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Financial sector should be active participant in Azerbaijan's growth

9 October 2015 17:01 (UTC+04:00)
Financial sector should be active participant in Azerbaijan's growth

By Aynur Karimova

The financial sector should play a more active role in Azerbaijan’s economic development, according to Rashad Orujov, executive director of the Central Bank of Azerbaijan.

He made this remark during the 4th Investors’ Fair "On the Pathway to Responsible Microfinance” held in Baku on October 9.

The event was organized by the Azerbaijan Microfinance Association and was attended by representatives from government and microfinance institutions, donor organizations, rating agencies, banks, insurance and leasing companies, and experts.

Orujov said that the developments in the global economy pose new challenges for the financial structures of many countries, including Azerbaijan.

“The financial sector has played an important role in the economic development up to the present, however, I believe that it should play a more active role in the new period,” he said.

Small- and medium-sized businesses have a considerable share in GDP in many developed countries, Orujov noted, adding that this figure reaches 50 percent in many developed economies.

"Undoubtedly, expanding the access of microfinance organizations, small and medium-sized business and in general, economic agents to finances is a key to improving their effectiveness and success," he stressed.

CBA urges banks to reduce debt

Orujov went on to add that the CBA has recommended the credit institutions to reduce the over-indebtedness of the population.

According to him, as of today, parallel borrowing remains an urgent problem in Azerbaijan.

"We, jointly with the World Bank, have developed two methodological documents in the field of protection of consumer rights. One document refers to complaints of customers, and the second one is a recommendation in the field of responsible lending. Both creditors and borrowers should take responsible attitude towards lending," he added.

Orujov also stressed the importance of measures taken toward improving the financial literacy of borrowers, and explaining how it could affect his/her financial condition.

"In this regard, the CBA is ready to actively work together with the Azerbaijan Microfinance Association," he said. "We all, as is said, are ‘in the same boat’ and should take a responsible attitude toward the risks of excessive over-indebtedness of the population."

The official exchange rate on October 9 was 1.0478 AZN / USD.


Aynur Karimova is AzerNews’ staff journalist, follow her on Twitter: @Aynur_Karimova

Follow us on Twitter @AzerNewsAz

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