IFC committed close to half a billion dollars to Azerbaijan’s private sector: regional director (Exclusive)
Baku, Azerbaijan, Sept.23
By Leman Zeynalova – Trend:
In Azerbaijan, the International Finance Corporation (IFC) has been supporting the private sector for more than two decades, committing close to half a billion USD, including mobilization, in 56 projects, Wiebke Schloemer, Regional Director, Europe and Central Asia, IFC said in an interview with Trend.
“As the largest global development institution focused on the private sector in emerging markets, IFC leverages the power of private businesses to help end poverty and boost shared prosperity. In Azerbaijan, we have been supporting the private sector for more than two decades, committing close to half a billion USD, including mobilization, in 56 projects. We have also supported around $100 million in trade through our trade finance program and provided $250 million for the Baku-Tbilisi-Ceyhan pipeline. IFC has also implemented a range of advisory projects aimed at encouraging private sector growth,” she said.
Schloemer noted that since IFC started working in Azerbaijan in 1995, it has led the way in a number of areas.
“We made the first foreign direct investment outside of the oil sector in Baku Coca-Cola Bottlers. We were also the first to invest in a foreign bank, Kocbank; in a microfinance bank, AccessBank; and in an international hotel chain, Hyatt. With all these projects, we focused on supporting private sector growth and helping Azerbaijan reduce its reliance on oil,” said the regional director.
She pointed out that with advice from IFC, the government of Azerbaijan has implemented a series of regulatory reforms to improve financial infrastructure and enable more small businesses to access credit.
“As part of these efforts, the government adopted a modern law on credit bureaus, enabling the creation of the country’s first private credit bureau in 2018. That has helped improve the quality and range of credit information, reducing financial institutions’ risks and facilitating more lending,” added Schloemer.
She went on to add that the project has also helped develop a secured transactions law that allows small businesses, which often lack assets like real estate, to use their movable assets, including inventory, accounts receivable, and equipment, as collateral.
“As a result of the reform, a movable collateral registry was created. According to the regulator of the financial sector, since its launch in March 2018, lenders in Azerbaijan have filed notices to the registry for loan applications from 32,000 borrowers, including smaller businesses, enabling these businesses to obtain easier access to financing. That work was driven by the Azerbaijan Financial Infrastructure Advisory Services project, a 10-year effort supported by Switzerland’s State Secretariat for Economic Affairs (SECO),” noted the regional director.
Schloemer pointed out that the reforms also helped Azerbaijan get into the list of 10 economies showing the biggest improvement in performance in the last World Bank Group Doing Business Report, released in October 2018, which looks at the business climate in 190 economies around the world.
“The country had carried out eight reforms, the highest number by an individual country,” she added.
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