Ahmadov V.

Abstract

This paper evaluates the financial policy of oil-exporting Azerbaijan in the recent oil boom and bust period. Analysis of fiscal policy evaluates the fiscal sustainability and efficiency of government spending to upgrade domestic economy. Monetary policy evaluation measures the effect of the exchange rate policy on competitiveness of non-oil economy and capacity of Azerbaijan government to sustain macroeconomic stability in the oil-shock period. The share of the oil revenue in government budget increased significantly, and budget spending is directed to physical investment while investment in human capital in the form of health, education and social spending lagged behind. Aside from currency crises in 2015, macroeconomic stability has been under control, but fixed exchange rate policy impeded the competitiveness of non-oil sector and caused Dutch disease.

Analyzing Bilateral Trade Dynamics between Azerbaijan and Pakistan: A Robust Least Squares Regression Approach

“…Notably, Azerbaijan's GDP per capita demonstrated a positive association with its imports from Pakistan, while exhibiting no statistically significant association with exports to Pakistan. Building upon prior research, one could argue that this phenomenon might be attributed to Azerbaijan's industrial lopsidedness (Hasanov, 2013;Ahmadov, 2022a). Despite its transformation into a prosperous economy, Azerbaijan continues to export primarily oil and gas, without high-value-added products that a significant market like Pakistan would import.…”

The Onion Sector in Azerbaijan: A Descriptive Analysis and Links to the Policy Decisions in 2023

“…In essence, the ongoing trends in the onion sector underscore the critical importance of food security for small and developing nations, particularly in the midst of geopolitical tensions and the concurrent decline in cultivation and sown areas. The agricultural sector of Azerbaijan's economy is positioned as a key alternative to oil-led economic growth and development which creates challenges to diversify the economy (Ahmadov, 2022). Consequently, agricultural growth and development should be directed toward ensuring, at the very least, food security.…”

Unveiling the Dutch Disease Indexes: Principal Component Analysis in a Small Oil-rich Country

“…The use of a mixed-methods approach in one recent study further demonstrated that specific non-oil industries in Azerbaijan, such as chlorine, soda, and sulfuric acid, have experienced de-industrialisation due to DD (Niftiyev, 2022). Various obstacles, such as exchange rate appreciation (Majidli, 2022), deficiencies in fiscal policy management of oil wealth (Ahmadov, 2022), and slow and ineffective industrial diversification (Guliyev, 2022), further confirm the undeniable presence of DD. In essence, recent studies underscore the crucial role of oil prices in shaping the Azerbaijani economy, influencing overall GDP, growth rates, and oil production (Sarkhanov, 2022).…”