Weekly actual topics in Azerbaijan (May 29-June 2)
EBRD offers Azerbaijan to create agency for work with foreign investors
The European Bank for Reconstruction and Development (EBRD) suggests that Azerbaijan creates a centralized agency for work with foreign investors, said Ivana Duarte, head of the EBRD resident office in Baku.
She made the remarks at the conference titled “Economic Reforms: Achieved Results and Recommendations” in Baku.
Such an agency could provide legal and consulting assistance to investors, help investors obtain various permits in the country, etc., according to Duarte.
She touched upon the measures implemented by the Azerbaijani government to support the SMEs, noting that the EBRD welcomes creation of an agency for work with SMEs in Azerbaijan. Creation of the agency will allow the government and the private sector to exchange views, as well as help in implementing reforms needed in this sector, according to Duarte.
She said Azerbaijan’s relevant strategic roadmap addresses the issue of improving literacy of SME representatives, and this is one of the areas the EBRD currently focuses on. Every year, the EBRD holds trainings for representatives of 50-60 companies and it has recently started working with women entrepreneurs, Duarte added.
She also pointed to the fact that the EBRD has extensive experience in financing projects within public-private partnership, adding the bank is ready to share this experience to help shape the necessary legal framework.
FIMSA offers expanding access to finances for Azerbaijani SMEs
Azerbaijan’s Financial Market Supervisory Authority (FIMSA) offers expanding access to finances for small and medium-sized enterprises (SMEs), said FIMSA head Rufat Aslanli.
He made the remarks at the conference titled “Economic Reforms: Achieved Results and Recommendations” in Baku.
Aslanli said financing of SMEs cannot be maintained only at the expense of traditional bank lending.
“At the moment, Azerbaijani business needs two types of financing – investments and loans. Investments cannot be financed through loans. This increases the cost of investments and makes them uncompetitive. Therefore, we propose a number of institutional measures to develop an access to financial instruments,” he said.
“For the purpose of ensuring investment financing, we suggest reorganization of the Azerbaijan Investment Company and extension of its mandate. The newly established institute will have to support the financing of start-ups, business expansion and other projects,” Aslanli noted.
“In order to expand access to loans, we believe it is necessary to combine a number of credit support institutions – the National Fund for Entrepreneurship Support, State Fund for Development of Information Technologies and State Agency for Agricultural Lending – into one structure,” he added.
Bavaria aims for long-term cooperation with Azerbaijan
Bavaria aims for long-term cooperation with Azerbaijan, Franz Josef Pschierer, state secretary in the Bavarian Ministry of Economic Affairs and Media, Energy and Technology, said.
“We hope to improve and strengthen relations between Bavaria and Azerbaijan in the first place,” he said, adding there are several companies interested in investing in Azerbaijan. “We want to prepare the ground for further mutual investments.”
Bavarian companies are interested in cooperation both in the oil and non-oil sectors of the economy, according to Franz Josef Pschierer.
“Naturally, we are very interested in the oil and gas cooperation but we also see that Azerbaijan is seeking to diversify its economy. Therefore, we are also interested in cooperation in the fields of tourism and new technologies,” he noted.
“We are especially interested in tourism cooperation. Azerbaijan is a very attractive country with its history, ancient architecture and spectacular views.”
Pschierer added that a number of Bavarian companies aim to establish joint ventures with Azerbaijani companies.
“It is very important for our companies to find a reliable partner for long-term cooperation in Azerbaijan. Our companies do not consider other countries only as a market to sell their products – they are interested in long-term investment and cooperation. Azerbaijan is a very interesting country for investments and establishing production,” he said.
ADIF talks terms for changing maximum interest rates on insured deposits
Changing the upper limit of the interest rate on insured deposits is not directly dependent on the changes in the discount rate, Azad Javadov, executive director of the Azerbaijan Deposit Insurance Fund (ADIF), said.
He said the maximum interest rates on insured deposits may be revised in case of significant increase or decrease of commercial banks’ interest rates on deposits.
“According to previous legislation, our maximum interest rates depended on the discount rate of the Central Bank of Azerbaijan,” Javadov said, adding there is no such dependence now.
“After 1Q2017, we held a monitoring and noticed that there were no significant changes in interest rates on bank deposits. So we left the maximum interest rates unchanged,” he noted.
Javadov added that ADIF will analyze the results of the next monitoring, to be held after 1H2017, and if necessary, decide on changing the upper limit of interest rates on insured deposits.
The Azerbaijan Deposit Insurance Fund has been operating since August 13, 2007.
The upper limit of the annual interest rate on insured deposits of individuals in foreign currency is 3 percent. The maximum interest rate on individuals’ manat deposits covered by insurance is 15 percent.
Montenegro, Azerbaijan should focus on industry, tourism, energy: PM
Montenegro and Azerbaijan should focus on the sectors of industry, tourism, energy, agriculture, transport, construction, science and technology, Montenegrin Prime Minister Dusko Markovic said in an exclusive interview with Trend.
"Having successfully implemented its strategic decisions – restoration of independence, membership in NATO, progress on the path towards the European Union, Montenegro wants to concentrate more on strengthening of its economy," he said. "In this context, it is very important that good political relations with many countries, including Azerbaijan, are enriched with high-quality economic cooperation."
"There is huge potential to enhance the current trade and economic relations through the implementation of bilateral agreements between Montenegro and Azerbaijan," Markovic said.
"Direct investments from Azerbaijan amounted to 47.15 million euros in 2016 and accounted for circa 6.9 percent of the total influx of investments last year," he said. "Over the past years, the influx was lower and we expect positive trend in the coming years."
Regarding trade relations, Markovic said the total share in exports is very small and there is room to improve trade between the two countries.
Markovic added that the successfully launched investment projects of Azerbaijan in Montenegro in tourism and banking sector represent a good foundation for deepening cooperation between the two countries, as well as encouragement for the implementation of other projects of mutual interest.
"Companies from Azerbaijan have expressed considerable interest in implementation of road infrastructure projects," he said. "In addition, it is important to emphasize the strong interest of Montenegro to be part of a major project of construction of the Trans-Adriatic Pipeline, which should, according to preliminary data, enter Montenegro from Albania (near a place called Štodra), and exit near Čipavica bay in Croatia."
"Taking into account the great potential of the construction market of Azerbaijan and the Caspian region, as well as experience and work ethic of the Montenegrin construction companies, we believe that this sector of the economy of Azerbaijan could be interesting to Montenegrin companies," Markovic added.