Self-employment program receives a drive to enlarge

By Sara Israfilbayova

Engaging in self-employment may gain a new speed, as enlarging this sphere has been determined as a perspective business task.

President of Azerbaijan Ilham Aliyev has recently urged to enlarge the self-employment program in Azerbaijan. 

Addressing a Cabinet meeting on April 10 the president pointed out that, every family living in poverty, should be able to cover their needs.

The state always takes care of the citizens living in harsh conditions. For that purpose the targeted social assistance program is being implemented, however, we gradually need to move on to a system of self-employment, create conditions for these low-income families to earn money by themselves and to do their own business. The government will support them first time. These works are conducted by the Ministry of Labour and Social Protection of the Population, whilst it is necessary to involve other ministries - the Ministry of Economy, the Ministry of Agriculture, local executive bodies and entrepreneurs.

Studies have shown that 70-75 percent of those who are receiving targeted social assistance have their own land. They neither use nor rent it. That is why the active able-bodied population should be engaged in self-employment.

On 23 September 2016, “Simplified support to family business” (ABAD) under the State Agency for Public Service and Social Innovations operating under the President of the Republic of Azerbaijan (ASAN) was created in order to support the active participation of citizens in the social and economic development of Azerbaijan, the development of small and medium-sized enterprises, increase of employment of the population.

For the purpose of support and help, the Ministry of Labour and State Social Protection of Population conducts courses and trainings. In the process of trainings, the participants of the trainings receive the necessary knowledge about the organization of business and self-employment. Besides, based on the assessment - the purpose, structure and content of the business plan, the relevant commission under the Ministry of Labour and Social Protection of the Population provides with goods and materials, helping citizens to create and manage family business. Only those who are able to justify their business plan benefit the program.

To attend these courses, first it is necessary to acquire a status of unemployed in centers of Labour and Employment.

After a while, citizens participating in these projects will be able to achieve success in animal husbandry, poultry farming, beekeeping, gardening, vegetable growing, retail sales and other areas.

There are also benefits for these citizens in tax paying and they pay the so called “simplified tax”.

People engaged in business in Baku pay 4 percent of the income, while in other regions they must pay 3 percent. In the sphere of trade and public catering, income tax equals to 6 and 8 percent, respectively.

In this regard, it is planned to create the Agency of Small and Medium Enterprises and the Guarantee Credit Fund in 2017-2018. Similar agencies already operate in Europe, the UK, the USA, China, Singapore and other countries, stimulating the development of small and medium-sized businesses.

In these agencies, any representative of a small or medium-sized enterprise can relatively quickly and easily find out about all the opportunities for the company's development, new methods and technologies, about raising the qualification of employees, and assessing the risks of working in another country. Also, the Fund introduces a huge number of various programs on concessional lending, which include special loans, credit risk insurance and subsidies. In general, the agency's mission is to help and protect the interests of small and medium-sized enterprises, create free market competition, and support and strengthen the country's economy in whole.

To assist to self-employment the Presidential Reserve Fund allocated 6 million manats ($3.649 million) to the Ministry of Labour and Social Protection of Azerbaijan.

That will ensure the transition from activities on the unsustainable passive social security of low-income families to the activities of sustainable active employment programs.

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