BAKU, Azerbaijan, October 22. Azerbaijan’s general government surplus is expected to rise to 10.6 percent of GDP in 2022, from 4.2 percent in 2021, Trend reports, citing the data from Fitch Ratings.
According to the agency, this will be driven by high energy prices, but also reflects high non-oil revenues and moderate costs (up by 9.3 percent year-on-year over January-August 2022).
As of the 2023 forecast, Fitch has also revised its outlook on Azerbaijan’s general government surplus up by 1.5 percentage points since the last review to 6.7 percent of GDP.
The forecast has been reassessed due to the new oil price forecast and expectations of still-high gas prices, but also due to the capital expenditure in the amount of 2 percent of GDP on the territories reclaimed as a result of the conflict with Armenia.=
However, Azerbaijan’s fiscal surplus is projected to narrow to 2.3 percent of GDP in 2024.
Meanwhile, the outlook on Azerbaijan's Long-Term Foreign-Currency Issuer Default Rating (IDR) has been revised to ‘Positive’ from ‘Stable’ and affirmed at 'BB+'.
“The rating is supported by Azerbaijan's very strong external balance sheet, the lowest public debt in the peer group, and financing flexibility from large sovereign wealth fund assets,” Fitch said.
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