WB forecasts Azerbaijan's GDP growth for 2025-2027

The World Bank (WB) has maintained its economic growth forecasts for Azerbaijan, projecting a 2.6 per cent increase in 2025 and 2.4 per cent in 2026.

In its latest report, the bank also included a GDP growth projection for 2027, estimating the country's economy will expand by 2.3 per cent that year. This places Azerbaijan's average annual economic growth for 2025-2027 at 2.43 per cent, Caliber.Az reports via local media.

Economic growth in the South Caucasus is expected to slow, reaching 3.6 per cent in 2025 and decelerating further to 3.4 per cent in both 2026 and 2027. The report states that growth in Azerbaijan is expected to be affected by reduced oil production amid weakening global demand and declining oil prices. Growth in Armenia and Georgia is projected to weaken, reflecting a decrease in domestic demand and a slowdown in re-exports. WB analysts anticipate that a decline in global demand and commodity prices will have varied effects across the broader Europe and Central Asia (ECA) region.

This trend is expected to negatively impact energy exporters like Azerbaijan, Kazakhstan, and Russia, as well as metal exporters such as Tajikistan, which are particularly vulnerable to China's economic slowdown. Conversely, energy importers like Türkiye are poised to benefit. For the ECA region as a whole, the World Bank forecasts a general slowdown in economic activity. After a 3.6 per cent growth in 2024, projections indicate a deceleration to 2.4 per cent in 2025, an acceleration to 2.5 per cent in 2026, and a 2.7 per cent growth in 2027. While the WB maintains its steady outlook, other institutions offer varying predictions for Azerbaijan's economic trajectory. 

Azerbaijan's Ministry of Economy projects higher GDP growth at 3.7 per cent in 2025, 3.2 per cent in 2026, and 3.6 per cent in 2027. International rating agencies present mixed views. S&P Global expects 2 per cent annual growth for 2025-2026. Fitch Ratings forecasts 3 per cent in 2025 and 2.4 per cent in 2026. Moody’s predicts 2.5 per cent annual growth. International financial institutions also show differences. International Monetary Fund (IMF) forecasts 3.5 per cent growth in 2025 and 2.5 per cent in 2026. European Bank for Reconstruction and Development (EBRD) projects 3 per cent in 2025 and 2.5 per cent in 2026. Asian Development Bank (ADB) anticipates 3.4 per cent and 3.3 per cent growth in the next two years, respectively. The Dutch group ING Group foresees 2.5 per cent annual growth.

By Naila Huseynova