EBRD: Azerbaijan expects one-percent economic growth in 2017

/By Azernews/

By Amina Nazarli

The European Bank for Reconstruction and Development expects growth in Azerbaijan’s economy in 2017.

The Regional Economic Prospects fresh report says that Azerbaijan is less susceptible to the negative effects of a slowdown in Chinese and Russian economies among other countries in Eastern Europe, Caucasus and Central Asia.

“The fall in oil prices has had a negative impact on exporting raw materials. Other countries in the region have suffered from the recession in Russia, which is the main source of remittances and an important trading partner,” the report reads.

A slowdown of Russian economy at one percent means slowing of GDP growth in several countries, however, this trend will have little effect to Azerbaijan, according to the bank.

The same is predicted for China. EBRD experts forecast that slowdown in China's GDP will weakly impact on Azerbaijan’s economy.

The EBRD’s specialists predict one-percent growth for Azerbaijan’s economy in 2017, while in 2016 the bank expects the GDP to decline by 3 percent.

“In 2015, Azerbaijan's economy grew by 1.1 percent. The strong GDP growth of 5.7 percent in the first half of 2015 is partly due to a large volume of construction projects. With the fall of the oil price, the growth slowed in the second half of last year and led to a reduction of export in the country,” the report says.

The EBRD has been active in Azerbaijan since the country's independence.

The bank allocated billions of euros to finance more than hundred projects in various sectors of the economy in Azerbaijan since the beginning of cooperation in September 1992. Azerbaijan, the largest recipient of the EBRD funds in the Caucasus, is also one of the largest recipients in the CIS and Eastern Europe.

Since the beginning of cooperation the Bank has allocated 2.55 billion euros for projects in Azerbaijan, 55 percent of which was aimed at developing the private sector. The current portfolio of the EBRD in Azerbaijan amounts to almost 1.1 billion euros.

One of the EBRD's priorities in Azerbaijan is to contribute to the growth of the non-oil private sector by investing in dynamic small and medium-sized enterprises.