IFAD approves loan for new agricultural project in Azerbaijan
Azerbaijan, Baku, June 16 /Trend, I.Khalilova/
The International Fund for Agricultural Development (IFAD) has approved $19.6 million loan to Azerbaijan to finance new agricultural project worth $103.8 million, a government source said Monday.
The Islamic Development Bank (IDB) also participates in financing this project and approved $66.4 million at the end of the last year.
IDB loan consists of three parts, two of which on preferential terms: $14.89 million available for a period of 20 years with a grace period of five years at 2.65 percent annually, $2 million - for 25 years with a grace period of seven years with banking services (a fee has not been established yet), $49.51 million according to the Istisna method - for 15 years with a grace period of three years and a rate swap+1.2 percent.
The area of the project covers Yevlakh Agdash, Sheki and Oguz districts.
This project will be similar to the agricultural projects implemented in Azerbaijan by IFAD. The new project may also include the issuance of micro-credit, water user associations, improving sewer systems and ensuring farmers with equipment and feedstuffs.
Since 1997, IFAD has implemented a number of programs in the field of agricultural development in Azerbaijan. So far, Azerbaijan has received by the IFAD only concessional financing for 40 years with deferred payments in 20 years and 0.75 percent per annum.
So far, the country has received from IFAD four credits totaling $49.3 million. The Foundation has confirmed the readiness to implement new projects in 2010-2015.
Azerbaijan has became a member of the Islamic Development Bank since 1992 and today the IDB portfolio in the country reached $280 million that were allocated for projects in various spheres of the economy.