The parliament of Azerbaijan ratified the nation's 2017 budget based on a $40 per barrel minimum oil price margin on December 16th. As the government moves to establish what many call "innovative" programs and establish trade agreements with many nations in Europe and the region, the projected gross domestic product (GDP) growth is 1.05 percent or nearly $362 million.
Revenues of the consolidated budget are forecasted to stand at more than $11 billion, while the deficit is expected to equal nearly $700 million.
Similar to the previous year’s budget, the parliament defined military expenditures as the top financial output standing at roughly $1.6 billion. Also priorities are science, education, healthcare, social protection and security.
Azerbaijan, a former Soviet republic situated on the Caspian Sea, borders Armenia and Georgia and Turkey. It is currently in a volatile territorial dispute with neighboring Armenia, which occupied Azerbaijan’s internationally recognized Nagorno-Karabakh (NK) region. Despite 22 years of negotiations, the conflict seems still far from a resolution, mainly due to what many describe as "Armenian recalcitrance and ongoing attacks."
Azerbaijani President Ilham Aliyev has said,
“Military expenditures are top priority for us. This is important both for settling the NK conflict and providing Azerbaijan’s security.”
Primary sources of budget income include revenues from, the Tax Ministry, State Customs Committee, State Committee on Property Issues, transfers of the State Oil Fund and paid services rendered by government-financed organizations.
The budget deficit will be generated from the privatization revenues, domestic and foreign loans, external grants and the budget’s remainder on the single treasury account on record on January 1, 2017.