TODAY.AZ / Business

Country negotiates on draft cooperation strategy with BSTDB

15 August 2019 [14:45] - TODAY.AZ

By Azernews


By Leman Mammadova

Black Sea Trade and Development Bank (BSTDB) and Azerbaijan have begun negotiations on the draft cooperation strategy.

BSTDB has prepared the first four-year draft strategy for cooperation with Azerbaijan, the Bank's President Dmitry Pankin told Trend.

In his words, the Bank began negotiations with Azerbaijani government, which will continue in August and September. “We plan to submit a draft strategy to the BSTDB Board of Directors in September 2019,” he said.

Pankin added that at the next stage, the project is subject to formal approval by the Board of Governors of the Bank. The strategy is expected to be formally approved in November or December this year.

Speaking of the details of the cooperation strategy, Pankin noted that so far, this is a too general draft.

As for priority areas of cooperation, he said that so far, BSTDB has tried to cover many sectors. It works in the financial sector, and in production, as well as in the agricultural sector, and it also considers infrastructure projects.

“We plan to work with Azerbaijan on projects in the field of renewable energy sources, processing in agriculture, milk processing and on a project for financing the production of equipment,” he added.

So far, the total number of Bank's operations in Azerbaijan is 39 with the financing in the amount of about 366 million euros.

The current portfolio of the Bank on projects in Azerbaijan is estimated at 53.867 million euros as of the end of 2018.

Earlier, Pankin noted that BSTDB may allocate about 80 million euros for projects in Azerbaijan in 2019. This will mainly be the financing of small and medium-sized enterprises (SMEs).

BSTDB supports economic development and regional cooperation, participates in granting loans for projects in the public and private sectors of member countries, opening credit lines, investing in and granting guarantees and trade financing.

BSTDB was founded by Azerbaijan, Albania, Bulgaria, Georgia, Greece, Moldova, Armenia, Romania, Turkey, Ukraine and Russia in 1999.

At present, the authorized capital of the Bank is 3.45 billion euros and the share capital is 2.3 billion euros. Azerbaijan has the 5 percent share capital and is the seventh largest shareholder of the 11 member countries.

The Bank has become the first international financial institution to issue bonds in Azerbaijani manats. Lending in national currencies appeared after the crisis of 2007-2008, when the monetary units of emerging markets fell sharply. Thus, it became too risky to take loans in dollars and to receive revenue in own currency.

The Asian Development Bank (ADB) and the European Bank for Reconstruction and Development (EBRD), are also interested in issuing and placing manat bonds.

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