Azerbaijan continues to demonstrate positive dynamics in its business environment, marked by income growth and expanding sectoral diversity, according to the ninth edition of Deloitte’s macroeconomic report “Business Outlook in Azerbaijan.”
Based on the 2024 Business Confidence Survey, 28% of respondents operate in banking and finance, 15% in trade, and another 15% in transport and logistics.
Compared to previous years, participation has increased from the construction (8%), agriculture (3%), and mining and metallurgy (3%) sectors, reflecting broader representation across industries.
Financially, 38% of surveyed companies reported annual revenues below 5 million manats, while those earning 10–100 million and 100–500 million manats each accounted for 15%.
Firms with revenues exceeding 500 million manats made up 10% of respondents. In 2023, the share of companies in the lowest income bracket had been higher at 44%, suggesting gradual growth in corporate earnings.
Measured Optimism Amid Stability
The survey indicates that 52.5% of businesses expect moderate revenue growth over the next 12 months, 25% foresee stability, and 12.5% anticipate a decline. Only 10% predict significant increases.
At the same time, the number of companies expecting a partial decrease in operating profits rose to 47.5% (from 37% in 2023), while 32.5% forecast stability and 20% expect growth – a sign of cautious optimism amid external and cost pressures.
Meanwhile, 60% of respondents expect a partial increase in wages, and 55% foresee higher capital costs. The main risks cited by business leaders include inflation, financing difficulties, and weakening demand.
Outlook for the Next Five Years
According to Deloitte, Azerbaijani companies expect the strongest growth over the next five years in construction and raw materials (20%), followed by transport and logistics (20%), telecommunications and media (15%), tourism (15%), and agriculture (15%).
The report also highlights growing concern over cybersecurity: 32.5% of respondents see cyberthreats as a serious risk, 27.5% rate them moderate, and 30% low, while only 10% believe such risks will not affect their operations.
Overall, Deloitte concludes that Azerbaijan’s business environment remains stable yet cautious, with companies balancing growth expectations against global uncertainty and rising costs that could pressure profit margins.
