Baku, Azerbaijan, May 11
By Azad Hasanli – Trend:
The International Financial Organization (IFC) helps Azerbaijan to establish a public private partnership (PPP) to regulate and operate an agricultural insurance system, Aliya Azimova, IFC Country Representative in Azerbaijan, told Trend May 11.
She said that the IFC Europe and Central Asia Agri-Finance Advisory Project, part of the World Bank Group’s Finance & Markets Global Practice, aims to help Azerbaijan establish a strong legislative and institutional framework for agricultural insurance and build the capacity to develop agricultural insurance products.
“Azerbaijan’s government recognizes the agriculture sector as key to ensuring food security, and providing jobs and income for about 40 percent of the population who live rurally,” Azimova said. “The sector can also play a key role in boosting non-oil growth.”
“Better access to finance would increase the productivity and profitability of the sector, and improve the livelihoods of those employed within it,” she said. “One way of ensuring increased access to finance is by mitigating the risks involved in agriculture production, such as weather and price volatility.”
“Insurance provides a way of protecting farmers against these risks,” Azimova said. “Coverage for crop losses can help farmers reduce the chance of bankruptcies and increase their capacity to repay loans.”
She said that the Road Map for the development of the agricultural sector thus envisages the creation of an efficient agricultural insurance system to improve access to credit, vital to grow the sector.
“The project is currently focused on reviewing and improving the legislative and regulatory environment for agricultural insurance,” Azimova said. “Efforts include supporting the government in establishing a PPP to regulate and operate an agricultural insurance system. This includes gathering production/weather data to calculate risks and develop the right insurance products.”
Azimova added that the project is also helping the PPP build capacity to design insurance products and raise awareness for stakeholders to build a sustainable agri-insurance system.
Azerbaijan cooperates with the IFC since 1995. The corporation’s portfolio for Azerbaijan exceeds $400 million and these funds were allocated for implementation of more than 70 projects.