IFC and BP Launch Access to Finance Program for Micro and Small Enterprises in Western Azerbaijan
IFC, a member of the World Bank Group, and BP on behalf of its co-venturers have today signed a grant agreement to improve access to finance for micro and small enterprises in western Azerbaijan. A $1 million grant from BP will help the Micro Finance Bank of Azerbaijan expand its branch network to the towns of Mingechevir and Gazakh and enhance services in the Ganja branch. The grant will be matched by $2.3 million of IFC and MFBA’s own investments through a separate agreement.
The project will help provide access to loans for micro and small enterprises in all sectors and improve financial intermediation. This will have positive, lasting effects on private investment, job creation, and the socioeconomic conditions in western Azerbaijan. BP’s contribution will be used to support international credit experts and develop local loan officers and branch managers.
“We believe this project will have positive and sustainable effects on private investment, helping create jobs and improve the social and economic environment in Azerbaijan’s western regions. The main focus will be on the communities where BP has economic development operations, especially along the Baku-Tbilisi-Ceyhan and the South Caucasus pipelines. The project will also benefit a broader group of small businesses in western Azerbaijan by introducing international banking practices,” said Bill Schrader, BP’s President of Strategic Performance in Azerbaijan.
“This new project is part of a larger investment and capacity-building program that IFC and BP have jointly financed and implemented in Azerbaijan to support micro and small enterprises and to increase the impact of the BTC pipeline on local firms and suppliers,” said Shahbaz Mavaddat, IFC Director for Southern Europe and Central Asia.
“The grant will allow us to expand more rapidly in the western regions of Azerbaijan, particularly in areas where local entrepreneurs have limited access to finance and financial services,” said Andrew Pospielovsky, General Manager of the Micro Finance Bank of Azerbaijan.
IFC, a member of the World Bank Group, fosters sustainable economic growth in developing countries by financing private sector investment, mobilizing private capital in local and international financial markets, and providing advisory and risk mitigation services to businesses and governments. IFC’s vision is that poor people have the opportunity to escape poverty and improve their lives. In FY07, IFC committed $8.2 billion and mobilized an additional $3.9 billion through loan participations and structured finance for 299 investments in 69 developing countries. IFC also provided advisory services in 97 countries. For more information, visit www.ifc.org.
BP is the operator of Azerbaijan’s major oil and gas development and transportation projects. It aims to double the value of contracts with Azerbaijani-owned companies by 2010. It works to reach this goal through the Enterprise Centre in Baku, which supports local small and medium enterprise development.
BP and its co-venturers are also funding the Supplier Finance Facility, an important initiative that was established in partnership with IFC to support local enterprise development and increase access to finance for Azerbaijan’s local oil and gas industry supplier and service enterprises.
BP is commited to the sustainable economic development of Azerbaijan. Through its regional development initiative, community investment programs, and educational sponsorships, the company is working to develop other initiatives that encourage enterprise development to help the country diversify its economy.
About the Micro Finance Bank of Azerbaijan
The Micro Finance Bank of Azerbaijan is owned by foreign shareholders, including IFC, the European Bank of Reconstruction and Development, the Black Sea Trade and Development Bank, and KfW, Germany’s development bank. MFBA seeks to be the leading financial services provider to Azerbaijan’s micro and small businesses, as well as its low- and medium-income households.It offers high-quality, customer-oriented financial services of European standards, including loans and savings products, credit/debit cards, and money transfer and payment services.
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