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ADB forecasts growth in Azerbaijani economy in 2018

27 September 2017 10:36 (UTC+04:00)
ADB forecasts growth in Azerbaijani economy in 2018

By Sara Israfilbayova

The Asian Development Bank (ADB) has forecasted Azerbaijan’s GDP growth to be one percent in 2018.

The Bank expects the recession to continue in 2017, but its pace to slow down, according to the "Asian Development Outlook 2017 Update: Sustaining Development through Public-Private Partnership".

The ADB says that the Azerbaijani GDP growth rate will decrease by 1.3 percent in 2017.

Azerbaijan’s economy contracted by 3.8 percent in 2016 compared to 2015. The non-oil GDP decreased by 5.4 percent in 2016.

Growth forecast for Central Asia, which also covers Azerbaijan, is 3.3 percent for 2017, and 3.9 percent – for 2018, according to the bank.

The Azerbaijani government expects the country’s GDP to grow by one percent in 2017, and by 1.5 percent – in 2018.

Recently, the IMF forecasted growth of Azerbaijan's economy by 2 percent in 2018.

“Azerbaijan’s economy shrank by 3.1 percent in 2016. We think that by the end of 2017, recession will decrease and amount to 1 percent, and next year, the economy will resume growth and the GDP will increase by 2 percent. We also expect the draft state budget of Azerbaijan for 2018, after which our forecasts can be adjusted,” said Jihad Azour, director of the IMF Middle East and Central Asia Department.

As for EBRD, The banks left growth forecast for Azerbaijan’s economy unchanged at -3.0 percent in 2016 and +1.0 per cent in 2017.

Loan

The ADB has approved a business plan on operations in Azerbaijan in 2018-2020.

Azerbaijan is eligible for regular ordinary capital resources (OCR) lending in 2018-2020, says the business plan. The estimated cost of the ADB lending program for three years is $1.6 billion. Total cost of projects, taking into account the share of the Azerbaijani government, is $1.985 billion.

ADB funds will be used for water (infrastructure), transport (road and railways), energy projects and public sector management projects.

Total volume of technical assistance that will be provided by the Asian Development Bank in 2018-2020 is $5 million. The technical assistance funds are meant to be used for improving public and private sector services in order to create infrastructure, preparing an integrated urban development project, improving the efficiency of public sector, supporting sustainable and inclusive energy.

ADB was founded in 1966. Sixty-seven states are its members. Azerbaijan became an ADB member on Dec. 22, 1999.

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