(MENAFN- AzerNews)
![Azerbaijan](https://menafn.com/updates/pr/2024-06/23/A_db46b709-6_Image_In_Body.jpg)
Ulviyya Shahin
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In January-May 2024, the total domestic product amounted to
48,026.0 million manats, which is 4.2 percent more than the same
period of the previous year. Compared to January-May last year, the
production of added value in the non-oil and gas sector of the
economy increased by 7.3 percent, while it remained at the same
level in the oil and gas sector.
Of the GDP production, 39.7 percent is attributed to industry,
9.6 percent to trade and vehicle repair, 7.0 percent to transport
and warehousing, 6.0 percent to construction, 3.8 percent to
agriculture, forestry, and fishing, 2.4 percent to tourist
accommodation and public catering, 1.8 percent to the information
and communication fields, and 20.1 percent to other sectors. Net
taxes on products and imports made up 9.6 percent of GDP. GDP per
capita was 4713.3 manats.
Head of the Innovative Economic Research Center of Azerbaijan
Technical University, professor, and economist Elshad Mammadov,
stated to Azernews that state capital investments
act as one of the main driving factors for the growth of gross
domestic product in Azerbaijan.
“It is known that large investment projects, especially in the
liberated territories, positively affect the country's economic
growth. At the same time, it should be noted that economic and
investment growth in a market economy should mainly be driven by
private domestic investment institutions. Bank lending should play
a decisive role in this context.”
“Furthermore, to promote GDP growth, we must import advanced
technologies through foreign investments. Three key factors are
crucial: developing internal investment institutions, importing
advanced technologies, and executing large state investment
projects, particularly infrastructure-related works. These three
directions should positively impact the sustainable growth of the
GDP,” E. Mammadov added.
According to him, in recent years, the country has faced
significant economic challenges, including the effects of COVID-19,
the global economic structure, and various crises.“These pressures
highlight that only sustainable investment growth can ensure
continued economic development. Additionally, there are serious
methodological issues in calculating inflation and GDP worldwide,
raising questions about the methodologies used. This suggests that
relying solely on GDP as the primary development indicator is
problematic,” the economist stressed.
“I believe that more effective indicators related to improving
the real social well-being of the population can better evaluate
the socio-economic agenda,” Elshad Mammadov concluded.
The impressive growth in Azerbaijan's GDP, particularly in the
non-oil and gas sectors, reflects a diversification effort that is
crucial for long-term economic stability. The significant
contribution of the industrial sector (39.7 percent of GDP)
underscores the importance of industrialization in driving economic
development. However, this growth is not without challenges.
The emphasis on infrastructure development, as highlighted by
Elshad Mammadov, is pivotal. The liberated territories offer a
unique opportunity for large-scale investment projects that can
transform these areas into economic hubs. The development of
infrastructure in these regions not only supports economic growth
but also enhances connectivity and accessibility, facilitating
further investment and development.
Encouraging private sector investment, particularly through bank
lending, is essential for sustainable economic growth. The private
sector's involvement ensures that economic development is
market-driven and resilient. Moreover, the importation of advanced
technologies through foreign investments can significantly enhance
productivity and competitiveness. This technological infusion can
lead to innovation and efficiency across various sectors of the
economy.
The global economic landscape, influenced by the COVID-19
pandemic and other crises, poses significant challenges. These
global pressures necessitate a resilient and adaptable economic
strategy. The methodological concerns in calculating inflation and
GDP further complicate the economic analysis, suggesting the need
for more comprehensive and accurate indicators.
Azerbaijan's economic growth in early 2024 demonstrates a
positive trajectory, driven by strategic investments and sectoral
diversification. However, addressing methodological issues and
focusing on indicators that reflect real social well-being is
essential for a holistic evaluation of economic progress. As
Azerbaijan navigates global economic challenges, the integration of
advanced technologies and the promotion of private sector
investments will be crucial in sustaining and enhancing its
economic growth.
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