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Catalyzing economic growth: Entrepreneurial incentives propel Garabagh forward

25 June 2024 08:30 (UTC+04:00)
Catalyzing economic growth: Entrepreneurial incentives propel Garabagh forward
Nazrin Abdul
Nazrin Abdul
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Azerbaijan has achieved a significant milestone by restoring its territorial integrity and sovereignty, marking a major victory. Today, the country is focused on resettling forcibly displaced populations and ensuring sustained economic activity in its liberated territories.

In the long-occupied regions of Garabagh and Eastern Zangazur, Azerbaijan is swiftly rebuilding infrastructure alongside extensive reconstruction efforts. These initiatives aim to reintegrate these areas into the national economy.

The successful implementation of the Great Return Program underscores Azerbaijan's commitment to reclaiming all liberated territories. This effort includes the establishment of new towns and cities in Garabagh and Eastern Zangazur, as well as the creation of modern trade hubs, logistics centers, and economic zones, accompanied by incentives for entrepreneurial activities.

In 2024, companies involved in rebuilding Garabagh are benefiting from favorable loan terms. Osman Khalilov, Chairman of Azerbaijan's Entrepreneurship Development Fund, highlighted during the "5th Domestic Companies Exhibition" that eligible firms can access loans starting from 5 million manats, with a 7-year tenure and a subsidized interest rate of 15%.

"The Fund aims to stimulate entrepreneurship by providing financial support. As a result, several companies have not only thrived domestically but have also expanded into international markets," noted Osman Khalilov.

It should be noted that by a decree issued on December 10, 2021, the President of the Republic of Azerbaijan has mandated measures to effectively manage economic and labor resources, foster the development of processing industries and service infrastructure, and implement tax, social insurance, and other incentives in the recently liberated territories. The decree also aims to stimulate private initiatives, enhance investment promotion mechanisms, and define customs and tax incentives related to the importation of raw materials and materials for production activities by local entrepreneurs.

These measures are designed to boost investment attractiveness and improve the business environment in the liberated areas, ensuring the implementation of the President's directives through optimized incentives and enhanced mechanisms outlined in amendments to the Tax Code.

Azerbaijan's strategic focus on revitalizing Garabagh includes developing its industrial potential, reintegrating it into the national economy, and ensuring employment for its residents. This vision has materialized through initiatives like the "Agdam Industrial Park" in Agdam and the "Araz Valley Economic Zone" Industrial Park in Jabrayil, established under presidential decrees.

Like other industrial parks across the country, these zones offer a conducive environment for investment, with state-funded infrastructure support. Additionally, residents benefit from exemptions on property tax, land tax, income tax, profit tax, and VAT on imported machinery for production purposes for a decade from registration.

Furthermore, recent amendments to Azerbaijan's Tax Code provide additional incentives for entrepreneurs operating in liberated territories. These include subsidized social insurance contributions, extended annual leave for residents, additional salary supplements, a one-time assistance payment, simplified work permit processes, and exemption from labor migration quotas for foreign specialists for five years.

Moreover, entrepreneurs in liberated territories have enjoyed VAT exemptions on various production-related materials for a decade. They also receive financial assistance equivalent to 20% of their monthly utility costs, based on communal service rates for a period of ten years.

These measures aim to stimulate business activity and foster economic growth in Azerbaijan's liberated zones, promoting sustainable development and prosperity in the region.

Overall, Azerbaijan's comprehensive approach to rebuilding and reintegrating its liberated territories reflects a strategic vision aimed at achieving sustainable development, economic prosperity, and lasting peace in the region.

By leveraging its newfound sovereignty, Azerbaijan seeks to unlock these areas' economic potential while ensuring its citizens' well-being and prosperity.

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