By Ayya Lmahamad
Azerbaijan’s Minister of Economy and the European Bank for Reconstruction and Development (EBRD) have discussed the bank’s possible involvement in restoration of the country’s territories liberated in last year’s war.
During the online meeting held on June 8, Economy Minister Mikayil Jabbarov said that there is a great potential to expand relations with the bank in various areas, especially in public-private partnership, on "green economy" and renewable energy.
The minister said that Azerbaijan’s cooperation with the EBRD is at a high level, underlining that Baku attaches great importance to the development of these ties.
He emphasized that the application of the best practices, modern technologies and innovations in Azerbaijan is especially important in projects implemented jointly with international financial institutions, including the EBRD.
In turn, EBRD regional director for the Caucasus Catarina Bjorlin Hansen said that the organization is ready to continue to support Azerbaijan’s economy. She emphasized the bank’s long-term cooperation with Azerbaijan, noting that the country's economic prospects have created conditions for the development of relations.
The meeting focused on the priorities of the socio-economic development of Azerbaijan. The parties discussed the cooperation possibilities between the Azerbaijan Investment Holding, Entrepreneurship Development Fund, Azerbaijan Export and Investment Promotion Fund, and the EBRD to achieve the goals set.
The sides also discussed the development of private sector in the country and projects to be implemented under the Ganja Green City program.
Earlier it was reported that the Bank plans to allocate € 10 million to the Azerbaijani government for the modernization of waste collection infrastructure in the Ganja city. In addition, the Bank is strengthening Azerbaijan’s agribusiness sector by providing a €25 million ($29.4M) loan to the country’s food and beverage producer Avrora LLC.
Additionally, earlier this year the Central Bank of Azerbaijan (CBA) and the European Bank for Reconstruction and Development (EBRD) have signed a $200 million swap agreement to ensure the financing of Azerbaijan’s real sector amid COVID-19 pandemic. Under the new agreement, EBRD will provide credit support to local companies in local currency. Of this amount, $50 million will be transferred to local companies, especially the relatively small ones that have faced temporary difficulties this year. The agreement between the Central Bank and the EBRD will not only support enterprises affected by the pandemic but will also encourage the increased use of derivatives in Azerbaijan and their use as an alternative financing instrument.
Established in 1991, EBRD invests in projects that contribute to the transition to an open market economy, as well as the development of private and business activities.
The bank is a leading investor in Azerbaijan. The country has been cooperating with EBRD since 1992 to achieve further economic development. One of the main priorities of EBRD in Azerbaijan is to support the local corporate sector with direct financing. EBRD continues to pursue investments in energy projects, especially where there is a gap to improve efficiency and energy security.
Azerbaijan is the largest recipient of the EBRD funds in the Caucasus, as well as one of the largest recipients of this organization’s funds in the CIS and Eastern Europe.
To date, the EBRD has invested €3.3 billion ($3.6bn) in Azerbaijan’s economy within 172 projects. The EBRD also provides business consulting services to small and medium enterprises, has provided technical support to improve the financial performance and development of more than 1,000 companies. The value of the current portfolio of projects supported by the EBRD in Azerbaijan is more than $1.3 billion.
Ayya Lmahamad is AzerNews’ staff journalist, follow her on Twitter: @AyyaLmahamad
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