Economic growth in the Caucasus and Central Asia (CCA) region exceeded expectations in 2017, in part due to stronger oil prices, remittances, and external demand, which are not expected to be sufficient, however, to maintain this growth momentum in 2018–19, IMF CCA Regional Economic Outlook reported.
In CCA oil-exporting countries, growth accelerated to almost 4 percent (from 2.4 percent in 2016), driven by Azerbaijan and Kazakhstan, the largest economies in the region, which benefited from the sharp increase in oil prices in the second half of 2017
Growth is projected to stabilize in the medium term around levels that are below the average reached in the first decade of this century.
‘In Azerbaijan, high public investment also contributed to the growth momentum, offsetting weaknesses in other sectors, the fiscal position in oil exporters generally improved. Plans for a substantial increase in capital expenditure in Azerbaijan could, however, exceed the economy’s absorption capacity. Fiscal rules are in progress in Azerbaijan’, IMF said.