The European Bank for Reconstruction & Development (EBRD) held a conference in Azerbaijan in September focusing on the progress of its microfinance initiatives within the country to date. The event hosted international investors as well as government officials and entrepreneurs in the SME and microenterprise sectors within Azerbaijan.
The EBRD is focused on expanding the micro and small and medium enterprise sectors within Azerbaijan with the goal of diversifying the economy through the development of non-oil and gas business sectors. Crude oil and oil products make up over 70% of Azerbaijan’s total exports and account for nearly 50% of budget revenues—which are stated to reach USD 30 billion by the end of 2008. The bank also works to extend micro-lending to the more remote rural provinces of Azerbaijan, where almost a third of the country’s population lives
The EBRD’s first initiative in Azerbaijan was to establish the Microfinance Bank of Azerbaijan (MFBA) in 2002 as first provider of financial services to microfinance institutions. It has reported that more than 260,000 sub-loans worth USD 693.1 million have been extended in the country since 2005. Approximately 33 percent of those loans were committed to borrowers outside of the capital Baku, where the concentration of the country’s wealth lies.
The EBRD was established in 1991 during the fall of communism in Central and Eastern Europe. Its aim is to help the development of market economies and democracies in 29 countries within Europe and Central Asia. The EBRD is the largest single investor in the region. It reports to the MIX microfinance database and reports USD 651,197,925 in assets allocated towards microfinance investments. Total assets for the bank are unavailable.
By Yrenilsa Lopez, Research Assistant
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