ADB: Azerbaijan's economy to grow by 2.4% in 2025

The Asian Development Bank (ADB) forecasts Azerbaijan's economic growth at 2.4% in 2025 and 2% in 2026, Report informs referring to the ADB's September review.

Azerbaijan's GDP growth estimate for 2025 has been revised downwards by 1 percentage point compared to the April forecast, and the forecast for 2026 has been revised downwards by 1.3 percentage points.

A reduction in hydrocarbon production slowed Azerbaijan's economic growth in the first half of 2025. While the economy expanded by 4.3% in the same period of 2024, the growth rate fell to 1.5% in 2025. The main reason was a 3.1% contraction in the hydrocarbon sector, while the non-oil economy grew by 3.9%.

Oil production fell by 5.3% and gas by 0.4%, leading to a 0.5% year-on-year decline in industrial production. Meanwhile, the construction sector grew by 8.5% due to increased public investment in rehabilitation projects.

The service sector almost halved: from 6.1% in the first half of 2024 to 3.1% in 2025, due to slower development of transport and communications. Meanwhile, agriculture accelerated, growing by 1.4% compared to 0.2% a year earlier, supported by increased agricultural production, the update states.

According to the bank's forecasts, moderate economic growth will continue until the end of 2026.

The Azerbaijani Ministry of Economy forecasts GDP growth of 3% in 2025 and 2.9% in 2026. The country's economy grew by 1% from January to August 2025.

Forecasts from international rating agencies vary: S&P Global expects growth of 2% per year in 2025-2026, Fitch Ratings forecasts 3.5% in 2025 and 2.5% in 2026, and Moody's forecasts 2.5% per year.

The International Monetary Fund forecasts growth of 3.5% and 2.5%, respectively, for 2025-2026.

The European Bank for Reconstruction and Development forecasts economic growth in Azerbaijan at 2% in 2025 and 2.5% in 2026. The World Bank expects economic growth in Azerbaijan at 2.6% in 2025 and 2.4% in 2026.