Azernews.Az

By Amina Nazarli

The international rating agency Standard & Poor's (S&P) forecasts real growth of Azerbaijan's economy in 2018 by two percent.

In 2017, S&P expects the country's economy to fall by one percent, while in 2019 and 2020 the country will see a real growth of 3.5 percent.

The main factor in the growth of the Azerbaijani economy will be gas supplies within the second phase of development of the Shah Deniz field, according to the agency's report.

"We also expect increased investment efficiency in the non-oil sector amid a decline in inflation," the report said.

Azerbaijan's nominal GDP will continue to grow and by 2020 and will increase from 60 billion manat ($38 billion) to 89 billion manat ($48 billion).

This year, GDP per capita in Azerbaijan will be $4,000, in 2018 - $4,400, in 2019 - $4,700, and in 2020 - $4,800, S&P experts say.

The contract for the development of the Shah Deniz offshore field was concluded on June 4, 1996. The estimated reserves of the field is equal to 1.2 trillion cubic meters of gas.

The gas produced at the second stage of Azerbaijan's Shah Deniz field development will be the main source of the Southern Gas Corridor, which envisages the transportation of the Caspian gas to the European markets.

In 2013, a BP-led consortium has signed gas sales deals with European buyers for annual exports of 10 billion cubic metres from phase two of the Shah Deniz field project off Azerbaijan.

The nine buyers of gas from the BP-operated project include European energy groups Shell, E.ON and Enel.

Investments

This year, Azerbaijan will also see increase of investments by 5.5 percent in the economy.

In 2018, investments into the economy of the country will grow by 3.5 percent and in 2019-2020 by 2.5 percent.

“We believe that the volume of investments in the economy of Azerbaijan will be restored this year, facilitated by the work under the Southern Gas Corridor project, designed to deliver Azerbaijani gas from the Shah Deniz 2 field first to Turkey by the end of 2018 and then to Europe by 2020,” according to analysts of the agency.

This year the volume of investments will be 25.4 percent of Azerbaijan's GDP or about 17.5 billion manat, 25.1 percent (18.8 billion manat) in 2018, 24.3 percent (19.9 billion manat) in 2019 and 23.7 percent (almost 21.1 billion manat) in 2020.

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Amina Nazarli is AzerNews’ staff journalist, follow her on Twitter: @amina_nazarli

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