BAKU, Azerbaijan, May 17
By Zeyni Jafarov - Trend:
Upgrading of Azerbaijan's long-term sovereign rating from negative to stable BB + by Fitch Ratings has been justified by monitoring the situation in connection with the COVID-19 pandemic and at the same time maintaining the stable economic situation in the country, Seymur Ibadov, head of the research and investment consulting department of Unicapital OJSC, told Trend on May 17.
"Despite the maintenance of a stable Azerbaijani manat exchange rate through the funds of the State Oil Fund of Azerbaijan (SOFAZ) during a sharp drop in oil prices last year and thanks to the holding of foreign exchange auctions, an increase in the value of SOFAZ’s investment portfolio in exchange for these expenses led to an increase in strategic reserves," Ibadov said.
Fitch Ratings also predicts that the current balance of Azerbaijan will reach 5.9 percent of GDP this year and 4.7 percent in 2022 in connection with an increase in oil prices.
Ibadov added that according to Fitch Ratings, the ratio of public debt to GDP will increase and reach 21.4 percent in 2021, but by the end of 2022 it will decrease to 17.6 percent.
Earlier, Fitch Ratings changed the forecast on the long-term issuer default rating (IDR) of Azerbaijan in foreign currency from "negative" to "stable" at BB +.
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