“Current growth forecast for 2016 is 0.8 percent but it is most likely be revised in the wake of latest developments. Sharp fiscal consolidation, substantial fragilities in the banking sector and expected low oil prices are the main factors which adversely affect the economic outlook”, Larisa Leshchenko said.
Leshchenko said Azerbaijan’s economy was undergoing a painful process of adjusting to low oil prices, but there were also “substantial opportunities for diversification of the economy.”
“In particular, tradeable sectors such as agriculture, manufacturing may benefit from the devalued currency and become more competitive in domestic and foreign markets,” she said.
The World Bank was discussing with the government a set of medium- and long-term measures to move towards a new private-sector led growth model and increase the country’s resilience to external shocks, she said.
“We know that the government is developing a comprehensive programme of structural reforms, and the World Bank … stands ready to provide necessary support,” Leshchenko said.
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