A loan agreement has been signed for the construction of a new wastewater treatment facility in Sumgayit, Azerbaijan, financed through institutions of the Arab Coordination Group (ACG). The agreement was signed in Baku during the 2026 Annual Meetings of the Islamic Development Bank (IsDB) Group.
Water and sewerage for 33 settlements
Alongside the Sumgayit plant, a memorandum of understanding was exchanged to expand cooperation between Azerbaijan’s Ministry of Economy, the Azerbaijan State Water Resources Agency and members of the ACG on the construction of water supply and sewerage systems for 33 residential settlements on the Absheron Peninsula, the densely populated region around Baku and Sumgayit.
Development finance for water infrastructure
The projects are backed by the Arab Coordination Group, a long-standing alliance of development-finance institutions. According to the group, it has provided more than 13,000 development loans to over 160 countries since its establishment in 1975. Its members include the Islamic Development Bank, the OPEC Fund for International Development, the Arab Bank for Economic Development in Africa, the Arab Monetary Fund, the Saudi Fund for Development and the Kuwait Fund for Arab Economic Development.
Development banks are an increasingly important source of funding for water and sanitation infrastructure, particularly for large municipal wastewater treatment schemes and network expansions that are costly to deliver. The Sumgayit facility and the Absheron water and sewerage programme are aimed at extending treatment capacity and piped services across one of Azerbaijan’s most heavily populated areas, echoing new sewage treatment plants being built to serve large urban populations elsewhere.
Frequently asked questions
What was agreed for Sumgayit?
A loan agreement was signed to finance the construction of a new wastewater treatment facility in Sumgayit, Azerbaijan.
What is the Absheron water project?
A memorandum of understanding to build water supply and sewerage systems for 33 residential settlements on the Absheron Peninsula, involving Azerbaijan’s Ministry of Economy and the State Water Resources Agency with ACG members.
Who is financing the projects?
Institutions of the Arab Coordination Group, a group of development-finance bodies that includes the Islamic Development Bank, the OPEC Fund, the Saudi Fund for Development and the Kuwait Fund.
What is the Arab Coordination Group?
An alliance of 10 development-finance institutions, established in 1975, that says it has provided more than 13,000 development loans to over 160 countries.
