Azerbaijani Entrepreneurs Spend over 30% Soft Credit in 2008
Azerbaijan, Baku, 21 May / corr. Trend I. Khalilova/ The National Fund for Entrepreneurship Assistance (NFEA) has granted soft credit worth AZN23.3mln to finance investment projects of the entrepreneurs so far, the Ministry of Economic Development of Azerbaijan said on 21 May. Some AZN32.8mln has been allocated by the Fund since the early 2008.
Some 179 entrepreneurs from 45 cities and regions have been granted loans by the NFEA. The soft credits are granted through 29 authorized business banks, one non-bank credit organization and four credit unions.
Over 80% of the financed projects account for the regions and 85% for the processing sphere.
The soft credit was allocated for the production of the industrial products, processing of the agricultural products, and development of the tourist infrastructure, service industry and others. Some 2,500 jobs are expected to be created in 2008 due to the financing of the projects.
According to rules approved NFEA on 28 December 2006, the macro-credits and micro-credits are granted for two-year term, medium credits for three year-term, large credits - 5-year term and the largest credits - 7-year term. The Supervisory Board of NFEA can extend credit terms as an exception. The maximum volume of the loan accounting for one entrepreneur is AZN3mln. The interest rate of the loans makes up 7%.
Some AZN80mln have been allocated by the 2008 state budget, AZN6mln of which is meant for the financing entrepreneurs in the Nakhchivan Autonomous Republic of Azerbaijan. However, NFEA believes that it will be possible to allocate over $100mln loans for the entrepreneurs in 2008.
The Ministry of the Economic Development of Azerbaijan plans to propose to change the form of ownership of NFEA, that is, to make it more independent. The Fund is expected to turn into joint stock company. According to the calculations of the Ministry, the self-financing of NFEA and refusal from the budget support will be possible by 2013. It will enable NFEA to grant credits out of the proceeds of the repaid resources.
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