EBRD signs loan agreement for financing ASCO without sovereign guarantee

Azerbaijan Caspian Shipping CJSC (ASCO), Azerbaijan Investment Holding (AIH) and the European Bank for Reconstruction and Development (EBRD) have signed a loan agreement for the financing of two Handysize dry cargo vessels without a sovereign guarantee.

Minister of Economy and EBRD Governor for the Republic of Azerbaijan Mikayil Jabbarov, Chief Executive Officer of AIH Ruslan Alikhanov, Chairman of the Management Board of ASCO Rauf Valiyev, EBRD Regional Director for the Caucasus  Alkis Vryenios Drakinos and the head of the EBRD Resident Office in Azerbaijan, Nataly Mouravidze, participated at the signing event.

The loan agreement was signed by Chief Executive Officer of AIH Ruslan Alikhanov, Chairman of the Management Board of ASCO Rauf Valiyev, and EBRD Regional Director for the Caucasus Alkis Vryenios Drakinos. 

The total project cost is USD 60 million. The loan agreement will consist of two tranches, with 70% of the vessel purchase cost financed by the EBRD loan and 30% by ASCO's internal resources.

The event highlighted the interest shown by international financial institutions, including EBRD, and the support provided by various financing instruments to the projects carried out in Azerbaijan, as well as to the large-scale projects in the field of transport and transit cargo transportation, which is an important component of the non-oil sector.

It was stated that the allocation of a loan directly to ASCO by the EBRD without a state guarantee is an indicator of successful reforms carried out in SOEs, the presence of corporate governance and accountability systems built in accordance with international practices, transparency in operations, and a sound financial standing.

It was emphasized that this new cooperation with the EBRD marks a new stage in the development of Azerbaijan’s shipping, and today’s loan agreement aims to expand ASCO’s operating geography in international waters beyond the Caspian Sea.

Additionally, the loan agreement signed with ASCO will contribute positively to addressing global climate change challenges. The financing will be used to purchase modern dry cargo vessels that meet the latest environmental requirements of the International Maritime Organization.