in the return of the ‘stable’ forecast, and in this regard noted the weakening of risks for the national currency and macroeconomic stability in Azerbaijan," the banks representative also said.
Besides, as she noted, S&P positively assessed the strong fiscal and external balance sheets, which ensure the resilience of the Azerbaijani economy to external shocks.
According to Gazprombank's initial statements, Azerbaijan has sufficient resources to maintain a stable exchange rate of its national currency and is one of the most secured by international reserves in the CIS countries.
So, as of early 2021, international reserves of Azerbaijan, taking into account the assets of the State Oil Fund, amount to nearly $50 billion, which exceeds 100 percent of the country's GDP, providing coverage for 57 months of imports.
"Standard & Poor's was the first of the leading rating agencies, which during the revision of the sovereign rating of Azerbaijan, the exhaustion of possible risks for the economy in connection with the settlement of the situation in Nagorno-Karabakh," summed up Haydarshina.
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