Leah Gutierrez: ADB to expand range of financial instruments for projects in Azerbaijan - INTERVIEW

Amid the global restructuring of supply chains, Azerbaijan is cementing its status as a key link in the Middle Corridor, linking the economies of Central Asia and Europe. Large-scale modernization of the transport network, digitalization of borders, and the country's ambitions to create a green energy bridge are becoming drivers of sustainable development for the entire region. In this transformation, the Asian Development Bank (ADB) is acting as a strategic partner, supporting both public reforms and private initiatives.

In an exclusive interview with Report, Leah Gutierrez, Director General of the ADB's Central and West Asia Department, discussed the prospects for developing the Trans-Caspian Energy Corridor, investments in solar and wind power generation, and new financial instruments to support the private sector.

Report presents the interview:

- ADB and Azerbaijan are actively cooperating on the development of cross-border corridors. Which specific projects are currently under active development, and how does the Bank assess Azerbaijan's role in ensuring regional connectivity within the Central Asia Regional Economic Cooperation (CAREC) program?

- ADB has made substantial investments along the CAREC 2 Corridor (which largely coincides with the Middle Corridor), including in Azerbaijan, particularly for railway development and road network upgrades. Unlocking regional cooperation's full potential will require further targeted support, especially in upgrading infrastructure, enhancing multimodal connectivity, and leveraging digital technologies to improve efficiency and capacity.

Through the CAREC Program, ADB is identifying priority projects for both public and private investment in Azerbaijan.

We are also supporting reforms to improve railway operations and encouraging private sector participation to expand the capacity and productivity of Caspian ports and associated logistics centers.

In parallel, we are exploring opportunities in urban and tourism development, as well as the modernization of border crossing points through digital solutions. These efforts are essential to transform transport corridors into dynamic economic corridors, creating jobs, supporting businesses, and generating inclusive opportunities, particularly for women and youth.

- Azerbaijan has set a course to become a green energy hub. Is ADB considering the financing of additional renewable energy projects in Azerbaijan? Beyond solar and wind farms, is the Bank ready to support the creation of infrastructure for energy export, such as the Black Sea submarine cable project or high-voltage transmission lines toward Europe?

- Through its private sector operations, ADB has played an active role in advancing major renewable energy projects in Azerbaijan. It has co-financed Masdar's Alat solar project, along with the Bilasuvar and Banka solar plants, helping to scale up clean energy capacity and support the country's transition toward a more sustainable energy mix.

As we work towards a clean energy transition across Central Asia and the Caucasus, ADB is exploring more opportunities for renewable energy development for solar and offshore wind projects in Azerbaijan and beyond.

ADB is specifically proud to support the preparation of the feasibility study for the Caspian Sea Green Energy Corridor project, a major regional initiative designed to strengthen cooperation in clean energy and serve as a green energy bridge between Asia and Europe. We see strong potential for the Corridor to become a critical platform for exporting renewable energy and accelerating the green transition across Central Asia, the Caspian Sea, and the Black Sea region.

Our support for this flagship project is growing. In April 2025, ADB, together with the Asian Infrastructure Investment Bank and the energy ministries of Azerbaijan, Kazakhstan, and Uzbekistan, signed a Memorandum of Understanding for the feasibility study. This study assesses the project's technical, financial, regulatory, and environmental aspects.

Overall, this initiative reflects ADB's broader commitment to supporting Azerbaijan's transition toward a sustainable, connected, and export-oriented energy future, while strengthening regional energy security and economic cooperation.

- Azerbaijan is actively implementing Public-Private Partnership (PPP) mechanisms. Does ADB have plans to provide direct loans to Azerbaijan's private sector (without sovereign guarantees) for the implementation of medium and large-scale infrastructure projects?

- ADB has long supported efforts to strengthen the regulatory and legal framework for public–private partnerships (PPP) in the country. In close collaboration with the government, ADB has contributed to the development of the PPP law, the establishment of a dedicated PPP unit, and the delivery of training programs for relevant government staff.

We are also exploring opportunities for developing PPPs that contribute to infrastructure modernization and economic diversification in Azerbaijan. A good example is ADB's recent PPP transaction advisory service for the Hovsan Wastewater Treatment and Reuse Project, the largest such plant in the country.

In addition, we are engaged with different private sector partners to identify investment opportunities to support small and medium-sized enterprises (SMEs), given their vital role in driving employment and innovation. To do this, we are expanding the range of financial tools we offer.

In addition to traditional loans, we can also provide guarantees, take equity stakes, and support trade finance to attract more private investment. Our goal is not just to fund projects, but to reduce investment risks and encourage additional partners to participate in financing impactful projects.

By using these approaches, we aim to help Azerbaijan realize its full economic potential, strengthen a resilient private sector, and advance its vision of sustainable and inclusive growth.