DEVELOPMENT OF ENTREPRENEURSHIP
Development of entrepreneurship, implementation of fundamental reforms for the creation of favorable business conditions arise from requirements of the economic development strategy set by national leader Heydar Aliyev and consistently implemented by President Ilham Aliyev. Assurance of sustainable and proportional development of country’s economy, acceleration of regional development is one of the priority duties in the present phase of socio-economic development of the country and successfully carried out in the frame of the state programs adopted.
Policy in this field is directed to the implementation of state support to entrepreneurship in the base of the system, lifting the effect of actions of state support to entrepreneurs. Continuous measures are taken to realize this strategic line. Entrepreneurship financial help mechanism was created and this source functions as an important real source to meet the need of small and medium entrepreneurs for funds.
Azerbaijan Export and Investment Promotion Foundation was created. The Foundation aims lifting the export capacity of the country and involving foreign investments. State-entrepreneur relations were developed, important steps were taken towards the improvement of the entrepreneurship state regulation system. Working mechanisms were created for the protection of the rights of entrepreneurs, interference dropped as a result of their use. Measures are underway to strengthen consulting, information support of entrepreneurship, and develop business ties.
The organization of the activity of entrepreneurship subjects by the ‘one-stop shop’ principle started to be applied from January 1, 2008. After the application of the ‘one-stop shop’ system, procedures to start a business were reduced from 15 to 1 and the term required for it from 30 to 3 days, a number of legal persons registered considerably grew.
As a result of purposeful actions share of the private sector in Gross Domestic Product (GDP) reached 85%.
In order to ensure the sustainable development of entrepreneurship in the country, the institutional organization of partnership between the state and entrepreneurs has been implemented. In this regard, the established mechanisms (Small and Medium Business Development Agency of the Republic of Azerbaijan, Azerbaijan Export&Investment Promotion Foundation, Business Training Centers, etc.) play an important role in the development of state-entrepreneur relations at the civil level.
In 2003, in order to increase the export capacity of the country and involving foreign investments, Azerbaijan Export and Investment Promotion Foundation was created. The Fund supports entrepreneurs in terms of increasing the export potential of the country's entrepreneurs, expanding investment opportunities, finding potential partners, and implementing joint cooperation projects.
The Ministry of Economy and the Azerbaijan Export and Investment Promotion Foundation (AZPROMO) hold important economic events in this direction. For example, we can show events such as business forums, exhibitions, seminars, and conferences both inside and outside the country. These events are very important due to the promotion of the country's business environment and economic potential, as well as for the development of business contacts of local entrepreneurs. The events organized in foreign countries show their positive results in terms of increasing the volume of investments in priority areas of the country's economy.
By the Presidential Decree "on Improvement of the state support mechanism for entrepreneurship development in the Republic of Azerbaijan” dated July 31, 2018, the Entrepreneurship Development Fund was established as a public legal entity under the Ministry of Economy. The annual interest rate on concessional loans provided by the Entrepreneurship Development Fund was reduced from 6% to 5% to ensure more effective use of them. Furthermore, the credit limits for medium-sized loans were set as 50,001 to 1,000,000 AZN in accordance with the new procedures.
Multiple laws have been adopted to improve the legal framework in the field of entrepreneurship. One of such laws was adopted on 2 July 2013 to encourage entrepreneurship. This is the Law of the Republic of Azerbaijan “On regulation of the inspections conducted in the field of entrepreneurship and protection of the rights of entrepreneurs”.
The Law encompasses a series of issues such as the purpose and underlying principles of inspections carried out in the field of entrepreneurship, regulations on their organization and conduct, the rights and obligations of regulatory bodies and their representatives, and issues pertaining to the protection of entrepreneurs’ rights and interests. The main purpose of the Law is to establish unified rules of conducting inspections in the field of entrepreneurship as well as to prevent unlawful interference with the activity of entrepreneurs during inspection visits. In the territory of the country, all supervision measures (audits, checks, monitoring activities, observation, supervision, raids, etc.) should take place strictly following mandatory registration in the Integrated Information Registry and comply with the rules envisaged by the Law.
Various organizational-economic models of entrepreneurship development are applied in the leading countries of the world. One of these models is special economic zones. Its overall goal is to support the acceleration of the development of priority areas of the country's economy, creation of more available conditions to attract domestic and foreign investment, introducing new competitive manufacturing and service areas on the basis of the special legal regimes and modern technology.
The appropriate tasks are also carried out in order to apply new organizational-economic models — special economic zones, industrial city, and creation of agro parks of entrepreneurship development in Azerbaijan.
The Agency for Development of Small and Medium Businesses was established under the Decree of the President of the Republic of Azerbaijan dated 28 December 2017. The Agency’s objective is to support micro, small, and medium businesses development in the country. Also, it provides a number of services to businesses, coordinates and regulates the services of government agencies in this area.
Currently, measures are taking systematically and consistently in the country to expand entrepreneurship and increase its role in the economy, to further improve the business and investment climate. According to new economic conditions, reforms are applied to support the private sector and protect the rights and interests of entrepreneurs. Following the international experience, mechanisms meeting modern challenges are applied for the development of this field. As a result of state support measures for entrepreneurship, the number of business entities has increased five times over the past 17 years, the share of the private sector in GDP exceeded 85 percent, and its share in employment exceeded 76 percent.