EBRD Forecasts Continuing Trend of Economic Development of Azerbaijan in 2016

The European Bank for Reconstruction and Development published forecasts (http://goo.gl/6k8nf7) on 5 November for the development of the economies of the three countries of the South Caucasus, according to which the development of the economies of these countries, including Azerbaijan despite the challenges of regional economies and the safety factors, will continue.

The document referring to the government data indicates that in the first nine months of the year growth of Azerbaijani economy amounted to 3.7% and the non-oil GDP increased by 6.4%.

Foreign currency reserves of Azerbaijan (in convertible currency) from November 2014 to August 2015 decreased from $ 13.2 billion to $ 5.3 billion. This was due to the fall in oil prices.

Nevertheless, the overall liquidity position remained strong and was maintained at the expense of assets of the State Oil Fund of Azerbaijan.

EBRD notes that due to reducing the exchange rate of manat by the Central Bank (the first time in the last two decades) by 25% (officially announced was almost 34% devaluation of the manat), the intensity of the financial balance and the balance of payments declined. At the same time, there was a problem of balance in the banking sector.

According to forecasts of the Bank, Azerbaijan's GDP in 2015 will increase by 3%, and in 2016 – by 2.5%. ---08D