The World Bank Board of Executive Directors today approved a package to help Azerbaijan increase the use of capital market instruments to improve access to finance and contribute to faster economic growth of the non-oil economy. The Capital Markets Modernization Project (CMMP) for Azerbaijan, a loan of US$ 12 million, is a continuation of the World Bank’s efforts to support the Government of Azerbaijan in strengthening and diversifying its financial sector.
The CMMP supports development of a modern capital markets regulatory regime and clearing and settlement infrastructure, improved access to capital markets, increased awareness of enterprises and potential investors to different capital markets instruments and strengthen the capacity of the State Committee for Securities (SCS).
The CMMP is designed to support the medium-term growth of private sector by providing opportunities for sustainable, alternative sources of financing, thereby contributing to the first strategic objective of the World Bank’s 2011 – 2014 Country Partnership Strategy (CPS), strengthening the non-oil economy.
“The World Bank is committed to support the authorities’ efforts to modernize the capital market over the medium term and in this regard, the CMMP will help build a more competitive non-oil sector through improved access to capital,” says Joseph Owen, the World Bank Country Manager for Azerbaijan.
“The Capital Markets Modernization Project supports a prioritized and coherent package of reforms needed to better diversify the financial sector, accelerate development of non-oil sector through improved access to finance and strengthen corporate governance over the medium term,” says Michael Edwards, Task Team Leader of the World Bank Team.
The CPPM is financed by an IBRD loan of US$ 12 million. The authorities opted for a US Dollars denominated Fixed-Spread Loan (FSL) with a 15 year maturity and 3 years of grace and repayments linked to disbursement.
Since joining the World Bank in 1992, the commitments to Azerbaijan total approximately US$ 2.9 billion for 43 projects.