TODAY.AZ / Business

Azerbaijan, IDB sign grant agreement

18 January 2017 [17:46] - TODAY.AZ

By Azernews


By Nigar Abbasova

The government of Azerbaijan has signed a grant agreement with the Islamic Development Bank for the provision of technical assistance in drafting a legislative base for Islamic financing.

The Jeddah-based Bank, which aims to foster the economic development and social progress of its member countries, will provide technical assistance worth $200,000 for drafting the legislative base, Trend reported.

The document was undersigned by Azerbaijan’s Economy Minister Shahin Mustafayev and IDB Vice President Sayed Aga during a meeting in Baku on January 18.

The deal envisages holding of an analysis of the banking legislation, as well as introduction of principles of Islamic banking in Azerbaijan. 

The current legal system in the banking sphere restricts possibilities for the use of Islamic bank products due to their restrictions and a number of unsettled issues in terms of double taxation, a definition of interest rates, bans on operation in certain areas.

Mustafayev also invited the Bank to invest in the establishment of industrial parks and districts in the country, manufacture of construction materials, as well as in the spheres of metallurgy and chemical industry.

The minister noted the importance of IDB financing in Azerbaijan’s private sector, in particular, in the real sector, and expansion of direct financing of big enterprises and participation  in a share capital of companies.

Mustafayev emphasized that Azerbaijan attaches special attention to the expansion of relations with Islamic countries and strengthening of the Islamic solidarity, adding that Azerbaijan will continue active cooperation with the IDB.

The Bank is also interested in transport corridors passing through the territory of Azerbaijan.  IDB Regional Director for the CIS Hisham Marouf earlier said that the financial institution is interested in participation in regional projects implemented by Azerbaijan Railways, particularly the ambitious North-South project.

 Also, the Bank intends to continue its participation in water and sanitation projects carried out in Azerbaijan.

Azerbaijan joined the Islamic bank in 1991. So far, the bank has allocated nearly $1 billion for the implementation of 18 projects in the country. Some 14 out of 18 projects have already been implemented in Azerbaijan, and four projects are in the process of implementation.

The share of the country in the capital of the Bank amounts to 0.13 percent.

URL: http://www.today.az/news/business/157828.html

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