BAKU, Azerbaijan, May 25. Additional funding for an employment support project in Azerbaijan will be provided by the World Bank (WB) in the amount of $150 million, Trend reports.
The WB reports that the loan is scheduled to be approved by the bank's Board of Directors on July 25.
The total cost of the project is $176.26 million. A new deadline of December 31, 2029, is being considered for the project's finalization.
The project has three components: expanding and improving the effectiveness of the self-employment program, strengthening employment services and programs, and project management, monitoring, and evaluation.
The Bank notes that the project will expand the coverage of the self-employment program in response to increased demand for financing of economic activities in alternative sectors outside agriculture, with a focus on manufacturing and services, to promote diversification of economic activities and increase resilience to shocks.
"With the additional funding, we can now implement an enhanced grant scheme that offers cash payments to a larger number of successful beneficiaries. Currently, the equity grant scheme used restricts the beneficiaries' ability to expand their economic activities, limiting their flexibility. Similar to a certified financial planner (CFP), the new cash-based equity grant scheme allows successful micro-enterprises and beneficiaries to apply for a cash grant to cover the costs outlined in their business plans. Similar to a CFP, the cash grant program has the potential to lower administrative expenses linked to obtaining and distributing assets. This, in turn, can benefit a larger number of recipients and potentially raise the grant amounts," the bank notes.
Besides, compared to the core project, the additional funding is anticipated to support a greater number of climate change adaptation and mitigation aspects. Both the adaptation and mitigation goals of the Paris Agreement are met by the initiative.
However, it is emphasized that in this context, it is planned to finance asset packages that include the purchase of green equipment and components.
"Business training and online courses will emphasize energy-efficient business management techniques like water conservation, renewable energy use, sustainable waste management, and worker safety in harsh weather. Low-cost solutions like installing solar panels and other energy-saving devices in assets will be financed sustainably. Green business models would be preferred for beneficiaries," the WB notes.
To note, the employment support project was launched on August 17, 2020, and the first payment was made on October 7 of the same year. The World Bank allocated $100 million for its implementation. The project implementation period covers the period from 2020 to 2025.
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