Azerbaijan's Reserves Cover External Debt 19.8 Times

Azerbaijan's strategic currency reserves stood at $89.4 billion on 1 October 2026, 19.8 times its external public debt, according to a Ministry of Finance report cited by Trend. Total public debt was over 23.89 billion manat ($14.1 billion), or 17.3% of projected 2026 GDP of nearly 138.04 billion manat ($81.2 billion).

That leaves the country well inside its public debt strategy, which caps public debt at 30% of GDP and external public debt at $10 billion, the report showed.

External debt keeps shrinking

External public debt was $4.5095 billion, or 5.6% of projected GDP, down $304 million since 1 January 2026. The State Statistical Committee put the decline at 7.8% year on year, APA reported. Debt maturing within five years made up 67.7% of the external stock, 5 to 10 years 26.8% and more than 10 years 5.5%.

The US dollar accounted for 86.3% of external public debt, the euro 5.8%, the Japanese yen 3.2%, IMF special drawing rights 2.9% and other currencies 1.7%. Variable-rate debt was 48.8% of the external total. In the first nine months of the year the government paid $766.9 million of principal and $285.7 million of interest on external debt.

Domestic debt is two thirds of the total

Domestic public debt was 16.23 billion manat ($9.5 billion), or 11.8% of projected GDP and 67.9% of all public debt, down more than 1.57 billion manat since the start of the year. Government securities accounted for about 7.77 billion manat, and government-guaranteed liabilities assumed by the government for 8.46 billion manat. The average maturity of government bonds was 3.64 years. Variable-rate liabilities were 15.6% of total public debt, against a strategy target of below 50%.

Government-guaranteed debt fell to nearly 7.89 billion manat ($4.6 billion), or 5.7% of projected GDP, from nearly 10.37 billion manat on 1 January, a drop of 2.48 billion manat. Foreign loans made up 61.6% of the guaranteed stock and domestic loans 38.4%.

Buffers keep growing

The IMF said in April that combined Central Bank and State Oil Fund reserves had risen to $85 billion by end-2025, with the liquid portion covering more than 38 months of imports. The $89.4 billion reported for 1 October would be about $4.4 billion higher, by CBJ's calculation, although the ministry's and the IMF's measures may not be defined identically. CBJ reported last week that the State Oil Fund's assets reached $74bn in nine months.

The IMF also said any windfall from high hydrocarbon prices must be saved and backed medium-term fiscal consolidation.

What it means for business

Low debt and large reserves give Baku room to borrow for infrastructure without approaching its own ceilings, and they support the exchange-rate policy that Fitch called appropriate this month. The fall in guaranteed debt means fewer contingent liabilities sit behind state companies. For lenders and bond investors, the figure to track is maturity: two thirds of external debt falls due within five years, although reserves cover the whole external stock almost 20 times.

What to watch

• The ministry's year-end debt figures against the strategy limits.
• Any new external borrowing, and whether it is fixed or variable rate.
• Reserve levels if oil prices fall from their current range.

Sources: Ministry of Finance of Azerbaijan, via Trend, 28 October 2026; State Statistical Committee, via APA, 9 October 2026; IMF, 2026 Article IV press release, 30 April 2026.