OREANDA-NEWS. October 1, 2009. The U.S. Trade and Development Agency (USTDA) and the State Oil Fund of the Republic of Azerbaijan (SOFAZ) have signed the USD 250,000 grant agreement on USTDA funding "the cost of goods and services required for technical assistance on Phase III of the Institutional Capacity Building for SOFAZ project". The agreement was signed by Shahmar Movsumov, SOFAZ Executive Director and Scott Greenit, USTDA Director for Europe and Eurasia.

Signing the agreement USTDA approved the selection by SOFAZ of Overture Financial Services, LLC as the company to perform the technical assistance on phase 3 of the project on institutional capacity building for SOFAZ.

Originally the project was evaluated at up to USD 700,000-800,000 and its parity financing is linked with the fact that since 2007 the US and Azerbaijan switched to co-financing of technical projects.

The new project will also be aimed at institutional development of SOFAZ. In particular, it includes assistance in choice of managers for SOFAZ assets management and training of management for activity, creation of a permanent training center for SOFAZ staff.

The first grant agreement on USD 1.091 million of technical assistance for SOFAZ was signed in Baku on 19 May 2004. The project of SOFAZ institutional development included placement of Fund’s finances and assessment of certain risks, definition of criteria of foreign managers on SOFAZ assets administration and monitoring of their work, definition of requirements for purchase of software on registration of assets and their accounting system, consultations for SOFAZ on co-operation with other software systems used by the Fund, in particular in the process of accounting transactions.

On 18 January 2005 SOFAZ signed a contract with Overture Financial Services for realization of this stage. The latter was to make proposals for staff reshuffles and SOFAZ structural branches’ mutual settlements conforming to international standards, and legal consultations for SOFAZ on acquisition of separate assets.

On 7 February 2007 SOFAZ and USTDA signed a USD 885,000 grant agreement on the 2nd stage of SOFAZ institutional development. The one-year grant programme includes Fund’s technical development – supply of the latest modern software on investment accounting and risk performance.

In this connection on 22 June SOFAZ signed two six-month contracts with Thomson Financial Ltd for supply of software for master ledger for USD 182,675 and for portfolio management software supply for USD 692,927.

SOFAZ was established in accordance with the presidential decree issued December 29, 1999 and is out-budget state institution under the auspices of the President’s Office. The Fund accumulates revenues from realization of oil contracts, in particular from sale of country’s profit oil, tariffs for oil and gas transit, state property lease, etc. Currently its assets exceed USD 11.2 bn.