Export-Import Bank Confirms to Senator that Azerbaijan will be Required to Submit Annual Report and Allow Inspections of Records

May 9, 2011

WASHINGTON, DC – U.S. Senator Jack Reed (D-RI), a senior member of the Armed Services Committee, has secured a series of written assurances and ongoing reporting requirements regarding a controversial loan recently extended by the U.S. Export-Import Bank to Azerbaijan for the purchase of an advanced satellite, reported the Armenian National Committee of America (ANCA).

The bipartisan Congressional inquiries into this deal, since it was first placed on the Ex-Im agenda earlier this year, were made possible by Congressman Brad Sherman (D-CA), whose detailed scrutiny into this transaction created the opportunity for both his House and Senate colleagues to follow up with a broad range of questions and concerns. In addition to Senator Reed, Senator Mark Kirk (D-IL), a leading voice in Congress on military issues, played an especially constructive role in addressing the potential regional security implications of this satellite financing deal.

In a detailed, two-page letter, the Bank’s Chairman and President, Fred P. Hochberg, explained to Senator Reed that, “[T]hough Ex-Im Bank has established that the satellite lacks a military capacity, the Bank has implemented additional measures to ensure that the satellite is not utilized for any military related purpose.”

— “The Ex-Im bank loan documentation will include a provision prohibiting the Government of Azerbaijan from entering any agreement allowing for the use of the satellite by any of the armed forces of Azerbaijan, or the armed forces of any other country.”

— “Ex-Im Bank will also have the right to inspect all books and records related to the project at any time during the life of the loan.”

— “Lastly, the Government of Azerbaijan will be contractually required to furnish monitoring reports to Ex-Im Bank on an annual basis. The monitoring reports will identify all parties that have contracted to lease transponder capacity and will include certifications by the Government of Azerbaijan that the satellite has not been leased, nor has the Government of Azerbaijan entered into any agreements, with any of the armed forces of Azerbaijan, or the armed forces of any other country to permit utilization of the satellite.”

“We want to thank Senator Reed, Congressman Sherman, and the other legislators who worked with the Export-Import Bank in seeking to address deeply held concerns, raised by Armenian Americans and others devoted to peace in the Caucasus, regarding any U.S. action that might empower or embolden Azerbaijan to renew its aggression against Nagorno Karabakh and Armenia,” said ANCA Executive Director Aram Hamparian. “While we remain opposed to this deal and to any other potentially harmful assistance to the increasingly belligerent Azerbiajani government of Ilham Aliyev, we do value the Bank’s sensitivities to its regional security implications, and appreciate the efforts of legislators to build meaningful safeguards, prohibitions, and reporting requirements into this transaction.”

On April 27th, the U.S. Export-Import Bank voted to approve the controversial deal to finance Azerbaijan’s purchase of an advanced satellite just weeks after Azerbaijan threatened to shoot down a civilian airliner. The decision came despite serious Congressional reservations and strong opposition by the Armenian American community to U.S. actions that will strengthen Azerbaijan’s military capabilities at a time of increasing threats and acts of aggression by Baku against both Armenia and Nagorno Karabakh.

Over the past three months, the ANCA has conveyed the Armenian American community’s serious legal, technical and political opposition to this transaction in a series of letters and meetings with senior officials of the Export-Import Bank and the State Department. The firm selling this satellite, known as Azerspace/Africasat-1A, is Orbital Sciences Corporation of Dulles, Virginia. It is being purchased by the Ministry of Communications and Information Technologies of Azerbaijan in Baku, Azerbaijan. The application for Ex-Im financing was made by BNP-Parabis of New York City, and the loan is being guaranteed by Azerbaijan’s Ministry of Finance.


For Immediate Release
Media Contact: Elizabeth S. Chouldjian
Email / Tel: (202) 775-1918 / (703) 585-8254 cell
Armenian National Committee of America
1711 N Street, NW, Washington, DC 20036
Tel. (202) 775-1918 * Fax. (202) 775-5648 *
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