Implementation of 2nd IFAD Project Launched by Ministry of Agriculture State Crediting Agency

Business Materials 6 November 2006 17:30 (UTC +04:00)

The State Agency on Crediting within the Agriculture Ministry has launched the implementation of the project Development of North-Eastern Regions of Azerbaijan (North Development Project) of the International Fund for Agricultural Development (IFAD) that was signed in Baku on 27 July, 2006. The project encompasses the four north-eastern regions of the Country Khizi, Siyazan, Davachi, and Absheron, Razim Valiyev, Head Director of the State Agency told Trend. Intra-economic reclamation work is envisaged in these districts.

The credit component of the project is $4.8 mln. A tender has already been announced to select credit organizations to implement this component. According to Mr. Valiyev, the Council for Control to conduct the selection has already been formed. Within the first IFAD agricultural project, TuranBank fulfilled the functions as the agent of the project.

The total value of the project is $25.148 mln with Azerbaijan's initial share at $2.69 mln. The Government refused to involve OPEC's Fund (some $7.9 mln.) to co-finance the project, since the Fund had increased the annual interest rate for Azerbaijan from 0.75% to 5%. As a result of this, the Government decided to finance this share from the State Budget.

Within the project, some $10 mln will be spent on reclamation work, $6 mln on the establishment of an association of water consumers, $4.8 mln on crediting, and the balance on the maintenance of a working group.