World Bank approves loan for capital markets modernization in Azerbaijan

The World Bank  Board of Executive Directors today approved a package to help Azerbaijan increase the use of capital market instruments to improve access to finance and contribute to faster economic growth of the non-oil economy, the bank reported.

The Capital Markets Modernization Project (CMMP) for Azerbaijan, a loan of US$ 12 million, is a continuation of the World Bank’s efforts to support the Government of Azerbaijan in strengthening and diversifying its financial sector.

The CMMP is designed to support the medium-term growth of private sector by providing opportunities for sustainable, alternative sources of financing, thereby contributing to the first strategic objective of the World Bank’s 2011 - 2014 Country Partnership Strategy (CPS), strengthening the non-oil economy.

"The World Bank is committed to support the authorities’ efforts to modernize the capital market over the medium term and in this regard, the CMMP will help build a more competitive non-oil sector through improved access to capital," the World Bank Country Manager for Azerbaijan Joseph Owen said.

"The Capital Markets Modernization Project supports a prioritized and coherent package of reforms needed to better diversify the financial sector, accelerate development of non-oil sector through improved access to finance and strengthen corporate governance over the medium term," Task Team Leader of the World Bank Team Michael Edwards said.

The CPPM is financed by an IBRD loan of US$ 12 million. The authorities opted for a US Dollars denominated Fixed-Spread Loan (FSL) with a 15 year maturity and 3 years of grace and repayments linked to disbursement.

Since joining the World Bank in 1992, the commitments to Azerbaijan total approximately US$ 2.9 billion for 43 projects.


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