BAKU, Azerbaijan, Sept.5. The International Finance Corporation (IFC) is working with Azerbaijan to introduce innovative financing instruments in agriculture, Ivana Fernandes Duarte, IFC’s Regional Manager for the South Caucasus, said in an exclusive interview with Trend.
“Azerbaijan’s agriculture has high potential to boost non-oil growth and support rural jobs in the country. IFC is working with the government to introduce innovative financing instruments, such as crop receipts, which can strengthen agriculture and connect smaller farmers to global value chains,” she said.
Duarte pointed out that often, small farmers find it difficult to receive a loan because they lack real estate collateral, a requirement for banks. In this kind of a situation, crop receipts can be an effective solution, allowing farmers to use future harvests as collateral.
“A convenient and reliable instrument, crop receipts help farmers obtain working capital financing to purchase high quality seeds and fertilizers, among other inputs. Also, warehouse receipts (post season financing) are used to provide financing in the form of short-term loans or guarantees,” said IFC’s regional manager.
She recalled that while supporting local financial institutions to launch value-chain financing products, IFC, through its Agricultural Financing Project - implemented in partnership with SECO -also helped select value chains (strawberry and hazelnut crops) increase competitiveness in export markets.
Azerbaijan became a member of IFC in 1995. IFC has implemented advisory projects in banking, corporate governance, leasing, SME development, housing finance, securities market development, investment promotion, and business environment.
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