Describes how major projects are secured and financed. Explains activities of the multilateral development banks in and other aid-funded projects.
Selling to the Government
The government of Azerbaijan, state-owned enterprises, and quasi-state-owned enterprises are some of the largest players in the economy. Selling directly to the government or to these enterprises can be profitable, but limited transparency in government procurement processes can present a challenge. Major infrastructure projects typically funded through the World Bank or other multilateral development bank financing are more transparent than those funded directly by the government. Azerbaijan is not a WTO member and has not agreed to abide by the WTO Government Procurement Agreement.
U.S. companies bidding on government tenders may also qualify for U.S. Government advocacy. A unit of the U.S. Commerce Department’s International Trade Administration, the Advocacy Center coordinates U.S. Government interagency advocacy efforts on behalf of U.S. exporters bidding on public sector contracts with international governments and government agencies. The Advocacy Center works closely with our network of the U.S. Commercial Service worldwide and inter-agency partners to ensure that exporters of U.S. products and services have the best possible chance of winning government contracts. Advocacy assistance can take many forms but often involves the U.S. Embassy or other U.S. Government agencies expressing support for the U.S. bidders directly to the foreign government. Consult Advocacy for Foreign Government Contracts for additional information
Financing of Projects
Access to capital is a key challenge to Azerbaijan’s economic development. Non-government domestic sources of project financing are limited. External sources of finance include the U.S. Export-Import Bank, the Overseas Private Investment Corporation, the Asian Development Bank, and the European Bank for Reconstruction and Development, among others. Venture capital is virtually non-existent. State procurement is typically financed from the national budget or through international financial institutions, though the government has focused on decreasing its debt-to-GDP ratio and limited borrowing.
Multilateral Development Banks and Financing Government Sales
Price, payment terms, and financing can be a significant factor in winning a government contract. Many governments finance public works projects through borrowing from the Multilateral Development Banks. A helpful guide for working with the MDBs is the Guide to Doing Business with the Multilateral Development Banks (PDF). The U.S. Department of Commerce’s International Trade Administration has a Foreign Commercial Service Officer stationed at each of the five different Multilateral Development Banks: the African Development Bank; the Asian Development Bank; the European Bank for Reconstruction and Development; the Inter-American Development Bank; and the World Bank.
Learn more by contacting the:
- Commercial Liaison Office to the Asian Development Bank
- Commercial Liaison Office to the European Bank for Reconstruction and Development
- Commercial Liaison Office to the World Bank.