In 2006 the European Bank for Reconstruction and Development (EBRD) will reduce the amount financing the projects in Azerbaijan. “Next year the bank will approve less credits to the country as compared to 2005, for no project in the oil and gas sector is under consideration,” Raymond Konway, the head of the Baku office of the EBRD, told Trend.
The second reason for cut in the amount of financing was explained with the Azerbaijani government’s decision to use the internal funds for financing the non-oil sector of economy. Besides, the country has man financing sources and Konway supposes the government would carry out their diversification.
During the cooperation, which started in1991, the EBRD has approved 700m euro to Azerbaijan. Konway said that 2004 was the record year, when 250m euros were allotted for the implementation of projects in the sphere of oil and gas, motor highways, banking sector. In 2005 the EBRD financed projects with the total budget of 250, euros.
The EBRD selected the private and non-oil sector as the priority directions for financing the Azerbaijani projects in 2006. Moreover, the bank intends to double the investments in the banking sector. So far, the EBRD approved 40m in this sector in 4 directions вЂ" small and medium-scale business, micro and trade financing and investments in the bank’s capital. “The EBRD has opportunities for more investing with respect to open credit lines to banks, while lack of sufficient capitals prevents it. So, initially we participate in the increase of their capital, and then increase the credit lines,” he underlined, adding that the partners banks have achieved this limit.