The Black Sea Trade & Development Bank (BSTDB) will make available €5mn for investment in equipment and machinery at a glass factory in Baku, Azerbaijan. The five-year loan will be extended to International Bank of Azerbaijan (IBA) for on-lending to Caspian Management Systems, a private Azeri company which acquired the factory under the Azeri privatisation programme.
The BSTDB financing will contribute to the total project cost of €15.4mn, which shall develop the glass plant capacity of 100mn jars and bottles per year and provide employment for about 100 people. The factory will supply its produce to Azeri manufactures of canned food and beverages who currently import glass containers at rather high prices due to high transportation costs.
The developmental impact of the operation involves the import substitution and employment generation in Azerbaijan.
International Bank of Azerbaijan is a majority state-owned biggest bank in the country and has a share of over 50% in the assets of Azeri banking system.
IBA is successfully implementing a BSTDB trade finance facility of US$6.5mn provided in 2003.