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WB: Azerbaijani government seeks 6-7 pct growth per year

6 October 2015 15:40 (UTC+04:00)
WB: Azerbaijani government seeks 6-7 pct growth per year

By Aynur Karimova

The World Bank believes that maintaining Azerbaijan’s economic growth at a level of 6-7 percent per year is one of the primary goals of the government.

Speaking at an event dedicated to the presentation of the new law “On the Securities Market,” Angela Prigozhina, the World Bank Country Sector Coordinator for Financial and Private Sector Development in the South Caucasus region, said on October 6 that “this requires a lot of work towards the development of the non-oil sector, increasing the export capacity of the country."

She also noted that the share of the private sector in Azerbaijan's export is very low – only 10 percent – whereas in Ukraine the figure is 54 percent and in Europe, it reaches 56-60 percent.

“This confirms the fact that Azerbaijan has the potential to develop the private sector and now is the time to do it,” the World Bank official added.

Prigozhina believes that another important point is the need to diversify the country's financial sector and to develop capital markets.

"The capital market plays a very important role in the access to long-term financial services,” she said. “Many companies' access to long-term financial services in Azerbaijan is currently not very high, so it is important to expand these opportunities.”

Today, in order to modernize capital markets, the World Bank is implementing a reform project together with the government of Azerbaijan.

"The project is estimated at $16 million, some $12 million of which are provided by the World Bank in the form of a loan for 27 years, and $2.4 million were allocated by the Azerbaijani government,” Prigozhina noted. “In addition, $1.6 million was provided by State Secretariat for Economic Affairs (SECO) in the form of grant. Practically, the entire allocated amount was spent, as the project is now coming to an end. It will be finished July 1, 2016.”

In his remarks, Chief Adviser to the World Bank for the securities market, Ketut Ariada Kusuma, said that the adoption of the new law in Azerbaijan will create a solid foundation for capital market development, protect investors and ensure safety.

He also said that the participation of international securities market experts in building a strategy to develop the domestic securities market is very important.

"Taking the needs of investors into account, studying whom to bring to the market -- large, medium or small companies – and determining who most needs the issue of shares or bonds is important for regulating the capital market," the World Bank official added.

The new law "On the securities market" entered into force on July 14, 2015.

Azerbaijan joined the World Bank in 1992 and since then, World Bank loans to the country have totaled over $3 billion spread over 55 projects. Currently, the World Bank investment portfolio in Azerbaijan includes 16 projects with a total commitment of $2 billion.

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Aynur Karimova is AzerNews’ staff journalist, follow her on Twitter: @Aynur_Karimova

Follow us on Twitter @AzerNewsAz

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