ArmInfo. The recovery in economic activity, which began in the second half of 2017 and continues in 2018, is due to deferred growth in the non-primary segment of the economy and an increase in export earnings. This is stated in the country forecast for the economy of Azerbaijan until 2022, prepared by the Russian rating agency ACRA. (https://www.acra- ratings.ru/research/838)
It is noted that from the second half of this year, some revival is expected in the raw materials industry. The transport capacities of the Southern Gas Corridor have already been put into operation (it will allow gas to be supplied from Azerbaijan to Turkey and further to Europe via the TANAP gas pipeline), which will serve as an incentive for improving the country's balance of payments and faster growth of the commodity segment of the economy.
Analysts of the agency, however, note that the dynamics of extraction of raw materials will not cause economic growth in the long term. The country is characterized by low credit activity of banks and low quality of assets of the banking system2, while real incomes of the population, although they began to grow, do not serve as a source of stable domestic demand. Their increase is rather temporary, because it is caused by a short-term combination of two factors: the slowing of inflation dynamics and the effect of the revenue growth postponed from 2016. The main structural problems of Azerbaijan - the lack of long-term drivers of economic growth and high dependence on external conditions in 2018-2022 - suggest that the macroeconomic risks typical for the country have not decreased. According to ACRA, there are no sufficient grounds for systemic improvement of the credit quality of Azerbaijan. A potential event that could positively influence this assessment is the privatization of the largest state bank IBA planned for 2018.
