S&P and Fitch affirm Azerbaijan's ratings

S&P Global Ratings affirmed the long- and short-term foreign and local currency sovereign credit ratings on Azerbaijan at 'BB+/B'. The outlook on the long-term ratings is stable.

"Our ratings on Azerbaijan are still primarily supported by the sovereign's strong fiscal position, underpinned by the large stock of foreign assets accumulated in the sovereign wealth fund, SOFAZ. We forecast SOFAZ's assets will amount to about 60% of GDP at year-end 2018," the agency reported.

According to the agency, GDP growth will be 2% in 2018, 3% in 2019, 3.5% in 2020-2021: ‘Azerbaijan’s GDP will make up $47 billion in 2018-2020 and $49 million in 2021’.  

S&P Global Ratings forecast GDP annual growth at 3% in 2018-2020. Annual inflation is forecasted to be 4% in 2018-2020. 

Fitch Ratings, in turn, affirmed Azerbaijan's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB+' with a Stable Outlook.

Azerbaijan's 'BB+' ratings balance a strong external balance sheet and low government debt, stemming from accumulated surpluses in times of high oil revenues, with a heavy dependence on hydrocarbons, an underdeveloped and opaque policy framework, and a weak banking sector and governance indicators.