EBRD, DEG to allocate 5M euros each for Azerbaijan’s leading supermarket chain
The European Bank for Reconstruction and Development (EBRD) and Germany’s Development Finance Institution DEG will help Azerbaijan’s leading supermarket chain Araz to improve its warehouse operations, Trend reports citing the Bank.
“Consumers and food producers in Azerbaijan will benefit as the country’s largest supermarket chain, Araz, is expanding its distribution and warehouse capacity. The EBRD and Germany’s Development Finance Institution DEG are financing the plans with loans worth €5 million each,” reads a message from EBRD.
Reportedly, Araz runs a network of 122 stores, including those under its own brand name and the ones with SPAR banner.
“With the new funds, the company is planning to expand its distribution centre and more than triple its warehousing capacity, from 12,600 square meters to 42,600 square meters. The newly enlarged facilities will also enable storage of fresh and frozen goods and by bringing management of the supply chain under its own control will help the company to improve supply chain management and working capital control, as well as increase the overall efficiency and profitability of the business,” said the Bank.
The warehouse will be expanded in line with sustainability standards and Araz is committed to obtaining sustainability certifications such as BREEAM-Good or LEED-Silver, according to the message.
EBRD said such certification recognises significant energy savings and includes requirements for more sustainable management of construction sites, for water efficiency, recycling and reuse of construction materials, and minimisation of construction waste.
Ivana Duarte, Head of EBRD in Azerbaijan, said that by financing Araz the EBRD is supporting the country’s fast-growing retail sector.
“Modern retail operations are a boost for local producers and also benefit customers, bringing greater efficiency, price transparency, higher standards of service and quality and safety of food and other goods,” she added.
The EBRD is a leading institutional investor in Azerbaijan and has so far invested close to 3.3 billion euros in almost 170 projects across various sectors of the economy. The Bank’s new strategy in the country focuses on efforts to help Azerbaijan diversify the economy and develop private sector in the non-oil sectors.
Germany’s DEG is active in Azerbaijan since early 2000s. It has supported several local private banks with long term financing and various technical assistance programs.