CESD: IMF’s Forecasts are more optimistic than reality in Azerbaijan

CESD: IMF’s Forecasts are more optimistic than reality in Azerbaijan

The IMF mission has completed discussions with the government of Azerbaijan as part of annual consultations on article 4 of the IMF charter. By results of the news conference on Tuesday, the head of the IMF mission on Azerbaijan Nadim Ilahi told reporters that ‘from the very beginning of the current ‘oil boom’ Azerbaijan has been recording high economic growth rates, macroeconomic stability and significant reduction in poverty rate. “This year, the nonoil sector in Azerbaijan expects about 9% growth (compared to 7.5% in 2010). In 2012 growth rates can make up 6%. This will be promoted by state spending”, Ilahi said.

Inflation in Azerbaijan is expected to reach 8% by the end of the year, Nadim Ilahi said. The Azerbaijani economy is developing at a fast pace at the moment, he added. “Macroeconomic stability has been ensured and poverty rate has significantly reduced.”  The growth in non-oil sector will be 9% compared to 7% last year. It will be 6% next year, Ilahi noted.

Vugar Bayramov, chairman of Center for Economic and Social Development (CESD), mentioned that IMF forecasts do not reflect the reality much: “IMF forecasts 9 % growth in non-oil sector meanwhile the fund expect 0,2 % economic growth in Azerbaijan in 2011.  The Fund, however, do not state how much economic growth expected in oil GDP. If GDP Growth is forecasted only 0,2 % for 2011, it almost seems impossible to reach 9,0 % economic growth the same period”.

CESD Chairman mentioned that non-oil sector contributed only 20 % of budget revenues, 67 % of GDP in Azerbaijan. More than 92 % of total export is oil and oil products. Figures show than non-oil sector contribution to the economy in Azerbaijan still is not observable and it cannot provide visible growth in this sphere. Therefore, IMF forecasts for 2011 ca not reflect the reality.

Vugar Bayramov said that considering that almost all international financial institutes including IMF have already adjusted their forecasts and it most probably seems that last figure on development in non-oil sector will be adjusted, too.

 

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