Azerbaijan’s state budget surplus will fall to 4.8% of GDP in 2023 from 6% in 2022, Report informs referring to the international rating agency Fitch Ratings.

The agency expects this figure to drop to 4.2% of GDP in 2024.

“The general government surplus rose 2pp in 2022 to 6% of GDP (and compares with a deficit of 6.5% in 2020) driven by a 27% increase in revenue. Expenditure rose 14.5% in 2022, well below nominal GDP growth (which was boosted by a 37% deflator) and the non-energy primary fiscal deficit fell to 22.7% of non-energy GDP, outperforming the fiscal target of 25%,” reads the report.

Fiscal rules reintroduced last year target a further narrowing in the non-energy primary deficit to 17.5% in 2026, and cap public debt at 20% of GDP, but they lack institutional underpinnings.