TBILISI: The Asian Development Bank (ADB) has approved the package of technical assistance for Azerbaijan to prepare for COP29, ADB Director General for Central and Western Asia Eugenue Zhukov said in an exclusive interview with Trend on the sidelines of the ADB annual meeting in Tbilisi.

He pointed out that this is a special year for ADB and Azerbaijan, because this year marks 25 years since Azerbaijan joined the Asian Development Bank in 1999.

‘Also, this year we’re preparing our new country partnership strategy, which will cover the next five years from 2024 to 2028, and it will define the areas of collaboration between ADB and the Republic of Azerbaijan. We’re very excited that Azerbaijan has been selected as the host for COP29, which will be held in Baku in early to mid-November this year. When this announcement was made in December of last year, ADB president sent congratulations note to President Ilham Aliyev, and offered ADB support to the government of Azerbaijan,’ said Zhukov.

Zhukov recalled tha
t three weeks ago or so, he had a chance to visit Baku together with ADB climate change colleagues to discuss specific areas for possible collaboration in this area.

‘We had an opportunity to discuss this with Azerbaijan’s Minister of Finance Samir Sharifov, who is the ADB governor, and had a productive meeting with president-designate for COP29, Minister of Environment Mukhtar Babayev.

Since then, we’ve already approved a package of technical assistance, which will help the country to build the capacity to conduct COP-related negotiations and to conduct the meeting itself. That is a kind of helping the country to prepare for COP. Of course, we’ll be happy to discuss any further areas for collaboration,’ added the ADB director general.

Supporting Azerbaijan’s green agenda

‘We’re also helping the country to develop and implement more green energy projects, so to demonstrate to the world that Azerbaijan is serious about climate change agenda. Two years ago, ADB invested in the largest solar power plant in t
he Caucasus. This is a 230-megawatt power plant run by Masdar company in Alat, which I also had a chance to visit. It’s a very modern plant, and it’s a step towards fulfilling government’s desire to implement a strategy 30 by 2030, meaning that by that year, the country should be able to produce 30 percent of its all energy from renewable sources,’ he said.

Zhukov noted that ADB is discussing with Azerbaijan and also with the private sector further opportunities to invest in solar energy projects.

‘I hope that we will have more specific announcements for this later this year. But also in general, we are discussing with the country possibilities of investment in the offshore wind power projects. And in addition, we are piloting a solar floating power project. That’s when we put the panels on a lake or on any body of water and produce energy that way. We have a small 100 kW project which is currently being implemented in one of the lakes in Baku. We’ll see if this works, if we can work on it more,’ he said.

Zhukov went on to add that ADB is also working with the government of Azerbaijan to decarbonize the transport sector.

‘For example, we have an ongoing project and we’ll be providing additional assistance to electrify parts of the North-South railway project. We’ll be happy to work on additional scope of such projects in the future,’ he said.

ADB director general noted that the Bank is a keen supporter of regional cooperation, because it is probably one of the few MDBs where the regional cooperation is mandated in its charter documents.

‘In the case of Central Asia and Caucasus, in early 2000s we established Central Asia Regional Economic Cooperation Program (CAREC). Since that time, total investments in regional cooperation, including connectivity, have exceeded $50 billion. There is of course ongoing study on the Black Sea cable, going from Azerbaijan to Georgia, from Black Sea to Romania and the rest of the European Union. Feasibility study ongoing now. We hope that it is preliminary finished by mid or e
nd of this year. So if the study demonstrates that the project is feasible, we are very keen to participate in that. I think it is a very large project and if it is going to happen, I think there will be room for many IFIs to participate. Then if we look to the east, indeed we saw that a few days ago in Tashkent, the governments of Uzbekistan, Kazakhstan and Azerbaijan signed a preliminary MoU on the possible underwater cable crossing the Caspian Sea from Uzbekistan to Kazakhstan and to Azerbaijan on the so-called green energy corridor. Uzbekistan has been investing quite a lot to produce renewable energy, solar and wind, in the western parts of the country, while most of the economic base is actually in east of Uzbekistan. We think that these projects have potential to produce green energy, which then can be supplied for this proposed green corridor, but we believe that a lot of investments will be needed for this to happen,’ he said.

Zhukov noted that since Azerbaijan joined ADB in 1999, the Bank provided
assistance package totaling $4.2 billion.

‘But the biggest part of it for now is done for the public sector. And our private sector window outstanding is only about $50 million. It’s an important lending. For example, the $21 million project we did two years ago, which we helped to develop 230-megawatt solar power plant, is very good. But basically what we would like to do, that in a country like Azerbaijan, which is upper-middle-income country, we see more scope for direct private sector investments from ADB with other partners, but without government guarantee, meaning that we will not be adding to the government debt. The other aspects of this is that many people call this COP29 the finance COP. So we’re very keen to work with the government and other IFIs to work on more innovative modalities to help address the issues related to climate change, which will require quite substantive investments,’ he said.

Details of New Country Strategy

‘We are preparing the New Country Partnership Strategy. But I have
to say that the overwhelming agenda for this strategy would be dealing with the consequences of climate change and helping Azerbaijan to decarbonize its economy and to increase the share of renewable energy. So, no matter what sectors that we work in, this is an overarching agenda for ADB, not only in Azerbaijan, but in all of Asia and Pacific. Overall, ADB committed to invest $100 billion by the year 2030 in this agenda,’ he said.

Transport sector

‘But if you look in sectors, we also want to work more on transportation, continue expanding our cooperation with the Azerbaijan Railways, because there is a lot of unfinished agenda there to rehabilitate and rectify the whole network,’ said Zhukov.

He pointed out that ADB also looks forward to successful negotiations between Azerbaijan and Armenia, because once the peace agreement is reached, that would allow the country to unlock additional transportation corridor, connect Azerbaijan and the region better to the world.

‘There is quite an old railway which run
s from the southern part of Azerbaijan through Armenia to Nakhchivan. So, if peace agreement is reached and other agreements are in place, we will be very excited to invest in rehabilitating that network, but of course subject to government of Azerbaijan’s priority resolutions,’ he added.

Cooperation in education

‘Another area which we will work on is education. For a while, we’ve been discussing with the government the possibility of improving technical education in Azerbaijan, because you need to skill up your young workforce for the remainder of the 21st century. We hope to provide investment in this area. The earlier, the better. And in general, as I highlighted earlier, we’ll probably be looking at shifting our focus a bit more in balancing between public sector investments and the private sector investments,’ he concluded.

Source: Trend News Agency