Azernews.Az

By Aynur Jafarova

The announcement of 2014 as the year of industry in Azerbaijan has encouraged the economic experts to propose various solutions to develop industry in the country.

Chairman of the Center for Economic and Social Development, Vugar Bayramov believes Azerbaijan needs to establish a special fund for financing the industrial sector.

"It is better to establish a special fund like Russia's that provides financial support for industry. The fund, on the one hand, can provide institutional support to industrial facilities and provide them with consultations. On the other hand, the fund can provide financing of enterprises and distribute financial resources among them," the expert told local press.

In early September, Russian Prime Minister Dmitry Medvedev signed a decree on the establishment of a fund for industrial development. Russia will allocate 18.5 billion rubles in the next three years.

Azerbaijan's State Statistics Committee has said 2,514 industrial enterprises operated in the country in 2012, some 28 of which were engaged in the extraction of crude oil and natural gas, and 289 - in the mining industry.

The remaining enterprises are engaged in the field of processing (1,795 companies), production of food (427 companies), beverages (127), tobacco production (eight companies), weaving (72 companies), color and clothing (75 companies), chemical industry (73 enterprises) and etc.

The fund will be established on the basis of the Russian fund for technological development, which has existed for several years. This fund provided loans for organizations involved in innovative projects of medium size.

It is crucial for Azerbaijan to take necessary measures to develop its industry. President Ilham Aliyev, who announced 2014 as the industry year in the country in January, has said at a recent meeting of the Cabinet of Ministers that today financing of the real sector by commercial banks is not at a proper level.

Today, only 10 percent of the credit portfolio is aimed at funding the production sector. In this regard, financing of the real sector under the current conditions is one of the main priorities for Azerbaijan.

President Aliyev also stressed the importance of establishing industrial parks in the regions of the country.

Bayramov believes the industry assistance fund can also help the establishment of industrial parks.

Touching on the financial resources of the fund, Bayramov said they can be formed on the expense of several sources.

"The first source is, certainly, state budget. In addition, international financial institutions and commercial banks of Azerbaijan can also be involved in the formation of financial resources," Bayramov concluded.