June 27 is the Micro, Small and Medium-sized Enterprises Day. 97.3% of SMEs operating in Azerbaijan are micro, 1.9% are small and 0.8% are medium-sized enterprises.
Approximately 90% of companies worldwide are micro, small and medium-sized businesses (SMEs). SMEs play an important - approximately 60-70% role in providing employment in the world. 50% of the world's gross domestic product (GDP) is provided by SMEs.
SMEs are considered engines of economic growth and social development. The contribution of SMEs to sustainable development, employment generation, poverty reduction, stimulation of entrepreneurship and innovation, and achievement of the Sustainable Development Goals is significant.
The United Nations General Assembly designated 27 June as “Micro-, Small, and Medium-sized Enterprises Day” to raise awareness of the tremendous contributions of MSMEs to the achievement of the United Nations Sustainable Development Goals (SDGs).
As in the whole world, SMEs in Azerbaijan are the driving force of the economy and the key to stable and sustainable development.
"New criteria for classification of micro, small, medium and large business entities" was approved by the Decision of the Cabinet of Ministers of the Republic of Azerbaijan dated December 21, 2018. According to these criteria, a micro-entrepreneur is an entrepreneur with up to 10 employees and an annual income of up to 200,000 manats. An entrepreneur whose number of employees is between 11-50 and whose annual income is up to 3 million manats is considered a small entrepreneur. A medium entrepreneur is an entrepreneur whose number of employees is between 51-250, and whose annual income is between 3-30 million manats.
More than 99% of entrepreneurs are SMEs in Azerbaijan. 97.3% of active SMEs are micro, 1.9% are small and 0.8% are medium enterprises. SMEs operate mainly in trade, agriculture, construction, processing, logistics, industry, tourism, public catering, transport and other fields in our country.
The number of SME subjects increased by 45% in 2018-2021 and was close to 360 thousand due to to the information of the State Statistics Committee. The share of SMEs in non-oil GDP increased from 23.5% to 26.6% during this period.
The turnover of SMEs increased by 19%, income increased by 61%, the criterion of more than 4,600 SME subjects grew in 2022 compared to 2021.
the transformation of small and medium entrepreneurship into the main source of economic growth and employment in the country is defined as one of the strategic goals in the medium-term socio-economic development strategy prepared within the framework of "Azerbaijan 2030: National Priorities for socio-economic development".
Entrepreneurs, including SMEs, are covered by extensive state support measures in our country.
The Small and Medium Business Development Agency of the Republic of Azerbaijan (SMB) operates in the direction of regulating the SME sector, improving the provision of public services to business, protecting the interests of SMEs, and improving their access to knowledge and innovations, markets and finance, and provides a range of support and services to SMEs. More than 3,000 trainings have been held until now free of charge by KOBIA's SME development centers to increase the business knowledge of SMEs, benefiting approximately 40,000 SMEs and up to 5,500 entrepreneurs benefited from consulting services, free business plans were prepared for about 800 SMEs.
Taking into account the importance of starting a business and expanding existing activities, 21 internal market researches were held based on the request of entrepreneurs, and 26 internal market researches were conducted at the initiative of the Agency.
About 100 "Startup" certificates were issued by KOBIA to support the digitization of SMEs and their innovative ideas, which exempted them from profit and income tax on the income obtained from innovation activities for a period of 3 years.
More than 750,000 manats of grants have been given to 39 SMEs in order to support the improvement of the financial capabilities of SMEs, within the framework of the financing mechanism for their projects in the fields of education, science, research and support.
The participation of about 1300 SMEs in 50 exhibitions and fairs held in Azerbaijan and foreign countries has been provided free of charge in order to support the access of SMEs to the markets. The sale of products of 25 entrepreneurs in various trade networks was ensured within the framework of the support mechanism for SMEs' access to trade networks provided by the agency.
The number of SME houses where state-business and business-business services are provided to entrepreneurs in a single space has reached three, and the number of services provided to business subjects in these centers has exceeded 300,000. Appropriate measures are being taken to create SME houses in other large cities and regions of the country, as well as in our territories liberated from occupation.
Currently, SME friends of the Agency, which operates in 41 cities and districts of the country, support the creation of new SME subjects and the development of existing businesses, support of their investment initiatives, and protect entrepreneurial interests within the framework of state support measures. So far, about 370 field meetings and educational events have been organized with the participation of about 17,000 entrepreneurs within the framework of the SME-friendly mechanism.
KOBIA has received about 1,500 applications up to date from entrepreneurs who want to set up business and invest in the liberated territories, of which about 70% are applications from local business subjects.
The Law "On the Development of Micro, Small and Medium Enterprises" approved by the President of the Republic of Azerbaijan on December 2, 2022 defines the forms and methods of promoting state support for SMEs. As per this Law, as well as according to the priorities of the state in the field of entrepreneurship and the challenges related to SMEs at the international level, support to SMEs will be continued.
