World Bank press release

WASHINGTON, February 15, 2005- The World Bank today approved a US$11.5 million Internally Displaced Persons (IDPs) Economic Development Support Project. This project aims to improve living conditions, enhance economic opportunities and prospects for social integration for IDPs.

Azerbaijan's armed conflict with Armenia over the Upper Garabagh region, which lasted from 1992 to 1994, left over 30,000 dead and over 1 million people displaced. About 575, 000, or 15 percent of the country's population, became "internally displaced persons." Many IDPs live in conditions where infrastructure, housing and service needs are substantial. Large numbers dwell in excessively poor housing conditions in school dormitories and former hotels, or occupy public buildings. Others live in informal settlements that often lack the most basic services, such as water, electricity, schools and health facilities. Economic opportunities are limited and unemployment is high.

"The project will extend the Government's efforts to improve the living conditions of IDPs who, as communities, will identify what investments are most needed," said Ellen Hamilton, head of the World Bank team designing the project.

The IDP Economic Development Support Project will consist of two main components: micro-projects and micro-credits. The first component will finance the preparation and implementation of up to approximately 200 small-scale projects (average cost about US$50,000) to rehabilitate, repair or reconstruct basic small infrastructure, social infrastructure and temporary shelter facilities. Under the second component, which is completely funded from the counterpart funding resources, financing to Partner Lending Institutions will be provided for the extension of micro-credits to IDPs.

By the time the project is completed, IDP communities will have benefited from new improved basic small infrastructure (water supply and sewage networks, electricity distribution networks, access roads and drainage systems), social infrastructure (schools and community centers), and temporary shelter facilities. IDPs will also have benefited from access to micro-credit for income-generating activities.

The IDP EDS Project has a maturity of 35 years, including a ten-year grace period.

Azerbaijan joined the World Bank in 1992. Since then, commitments to the country total approximately US$622 million for 25 operations.