Azerbaijan: Advisory Service on Macroeconomic Management and Institutional Reforms
During its 17 years of independence, Azerbaijan has faced many of the challenges that also confronted other CIS* countries, namely economic distortion and contraction, deterioration in social services and infrastructure, and a rise in poverty. In addition, a conflict with Armenia led to an influx of about one million refugees and internally displaced people, disrupting the country’s key regional trade and transport links. In 1995, the Government decided to embark on a program to stabilize the economy and accelerate structural reforms. Thanks to the success of these reforms, the country finally enjoyed some political stability, which triggered Azerbaijan’s economic recovery.
Over the last five years, Azerbaijan’s GDP growth has been rated at a yearly average of 21%; the country even ranked first in 2006 with a 34.5% growth rate. These impressive digits can be explained by bigger oil and gas production. Continuing on the path of economic transition and enjoying an oil boom expected to last for the upcoming 15 years, the country however faces the challenge of effectively managing its oil revenues in a way that will ensure growth in the non-oil sectors of the economy, sustainable poverty reduction and governance strengthening.
CASE’s two-year Advisory Service Technical Assistance Project, which started on September 1st, 2008, purports to provide high-quality policy advising and training services to the Ministry of Economic Development (MED) of the Republic of Azerbaijan. The overarching objective is to upgrade the quality of economic policy making process and improve the MED’s institutional and human resources capacity, leaving it with better analytical and forecasting/projection tools and superior technical capacity to diagnose the economic situation and elaborate and propose adequate policy response.
CASE experts will focus on three broad thematic topics:
- macroeconomic policy, including monetary and fiscal policies, price stability, budget reform, macroeconomic forecasting, impact of oil prices and revenue on economic growth and other macroeconomic indicators;
- structural and investment policies; and
- social policy.
The project is supported by the Regional Development Initiative, funded by British Petroleum, Statoil, SOCAR, TPAO, Total, LUKoil, NICO, Chevron, ExxonMobil, ITOCHU, Devon, Amerada Hess, ENI, ConocoPhillips and INPEX.
*CIS: Commonwealth of Independent States
