General economic situation in Azerbaijan (2012)

In 2012, Azerbaijan's economy successfully developed, by maintaining its dynamic development. The most gratifying moment is that the non-oil economy grew by about 10 percent, which marks a decrease in dependence of the country's economy on the oil sector.

In 2012, Azerbaijan's GDP grew by 2.2 percent compared to the year before, amounting to 53.9 billion manat in current prices. Nominal GDP growth rate last year was at 3.6 percent. GDP per capita totaled 5,884.5 manat ($7,490.5).

Value-added production in the non-oil sector has increased by 9.7 percent, compared to 2011, reaching 52.7 percent of GDP (compared to 48.8 percent in 2011), and in the oil and gas sector has decreased by five percent to 47.3 percent of GDP.

In 2012, in the non-oil sector GDP grew by 11.7 percent, in the areas of tourist accommodation and catering - by 18.8 percent, construction - by 18 percent, information technology and communications - by 15.9 percent, trade and repair services of cars - by 9.6 percent, agriculture, forestry and aquaculture - by 5.8 per cent, social and other services - by 5.4 percent, transport and barn facilities - by five percent.

50 percent of GDP accounted for the manufacturing sector, 5.2 percent - for agriculture, forestry and aquaculture, 9.2 percent - for the construction industry, 8.4 percent - for trade and paid services, 5.5 percent - for the transport sector, 1.7 percent - for the communications sector, and 6.2 percent - for net taxes on products and imports.

Source: State Statistics Committee.

Non-oil industry in Azerbaijan increased by 7.8 percent in 2012 as a result of industrialization policy. Launch of about 100 industrial enterprises, including heavy engineering works and fine processing plant in Sumgayit tech park, Ganja aluminum plant, cement plants in Nakhchivan and Garadagh, plants for sorting and incineration of solid waste, as well as the continued construction of more than 90 industrial enterprises played a significant role in the development of non-oil sector.

Industrial production output [produced goods and rendered services of industrial character] in Azerbaijan amounted to 33.929 billion manat in 2012, which is 2.3 percent less than in 2011.

In the private sector, the volume of industrial production compared to the year before last, fell by 2.5 percent, reaching 81 percent of total industrial production. While 91.8 per cent account for the production of industrial goods, 8.2 percent - industrial services.

The volume of production in the mining industry decreased by 4.2 percent, amounting to 25.6 billion manta with a special weight at 75.4 percent of total volume of industrial production. Oil production during this period amounted to 43 million tons, decreasing by 5.3 percent. The volume of natural gas production grew by 5.4 percent and amounted to about 17.2 billion cubic meters.

Production volume in processing industry amounted to 6.42 billion manat in 2012, increasing by 5.4 percent. A 8-fold increase in the production of computers and other electronic equipment were observed during the reporting period, rubber and plastic products - by 2.3-fold, printing work- 2.2 times, weaving industry- 61 percent, electrical equipment - 76.9 percent, finished goods from metal - 48.6 percent, production of paper and cardboard - 43.6 percent, and production of furniture - 2.3 percent.

A 2.7-percent increase was observed in the production of food products. Production of sugar and granulated sugar in the country grew by 6.3 percent to 355,100 tons, vegetable oil - by 64.5 per cent (63,100 tons), margarine - 15.2 percent (23,100 tons), jam and marmalade - by 7.5 percent (11,300 tons).

The special weight of production, distribution and supply of electricity, gas and steam in the total industrial production was 5.1 percent (an increase of 11.6 per cent), in the water sector, treatment of wastewater and waste account for 0.6 percent (an increase of 1.3 percent).

As of 2012, the Azerbaijani metallurgical industry and enterprises produced products and rendered services worth 438.8 million manat. Amount of production in metallurgical industry increased by 17.1 percent, finished metal products during this period increased by 48.6 percent.

Azerbaijan cut gold production by 12 percent, and silver production - by 48.6 percent in 2012. In 2012, the country produced 2,188 kilograms of precious metals, or 26.9 percent lower than their production in 2011. In particular, gold production was 1,562 kg and silver - 625.8 kg.

Agricultural sector of Azerbaijan demonstrated excellent results in 2012. According to the State Statistics Committee of Azerbaijan, as of Jan.1, 2013 the agricultural production in Azerbaijan increased by 5.8 percent compared to 2011 and amounted to 4.763 billion manat. Production of crops increased by 5.8 percent, and livestock - by 5.9 per cent compared to 2011.

The Azerbaijani consumer market developed rapidly (9-10 percent of the annual growth). The retail trade facilities, catering trade points form the basis of this growth. They are developing in the country both qualitatively and quantitatively. According to the State Statistics Committee, in 2012, the Azerbaijani trading networks sold consumer goods to the population at 17.559 billion manat, which is 9.6 percent more than in 2011. Paid services were rendered in the amount of 5.828 billion manat, which is 8.0 percent more compared to 2011.

The price of consumer goods and tariffs for services increased by 0.7 percent in Azerbaijan in December 2012, and in January-December 2012 increased by 1.1 percent compared to the same period of last year, the State Statistics Committee said

Inflation was 1.1 percent. This is the lowest level in recent years. The cash income of the population has increased by 13.8 percent. That is, the difference between inflation and cash income is more than 10 percent.

According to State Statistics Committee of Azerbaijan, in 2012 nominal income of the population of Azerbaijan totaled 34.723.9 billion manat, which is 13.8 percent more than in 2011. During the same period, nominal per capita income grew by 12.2 percent to 3,784 manat. The average monthly income per capita was 315.4 manat. According to the State Statistics Committee of Azerbaijan, as of Jan.1, 2013, 36,800 people were officially registered as unemployed, 42.1 percent of whom are women. During the year, the number of unemployed in the country decreased by 3.9 percent.

In 2012, the country's foreign trade turnover with 155 countries amounted to $33.560 billion, which is 7.61 percent less than in 2011. Compared to 2011, the volume of exports decreased by 10.02 percent to $23.907 billion. The volume of imports fell by 1.06 percent to $9.652 billion. Azerbaijan exported 2,273 types of goods and imported 6,421 types of different goods. As of late 2012, despite a significant decline in exports, the nominal rate of exports exceeded imports, which led to a trade surplus in the amount of $14.255 billion, which is 15.3 percent less than in 2011.

High investment activity continues in Azerbaijan. According to the State Statistics Committee, 15.338.5 billion manat was invested in the economy of Azerbaijan in 2012 from all financial sources, increasing by 18.0 percent compared to the figures of the same period of 2011.

According to preliminary data, revenues of Azerbaijan's consolidated budget in 2012 amounted to 22.1 billion manat, or 101 percent of the forecast, whereas expenses stood at 19.7 billion manat (executed by 94.4 percent).

State budget revenues were executed at 101.4 percent, reaching 17.3 billion manat, while expenditures amounted to 17 billion manat, or 96.2 percent of the forecast.

Manat exchange rate remained stable. In December 2012, average rate of manat to the U.S. dollar was 0.78 manat per dollar, to euro - 1.03 manat per euro, Russian ruble - 2.56 manat per 100 ruble.