Baku, Azerbaijan, Nov. 27
By Azad Hasanli – Trend:
Germany’s state-owned KfW Development Bank has abandoned a project on development of entrepreneurship in Azerbaijan, a source in the country’s financial market told Trend Nov. 27.
The source reminded that in April 2016, the KfW approved allocation of a loan worth $200 million for Azerbaijan. These funds were intended for the development of entrepreneurship in the country.
“Initially, it was planned that the funds would be spent within two years,” the source said. “Companies in Azerbaijan were supposed to receive the loans in Azerbaijani manats through the International Bank of the country (IBA). However, as is known, a recovery procedure started in the bank in July 2015, and it turned out that the IBA couldn’t provide such an amount of funds.”
As a result, because the IBA was unable to participate in the project, its implementation was suspended, and the KfW began to search for a new partner, the source noted, adding that the search didn’t yield any results, so the German bank had to abandon the project.
On July 15, 2015, President of Azerbaijan Ilham Aliyev signed a decree on rehabilitation measures related to preparations for privatizing the state-owned shares of the International Bank of Azerbaijan OJSC. In order to restore the bank’s financial position, its distressed assets were transferred to Aqrarkredit CJSC, a state-owned non-bank credit organization. Aqrarkredit CJSC provides the IBA with liquid assets in exchange for distressed assets.