IDB signs loan agreement with Azerbaijan on agricultural project
Azerbaijan, Baku, June 30 /Trend, I.Khalilova/
On Thursday the headquarters of the Islamic Development Bank (IDB) in Jeddah hosted a ceremony to sign a loan agreement on the Integrated Rural Development Project in Azerbaijan, for the realization of which the bank has allocated $66.4 million, said the Baku office of the IDB.
The Azerbaijani government signed the agreement last Friday. The powers for that were granted to the Minister of Agriculture Ismyat Abasov.
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 total project cost is $103.8 million. The International Fund for Agricultural Development (IFAD), which approved a loan of $19.35 million, also engages in the project financing. The loan agreement between the government of Azerbaijan and IFAD was signed on Tuesday.
The project aims to assist 50,000 rural families in the four northern and central regions of the country - Yevlakh Agdash, Sheki and Oguz. One component of the project is to improve the irrigation system. Farmers will have an access to credit and be able to develop skills in the field of agriculture.
Azerbaijan is an IDB member since 1992 and the bank's portfolio in the country exceeds $540 million, which allocated for projects in various sectors of the economy.
Since 1997, IFAD has implemented a number of programs in the field of agricultural development in Azerbaijan. The total investments of IFAD in Azerbaijan amount to $87 million.