BAKU, Azerbaijan, September 16. The exchange
rate of the US dollar against the Azerbaijani manat is projected to
remain at 1.7 manat in 2027.
This is reflected in the Statement on the Initial Indicators of
the State and Consolidated Budgets for 2027 released by
Azerbaijan’s Ministry of Finance.
The Azerbaijani manat has remained at 1.7 per US dollar since
March 7, 2018.
According to the statement, the macroeconomic forecasts
submitted by the Ministry of Economy assume a stable manat exchange
rate against the US dollar at the current-year level in
2027–2030.
Azerbaijan’s economic growth forecasts
According to forecasts presented by the Ministry of Economy in
August this year, the baseline scenario assumes an average annual
export price of $65 per barrel of oil in 2027–2030.
According to the forecasts, Azerbaijan’s GDP is expected to
reach 141 billion manat ($82.9 billion) by the end of 2027,
including 109.1 billion manat ($64.2 billion) in non-oil and gas
GDP.
In 2030, GDP is expected to reach 169.1 billion manat ($99.5
billion), while non-oil and gas GDP is projected at 138.6 billion
manat ($81.5 billion).
Real GDP growth is projected to average 3.3% annually over the
medium term, while non-oil and gas GDP growth is expected to
average 4.4%. The share of the non-oil and gas sector in GDP is
expected to reach 82% by 2030.
According to the forecasts, household incomes are expected to
rise to 137.1 billion manat ($80.6 billion) and expenditures to
134.1 billion manat ($78.9 billion) in 2030. Investment in fixed
capital is projected to increase by 2.4% in 2027 and by an average
of 2.2% annually over the medium term.
Azerbaijan expects 5.3% inflation in 2027
Annual inflation in Azerbaijan is projected at 5.3% in 2027.
The statement said that, according to the Ministry of Economy’s
forecasts, average annual inflation, expected at 5.7% this year, is
projected to gradually decline to 4.3% in 2030.
The forecast takes into account actual inflation during the
period elapsed this year, global commodity and food price dynamics
and their impact on import prices, changes in the nominal effective
exchange rate index, a stable manat exchange rate, and the impact
of changes in tariffs for regulated goods and services.
Azerbaijan sets 2027 budget oil price at
$65
The average annual selling price of one barrel of Azeri Light
crude oil was set at $65 when preparing Azerbaijan’s state and
consolidated budget drafts for 2027.
This is the same as the price assumed for 2026.
State budget revenues are projected at 39.234 billion manat
($23.079 billion) in 2027, equivalent to 27.8% of GDP.
Of state budget revenues, 15.48 billion manat ($9.106 billion),
or 39.5%, is expected to come from the oil and gas sector, while
23.754 billion manat ($13.973 billion), or 60.5%, is projected to
come from the non-oil and gas sector.
State budget spending is projected at 42.4 billion manat
($24.941 billion) in 2027, up 696.4 million manat ($409.6 million),
or 1.7%, from the approved figure for 2026. Compared with the 2025
execution figure, spending is projected to increase by 3.7954
billion manat ($2.232 billion), or 9.8%.
Of state budget spending, 26.4 billion manat ($15.529 billion),
or 62.3%, will be allocated to current expenditures, 13.8 billion
manat ($8.118 billion), or 32.5%, to capital expenditures, and 2.2
billion manat ($1.294 billion), or 5.2%, to servicing public debt
and liabilities.
The state budget deficit is projected at 3.166 billion manat
($1.862 billion) in 2027, up 71.4 million manat ($42 million), or
2.3%, from the approved figure for 2026. The budget deficit is
expected to account for 2.2% of GDP.
Of the deficit, 2.751 billion manat ($1.618 billion) is planned
to be financed through borrowing, 275 million manat ($161.8
million) from the balance of the single treasury account, and 140
million manat ($82.4 million) from privatization proceeds.
Consolidated budget revenues and spending
Consolidated budget revenues are projected at 47.6088 billion
manat ($28.005 billion) in 2027, up 2.6395 billion manat ($1.553
billion), or 5.9%, from the approved figure for 2026.
Consolidated budget spending is projected at 50.3867 billion
manat ($29.639 billion), up 1.5474 billion manat ($910.2 million),
or 3.2%, from the approved figure for 2026.
As a result, the consolidated budget deficit is projected at
2.7779 billion manat ($1.634 billion) in 2027.
Main sources of state budget revenues
In 2027, 18.43 billion manat ($10.841 billion) in state budget
revenues is expected to be collected through the State Tax Service,
accounting for 47% of total state budget revenues.
Of the revenues collected through the State Tax Service, 14.85
billion manat ($8.735 billion), or 80.6%, is expected to come from
the non-oil and gas sector, while 3.58 billion manat ($2.106
billion), or 19.4%, is projected to come from the oil and gas
sector.
Revenues collected through the State Customs Committee are
projected at 6.865 billion manat ($4.038 billion).
In addition, 11.9 billion manat ($7 billion), or 30.3%, of state
budget revenues is planned to come from a transfer from the State
Oil Fund. Dividends from enterprises in which the state holds
shares are expected to account for 855 million manat ($502.9
million), or 2.2%, while 599 million manat ($352.4 million), or
1.5%, is projected to come from extrabudgetary revenues of
budget-funded organizations, and 585 million manat ($344.1
million), or 1.5%, from other revenues.
Main state budget expenditures
In 2027, the largest allocations from the state budget are
planned for economic activity, defense and national security,
general public services, education, and social protection.
Spending on economic activity is projected at 8.891 billion
manat ($5.23 billion), defense and national security at 8.8164
billion manat ($5.186 billion), general public services at 5.5063
billion manat ($3.239 billion), education at 5.0982 billion manat
($2.999 billion), and social protection and social security at
4.916 billion manat ($2.892 billion).
Healthcare spending is expected to total 3.9628 billion manat
($2.331 billion) in the consolidated budget, including 2.0826
billion manat ($1.225 billion) from the state budget.
Spending on the judiciary, law enforcement and prosecution is
projected at 3.4336 billion manat ($2.02 billion), agriculture at
1.3795 billion manat ($811.5 million), environmental protection at
438.7 million manat ($258.1 million), and culture, arts,
information, physical education and youth policy at 645.2 million
manat ($379.5 million).
Spending on housing and communal services is projected at 335
million manat ($197.1 million), while expenditures on services not
classified under the main sections are expected to total 857.6
million manat ($504.5 million).
