According to this Bloomberg article:
Azerbaijan's economy, the world's fastest growing, will probably expand more than 35 percent this year as oil exports accelerate, Economic Development Minister Heydar Babayev said.
Growth in the $21 billion economy accelerated to 41.7 percent in the first three months of the year from 39.5 percent in the same period a year ago, more than triple the rate in China and Latvia, which has the European Union's fastest expanding economy. Non-oil gross domestic product makes up 12 percent of growth, helped by industrial output.
Azerbaijan, a former Soviet republic located on the Caspian Sea with 0.6 percent of the world's proven oil reserves, shipped 50 percent more oil last year than in 2005.
Natural gas production in 2008 will rise by a third to 8 billion cubic meters.
Growth in the country of 8.1 million has brought ``many problems,'' the 50-year-old Babayev said, speaking during a meeting of leaders from Georgia, Ukraine, Azerbaijan, Poland, Lithuania and Moldova. Inflation accelerated to 16.7 percent in the first quarter, compared with 5.4 percent in the same period a year ago, according to Bloomberg data.
The national currency, the manat, will strengthen as much as 7 percent against the U.S. dollar this year which may help the government to slow inflation, Babayev said. The manat traded at 0.8563 against the dollar today in Baku, compared with 0.897 almost a year ago, according to Azerbaijan's central bank.
The International Monetary Fund in February predicted growth would be 29 percent this year, down from 31 percent in 2006 while average annual inflation would accelerate to 21.1 percent from 8.4 percent last year. It suggested the central bank and government work together to allow the currency to appreciate further while also curbing government spending to slow inflation.