BAKU, Azerbaijan, Dec.2
Trend:
The Asian Development Bank (ADB) has approved a $250 million policy-based loan in support of the Government of Azerbaijan’s efforts to strengthen public sector governance and fiscal management, and encourage private sector development, Trend reports citing ADB.
ADB’s loan is associated with the second phase of the Improving Governance and Public Sector Efficiency Program in Azerbaijan. As part of the program, the government is implementing rule-based fiscal planning, which should ensure that public debt and fiscal risks are managed more effectively. The government has also undertaken legal and institutional changes to the management of state-owned enterprises in order to improve fiscal stability, financial transparency, and improve the quality of services that they provide.
“Azerbaijan continues to take significant steps towards improving fiscal sustainability and economic diversification,” said ADB Senior Financial Sector Economist for Central and West Asia Mr. João Farinha Fernandes. “ADB’s continued support aims at helping the country establish mechanisms that shield its economy from external shocks and create an environment more conducive for business.”
In recent years, the Government of Azerbaijan has worked to address gaps in public sector management and to diversify its heavily oil-dependent economy in response to a drop in oil prices in 2014. The program also aims to promote private-sector growth through its support for entrepreneurs, enabling more small and medium-sized enterprises to have broader access to finance. The government will also continue to implement a series of reforms to improve the country’s business environment. Aside from the $250 million loan, ADB will also provide an $800,000 technical assistance grant to support the government’s planned initiatives going forward.
Since joining ADB in 1999, Azerbaijan has received about $4.2 billion in sovereign and nonsovereign loans, guarantees, and technical assistance for transport, energy, public sector management, water supply and sanitation, finance, agriculture and natural resources, and health projects and programs.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. In 2018, it made commitments of new loans and grants amounting to $21.6 billion. Established in 1966, it is owned by 68 members—49 from the region.