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EBRD updates forecast for Azerbaijan growth (UPDATE)

6 November 2012 15:46 (UTC+04:00)
EBRD updates forecast for Azerbaijan growth (UPDATE)

The European Bank for Reconstruction and Development (EBRD) has updated forecasts for economic growth in Azerbaijan, according to which the real GDP growth at the end of 2012 is expected to be two percent and forecast is three percent for 2013, the bank said on Monday.

"Diversification of the economy is important, as the risks associated with dependence on the oil sector became apparent when oil prices in the world markets decreased. However, unexpected macroeconomic risks continue to mitigate a very strong financial position of Azerbaijan," the bank says.

According to EBRD experts, the decline in oil production in Azerbaijan was partially offset by strong growth in the non-oil sector, which was mainly stimulated by the budgetary expenditure.

According to the report, the volume of foreign direct investment is projected at 1.4 percent of GDP in 2012.

Current account surplus of the balance of payments is expected for the year in the amount of 26.5 percent of GDP.

EBRD forecasts consumer inflation at 1.5 percent in 2012.

In June, the World Bank published its forecast on Azerbaijan's GDP growth, which was indicated at 3.1 percent in 2012, 3.5 percent in 2013, and 4.5 percent in 2014. Also, the WB expects a current account surplus at 24.9 percent of GDP this year, 21.6 percent next year, and only 18 percent in 2014.

The Azerbaijani government predicts GDP growth this year at 5.7 percent, non-oil GDP growth at 8.6 percent and that of oil GDP at 1.5 per cent. Inflation rate is expected to be 6 percent. The country's GDP is expected to be $55.1 billion.

Azerbaijan's GDP grew 1.5 per cent in the first half of 2012 compared to the same period of last year to reach 25.9 billion manats (nearly $33 billion).

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