BAKU, Azerbaijan, March 29. Azerbaijan is expected to see relatively small budget deficit in 2023, Trend reports, citing the latest Asian Economic Outlook and Integration Process issued by Boao Forum for Asia, a non-profit organization from China.
According to the report, Azerbaijan may experience a shift from a fiscal surplus to a fiscal deficit in 2023.
"In December 2022, Azerbaijan approved its 2023 budget. The revenue budget is planned at 30.7 billion manats ($18.1 billion), up from 29.2 billion manat ($17.1 billion) in 2022. The expenditures are expected to reach 33.3 billion manat ($19.5 billion), up from 32.3 billion manat ($19 billion) in 2022,"
As the outlook noted, the forecasts are based on an estimated average oil price of $50 per barrel in 2023, which shows Azerbaijan's efforts to prevent excessive spending.
"Defense remains one of the government’s priorities for 2023. In this regard, Azerbaijan plans to allocate 5.3 billion manat ($3.1 billion), up by almost 5 percent over 2022. Other priorities include social security, education, healthcare, and agriculture," the organization said.
At the same time, as the report pointed out, the reconstruction of Karabakh will also be a key priority for Azerbaijan, as the government plans to allocate 3 billion manat ($1.7 billion), up more than 10 percent over 2022.
"The EIU expects Azerbaijan’s public finance to be in deficit in 2023, but as oil prices are likely to be approximately 50-70 percent higher than the baseline set in the current budget, the relative size of the deficit will be rather small, at around 1 percent of the GDP, which is significantly lower than the government’s current forecast of 2.4 percent," the report concluded.
