A Press Conference was held on the results of the activities of the Small and Medium Business Development Agency (KOBIA) for 2022 on January 19.
Chairman of the Board of Directors of KOBIA Orkhan Mammadov made a presentation on the work done by the Agency over the past year and prospective plans. It was noted that KOBIA actively participated in the process of improving the business environment, upgrading the legislation in the SME sector and state services for business, supported the creation of new SME entities and the development of existing SMEs through various mechanisms, provided support for protection of legal interests of entrepreneurs, their access to markets, knowledge and innovations, and to financial resources in 2022.
Improving the business environment
It was reported that last year, 2 of the normative legal acts prepared on the initiative of KOBIA were approved, 3 projects were agreed, 122 draft normative documents prepared in various directions were given opinions and suggestions by the Agency last year within the framework of the agency's participation in the formulation and regulation of state policy in the field of entrepreneurship.
"Model Regulation on clusters of micro, small and medium enterprises" was approved by the Decree of the President of the Republic of Azerbaijan dated December 15, 2022. The new bill "On the development of micro, small and medium enterprises" passed all three readings in the Milli Majlis. This law will regulate relations in the field of development of micro, small and medium enterprises and will determine the forms and methods of promoting the state support for them.
9 surveys were conducted with the participation of more than 2,500 SMEs, covering Baku city and country regions to study the needs, challenges and proposals of SMEs.
The Agency organized 137 meetings with the participation of about 3 thousand entrepreneurs, as well as 7 public discussions were organized with the participation of more than 550 entrepreneurs by the Public Council under KOBIA.
Applications received by the agency
More than 6,000 citizens applied to the Agency in 2022, more than 1,200 of which were related to the protection of SME interests, 21.2% of more than 1,200 applications were positively resolved within the framework of government-to-business and business-to-business platforms, 64.8% were given relevant recommendations by explaining the requirements of the legislation, 9% were directed to other specilized institutions.
Services rendered by SME houses
More than 73 thousand "G2B" (government-to-business) and "B2B" (business-to-business) services were provided to entrepreneurs in the Yevlax and Khachmaz SME houses in 2022. Currently, more than 250 services are provided to entrepreneurs by state and private institutions in Yevlax, Khachmaz and "Baku SME House", which started its activities on January 6 this year. In general, the level of satisfaction with the services provided by SME houses is 98%. At the next stage, it is planned to establish an SME house in the city of Ganja.
SME-friend network expanded
11 SME-friend have started operating (in Zagatala, Aghdam, Aghjabedi, Aghstafa, Dashkasan, Goygol, Gakh, Khizi, Zangilan, Tovuz, and Gadabey regions) in 2022. Currently, the SME-friend network covers 38 cities and regions of the country. SME-friend are local representatives of KOBIA and provide prompt support and services to business entities related to entrepreneurial activities.
Knowledge and skills of SMEs are expanding
More than 730 trainings were held, over 11,300 hours of consulting services were provided by SME development centers included in the structure of KOBIA last year that more than 9,700 SMEs, start-ups and people who want to start a business have benefited from these services last year. At the same time, SMEs provided free support to entrepreneurs in the preparation of more than 300 business plans in 2022. The creation of 30 new SME entities in the agricultural and service fields was supported by SMEs including in Baku and the regions last year.
About 1,000 SMEs benefited from the online training platform in 2022, which consists of 180 training videos.
46 entrepreneurs and managers in 2022, and a total of 526 entrepreneurs and managers in 2009-2022 took advantage of the " Germany-Azerbaijani Joint Program on improving the qualifications of managers in the business community of Azerbaijan " coordinated by KOBIA from Azerbaijan and by the German Society for International Cooperation (GIZ) from Germany.
Financing of SME projects continues
In accordance with the relevant Decree of the Cabinet of Ministers, financing of the SME projects in the fields of education, science, research and support was continued in 2022. 12 of the projects submitted to the 2nd grant competition held for this purpose were funded. The amount of financing for each project is up to 20,000 manats within the framework of this support mechanism. Currently, the projects submitted to the 3rd grant competition are being evaluated and the results will be announced in February. In total, more than 500,000 manats of grant funds have been allocated for the financing of 26 projects of SMEs in the fields of education, science, research and support.
Advantages of "Startup" certificate
The Agency received 98 applications to obtain a "Startup" certificate, and issued 54 "Startup" certificates (agriculture and agribusiness, mobile application, fintech, online platform, production areas containing innovative solutions, e-commerce projects) to micro and small business enterprises last year. The "Startup" certificate exempts SMEs from profit and income tax on their income from innovation activities for a period of 3 years from the date of receipt of the certificate.
Supporting market access for SMEs
Internal market research was conducted in 6 areas based on the requests of entrepreneurs and in 1 area on the initiative of KOBIA in 2022. 80% of the cost of each internal market research conducted on the basis of the application of a micro-entrepreneur, 50% of the cost of the research carried out at the request of a small business entity was covered by the state within the internal market research mechanism. But the medium business entities can take advantage of free training and seminars, information support within the framework of this support mechanism. The maximum amount of support is up to 20 thousand manats.
Support for expanding sales opportunities of SMEs
In order to support the access and sales of micro, small and medium enterprises to domestic and foreign markets, more than 1000 SMEs were supported to participate free of charge in 26 exhibitions and fairs (including 7 abroad and 19 in the country) in 2022.
The Agency has created conditions for the sale of products of 24 business entities in 3 sales outlets in trade networks as part of the mechanism to support the access of micro and small businesses to trade networks. It should be noted that a micro-entrepreneur pays 20% of the rent for the sales space provided for his use, while a small entrepreneur pays only 50%.
Potential activities of SMEs in de-occupied territories
As of January 1, 2023, 1339 applications have been received from entrepreneurs who want to start a business in our territories liberated from occupation. 873 of the applications belong to local investors, and 466 to investors from 37 foreign countries. Applications from Turkey, Kazakhstan, Hungary and Russia prevail among the applications of foreign investors. 90% of investment projects are local, and 10% are investment projects of foreign entrepreneurs. 36% of the applications for investment projects cover trade and services, 27% industry, 26% agriculture and another 11% construction, tourism, health, education and culture.
A market was established with the support of KOBIA, TUIB and Turkey's "Kolin" company in order to satisfy the needs of the residents living in Aghali for daily necessities, the service window of KOBIA, which provides services for small and medium businesses, in Aghalı village of Zangilan region, garment factory on the basis of public-private partnership with the support of the agency in 2022.
A business trip to 15 countries was organized in order to study best practices in the field of support and services to SMEs, expand the relations of local SMEs and implement joint projects, find potential foreign partners, as well as mediate between local entrepreneurs and investors interested in cooperation and 24 documents were signed with various partner institutions in 2022. The agency organized 7 international events and became a member of 2 international organizations in the field of SMEs.
Support for social entrepreneurship
In order to develop social entrepreneurship, KOBIA implemented various events and projects in cooperation with relevant state institutions and the private sector last year too. Social Entrepreneurship and Social enterprises and Employment Center has started functioning in Masalli for people belonging to social groups with disabilities and vulnerable group, including family members of martyrs, veterans to acquire relevant professional knowledge in Shamakhi within the framework of the project "Social development support for single mothers" together with partner institutions in 2022. In addition, the book "Development of social entrepreneurship in Azerbaijan" was published within the framework of the grant provided by KOBIA. A business plan was prepared for 24 people who successfully completed business and professional training, and 6 people were already provided with the necessary equipment within the framework of the "Youth Entrepreneurship Workshop" project. The remaining participants will be provided with appropriate equipment this year. 134 applications were received for "The power of women in business" project implemented by the joint partnership of KOBIA, Rabitabank, National Confederation of Entrepreneurs (Employers) and AQSIA.
The questions of media representatives were answered at the event.
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