The European Bank for Reconstruction and Development’s (EBRD) new two-year strategy for
- Azerbaijan recognises improvements in the investment climate, but calls for further measures in order to realise stronger growth outside the oil and gas sector. It also sets out approaches to how the EBRD can contribute to Azerbaijan’s plans for reducing poverty.
Macroeconomic performance in Azerbaijan has been impressive over the last two years but there are still obstacles and progress to be made in the transition process, says George Krivicky, director for the Caucasus, Belarus and Moldova. The new strategy is designed to help Azerbaijan face these challenges and realise its economic potential.
The EBRD aims to help Azerbaijan to improve its investment climate, with particular emphasis on the legal/regulatory environment, infrastructure development, strengthening of the financial sector, and support for small and medium-sized enterprises (SMEs).
The bank will continue to assist Azerbaijan in the environmentally sensitive development of the oil and gas sector, corporate governance, transparency and sound revenue management, while also supporting measures to aid the diversification of the economy. Specifically, the EBRD will:
- Promote micro, small and medium-sized enterprises and non-oil private-sector projects by direct financing and through the financial sector, as well as through policy dialogue about the investment climate.
- Focus on building an effective and competitive financial sector that commands the confidence of the population and efficiently intermediates between savers and investors in particular with a view to supporting micro enterprises and SMEs.
- Continue to support the creation of a market-based economy through the promotion of sound infrastructure projects that promote commercialisation, private-sector involvement, and the strengthening of institutional and regulatory frameworks. Projects that foster regional cooperation will take highest priority.
In executing this strategy, the EBRD will co-ordinate closely with other international and bilateral institutions to ensure a complementary approach, in particular in supporting Azerbaijan’s implementation of its state programme on poverty reduction and economic growth. The EBRD says it will continue an active, ongoing dialogue with the private sector and NGOs.