BAKU, Azerbaijan, April 28
By Zeyni Jafarov - Trend:
Azerbaijan's expanded fiscal policy will continue this year, given that the budget deficit will increase to 4.2 percent of GDP and social spending will remain high, Trend reports referring to Asian Development Bank’s (ADB) report Asian Development Outlook-2021.
"The state budget deficit will decline to 0.7 percent of GDP by 2022 as a result of revenues recovery and reapplying the fiscal rule towards spending," the report said.
According to the ADB, the state budget revenues will increase up to 34.5 percent of GDP in 2021, but will decline to 33.7 percent by 2022 due to a decrease in transfers from the State Oil Fund of the Azerbaijan Republic.
The budget expenditures will increase to 38.7 percent of GDP in 2021 while the budget expenditures will decrease to 34.7 percent by 2022 as a result of the restoration of fiscal control.
The funds allocated from the budget in 2021 to finance the measures related to the COVID-19 pandemic is 2.8 percent of GDP and include free medical care for those suffered from COVID-19, free COVID-19 vaccination, temporary wage increases for healthcare workers, compensation for state-owned enterprises and the support for low-income individuals and firms, the ADB report said.
In general, the ADB predicts Azerbaijan's GDP growth in 2021 at 1.9 percent while in 2022 - by 2.5 percent.
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