EBRD assesses fiscal reforms in Azerbaijan

Azerbaijan has strengthened the transparency of its budget policy by implementing fiscal rules, Report informs referring to the draft Economic Management Strategy of the European Bank for Reconstruction and Development (EBRD) for 2026-2030.

The document notes that the Türkiye and Caucasus region as a whole demonstrates relatively high indicators of public governance. However, gaps persist in areas such as perceived corruption, competition, and governance of state-owned enterprises (the assessment of the latter indicator is based on data for Azerbaijan and Georgia).

Natural resource governance in the region has shown mixed results. In particular, Azerbaijan has improved transparency and budget discipline by introducing fiscal rules governing the activities of the State Oil Fund. Meanwhile, the Southern and Eastern Mediterranean countries report weak governance indicators in the mining sector, with regression observed between 2016 and 2024.

According to the Bank, resource-rich countries that have implemented clear fiscal and regulatory frameworks have achieved greater macroeconomic stability and accountability. States that have not implemented appropriate reforms continue to face high risks of poor governance and rent-seeking behavior.

The EBRD has launched a public consultation on the draft strategy. The document is open for comment until 28 March 2026.

According to the EBRD's Strategic and Capital Framework for 2026-2030, economic governance is identified as one of three key areas of focus, along with the transition to a green economy, human capital development, and ensuring equal opportunity. The strategy aims to strengthen long-term systemic changes aimed at creating well-functioning market economies.

By combining the Bank's unique business model-closely integrating policy and investment reforms-with a focused operational approach, the strategy positions economic governance as a transformational lever for systemic market reforms. This will help our regions transition to a future characterized by openness, innovation, and new opportunities, the document emphasizes.

As of January 31, 2026, the EBRD's current lending portfolio in Azerbaijan was estimated at 895 million euros, 40% of which was in the private sector. Thirty-six projects are currently active.

Overall, the Bank has invested 3.612 billion euros in Azerbaijan through 201 projects.