Leasing Has Huge Potential to Develop in Azerbaijan: Head of Leasing Association (video)
Azerbaijan, Baku / corr Trend U.Ismayilova / Trend 's interview with the President of the Association of Leasing Companies and, head of the leasing company Ag Leasing, Azer Mammadov:
Question: What are your views on the current development of leasing services in Azerbaijan?
Answer: At presentleasing activities are very popular in Azerbaijan and we are actively involved in the resolution of problems of this market. The association is involved in the issues of taxation, cutting tax burdens of leasing companies. Our fourth task is to make leasing competitive enough compared to other financial services in the market. The main rival of leasing in the market is bank loans and at present leasing is victorious in many positions.
Leasing is very sensitive to taxation and our initiatives are directed at the further development of this type of financial services. According to experts' estimations, the potential of leasing in Azerbaijan is approximately AZN 500mln. There is huge potential, but it is necessary to help leasing companies in rendering these services to entrepreneurs. Finally, it will lead to new jobs, growth of companies and an increase of tax revenue to the public budget.
Question: What major problems could you mention in the development of leasing?
Answer: One of the problems in the Azerbaijani leasing market is the absence of licensing and a regulator of leasing companies in Azerbaijan. The association focuses on legislative initiatives and if we succeed one of these initiatives will be the establishment of such a regulator. It can be done if the Government supports us.
After the resolution of problems, particularly, tax collection, we will put forward an initiative on the establishment of a regulator of the leasing market. For the time being we are not so much interested in such a regulator, because at present leasing is not as attractive as bank loans. Leasing companies are less in number.
Question: What rise do you expect in the amount of portfolio of leasing companies by the end of the year?
Answer: As of my calculations, the total portfolio of Azerbaijani leasing companies will exceed AZN 100mln by the end of the year. According to data by the IFC, the total leasing portfolio in the country comprises approximately AZN 80mln. However, the IFC concluded the program on support of leasing in the country and this work is complete. Within the framework of the association we plan to set up own calculations.
Speaking about the prospects of leasing in Azerbaijan, I can say that after the approval of our initiatives Azerbaijan will see a boom in leasing services.