IOM and UNDP transform their joint project into a community micro-finance institution in Nakhchivan

Nakhchivan, November 22, 2006 - The International Organization for Migration (IOM) handed over one of its most successful projects in Azerbaijan to a community-owned micro-finance institution in Nakhchivan. The Community Development and Micro-Credit (CDMC) Project, a joint project of IOM, the United Nations Development Programme (UNDP) and the Government of Nakhchivan Autonomous Republic (NAR) was transformed into a sustainable microfinance institution. The project started in November 1998 in Nakhchivan and aimed at reducing levels of poverty, developing local small businesses and generating jobs. During the eight years of its implementation, the project helped 72 villages and improved the standards of living of 18,652 villagers while creating 539 jobs in the urban areas. The project has provided micro credit loans to the tune of US$4,216,930 by using the revolving fund of US$383, 718.

Nakhchivan-Kredit Ltd, the organization taking over the CDMC project, was founded by the Regional Advisory Centre (RAC) based in Nakhchivan. It was registered as a non-banking credit organization at the Ministry of Justice of Azerbaijan Republic in May 2006 and received a license from the National Bank of Azerbaijan in July 2006. Participating as the Chief Guest during the handing over ceremoney, Mr. Vasif Talibov, the Chairman of the NAR Parliament stated that the CDMC project is a great example of cooperation between government and international community. The Chairman also stressed the high level of impact the project had on the development of small businesses and generation of jobs in Nakhchivan.

"The project is currently able to generate enough revenue to meet its operational costs. I am quite confident that the Nakhchivan-Kredit LLC will continue implementing the project in a sustainable and effective manner," said Sarat Das, the Chief of IOM Mission in Azerbaijan. Fargan Abbaszadeh, Communications Manager of UNDP Azerbaijan emphasized that the implementation of the project would not have been possible without the commitment and the hard work of the IOM team in Nakhchivan, support of the local government and the serious attitude of the Nakhchivan villagers who received small credits. He said: "The evidence for the success of the project is 98% rate of loan recovery. The beneficiaries had the honesty and reliability to pay back those loans, and that was very important. They really believed in the project."

During the initial phase of project implementation, twenty two water projects were constructed or rehabilitated as a means to build the capacity of the local communities to address their water problems.
UNDP was the main donor to the project and IOM contributed $50,000. AGFUND, the Arab Gulf Programme for UN Development Organisations, also made an important contribution to the success of the project by donating US$100,000 to the project component on women's empowerment through micro-credit.

The movie on the success of the project was also presented during the handover ceremony. The event finished with the signing of the Agreement between the IOM Azerbaijan and the Regional Advisory Centre followed by a visit of the participants to an exhibition of commodities produced by the CDMC project's clients.