The number of pensioners in Azerbaijan is projected to double by 2050, as demographic changes gradually increase the share of the elderly population, according to the “Medium-Term Expenditure Framework for 2026–2029” prepared by the Ministry of Finance.
The document notes that 69.7% of Azerbaijan’s population is currently of working age (15–65 years), while 9.1% are aged 65 and above. Though the financial stability of the state pension system is assessed as satisfactory, demographic trends indicate rising long-term pressure on its sustainability.
“In the coming decades, as the number and share of elderly citizens increase, the number of contributors to mandatory social insurance will decline,” the report warns. “This could raise the system’s financial obligations.”
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Aging population, slowing growth
According to UN demographic projections, Azerbaijan’s annual population growth rate — currently 0.6% – is expected to decline sharply by mid-century.
The share of working-age citizens is projected to peak in the second half of the 2030s before starting to fall, dropping to 65.4% of the total population by 2050.
Meanwhile, the population aged 65 and older is expected to grow at the fastest pace, reaching 18.1% by 2050 – roughly double the current level.
Life expectancy rising, adding fiscal pressure
Improved living standards, healthcare quality, and social services are expected to extend life expectancy – and, as a result, the average duration of pension payments.
In 2024, life expectancy in Azerbaijan was 74.6 years; by 2050, it is forecast to reach 78.6 years.
The report emphasizes that this demographic aging, combined with informal employment and structural shifts in the labor market, will require further adaptation of the pension system to modern social and economic realities.
Reforms to continue
The government plans to continue reforms to strengthen the financial sustainability of the insurance-pension system and reinforce its underlying insurance principles.
It also highlights the importance of investing the available resources of the State Social Protection Fund, under the Ministry of Labor and Social Protection, as a tool for ensuring long-term stability and future resilience of the pension framework.
