British Petroleum (BP), the international petroleum corporation, on behalf of its Azeri subsidiaries, and the European Bank for Reconstruction and Development (ERBD) recently signed an agreement to support “private sector development” in Azerbaijan. BP will contribute USD 5.25 million to a three-year program while the EBRD will co-finance operations with an amount at least matching BP’s contribution. The money will come in the form of low interest loans and will support two local microfinance institutions (MFIs), Rabitabank and FINCA Azerbaijan. Each institution will initially receive a loan of USD 3 million which it will on-lend to local micro-enterprises. The program will be implemented through the EBRD’s Azerbaijan Micro-Small and Medium Enterprise Facility, and BP’s Regional Development Initiative (RDI, page 42), which has the goal of creating effective access to commercial finance in the countries in which it operates.
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