BAKU, Azerbaijan, October 16. Azerbaijan's state budget is projected to allocate 8.8 billion manat ($5.2 billion) for defense and national security in 2027.
This was reflected in the Medium-Term Expenditure Framework prepared by the country's Ministry of Finance for the next four years.
According to the document, expenditures on public debt servicing will amount to 2.2 billion manat ($1.3 billion) in 2027. Of this amount, 1.4 billion manat ($839.7 million) will be allocated to servicing external public debt, including 1.06 billion manat ($625.6 million) for principal repayments and 364 million manat ($214.1 million) for interest payments.
For servicing domestic public debt, 137.2 million manat ($80.7 million) is earmarked for principal repayments and 635.3 million manat ($373.7 million) for interest payments. Thus, total interest payments on public debt are projected to amount to 999.3 million manat ($587.8 million) in 2027.
According to the functional classification, the main areas of state budget expenditures for 2027 are as follows:
- Defense and national security – 8.8 billion manat ($5.2 billion), or 20.8%;
- Economic activity – 8.9 billion manat ($5.2 billion), or 21%;
- General public services – 5.52 billion manat ($3.2 billion), or 13%;
- Education – 5.09 billion manat ($3 billion), or 12%;
- Social protection and social security – 4.9 billion manat ($2.9 billion), or 11.6%;
- Judiciary, law enforcement and prosecution – 3.4 billion manat ($2 billion), or 8.1%;
- Healthcare – 2.08 billion manat ($1.2 billion), or 4.9%;
- Agriculture – 1.37 billion manat ($811.5 million), or 3.3%
- Services not classified under main functions – 822.5 million manat ($483.8 million), or 2%;
- Culture, arts, information, physical education and youth policy – 643 million manat ($378.2 million), or 1.5%;
- Environmental protection – 438.6 million manat ($257.9 million), or 1%;
- Housing and utilities – 335.2 million manat ($197.2 million), or 0.8%.
The document notes that, compared to 2027, the share of general public services in state budget expenditures is expected to increase by 0.6 percentage points by the end of the medium-term period; the share for healthcare is projected to rise by 0.5 percentage points, and the share for expenditures on the judiciary, law enforcement, and the prosecutor's office is projected to rise by 0.3 percentage points.
Furthermore, it is forecast that the respective shares of social protection and social security, as well as agriculture, within the state budget will each increase by 0.1 percentage points.
According to the Ministry of Finance’s assessment, the growth in non-oil and gas revenues, based on updated macroeconomic forecasts, and the expansion of the medium-term resource envelope (in line with the projected trajectory of the fiscal rule) will facilitate the strengthening of the country’s defense and national security capabilities. It will also enable the financing of the socio-economic development strategy, the Great Return state program, the State program for the socio-economic development of the Nakhchivan Autonomous Republic (2023–2027), and various other state programs. In addition, it is envisaged that budget resources will be directed toward fulfilling obligations related to the servicing of state debt.