A. Fuad (Zerkalo)

The national economy has shown high rates of development within the conditions of the world financial crisis. It became possible thanks to projects realized in the country on development of regions and allocation of the state financial support to businessmen, the chief executive of National Fund for Entrepreneurs ship Support (NFES) of Azerbaijan Shirzad Abdullayev declared at the press conference on Tuesday.
"In 2009 at the expense of resources of NFES credits for the amount of 130 million AZN were received by 2101 businessmen. In comparison with 2008 the crediting volume has increased in 1,5 times, quantity of the entrepreneurs who received credits, - in 2,6 times", - Sh. Abdullayev said.
As he said, financing of these projects will allow to create about 8,5 thousand workplaces.
Sh. Abdullaev marked that in 2009 the fund actively carried out crediting of projects in regions, including infrastructural projects. In particular, 99 % of all financed projects fell on regions, the volume of crediting of infrastructural projects thus made 47,8 million AZN.
"Within the limits of financing of infrastructural projects in 2009, 31,9 million AZN was directed to crediting of building of modern warehouse refrigeratory complexes with the general capacity of 48 thousand tons. 15,9 million AZN more was directed to the crediting of building of modern granaries with the general capacity of 199 thousand tons", - he emphasized.
The chief executive added that financing of the projects connected with the creation of modern warehouse refrigeratory complexes and granaries, provides creation of 1183 new workplaces.
As he said, in 2009 NFES actively carried out micro-crediting of businessmen, and also issued small credits. "In 2009 small credits and micro-credits were issued to 2007 businessmen. In 2010 the same policy will be continued. We are interested in that receivers of credits were as much as possible.
Basically there is a need for micro-credits and credits for small sizes in regions", - Sh. Abdullayev marked.
We would note that during the current year at the expense of resources of fund, entrepreneurs will receive at least 115 million AZN. "... 44 million AZN out of them will make the resources allocated from the state budget, 71 million - return on credits earlier issued by fund and interests for credits", Sh. Abdullayev said. As he said, NFES applied the Ministry of Finance for reception of the means provided for fund in the state budget. "Within the next few days the part of these resources will arrive on an exchequer account of fund that will allow to start crediting of entrepreneurs from next week. The banks-agents of the fund already receive the projects from businessmen", - he marked.
Sh. Abdullayev emphasized that in 2010 NFES can involve external sources of financing for crediting of projects of entrepreneurs as well. In particular, negotiations about engaging of resources are carried on with number of the international financial institutions, including the World Bank, International Financial Corporation, European Bank for Reconstruction and Development, Islamic Bank for Development.
"Reduction of the resources allocated from the state budget for NFES (44 million AZN in 2010 against 74 million AZN in 2009 - IF) can be regarded as the first step in a direction of support of self-financing of fund", - Sh. Abdullayev added.
The chief executive marked that NFES defined the schedule of events in regions for February-March, 2010 with the purpose of issuing the credits to entrepreneurs and their informing on fund activity. In particular, on February 12 such event will be held in the Barda, on February 24 - in Shamkir, on March 10 - in Shamakhy, on March 18 - in Beylagan. "37 events were held for entrepreneurs in regions in 2009. Within the limits of their carrying out the entrepreneurs received soft loans for the amount of 36,9 million AZN. Besides, in regions trainings about informing on fund activity were organized for 6 thousand entrepreneurs, - he told.
By the way, now NFES carries out selection for financing of investment projects in agrarian and industrial complex sector. As Sh. Abdullayev marked, selection of investment projects is carried out in three directions: the projects providing production of children's nutrition; projects on creation of cattle-breeding complexes; projects on creation of small and average enterprises on grapes processing.
NFES it is ready to finance projects on production of following sorts of children's nutrition: milk, pur?e, meat and fish meal, soups, fruit pur?e, desserts. At financing of such projects following criteria will be considered: presence of favorable infrastructure for production of such production; presence of the modern equipment at the enterprise; creation of modern laboratory for quality support of made production; implementation of projects in optimal terms; at least 30 % of cost of the project should be contributed to the entrepreneurships, other resources - NFES .
Projects in animal industries sphere should provide creation of complexes at least on 100 goals. At financing of such projects following criteria will be considered: presence of a favorable infrastructure for production of such production; presence of modern technologies; presence of modern laboratory; presence of arrangements with suppliers of forages; high efficiency support; at least 30 % of cost of the project should be brought the businessman, other means - to NFES .
NFES plans to finance projects on creation of small and average entrepreneurs on processing of grapes in Aran, Ganja-Gazakh, Guba-Khachmaz, Lankaran, Sheki-Zagatala economic region, Upper Shirvan and Upper Karabakh.
Under the terms, following criteria will be considered during financing of such projects: mounting of the modern equipment and creation of modern laboratory; presence of favorable infrastructure, implementation of projects in optimal terms; at least, 30 % of cost of the project should be contributed to the entrepreneurs, other means - to NFES. Financing of the selected projects will be carried out within the limits of implementation of the State Program of steady provision of the population of Azerbaijan with foodstuff in 2008-2015.
We would note that NFES was established in 1992. Issuing of credits to entrepreneurs is carried out through the authorised banks and non-bank credit organisations which total number makes 36 ("Interfax-Azerbaijan").
Undoubtedly, specialised agrarian bank of the country could contribute to the provision of the population with the foodstuff. But, unfortunately, this question still remains at study stage.
Non-bank credit organisation Agrarcredit presented to the Ministry of Finance of Azerbaijan - to the main shareholder (owns 99,9 % of share holding) - the five years' concept of development of agricultural bank in the country, it was informed in the government. Creation of agricultural bank in Azerbaijan is planned on the basis of Agrarcredit.
"Necessity for creation of such specialised bank and readiness of the credit organisation for reorganisation in bank in the country are grounded in the concept which is prepared on demand of the Ministry of Finance", - the source in the government told. Today the need of agrarian sector of the country for financial means makes 1 billion AZN, at annual requirement of this sector for subsidies for 239 million AZN that explains inevitability of quick creation of agricultural bank.
Thus, resource allocation is optional for spending through agricultural bank. Along with it can be involved other banks operating in the country as well. Authors of the concept specify some sources of engaging of financial resources for the purpose of discharge of requirements of agrarian sector - at the expense of the public funds involved by the agricultural bank of deposits, and credits from foreign donors. "For support of development of agrarian sector of the country building of five processing firms is offered annually, each of them require investing of 10 million AZN, five canneries - on 20 million AZN" , - it was informed in the government.
The spheres to which development the preference in connection with their labour-intensiveness and profitableness should be given are specified in the five years' concept. In particular, development of wine growing which can bring in 10 times more profits, than, for example, corn production is offered.
In 2009 the common production of agricultural production in Azerbaijan grew on 3,5 %, including plant growing production - on 4 %, cattle-breeding production - on 2,8 %.
Today whereas 50 % of the population of the country is involved in agriculture, it is necessary to develop agrarian sector for preventing the strong inflow of countrymen in capital so, to increase investment in the countryside.
Thereupon, the Ministries of Economic Development and Agriculture, the Central Bank appeared with offers in the country government about transformation of Agrarcredit to gricultural bank. From outside the main shareholder of the credit organization party - the Ministries of Finance - substantiations for creation of such financial institutions were offered in turn, that is concept preparation. Originally it is a question of creation of the state bank, and in subsequent its privatisation is expected. Earlier it was told about possibility of transmission to foreign investors of 50 % of share of involvement in the capital of new bank. The rest share holding (50 %) can be distributed between a local private sector and the state - on 25 %. On prospect, the state share in bank will also be privatized.
Before deepening of world financial crisis the European Bank for Reconstruction and Development (EBRD) showed interest to package purchase in 25 % + 1 share in created agricultural bank. Besides it, the International financial corporation was interested in it, the German Bank for Development KfW. Consultations with these financial institutions are postponed for a while.
At present, the credit organisation operates on the basis of the limited licence. Now the capital of the credit organisation is generated at 18,5 million AZN level. The question of further capitalisation of Agrarcredit will be decided by shareholders of the credit organisation. Organisation assets make about 26 million AZN, and credit portfolio - 16 million AZN. The profit following the results of 2009 made 120 thousand AZN. The main shareholder "Agrar-credit" is the Ministry of Finance of Azerbaijan which owns 99,9 % of shares of the credit and the others - are equally distributed among the state insurance organisation "Azersighorta" and Open Society "Land improvement and water management" OSC ("Trend").
Development of non-oil sector of the country is for today one of priority national economy directions. And big potential is invested on development of agrarian sector. For today returning of such concepts, as specialisation and concentration of production, labour productivity rise, productivity and efficiency increase should become the branch main task. And development of agrarian sector in the given direction demands investments to organise production on the basis of modern technologies, with usage of high-yielding sorts and developments of pedigree cattle breeding.
The increase in export potential of the country, and also solution of a question of food safety of the country should become expected result from held operations in agrarian sector.