fbpx 49093-001: AZE: Improving Financial Service Outreach for Agriculture - AccessBank Azerbaijan | Asian Development Bank

Azerbaijan: AZE: Improving Financial Service Outreach for Agriculture - AccessBank Azerbaijan

Nonsovereign (Private) Project | 49093-001 Status: Active

One loan of up to $75 million to support farm investments and working capital and enterprises operating in the agriculture value chain through Access Bank Azerbaijan (ABA). ADB funding will improve rural income generation and livelihood in Azerbaijan. With only 16% of credit flowing to Azerbaijans regions, and only 5% to agriculture, finance is largely unavailable in rural Azerbaijan. Agriculture is fragmented into 1.2 million small farms employing 38% of the working population and contributing only 6.2% to GDP (2013). However, agriculture witnessed robust growth of 4% p.a. over the past decade and has substantial growth potential to meet growing domestic and import demand for food (fruits, vegetables and dairy products). Farms and MSMEs are the most important source for employment and income generation in the regions. Lack of funding is one of the main reasons limiting their growth.

Project Details

Project Officer
Hruschka, Stefan A. Private Sector Operations Department Request for information
Country
  • Azerbaijan
Sector
  • Finance
 
Project Name AZE: Improving Financial Service Outreach for Agriculture - AccessBank Azerbaijan
Project Number 49093-001
Borrower/Company AccessBank Azerbaijan
Country Azerbaijan
Location Nation-wide
Type or Modality of Assistance
3253 Loan Ordinary capital resources USD 75.00 million Committed
Strategic Agendas Inclusive economic growth
Drivers of Change Knowledge solutions
Partnerships
Private sector development
Sector / Subsector

Finance / Banking systems and nonbank financial institutions

Gender Equity and Mainstreaming Some gender elements
Responsible ADB Department Private Sector Operations Department
Responsible ADB Division Portfolio Management Division, PSOD
Responsible ADB Officer Hruschka, Stefan A.
Project Sponsor(s)
Description One loan of up to $75 million to support farm investments and working capital and enterprises operating in the agriculture value chain through Access Bank Azerbaijan (ABA). ADB funding will improve rural income generation and livelihood in Azerbaijan. With only 16% of credit flowing to Azerbaijans regions, and only 5% to agriculture, finance is largely unavailable in rural Azerbaijan. Agriculture is fragmented into 1.2 million small farms employing 38% of the working population and contributing only 6.2% to GDP (2013). However, agriculture witnessed robust growth of 4% p.a. over the past decade and has substantial growth potential to meet growing domestic and import demand for food (fruits, vegetables and dairy products). Farms and MSMEs are the most important source for employment and income generation in the regions. Lack of funding is one of the main reasons limiting their growth.
Objectives and Scope The expected outcome is improved ability of ABA to provide financial services to farmers, and agriculture MSMEs.
Status of Development Objectives The 2015 manat devaluation adversely impacted ABA's business and financial performance. As such as of end-June 2017, ABA tracked behind its development targets.
Linkage to Country/Regional Strategy The loan will reach agriculture MSMEs and farmers, providing longer tenors for their investments. This is consistent with government and ADB strategy to promote private non-oil activities.
Safeguard Categories
Environment FI
Involuntary Resettlement FI-C
Indigenous Peoples FI-C
Summary of Environmental and Social Aspects
Environmental Aspects ABA will apply ADB's prohibited investment activities list; exclude subloans categorized A for environment; ensure that investments using ADB funds abide by applicable national laws and regulations, as well as ADB Safeguard Policy Statement (2009)
Involuntary Resettlement ABA will apply ADB's prohibited investment activities list; exclude subloans categorized A or B for involuntary resettlement; ensure that investments using ADB funds abide by applicable national laws and regulations, as well as ADB Safeguard Policy Statement (2009)
Indigenous Peoples ABA will apply ADB's prohibited investment activities list; exclude subloans categorized A or B for indigenous peoples; ensure that investments using ADB funds abide by applicable national laws and regulations, as well as ADB Safeguard Policy Statement (2009)
Stakeholder Communication, Participation, and Consultation ADB team conducted several consultations with potential end-borrowers and farmers in rural Azerbaijan.
Timetable for assistance design, processing and implementation
Concept Clearance 02 Feb 2015
Credit Committee Meeting 09 Mar 2015
Approval 22 Apr 2015
Last PDS Update 10 May 2018

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Related Publications

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