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Qabil Ashirov

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Azerbaijan’s external economic position is gaining fresh international recognition as the International Monetary Fund (IMF) significantly upgrades its current account surplus forecasts for 2026 and 2027. According to the IMF’s October 2026 World Economic Outlook, Azerbaijan’s current account surplus is projected to reach 11.3% of gross domestic product (GDP) in 2026 and 9.8% in 2027. The revised estimates compare with previous projections of 9.7% and 5.4%, respectively, highlighting the country’s substantial capacity to generate foreign currency through international economic activity.

The figures carry considerable importance for Azerbaijan’s macroeconomic stability, currency market and long-term development strategy. A current account surplus represents the excess of a country’s international earnings from goods, services, income and transfers over its corresponding payments abroad. For Azerbaijan, energy exports remain the principal source of this financial strength, supported by the country’s established position in international oil and natural gas markets.

The first half of 2026 provides a clear illustration of this performance. Azerbaijan recorded a current account surplus of approximately $4.74 billion, equivalent to 12.4% of GDP, compared with $2.32 billion during the corresponding period of 2025. The improvement reflects the strength of export revenues and the contribution of favourable international energy prices to the national balance of payments.

The energy sector generated a current account surplus of approximately $9.06 billion during the first six months of 2026, representing a 23.6% annual increase. Meanwhile, the non-oil and gas sector recorded a current account deficit of around $4.32 billion, which narrowed by 13.7% year on year. These figures illustrate the central role of hydrocarbons in Azerbaijan’s external accounts alongside encouraging developments across the broader economy.

Azerbaijan’s merchandise trade figures reinforce this picture. Total exports reached approximately $14.3 billion in January–June 2026, increasing by 16.9% year on year. Oil and gas exports accounted for $12.3 billion, while non-oil and gas exports approached $2 billion, registering annual growth of 18%. Imports totalled approximately $8.1 billion, leaving a merchandise trade surplus of around $6.1 billion.

These results have direct implications for currency stability. Strong export receipts increase the supply of foreign currency entering the economy, creating favourable conditions for meeting import payments, servicing external obligations and supporting the exchange-rate framework. Azerbaijan’s substantial external earnings also strengthen the country’s capacity to manage international economic fluctuations and maintain confidence in its financial system.

The benefits extend to the management of sovereign wealth. Export revenues contribute to the financial resources available to the State Oil Fund of Azerbaijan, while foreign exchange operations and reserve management shape the broader national financial position. The IMF reported in April 2026 that Azerbaijan’s combined Central Bank and SOFAZ reserves had increased from $70 billion at the end of 2024 to approximately $85 billion at the end of 2025. These resources provide an important foundation for economic security and long-term financial planning.

The next strategic priority is to translate this external strength into broader productive capacity. Non-oil exports of approximately $2 billion during the first half of 2026 demonstrate an existing platform for further expansion. Agriculture, food processing, chemicals, metallurgy, transport, logistics and tourism offer opportunities to increase foreign earnings through a wider range of products and services.

The non-oil sector’s improving trade performance deserves particular attention. Its exports grew by 18% in the first half of 2026, while its current account deficit narrowed by 13.7%. Together, these developments indicate progress towards a more diversified external earnings structure. Continued investment in manufacturing, agricultural productivity, export infrastructure and international market access could strengthen this trend over the coming years.

Azerbaijan’s geographical position also creates opportunities to expand transport and logistics revenues through the Middle Corridor, connecting Asian markets with Türkiye and Europe. Greater freight volumes, port activity, railway services and associated commercial operations could increase the contribution of services to the country’s external accounts.

The IMF’s upgraded forecasts therefore offer an important measure of Azerbaijan’s external financial strength. A projected current account surplus of 11.3% of GDP in 2026 and 9.8% in 2027 provides a favourable foundation for macroeconomic stability, reserve management and investment planning. The central long-term objective is to complement energy-generated foreign currency earnings with stronger non-oil exports, competitive domestic production and higher-value services.

Azerbaijan enters this period with substantial external resources and expanding opportunities across several economic sectors. Converting these advantages into sustained productivity, diversified exports and lasting prosperity will shape the next stage of the country’s economic development.