Azerbaijan to manage on 10% growth in 2009

Last week, the European Bank for Reconstruction and Development (EBRD) cut its 2009 growth forecast for Azerbaijan from 15% to 8%, which still ranks the country the second best performer in the ex-communist region, after Turkmenistan.  On Wednesday, President Ilham Aliyev projected ’09 growth of 10%,  citing the fact that the Caspian oil producer had  to stabilize crude prices with oil output cuts.  “The times when we had [growth] of 25-30% are over–it is not possible to repeat this,” he lamented.  Azerbaijan is adjusting to lower export revenues after a boom which saw an average GDP growth of 21.1% between 2003 and 2007.

Aliyev stated that his country would continue to cooperate with OPEC, though it is not an official member.  Last year it announced at an OPEC meeting in Algeria that it would cut production by 300,000 barrels per day to 540,000 bpd–its lowest output level in two years–to help support world prices.  To healp weather the global crisis, Azerbaijan can tap its reserves.  Like Russia and Norway, it has a fund to keep oil revenues from distorting the economy and to use on long-term investment projects.  The fund currently stands at $11.2 billion.