The European Bank for Reconstruction and Development (EBRD) announced its economic forecasts for the countries of the Middle East and the Caucasus.
According to the forecast, the weakest economic growth in this region in 2023 will be in Azerbaijan – only 2.5%. In that period, economic growth is expected to be 5% in Georgia and 4% in Armenia. The situation will continue in 2024 and the lowest economic growth in the region will be in Azerbaijan – only 2.7%. How realistic was the forecast of the European Bank for Reconstruction and Development?
On topic Publika.az– the speaker economist Rashad Hasanov said that Azerbaijan fell into the trap of “middle income” in the last 10 years.
“It can also be considered the unfortunate end of the resource-based economy. During the period I mentioned, the economy of our country grew very little, on average around 1-1.2%. This is a very low indicator for a young country like Azerbaijan, which has just entered the market economy. Especially in 2006-2008, the great growth dynamics was caused by oil production, and in a sense, the base part of the economy grew. In the following years, Azerbaijan’s relevant capabilities, resources, diversification of the economy, high investments in areas with a wide capacity to create added value, as well as the development of human capital, could not be directed to the areas of application of innovation in this area”, he pointed out.
According to R. Hasanov, shrinking is observed more in the resource economy under current conditions:
“As a result, the statistics of the first month for 2023 have already been announced, and as you can see, a 1.5% contraction in the economy was recorded. This is mostly observed in the resource economy, as there is a decline of more than 4.5% in that area. And the non-resource economy cannot compensate for the corresponding shrinkage at today’s growth rate. At least the results of the first month show this, as the non-oil economy recorded a growth of 2.5%. This trend, of course, will change to some extent in the next months of the year. In particular, certain increases in the non-oil industry, a partial recovery of the decline in the oil sector, will lead the economy to a positive course. But this change will reflect itself more seriously in the per capita growth indicators.”
The economist believes that the government’s disinclination to change the fundamental principles of the economic policy, which it has continued until now, manifests itself as the main problem arising here: “The problem is also visible in the state programs, including the 2023-2026 social economic strategy. The continuation of the status quo complicates the growth process of Azerbaijan’s economy. I hope that in the coming years we will see a position on making more rational decisions.”
Ayshan Rahim
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