Azerbaijan, Baku / corr. Trend I.Khalilova / The State Agency for Agricultural Credits of Azerbaijan's Ministry of Agriculture completed the use of budget funds allocated from 2007 for financing farmers, said the Director General of the State Agency, Razim Veliyev. AZN 5mln was allocated in 2007 for these purposes, and the same amount will be allocated in 2008.
The preferential credits were distributed via authorized banks - Texnikabank, Turanbank, Rabitabank, MuganBank, ZaminBank, Bank of Azerbaijan, Gencebank, Azerbaycan Senaye Banki and non-banking IKA - Icrachi Kredit Agentliyi.
According to Veliyev, the list of these banks will be kept in the future and may be increased if other credit organizations will demonstrate an interest.
Micro credits in the amount of AZN 1,000 are allocated for two year terms; small credits from AZN 1,000 to 20,000 and average credits from AZN 20,000 to 50,000 for three year terms; and big credits from 50,000 to 200,000 for five year terms. The interest rate for the credits is 7%, as in the National Fund for Entrepreneurship Development.
According to an order from Azerbaijan's Cabinet of Ministers, the credits may be directed towards the production and processing of agricultural products, improvement of melioration of irrigative lands, the provision of irrigation equipment, the purchase of agricultural and chemical substances, modernization and development of the foodstuffs sector, the completion of Ministry of Agriculture's pilot projects, and artificial fertilization in cattle breeding.
The State Agency believes that today, key attention must be paid to the development of cattle breeding since this sphere is considered very profitable and promptly repayable. The farmer can repay the credit within one and two years.
The Government is interested in developing all directions of the agrarian sector and therefore, the credits are planned for a period of up to five years. The 2009 budget allocations in this regard will increase and is projected at an amount of AZN 30mln.