BAKU, Azerbaijan, May 30. Azerbaijan's GDP growth is forecasted to be at 2.7 percent in 2023, Deputy Head of Research, Chief CIS economist at Russian Gazprombank Gulnara Khaidarshina told Trend.
According to the bank's forecast, the growth will be 3 percent with the average price of Brent Crude Oil at $93 per barrel
"We have updated our forecast of Azerbaijan's economic growth. We expected economic growth of about 4 percent last year, but this forecast did not take into account OPEC+'s decision to reduce oil production to maintain stable prices on the world oil market. This contributed to a 7.5 percent decrease in oil production in Azerbaijan in the first quarter of 2023," she said.
According to her, with a possible correction in the price of Brent oil to $80 per barrel in 2024 and the development of the non-oil and gas sector, growth will accelerate to 3.5 percent.
"We expect that Azerbaijan's economy will become less dependent on fluctuations in hydrocarbon prices in the medium term. The non-oil and gas sector will become the main engine of economic growth in 2023-2024," she added.
According to the bank's estimates, the share of the non-oil and gas sector in the total GDP of Azerbaijan will be 66 percent this year and will reach 68 percent in 2024. The share of the hydrocarbon sector in GDP may decrease to less than 30 percent in the medium term with this development of Azerbaijan's economy.
Khaidarshina thinks that this will be facilitated by an increase in consumer activity due to the influx of tourists, the creation of new jobs, new projects in Karabakh and infrastructure projects related to the development of Azerbaijan's role as a Eurasian logistics hub.
She also noted that the importance of the digital sector in GDP will grow with the development of the Digital Silk Road project.
The government of Azerbaijan forecasts GDP growth at 2.7 percent in 2023, 4.1 percent in 2024 and 3.7 percent in 2025, the average annual growth rate for the period from 2023 to 2025 will be 3.5 percent.
