WASHINGTON, D.C., Aug. 25—The International Finance Corporation (IFC) today signed investment agreements with Baku Coca-Cola Bottlers Limited for US$5.8 million. IFC is providing US$3.5 million in debt and US$2.3 million in equity to a Coca-Cola bottling operation in Baku, the capital of Azerbaijan. This is IFC's first investment in Azerbaijan.
Baku Bottlers, a joint-venture between Efes Investments of Turkey and Ilchin Limited of Azerbaijan, produces Coca- Cola, Fanta and Sprite for the local market. The plant utilizes both returnable glass bottles and Polyethylene Terephthalate containers for beverage packaging. The total investment is US$26.5 million equivalent.
Azerbaijan gained independence in 1991 and since that time has faced significant political and economic challenges in its transition to a market economy. While the government's economic reform program has restored financial stability and curbed inflation, private enterprise is still only beginning to emerge. Baku Bottlers has created 150 jobs and will support private distributors and transporters as well as small and medium-sized wholesalers and retailers.
"This is the first major greenfield foreign direct investment in Azerbaijan, outside the oil sector," said Mr. Harold Rosen, Director of IFC's Europe Department. "Baku Bottlers is introducing modern business management, production and distribution methods to Azerbaijan's private sector, which are expected to encourage future foreign direct investment in the country."
Efes Investments is part of the Anadolu Group, one of Turkey's leading industrial conglomerates in the beverage, automotive, finance, and office equipment sectors. Ilchin Limited, is a private company wholly owned by two Azeri entrepreneurs. Azerbaijan became a member of IFC in October 1995. IFC's strategy for the country is to help catalyze private-sector investments, with an initial focus on oil production and pipeline projects, agro-processing operations, foreign joint-ventures and capital markets development.
