EBRD investments in Azerbaijan private sector hit record high in 2012 (UPDATE)
By Nigar Orujova
The European Bank for Reconstruction and Development, the largest investor in the non-oil sector of the Azerbaijani economy, set a record level of investment funding in the domestic private sector this year, EBRD Azerbaijan office head Neal McKain told local media on Thursday.
"In 2012, the bank financed 15 private sector projects in the amount of $100 million (78 million euros)," McKain said. "This is a record number of projects and amount of funding. The EBRD may participate in three more projects by late 2012."
McKain said that the EBRD plans to finance 15 new projects in the private sector in 2013.
"Next year, we are planning to launch about 15 new projects in the non-oil sector, including transport and banking. Moreover, a new project is expected in the oil and gas sector which is a continuation of the previous one," McKain said.
According to him, small but important projects are expected in the banking sector.
"Allocation of not only investments, but also grants by EBRD which will be directed to training of banking specialists and improvement of the situation on transition of local banks to international standards is expected in order to improve the quality of the banking sector. We have no limits to our investments in Azerbaijan," McKain said.
McKain said the bank has been involved in 127 projects in Azerbaijan over the past 20 years, including 115 projects carried out in the private sector.
The bank's budget for Azerbaijan is around 2 billion euros, while its current portfolio is 692 million euros, McKain said.
The EBRD started developing a new four-year strategy for Azerbaijan in November.
"We are developing a new strategy for the country that will cover 2013 through 2016. Implementation has not yet begun," McKain said in mid-November.
According to him, a delegation will arrive in Azerbaijan from London during the first quarter of 2013. Its representatives will discuss issues pertaining to the new strategy not only with the government, but also with non-governmental organizations.
"The goal is to develop a new strategy that will assist Azerbaijan in economic development and diversification. Growth in the non-oil sector of Azerbaijan is very high, compared to the overall growth rate of the economy. We believe that the process of diversification is rather active," McKain said.
According to McKain, the strategy will focus on such private sector areas as industry, agriculture and finance.
"These segments are very interesting for our bank and there are a lot of potential projects," he said.
The EBRD, the largest investor in the private and financial sectors of Azerbaijan, focuses its activities on a number of fields including industry, commerce and agribusiness, finance, energy and infrastructure, to help speed up reforms and address some of the challenges facing Azerbaijan.
In 2011 the EBRD invested a total of $391 million in 12 projects in the country, a record annual volume for the bank in Azerbaijan. The total value of EBRD projects implemented over 20 years is 6.6 billion euros.