BAKU, Azerbaijan, October 16. The
ratio of Azerbaijan’s non-oil primary deficit to non-oil-and-gas
GDP is expected to decline to 10.5% by 2030 from about 18.2% in
2026.


This was reflected in the Medium-Term Expenditure
Framework for 2027-2030 prepared by the country’s Ministry of
Finance.


According to the document, supporting the
non-oil-and-gas sector, expanding the tax base and increasing the
efficiency of public finances will help strengthen fiscal
sustainability in the medium term.


The Ministry of Finance developed scenarios to assess
how changes in non-oil-and-gas GDP growth would affect budget
revenues and fiscal indicators. The scenarios envisage deviations
from the baseline growth forecast of 0.5, 1.0, 1.5 and 2.0
percentage points, both upward and downward. The assessments
indicate that non-oil-and-gas growth plays a significant role in
budget revenues, the non-oil primary deficit ratio and the
consolidated budget balance.


According to the document’s graph, the ratio stood at
approximately 22.4% in 2022, 22.2% in 2023, 20% in 2024, 18.7% in
2025, and 18.2% in 2026. Under the baseline scenario, it is
projected at approximately 17.5% in 2027, 14.3% in 2028, 12% in
2029, and 10.5% in 2030.







According to calculations, the ratio would fall by
about 7.7 percentage points between 2026 and 2030, with the
sharpest annual decline of 3.2 percentage points in 2028.


In 2027, the ratio could vary within a range of
0.3-1.2 percentage points, depending on how non-oil-and-gas GDP
growth deviates from the baseline scenario.


The ministry named expanding the tax base, improving
tax administration, increasing the number of taxpayers, and
continuing medium-term fiscal consolidation as key measures. It
also plans to improve the operational efficiency of state-owned
enterprises, optimize subsidies, gradually reduce the role of
regulated prices, and strengthen governance and disclosure
standards at state-owned enterprises.


The ministry expects these measures to reduce the
potential burden on public finances, improve the competitive
environment and support non-oil economic growth, limiting the
impact of growth fluctuations on fiscal indicators.