BAKU
The Asian Development Bank (ADB) plans to provide a $5.9 million three-year loan to Avrora LLC, Azerbaijan’s third-largest food and beverage manufacturer and distributor.
The proceeds of the loan will finance Avrora’s working capital needs to produce and distribute staple foods like wheat flour, pasta, biscuits, and dairy products. It will also be used for additional operational expenses needed due to the COVID-19 pandemic.
The proposed project is aligned with three operational priority areas of ADB Strategy 2030: addressing remaining poverty and reducing inequalities, accelerating progress in gender equality, and promoting rural development and food security, ADB said.
“This loan will ensure the production and distribution of basic food products for the domestic market, which are important commodities in the COVID-19 crisis,” it said in a statement.
“As production continues, Avrora will be able to retain its own workforce and the workforce along its supply chain in this time of increased difficulty and uncertainty.”
The bank said that the additional working capital would support the increase of Avrora’s credit terms to its customers and quicker payments to its suppliers, to avoid supply disruptions, thus, ensuring basic food products availability.
The ADB said this week that Azerbaijan’s economic growth was forecast to return in 2021 at 1.9 percent and accelerate to 2.5 percent in 2022 as demand improves at home and abroad. As consumer confidence is restored and petroleum receipts become available for public investment, growth in the petroleum industry is expected to be outpaced by expansion in the rest of the economy
Inflation is forecast to accelerate to 3.5% in 2021, reflecting price increases of 10% for gasoline and 33% for diesel and a doubling of household water charges. A projected decline in domestic food prices should trim inflation in 2022 to 3.0%. Inflation could be higher if other utility tariffs are raised. The managed exchange rate regime should limit the impact of import prices on inflation.