WB supports Azerbaijan's new approach to foreign borrowing
Azerbaijan, Baku, Aug. 13 / Trend A.Akhundov /
The World Bank (WB) fully supports the new approach of the Government of Azerbaijan to the cautious policy of attracting foreign borrowing, and in accordance with this, develops directions for the work in the country for the next two years, the WB Baku Office told Trend on Monday.
This issue was discussed at the meetings during the visit to Azerbaijan of World Bank Regional Director for South Caucasus, Henry Kerala.
"The Bank fully supports the government's new approach to foreign borrowing," the office said.
In this regard, the bank's strategy is built on several principles: any new projects should reflect the real needs of the country and be based on the priorities of the government, all new projects must be clearly justified, be fully ready for implementation, and there should be clear will and capacity of the executive bodies and government agencies for the successful implementation of projects, new projects should cover those areas where there is experience of previous successful cooperation, new projects should bring to the country new technologies and best practices, the office said.
Based on these principles, new WB directions in the country for the next two years will be developed.
"We plan to finalize the selection of new projects over the next few months," the banks said.
Since 1992, over a period of cooperation with Azerbaijan, the World Bank has financed 43 projects in various sectors of the economy totaling $3.1 billion in loans and grants from the International Development Association (IDA) and loans from the International Bank for Reconstruction and Development (IBRD), of which 42 percent has already been mastered.
About 75 percent of the funding fell to two main areas - transport (48 percent) and water supply, sewerage services (21 percent). Other sectors are public administration and law (eight percent), agriculture, fisheries and forestry (eight percent), energy and mining (five percent), finance (four percent).
Over 59 percent of current active portfolio of World Bank in Azerbaijan falls to transport, 23 per cent - the water sector, five per cent - agriculture, fisheries and forestry, five percent - public administration, law and justice.
The current portfolio consists of 19 active projects, general obligation on them reach $2.26 billion, of which 74 percent have not yet been mastered.
The six active projects, funded under the IDA conditions, cover virtually every sector, while the portfolio of IBRD focuses mainly on the infrastructure sectors.
The low level of mastering is partly due to a sharp increase in lending through the IBRD in 2008, almost three times as much as the amount of the portfolio of World Bank in the country.