By the Decree of the President of the Republic of Azerbaijan dated August 4, 2023, a number of changes were made in the "Socio-economic Development Strategy of the Republic of Azerbaijan in 2022-2026". Tarana Salifova, head of the monitoring and evaluation department of the Center for Analysis of Economic Reforms and Communication, Tarana Salifova, commented on the issues arising from this change.
T. Salıfova said that according to the change that serves to ensure sustainable and high economic growth, by the end of 2026, according to the "Strategic framework for sustainable growing competitive economy” clause of the Strategy, it is aimed that the share of the total public debt in GDP should not exceed 30%, including the foreign public debt, not exceeding 10 billion US dollars.
Before the change, the relevant indicators were to keep the share of the total public debt in GDP at 20%, including the share of foreign public debt at 10% of GDP. As President Ilham Aliyev noted at the meeting dedicated to the socio-economic results of the first six months of the current year, held on July 11, 2023, the target set during the last period has been achieved, our foreign public debt is 6.7 billion dollars and made up about 10 percent of the GDP.
T. Salıfova said that due to the relevant changes, the Indicator table, which determines the distribution of the result indicators of the measures provided for in the Strategy for the II half of 2023 by years, will be revised and the corresponding changes will be reflected in the intermediate and final result indicators.
The above-mentioned changes were reflected in the "Framework for updating the medium and long-term Strategy for 2022-2025 on public debt management in the Republic of Azerbaijan" approved by Decree No. 3702 of the President of the Republic of Azerbaijan dated December 30, 2022.
In addition, a number of additional changes were made to the Framework document. Thus, in addition to the return of the foreign state debt, it was noted that up to 5 billion US dollars of foreign debt can be attracted to finance investment projects in priority areas, based on the goals of giving an additional boost to the socio-economic development rates of the country. For this reason, the indicator of the ratio of foreign public debt to GDP (10%) was replaced by the upper limit indicator of foreign public debt in nominal terms (10 billion US dollars).
According to the new change, by the end of 2025, the foreign public debt is expected to be 7.1 billion US dollars, that is, 10.7 percent of GDP. However, it is not excluded that these indicators will change due to the repayment of the existing foreign state debt, as well as the financing of investment projects in priority areas in order to give an additional boost to the socio-economic development rates of the country.