EX-IM BANK, AZERBAIJAN SIGN PROJECT INCENTIVE AGREEMENT
The Export-Import Bank of the United States (Ex-Im Bank) and Azerbaijan today signed a Project Incentive Agreement (PIA) which lays the foundation for possible financing of U.S. exports to the former Soviet republic.
The accord was signed at a ceremony attended by Azerbaijan President Heydar Aliyev at Blair House, the President`s Guest House, in Washington, D.C. Signing for Azerbaijan were Minister of Finance Fikret Yusifov and National Bank Chairman Elman Rustamov. President and Chairman James A. Harmon signed for Ex-Im Bank.
This agreement enables us to work together to create growth for both our countries, Harmon said. It enables Azerbaijan to obtain capital goods to develop infrastructure and industry, in particular to develop its enormous oil reserves. And it is an important first step toward opening the door to an emerging market with significant potential for U.S. exporters.
The PIA provides a framework for financing U.S. sales to Azerbaijan where repayment is based on export revenues generated by the borrower, rather than a sovereign guarantee of the debt by the host country government. Repayment of loans will be facilitated through the establishment of offshore collateral accounts.
Ex-Im Bank has not opened its programs for sovereign-guaranteed transactions in Azerbaijan since the country became independent following the dissolution of the Soviet Union. However, Azerbaijan`s progress in implementing significant economic reforms in the past three years helped lead to the PIA signing between Ex-Im Bank and Azerbaijan. In late 1994, a consortium of western oil companies signed an agreement with Azerbaijan to develop the country`s substantial oil reserves and create two pipelines for oil exports.
Ex-Im Bank is an independent government agency that promotes and finances the sale of U.S. goods and services around the world.