The European Bank for Reconstruction and Development (EBRD) and the European Union (EU) are contributing to the development of a circular economy in Azerbaijan. The Bank is providing a loan of up to US$ 4.2 million to lead-acid battery recycling company Az-Lead. The company produces secondary (unrefined) lead bullion and refined lead ingots by recycling end-of-life lead-acid batteries that would otherwise have ended up in landfill. The transaction will be supported by a guarantee from the European Fund for Sustainable Development (EFSD), APA reports.
The investment is set to boost the company’s recycling and refining capacity, improve lead-recovery rates and allow Az-Lead to increase its monthly production from 500 to 800 tonnes and eventually to more than 1,000. This will support the company in meeting growing demand for recycled lead in the automotive and renewable energy sectors.
In addition to the financing, the Bank will also support Az-Lead in legal due diligence, as well as in developing an environmental, social and governance pathway in line with international best practice for small and medium-sized enterprises.
This investment project contributes to the implementation of the EU’s Economic and Investment Plan (EIP) in the Eastern Partnership region. One of the key flagship priorities of the EIP for Azerbaijan is to promote the country’s economic diversification and a greening of the economy while supporting local businesses.
The EFSD is an EU risk-mitigation instrument available for projects in the EU neighbourhood in the municipal infrastructure, transport and logistics, industrial, and building sectors. The EFSD guarantee has two strategic priorities. It aims to support borrowers negatively affected by the Covid-19 pandemic. It also aims to accelerate financing flows for projects that contribute to the transition to green economies.
Matteo Patrone, Managing Director for Eastern Europe and the Caucasus at the EBRD, commented: “We are delighted to support our first circular economy project in Azerbaijan. Az-Lead is recycling batteries that would otherwise have ended up on landfills. With our support, the company is aiming to ramp up its recycling and refining capacity, which will boost Azerbaijan’s exports while protecting the environment. We are proud of the nature of this project and that it fully corresponds with the EU Circular Economy Action Plan.”
Lawrence Meredith, Director of the EU’s Eastern Neighbourhood and Institution Building at the European Commission, noted: “We fully support this EBRD investment which is aligned with our Economic and Investment Plan for Azerbaijan and Eastern Partnership countries. Thanks to the support of the EU guarantee, we are contributing to green transition in the country and creating new employment opportunities.”
Az-Lead was established in 2014 and is located in the Sumgayit industrial zone. The company is the largest secondary producer of unrefined lead and the sole producer of refined lead ingots. The company exports all of its lead-based products internationally.
The EBRD is a leading institutional investor in Azerbaijan, where it has invested US$ 3.6 billion in 187 projects to date in the financial, corporate, infrastructure and energy sectors, with most of those investments in private enterprises. The Bank’s strategy in the country focuses on helping Azerbaijan to diversify its economy and develop the non-oil private sector.