IFC Collaborates with Azerbaijan to Bring Progressive Financing Tools for Agriculture

Azerbaijan has set a firm course to diversify the economy's sources of growth in order to reduce its reliance on oil. Strategic Road Maps on the National Economy Perspective and Main Sectors of the Economy guide the restructuring. Long-term, the goal is to have in place by 2025 the policy frameworks and other conditions required to advance the diversification process.

"IFC, by way of its Agricultural Financing Project, applied in partnership with SECO, has supported native monetary establishments in launching value-chain financing merchandise and helped the chosen worth chains on strawberry and hazelnut crops improve their competitiveness in export markets," said Rana Karadsheh, IFC's Regional Director for Europe

"Value chain financing was an important step in allowing farmers to access finance without real estate collateral and with strong belief in crops exported to Gulf or European markets," she added.

Karadsheh stated that the IFC is collaborating with the Azerbaijani federal government to introduce progressive financing devices to develop agriculture in Azerbaijan and connect small farmers to global value chains.

"These devices are crop receipts, which permit farmers to acquire pre-harvest finance in opposition to a promise to supply a sure amount of crops, and warehouse receipts (submit season financing), which can be utilized to offer financing within the type of short-term loans or ensures.

The government, farmers, financial institutions, and other stakeholders see the benefits, and draught legislation to allow these devices is currently being debated," said the IFC regional director.