BAKU, Azerbaijan, March 5. The country's key economic and financial foundations remain very strong, Azerbaijan’s Minister of Economy Mikayil Jabbarov said, Trend reports.
Speaking during a forum in Baku titled “Looking to the Future in the Tax System: New Governance Model and Data-Driven Decisions,” Jabbarov stated that 2025 was a notable year in terms of strengthening Azerbaijan’s international standing.
“Progress in the peace agenda has opened significant prospects for economic development for our country and the region. Strategic partnership documents signed with global economic partners further enhance Azerbaijan’s growing geoeconomic role. These partnerships create new opportunities for deeper integration into global value chains in areas such as investment, trade, energy, digital transformation, artificial intelligence, high technologies, and other sectors,” the minister said.
Jabbarov noted that the diversification of the economy forms the basis of the country’s strategic objectives and that the non-oil and gas sector has already become the main driver of economic growth.
“To see the broader picture, let us briefly look at the past five years. Between 2021 and 2025, real growth of 5.9% on average annually in the non-oil and gas sector’s gross domestic product (GDP) became the main source of economic expansion,” he stated.
The minister emphasized that the private sector plays a significant role in economic diversification and continues to receive active state support. In recent years, a large share of government support to the private sector has consisted of tax and customs incentives.
“This strategic approach has produced positive results in significant qualitative and structural changes in the country’s economy, as well as in the increasing share of the private sector in tax revenues. Last year, revenues from the non-oil and gas private sector reached 76% of total revenues from the non-oil and gas sector,” he said.
Jabbarov also noted that in 2025, investments in fixed capital directed to the non-oil and gas private sector increased by 11.1%, while investments in fixed capital from foreign sources grew by 24%.
“In the non-oil and gas industry, investments increased by up to 26%. Between 2021 and 2025, value added in this sector grew on average by 8% annually. As a result of these factors, the share of the non-oil and gas sector in GDP increased from 58.3% in 2018 to 71.5% in 2025.
In 2025, tax revenues accounted for 12.7% of GDP, while the share of tax revenues from the non-oil and gas sector in non-oil GDP amounted to 13%, representing increases of 3.4 and 2.4 percentage points, respectively, compared to 2018. Compared to 2018, the share of tax revenues from the private segment of the non-oil and gas sector in GDP increased by 2.2 percentage points, reaching 9.9% in 2025,” the minister added.
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