Azernews.Az

By Leman Mammadova

Development of small and medium-sized businesses leads to the growth of entrepreneurship which is one of the priority directions of Azerbaijan’s economic policy.

The Agency for the Development of Small and Medium-sized Enterprises (SMEs) under the Economy Ministry of Azerbaijan held a series of meetings with representatives of the Asian Development Bank (ADB) visiting Azerbaijan.

At the meeting dedicated to public-private partnership, an international specialist in this field Rina Alzate told about the models applied on public-private partnerships. Alzate informed about activities on legal, normative and institutional development in this field in Azerbaijan.

In addition, considering the advanced international experience, recommendations and proposals for organizing the effective work of the Center for the Development of State-Entrepreneurial Partnership, which is a part of the Agency’s structure, were discussed during the meeting.

At a meeting with a delegation led by director of the Infrastructure Finance Department at ADB’s Private Sector Operations Department in South Asia, Central Asia and West Asia Shantanu Chakraborty, the Bank's representatives were informed about the reforms in the development of small and medium-sized businesses in our country, new support mechanisms, as well as the activities of Agency for the Development of SMEs.

At the meeting, the sides discussed possible cooperation opportunities for the establishment of the Center for the Development of State-Entrepreneurial Partnership, small and medium-sized business development funds as well as business clusters, highlighting the importance of expanding cooperation with the bank in the development of the private sector and exchanged views on the prospects of development of relations.

Small and medium-sized businesses play an important role in development of the country's economy.

The share of small and medium-sized enterprises (SMEs) in Azerbaijan’s foreign trade is planned to increase to 40 percent after 2025.

The Agency for the Development of Small and Medium Business of Azerbaijan was established in 2017 to ensure the consistency of reforms, as well as the improvement of the business regulation system and the application of effective coordination, enhancement of the role and competitiveness of small and medium-sized businesses in the country's economy, and the compliance of the management system of this sphere with modern requirements.

Simplifying access to financial resources for SMEs is an important aspect of the agency’s activities, as the main part of the appeals involves financing.

The agency is working on the creation of an online platform for access to finances. This platform will provide an opportunity for online communication between financial institutions and entrepreneurs. Entrepreneurs will have the opportunity to present their projects to all interested parties online, and this will also minimize the loss of time.

One of the important projects of the Agency is the creation of the “Registry of SMEs” and raising awareness about various state information resources on the basis of a single database on SMEs.

In addition to many other areas, the Asian Development Bank (ADB) also cooperates with Azerbaijan to strengthen the role of small and medium-sized businesses in the country's economy, to increase their specific weight and competitiveness.

ADB believes that the private sector is the main driver of economic growth, sustainable and stable economic growth can be achieved through private investments.

Earlier, it was stated by ADB that Bank will assist Agency for the Development of SMEs to attract three experts.

The main objective of the ADB is to support the economic development of member countries and to help alleviate poverty and improve the living standards of the population.

Azerbaijan joined ADB in 1999 and its share in the bank is 0.5 percent. In 2004, the Bank's local representative office was opened in our country. Azerbaijan hosted the 48th Annual Meeting of the Board of Governors of the Bank in 2015.

ADB has provided a $ 5.1 billion loan, guarantee, grant and technical assistance for the country, so far.

ADB’s program for Azerbaijan during 2011–2017 consisted of 47 projects. Energy was the largest sector supported, accounting for 42% ($2.1 billion) of total financing followed by transport, at 27% ($1.4 billion).

The Asian Development Bank will allocate $ 815 million from its credit resources to Azerbaijan in 2019-2021. This is stated in the bank's three-year business plan. Thus, in 2019, the bank will allocate $ 250 million to the country, $ 265 million in 2020, and $ 300 million in 2021.

These loans, which will be allocated by the bank for three years, will focus on the modernization of the country’s energy system ($335 million) and the improvement of public administration ($250 million).

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Leman Mammadova is AzerNews’ staff journalist, follow her on Twitter: @leman_888

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