Azernews.Az

By Aynur Karimova

The International Monetary Fund forecasts Azerbaijan's economic growth at 1 percent in 2017, reads the IMF World Economic Outlook published on April 12.

The report was developed for presentation at the IMF and the World Bank Group Spring Meeting scheduled for April 14-19 in Washington.

The IMF experts forecast inflation in Azerbaijan to amount to 9.5 percent, while the current account surplus is projected at 0.2 percent of GDP in 2017.

In 2016, the IMF expects the economies of the CIS countries to slow down by 1.1 percent and to gradually grow by 1.3 percent in 2017 and by 2.4 percent in 2021.

"The forecast of economic growth in the CIS countries will remain weak, which is due to the recession in Russia, as well as low oil prices. Steady decline in oil prices, economic slowdown in Russia, as well as slowing down and rebalancing of the Chinese economy constrain economic growth in the Central Asia and the Caucasus countries, putting pressure on exports, remittances and investments," the report said.

The IMF experts believe that in 2016, the inflation in Azerbaijan will be 12.8 percent, while the average forecast for the CIS countries [except Russia] will stand at 11.9 percent. In 2017, the inflation in the country will return to the single digits, reaching 4 percent in 2021.

The IMF expects Azerbaijan to be one of the three CIS countries with current account surpluses, along with Russia (5.1 percent of GDP) and Uzbekistan (0.5 percent of GDP). The current account deficit is expected in the remaining countries in the next year.

A similar situation is projected for 2021. According to the IMF expectations, only four countries will record surplus in the current account: Azerbaijan (5.9 percent of GDP), Russia (6.5 percent of GDP), Uzbekistan (2 percent of GDP) and Kazakhstan (2.6 percent of GDP). The current account deficit is expected in the remaining countries of the region.

Earlier, the Asian Development Bank reported that Azerbaijan will see 1 percent rise in its GDP in 2017. ADB’s predictions coincide with other forecasts on Azerbaijan’s GDP for the current and coming years just with slight difference.

The inflation rate in Azerbaijan was projected to be 12 percent for 2016, but the ADB’s experts forecast 5.7 percent decline in inflation rate in Azerbaijan for 2017.

Moody’s Investors Service forecasted real GDP growth rate to slow down to 1.7 percent in 2016 from 2.8 percent in 2015 in Azerbaijan. Moody’s expects it to accelerate to around 3 percent during the period of 2017-2019.

Standard & Poor’s international ratings agency projected the GDP growth by 2 percent in Azerbaijan in 2017, by 4 percent in 2018, and by 4.5 percent in 2019.

Meanwhile, the World Bank predicts 2.6 percent growth of the GDP in Azerbaijan in 2016 and 2.7 percent in 2017. The European Bank for Reconstruction and Development was also optimistic about the real growth rate of the GDP in the country, predicting it to reach 2.5 percent.

The State Statistics Committee of Azerbaijan, however, reported 3.2 percent decline in GDP for January-February 2016.

Meanwhile local economists believe that the main factors that can affect the dynamics of Azerbaijan’s GDP are oil prices, global competitiveness of the national currency, and funds allocated from the state budget for investment.

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Aynur Karimova is AzerNews’ staff journalist, follow her on Twitter: @Aynur_Karimova

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