Today, the Government of the Republic of Azerbaijan and the World Bank have signed credit, loan and project agreements for a $ 76.8 million equivalent IDA credit and a $ 3.2 million IBRD loan for the Azerbaijan Water Users Associations Development Support Project (WUAP).

With US$ 34.3 million Government contribution the total financing of the project will be $ 114.3 million. The Agreements were signed by the Minister of Finance of Azerbaijan, Mr. Samir Sharifov, the Chairman of the Amelioration and Irrigation Open Joint Stock Company, Mr. Ahmad Ahmadzade and World Bank Country Manager for Azerbaijan ,Mr. Joseph Owen.

The Project is expected to improve the productivity of 760,000 small-scale farmers located in 27 provinces of Azerbaijan thanks to the rehabilitation of the country's on-farm irrigation and drainage networks and capacity building activities being supported by new World Bank financing.

With favourable climate and soils, Azerbaijan has significant potential to develop its agricultural sector which can become a key sector of non-oil economy and contribute to economic diversification and export growth. At the same time, most of the agricultural activity in the country depends on irrigation. Azerbaijan has an extensive irrigation network, but many irrigation systems need to be rehabilitated, especially the on-farm systems which are managed by water users themselves. Previous projects supported by the World Bank, helped water users with training to take over the management of irrigation systems, and with rehabilitation of the irrigation infrastructure. The new project, implemented by the Amelioration and Irrigation Open Joint Stock Company, will expand this support to a larger area and the majority of water users in the country.

"This project will help tap the potential of Azerbaijan's agriculture," said Joseph Owen, World Bank Country Manager for Azerbaijan. "Rehabilitation of irrigation systems will support improvements in agriculture productivity and will create jobs and incomes for farmers and rural workers. This project will also strengthen the management of on-farm irrigation systems in the country."

The WUAP focuses on strengthening the capacity of Water Users Associations (WUAs), which are responsible for the management of on-farm irrigation systems. The project will provide training and support to about 379 WUAs on almost 900,000 hectares, helping them to improve the water supply to their members. The project will also finance the rehabilitation of almost 3,000 km of irrigation and drainage canals and water regulation structures, benefitting around 85,500 ha and 34 WUAs.

The project has three components:

1. Institutional Strengthening and Capacity Building Component, which will finance institutional strengthening and capacity building activities for both central agencies, and individual Water Users Associations.
2. On-farm Irrigation and Drainage Rehabilitation Component, which will finance rehabilitation of on-farm irrigation and drainage systems for eligible WUAs in selected raions;
3. Project Management Component, which will finance project management and implementation activities including monitoring and evaluation.

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

/Trend/