Increase in Oil Prices to Accelerate Economic Growth in Azerbaijan-Moody`s

Higher oil prices will accelerate the economic recovery of Azerbaijan, analyst, Junior Vice-President of the rating agency Moody’s Peter Paklin said.

“According to our estimates, in 2017 the GDP decline in Azerbaijan will be 1%, and in 2018 there will be an increase of 1.8%. If the price of oil exceeds $ 50 per barrel, then the state can abandon the austerity regime and increase the amount of public investment, which will accelerate the recovery of economic growth,” Paklin said.

According to him, the situation with the International Bank of Azerbaijan (IBA), which is going to voluntarily restructure its external obligations, may slow the economic recovery.

“In the banking market, as before, there is a shortage of manat liquidity. This limits lending, as interest in dollar loans is very low. All this slows the pace of economic recovery, as it was expected that the revival of lending will support economic growth,” Paklin said.