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Insurance of Agri-culture loans: Developing Mechanism
On May 20, 2010, Azerbaijan Micro-finance Association hosted an Advocacy workshop on “Agriculture Credit Insurance” project. At this meeting representative of AMFA members, insurance companies, government organs and other partners took part. AMFA Head of the
Research team – Dr. Vagif Rustamov, made a presentation on current situation (legislative-normative basis, economic mechanisms and system structures) in Azerbaijan related to insurance of agriculture credits. He has indicated that there is a relationship between allocated credits with the development of agriculture sector. On the basis of market economy and government supervision,
intersection of involved market players (micro-finance organization, insurance companies, farmers, etc) will initiative new opportunities on the agriculture sector. For the best of widening and developing entreprenership, one of required components is to make slight modifications on the basis of current legislation and initiate a mechanism.
Currently, insurance of agriculure credits are taken into consideration on the current legislation: Decree on “Stimulation of
agriculture credit insurance” of Azerbaijan Republic (18.06.2002) and approval by the Ministry of Cabinet on “Policies on allocation and approval of financial resources for the agriculture credit insurance” (04.03.2004).
In addition, it has been indicated that from the fiscal year budget massive amount of money is allocated for the development of the
agriculture sector. Based on unknown reasons, only small portion of the resources are used. Having less stimulus is quite serious issue
for the development of agriculture sector. Herein, an important issue is to increase knowledge and information base of farmers.
After the presentation, discussion among the participants on insurance has started. The primary issue was insurance of agriculture credits and making this compulsory. read more >>>>
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