The financing supports domestic food production, reduces import dependency, and addresses food security challenges arising from economic, climate, and regional political uncertainties
The Asian Development Bank (ADB) and Bank Respublika Open Joint Stock Company signed a 34 million Azerbaijan manat loan (around $20 million) to support women borrowers and micro, small, and medium-sized enterprises (MSMEs) involved in agricultural production, processing, and trade in Azerbaijan.
The financing supports domestic food production, reduces import dependency, and addresses food security challenges arising from economic, climate, and regional political uncertainties. Boosting the agriculture sector has significant potential to reduce poverty as most of the country’s food is produced by smallholder farmers.
“MSMEs are essential to lift incomes and create jobs in Azerbaijan, as they employ more than two-thirds of working people and nearly 40 per cent of registered women-owned businesses are in the agriculture sector. Bank Respublika is a longstanding reliable partner of ADB and its work aligns with ADB’s goal of improving food security, strengthening agriculture, and helping women to access finance, training, and markets. We look forward to our continued partnership with Bank Respublika” said Candice McDeigan, ADB’s Azerbaijan Country Director.
A majority of private businesses in Azerbaijan are MSMEs with almost half of them located in rural areas. Despite their importance, MSMEs struggle to access financial resources, making it harder for them to secure bank loans than larger firms. The country’s financial sector is slowly recovering from the impact of COVID-19 while currency-related risks continue to be a concern in the banking sector.
“Bank Respublika is a strong and valued partner due to its significant presence in rural areas, focus on MSMEs, and commitment to improving financial access for women and rural customers,” says Suzanne Gaboury, ADB Director General for Private Sector Operations. “This deal draws from our regional experience, particularly the advantages of using local currency to strengthen capital markets.”
ADB will also issue a Manat-denominated bond to support the loan. ADB will also work with Bank Respublika to promote gender equality through a professional development certification program for women employees and tailored financial services for female clients. ADB will work with Bank Respublika to develop gender-disaggregated loan data and provide training to loan agents on understanding women’s business concerns.
