Catalog

The Country Classification of Azerbaijan (2001)

ADB officially recognized Azerbaijan (AZB) as a developing member country (DMC) in December 1999. This paper categorizes AZB based on the criteria in the ADB graduation policy, namely per capita gross national product (GNP) and debt-repayment capacity

Classification of AZB

AZB belongs to the Group B1 category. This can be attributed to these facts:

• AZB's 1999 per capita GNP was $550 at current prices, lower than the current International Development Assistance (IDA) operational cutoff of $885
• ADB classifies its DMC's debt-repayment capacity into A (weak), B1 (limited) and B2 (adequate). AZB's falls into category B1

Supporting considerations include the following:

• poverty in AZB is widespread and deep, particularly among refugees and internally displaced people (IDP)
• the economy is relatively small
• the public sector has weak institutional capacity
• there is an urgent need for development assistance to policy reforms of the non-oil sector, and
• over 80 percent of the $2 billion external assistance to AZB are on concessional terms

Operational Implications

ADB's assistance to AZB will focus on

• direct assistance to the poor, especially refugees and IDPs
• support for poverty reduction through non-oil sector development

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