Baku, Azerbaijan, January 26, 2023—To increase access to finance for smaller businesses and women entrepreneurs in Azerbaijan, IFC is providing a financing package of up to $40 million to Bank Respublika. The project aims to boost the bank's lending to micro, small, and medium enterprises (MSMEs), including women entrepreneurs, while helping spur economic activity post-COVID-19.
The financing package comprises $20 million by IFC. And IFC will additionally mobilize up to $20 million. Around 50 percent of the proceeds will be earmarked for on-lending to women-owned MSMEs, improving their access to funding. The project is supported by the IFC Women Entrepreneurs Finance Initiative and the Women Entrepreneurs Opportunity Facility.
MSMEs are an essential part of Azerbaijan's economy, contributing 45 percent to employment and 15 percent to gross domestic product (GDP). During the COVID-19 pandemic, large part of MSMEs in the world were affected and many had to scale down operations.
"Since the main objective of our bank's strategy is to support the real economy, particularly micro, small, and medium enterprises, we pay high attention to the growth of these segments. IFC, one of the world's leading financial institutions, believes in and supports our strategy, which will help us to successfully achieve the intended targets," said Tariyel Ismayilov, the Chairman of the Management Board of Bank Respublika.
IFC's funding aligns with the World Bank Group's strategy for Azerbaijan to boost access to finance for MSMEs, increasing economic competitiveness. It also fits with the country's 2030 National Development Vision, which prioritizes supporting smaller businesses to bolster economic growth and create jobs.
"Globally, the pandemic has impacted smaller businesses the most, especially those owned by women. Azerbaijan is no exception. IFC's funding will enable Bank Respublika to support these vital businesses, while also building the financial sector's resilience and strengthening the country's post-pandemic recovery efforts," said Rana Karadsheh, IFC's Regional Director for Europe.
Azerbaijan became a member of IFC in 1995. Since then, IFC has invested around $500 million in the country, including $73 million through mobilization, financing projects across sectors including financial services, infrastructure, and manufacturing. IFC has also supported Azerbaijan with around $100 million in trade through its trade finance program, provided $250 million for the Baku-Tbilisi-Ceyhan pipeline in 2004, and implemented several advisory projects to boost private sector growth in the country.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2022, IFC committed a record $32.8 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org.
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For more information about Bank Respublika, visit: www.bankrespublika.az
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