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Economy Overview

Azerbaijan's number one export is oil. Azerbaijan's oil production declined through 1997, but has registered an increase every year since. Negotiation of production-sharing arrangements (PSAs) with foreign firms, which have thus far committed $60 billion to long-term oilfield development, should generate the funds needed to spur future industrial development. Oil production under the first of these PSAs, with the Azerbaijan International Operating Company, began in November 1997. A consortium of Western oil companies is scheduled to begin pumping 1 million barrels a day from a large offshore field in early 2006, through a $4 billion pipeline it built from Baku to Turkey's Mediterranean port of Ceyhan. Economists estimate that by 2010 revenues from this project will double the country's current GDP. Azerbaijan shares all the formidable problems of the former Soviet republics in making the transition from a command to a market economy, but its considerable energy resources brighten its long-term prospects. Baku has only recently begun making progress on economic reform, and old economic ties and structures are slowly being replaced. Several other obstacles impede Azerbaijan's economic progress: the need for stepped up foreign investment in the non-energy sector, the continuing conflict with Armenia over the Nagorno-Karabakh region, and the pervasive corruption. Trade with Russia and the other former Soviet republics is declining in importance while trade is building with Turkey and the nations of Europe. Long-term prospects will depend on world oil prices, the location of new pipelines in the region, and Azerbaijan's ability to manage its oil wealth.

Agriculture Products

cotton, grain, rice, grapes, fruit, vegetables, tea, tobacco; cattle, pigs, sheep, goats

Industries

petroleum and natural gas, petroleum products, oilfield equipment; steel, iron ore; cement; chemicals and petrochemicals; textiles

Industrial Production Growth Rate

40% (2005 est.)

Labor Force

5.45 million (2005 est.)

Electricity production

20 billion kWh (2003)

Electricity Consumption

20.25 billion kWh (2003)

Electricity Exports

700 million kWh (2003)

Electricity Imports

2.35 billion kWh (2003)

Unemployment Rate

1.1% official rate (2005 est.)

Population Below Poverty Line

49% (2002 est.)

Household Income or Consumption by Percentage Share

Lowest 10%: 2.8%

Highest 10%: 27.8% (1995)

Distribution of Family Income Gini Index

36.5 (2001)

Budget

Revenues: $3.18 billion

Expenditures: $2.986 billion; including capital expenditures of $NA (2005 est.)

Public Debt

11.3% of GDP (2005 est.)

Commercial Bank Prime Lending Rate

Stock of Narrow Money

Stock of Broad Money

Stock of Domestic Credit

Market Value of Publicly Traded Shares

Reserves of Foreign Exchange and Gold

$1.192 billion (2005 est.)

Debt External

$1.873 billion (2005 est.)

Stock of Direct Foreign Investment at Home

Stock of Direct Foreign Investment Abroad

Exchange Rates

Exchange rates: Azerbaijani manats per US dollar - 4,727.1 (2005), 4,913.48 (2004), 4,910.73 (2003), 4,860.82 (2002), 4,656.58 (2001)

Note: on 1 January 2006 Azerbaijan revalued its currency, with 5,000 old manats equal to 1 new manat

Year	2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000

GDP Official Exchange Rate

$10.4 billion 2005 est.

Fiscal Year

calendar year

GDP Purchasing Power Parity

$42.99 billion (2005 est.)

GDP Real Growth Rate

26.4% (2005 est.)

GDP Per Capital

$5,400 (2005 est.)

Gross National Saving

GDP Composition by end Use

GDP Composition by Sector of Origin

Agriculture
14.1%
Industry
45.7%
Services
40.2% (2002 est.)

Inflation Rate Consumer Prices

9.6% (2005 est.)

Current Account Balance

$167.3 million (2005 est.)

Exports

$6.117 billion f.o.b. (2005 est.)

Exports Commodities

Oil and gas
90%

Imports

$4.656 billion f.o.b. (2005 est.)

Imports Commodities

Machinery and equipment, oil products, foodstuffs, metals, chemicals

Azerbaijan