WB: Azerbaijan's GDP growth rate to rise to 5 pct in 2021

By Azernews

By Ayya Lmahamad

The World Bank has increased its growth forecast for Azerbaijan's economy in 2021 to 5 percent in its fall edition of a report on Europe and Central Asia.

"The GDP growth rate is projected to rise to 5.0 percent in 2021, reflecting a strong recovery in both the energy and nonenergy sectors," the statement read.

This forecast assumes that the pandemic will remain controlled, and vaccination will continue at its current pace.

It should be noted that the bank forecasted growth for the country's economy at 2.8 percent in June.

The bank also forecasts non-oil and gas GDP growth to reach 7.1 percent in 2021, while output is expected to reach pre-pandemic levels by the end-2021.

"The annual GDP growth rate is projected to moderate to an average of 2.9 percent during 2022-23. The non-energy sectors are expected to drive growth, supported by rising public investment, including post-conflict reconstruction," the bank reported.

At the same time, the bank projects the energy sector to stabilize in line with predetermined OPEC+ quotas and anticipated expansion of natural gas production by the end-2023, which will also increase energy-related greenhouse gas emissions and slow the overall decline in emissions.

"A rapid increase in prices for imported food and non-food items and recovering domestic demand is projected to boost inflation to 5.5 percent in 2021, close to the upper bound of the CBA target range," the statement said.

It should be noted that Azerbaijan joined the WB in 1992. Since then, the bank has financed over 50 projects with total commitments of $4.4 billion. It started economic cooperation in Azerbaijan to help increase the country’s institutional capacity and to build efficient management of oil reserves. The WB has always supported the large-scale reforms carried out in Azerbaijan.