BAKU, Azerbaijan, October 17. Azerbaijan holds a leading position in the South Caucasus in terms of the volume of its strategic foreign exchange reserves, which are six times greater than the total reserves of Armenia and Georgia. According to data from the State Statistical Committee of Azerbaijan, the country's strategic foreign exchange stood at $89.38 billion as of September 30, 2026. This amount is about 19.8 times greater than the country's external public debt of $4.51 billion. In a regional comparison, Azerbaijan's strategic reserves are about 10.9 times larger than Georgia's international reserves, reported at $8.17 billion in September, and 13.4 times larger than Armenia's foreign exchange of $6.66 billion.
This disparity highlights the scale of Azerbaijan's financial buffer. Its strategic reserves encompass both the foreign exchange of the Central Bank of Azerbaijan (CBA) and the assets of the State Oil Fund (SOFAZ). This extensive asset base strengthens the country's capacity to meet external payment obligations and maintain financial resilience amid global economic shifts.
Azerbaijan’s strategic reserves stand out in region
The volume of Azerbaijan’s strategic foreign exchange is significantly higher than the official reserve figures for Armenia and Georgia. According to data from the National Bank of Georgia, the country’s international reserves stood at $8.17 billion in September 2026, while the Central Bank of Armenia reported its country’s foreign exchange at $6.66 billion. In comparison, Azerbaijan’s strategic reserves of $89.38 billion are nearly 10.9 times greater than Georgia’s figure and 13.4 times greater than Armenia’s.
One significant reason for this difference lies in the composition of Azerbaijan's strategic reserves. The country's figure encompasses not only the official foreign exchange of CBA but also the assets of SOFAZ. Therefore, when making comparisons, it should be noted that Azerbaijan's strategic reserves reflect a broader base of sovereign financial assets.
According to figures disclosed by the CBA Chairman, Taleh Kazimov, Azerbaijan's strategic reserves exceed its GDP and are sufficient to cover approximately 41 months of imports of goods and services. Furthermore, the fact that these reserves are 3.5 times larger than the M2 money supply serves as an indicator of the scale of the foreign currency buffer within the country's financial system.
The capacity to finance imports over an extended period enhances the country's room for maneuver in the face of shifts in foreign trade and international financial markets. This scale of strategic reserves demonstrates that Azerbaijan possesses substantial financial resources to meet external payment obligations and maintain economic stability.
Central Bank reserves and State Oil Fund assets complement financial buffer
Two key components, the CBA’s foreign exchange reserves and the assets of SOFAZ, play a significant role in the formation of Azerbaijan’s strategic reserves.
According to the CBA, its foreign exchange reserves stood at $15.36 billion as of October 1, 2026. This represents an increase of $62.1 million (0.41%) compared to September 1, and an increase of $4.05 billion (35.8%) compared to October 1, 2025. Thus, a growth of over $4 billion has been recorded in the CBA’s foreign exchange reserves over the course of one year.
Meanwhile, the assets of SOFAZ amounted to $72.6 billion at the end of the first half of 2026. The fund’s assets are significant in terms of accumulating and managing energy revenues, safeguarding the state’s long-term financial capabilities, and building an asset base for future generations.
Although these two components perform distinct functions, together they form the foundation of Azerbaijan’s extensive financial resources. The CBA’s reserves are significant in terms of external payments and currency liquidity, while the assets of SOFAZ facilitate the long-term management of energy revenues.
Current account surplus strengthens the external financial position
In addition to the scale of strategic reserves, the volume of foreign currency entering the country is a key indicator of financial stability. Data on Azerbaijan’s balance of payments for the first half of 2026 indicate a positive balance in the country’s external financial position.
According to CBA, the current account surplus reached $4.7 billion, or 12.4% of GDP. This is more than double the $2.3 billion surplus recorded during the same period in 2025. While the oil and gas sector posted a current account surplus of approximately $9 billion, the non-oil and gas sector recorded a deficit of $4.3 billion. In the first half of the year, the average realized price of Azerbaijani oil, at $94.5 per barrel, representing a 33% growth compared to the same period of the previous year, bolstered export revenues. During this period, commodity exports amounted to $14.3 billion, while imports totaled $8.1 billion, resulting in a $6.2 billion surplus in commodity trade.
These figures clearly demonstrate the role of the energy sector in shaping the country’s external financial capacity. Revenues generated from energy exports enable the accumulation of strategic reserves, support public finances, and provide resources for economic development.
At the same time, the expansion of the non-oil and gas sector creates further opportunities to strengthen the existing financial base. In the first half of 2026, non-oil and gas exports reached $2 billion, while the surplus in transport services amounted to $941 million. These indicators highlight the potential to further increase the contribution of non-oil sectors to foreign currency inflows.
Expansion of budget revenues enhances economic opportunities
Another factor strengthening Azerbaijan's financial position is its budget indicators. According to data released by the Ministry of Finance, revenues for the consolidated budget in the first 6 months of 2026 amounted to 24.4 billion manat ($14.3 billion), while expenditures totaled 19.8 billion manat ($11.6 billion). This resulted in a surplus of 4.58 billion manat ($2.69 billion), equivalent to approximately 7% of GDP.
The non-oil and gas sector also plays a significant role in the structure of state budget revenues. During the first 6 months, receipts from this sector reached 10.98 billion manat ($6.4 billion), accounting for 57.3% of total state budget revenues, an increase of 6.8% compared to the same period of the previous year.
The expansion of non-oil and gas revenues contributes to the strengthening of the state's financial base and increases the contribution of various economic sectors to budget revenue. Sustaining these results is important for directing the opportunities created by Azerbaijan's strategic reserves toward broader economic development goals. According to the Ministry of Finance’s medium-term forecasts, the share of the non-oil and gas sector in GDP is expected to reach 82% by 2030. For that period, nominal GDP is projected to be 169.1 billion manat ($99.47 billion), while non-oil and gas GDP is forecast at 138.6 billion manat ($81.5 billion). The average annual real growth rate for non-oil and gas GDP is projected to be 4.4%.
The ratio of public debt to GDP is forecast to reach 19.5% by the end of 2026 and 20.4% by the end of 2030.
These figures highlight the importance of aligning debt policy with strategic reserves and budgetary capacity. Furthermore, directing borrowed funds toward productive projects can contribute to supporting economic growth and future budget revenues.
Assets of SOFAZ create long-term financial opportunities
The assets of SOFAZ constitute one of the core components of Azerbaijan’s strategic reserves. The fact that the fund held assets worth $72.6 billion by the end of the first half of 2026 demonstrates that energy revenues have been transformed into a significant financial resource.
Managing the fund’s assets is crucial not only for preserving existing reserves but also for safeguarding financial capacity for future periods. To this end, the long-term management of energy revenues, the generation of investment returns, and the planning of transfers to the state budget play a vital role.
In the Ministry of Finance’s baseline scenario for 2027-2030, the average annual price of oil is assumed to be $65 per barrel. Based on this scenario, the assets of SOFAZ are projected to reach $73.9 billion by 2030.
This approach highlights the importance of employing prudent assumptions when planning for energy revenues over the long term. Azerbaijan’s extensive strategic reserves and the assets held by the fund enable the state to strike a balance between addressing current financial needs and preserving resources for future generations.
Azerbaijan's financial superiority creates basis for future development
Azerbaijan's strategic foreign exchange of $89.38 billion, the low level of foreign public debt compared to this amount, the possibility of financing imports for about 41 months and the current account surplus are the main advantages of the country's financial position. These indicators show that Azerbaijan has large financial resources in the South Caucasus and significant maneuvering opportunities against foreign economic changes.
A comparison with the reserves of Armenia and Georgia clearly reveals the scale of Azerbaijan's financial buffer. Azerbaijan's advantage is related to the wider sovereign financial base, which is formed due to both the CBA's foreign exchange reserves and the assets of SOFAZ.
At the next stage, it is of particular importance to turn this advantage into wider opportunities for economic development. Increasing non-oil and gas exports, promoting productive investments, diversifying budget revenues and effectively managing the assets of the State Oil Fund can further strengthen the financial position of Azerbaijan.
Thus, Azerbaijan's strategic reserves are not only an indicator of current financial stability, but also an important resource for future economic development. Targeted management of these resources and expansion of the non-oil economy can strengthen the long-term foundations of the country's financial dominance in the South Caucasus.