Fitch forecasts Azerbaijan's net sovereign asset position to rise to highest in rating peer group

Fitch forecasts Azerbaijan's net sovereign asset position to rise 14.3pp in 2022-2024 to 77.6% of GDP, the highest in the rating peer group, Report informs, citing the agency.

Sovereign foreign-currency assets rose to USD52.6 billion at end-June from USD52.1 billion at end-2021. Eighty-six per cent of these are sovereign oil fund (SOFAZ) assets, where the increase in oil and gas revenues in 1H22 more than offset investment losses of USD2 billion.

Fitch forecasts the current account surplus will increase 12.1pp in 2022 to 27.3% of GDP, and narrow to 19.3% in 2023 and 12.1% in 2024 (partly reflecting a drop in the oil price to average USD85/b in 2023, and USD65/b in 2024) but still the highest in the 'BB' peer group.