BAKU, Azerbaijan, November 14. The largest share of Azerbaijan's state budget expenditures in 2027 is expected to be allocated to economic activity.
According to the Chamber of Accounts' opinion on the draft law "On the state budget of the Republic of Azerbaijan for 2027," funding for the above-mentioned area is projected at 8.9 billion manat ($5.24 billion), accounting for 21% of total budget expenditures.
According to the document, state budget expenditures are projected at 42.4 billion manat ($24.94 billion) in 2027. This is 696.4 million manat ($409.6 million), or 1.7%, above the approved expenditure figure for the current year.
Next year, expenditures are expected to increase across all functional classification sections, except for "Services not classified under main sections."
According to the Chamber of Accounts' analysis, unlike in previous years, "Economic activity" will account for the largest share among functional classification sections in 2027. Its share of total state budget expenditures is expected to increase by 2.2 percentage points compared with the current year, reaching 21%.
Expenditures on economic activity to increase by 13.4%
In 2027, 8.9 billion manat ($5.24 billion) is allocated to the "Economic activity" section. This is 1.05 billion manat ($618.1 million), or 13.4%, above the approved figure for the current year.
The opinion noted that one of the main reasons for the increase is a 682.3 million manat ($401.4 million) rise in expenditures on economic support measures.
Another important factor is the abolition of targeted budget funds. In previous years, more than 400 million manat ($235.3 million), allocated to the "Roads" and the "Public transport" targeted budget funds, was recorded under the "Services not classified under main sections" section. Starting in 2027, these funds will be included under "Economic Activity."
The Chamber of Accounts remarked that the redistribution of expenditures under the functional classification was also affected by Presidential Decree No. 789 dated September 10, 2026. The decree provides for additional measures concerning the use of earmarked budget funds established within the state budget and extra-budgetary funds of organizations financed from the state budget.
Expenditures on services not classified under main sections to decline by 53.1%
In 2027, expenditures under the "Services not classified under main sections" section are projected at 822.5 million manat ($483.8 million). This is 930 million manat ($547.1 million), or 53.1%, below the approved figure for the current year.
One of the main reasons for the decline is the redistribution of more than 450 million manat ($264.7 million), previously recorded under this section, to other areas following the abolition of targeted budget funds. These funds are planned to be allocated to the "Economic activity" and "Environmental protection" sections.
In addition, a 417 million manat ($245.3 million) reduction is projected in the unallocated (blocked) expenditure item titled "Security, Socioeconomic and Other Measures."
Discrepancy of 1.4 billion manat ($823.5 million) eliminated
The Chamber of Accounts' opinion also addressed the elimination of discrepancies identified in the functional classification in previous years.
The opinion noted that, following the implementation of recommendations made in the chamber's previous opinions to ensure compliance with the Unified Budget Classification (UBC), changes have been made to expenditure amounts at the section, subsection, and paragraph levels of the functional classification.
An analysis of the submitted data showed that discrepancies totaling 1.4 billion manat in the functional classification, previously identified in the Chamber of Accounts' opinions, have been eliminated in the 2027 budget package.
Thus, economic activity will become the main area of state budget spending in 2027. The growth in its share is associated both with expanded funding for economic support measures and with the redistribution of funds under the functional classification following the abolition of targeted budget funds.
