Azerbaijan, Baku, December 8 / Trend I. Khalilova /
The Government of Azerbaijan and German development bank KfW agreed on the reprogramming of the €10 million loan to support small and medium enterprises in the country, said a government source said. The agreement was reached during the recent Azerbaijan-Germany inter-governmental negotiations.
"Unlike previous two preferential loans, the government refused to provide state guarantee for the third loan, therefore, maintaining credit resources for Azerbaijan, the bank allocated them through one of the European funds, but not through the German-Azerbaijani Fund," the source said.
Initially the European Fund will provide €5 million for distribution through the Azerbaijani banks, and after the use of the resources, the second tranche will be provided. Only the partner banks of German-Azerbaijani Fund will have access to credit for small and medium businesses.
Since 1999, the German bank provided two tranches of €8.7 million to GAF. Spending them and the loan of EBRD completed, and therefore, currently the local banks are financed from the revolving account. The current portfolio of placement from the GAF varies from €11.5 million.
GAF partners are of Bank of Baku and Unibank (since March 2001), January 2003 - Parabank and Bank Respublika, September 2004 - Azerdemiryolbank and AGbank, December 2006 - Rabita Bank and Mugan Bank, February 2007 - Nikoil Bank.