Azerbaijan, Baku, 4 April / corr. Trend I. Khalilova/ A finance agreement has been signed between Azerbaijani and the German government on the commitment of the German government on financing projects during 2004-2007, the diplomatic representation of Germany in Azerbaijan said on 4 April. The projects will be financed through the German Bank of Reconstruction KfW.
The agreement was signed by Samir Sharifov, the minister of finance of Azerbaijan and Gans Josef Over, the German charge d'affaires from Germany.
The first agreement (2004-2005) envisages the allocation of credit worth of €2.5mln and financial grant of €3mln. KfW granted soft credit of €2.5mln for the establishment of cadastre and grant worth of €1mln to institutionalize the beneficiary organization. The system of real estate registration is expected to be set up in Shaki and Ganja from the resources.
The remaining part of the resources will be allocated for the water project to pay for the services of consultants to manage the project. The project has already begun and the Bank has already allocated €37.3mln for 40 years with a grace period of 10 years at an interest rate of 0.75%.
Within the framework of the second agreement (2006-2007), KfW will grant a credit of €8.5mln and financial grant of €1.5mln. Some €3.5mln of the amount is expected to be allocated for the housing finance and €500,000 for accompanying measurers.
To support the entrepreneurship via the German-Azerbaijani Fund (GAF), KFW will allocate the third privilege loan in the amount of €5mln and an additional €1mln as a grant for management of the Fund and payment for the services of a manager - German Savings Bank Foundation for International Cooperation (SBFIC). Since 1999, KfW has provided €8mln to GAF.
The Agreement will take effect after it is ratified by the Azerbaijani parliament.
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