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ACDI/VOCA -USAID awarded the Azerbaijan SME Support through Financial Sector Development Project, a three-year cooperative agreement, to ACDI/VOCA (and sub-contractors The Pragma Corporation, The QED Group, LLC, and the MBA Enterprise Corps) in September 2005. The project has three main components that will collectively stimulate the provision of credit and other financing to small and medium enterprises (SMEs) in Azerbaijan by strengthening the financial sector. -Institution Development - The project will work indirectly through local associations and training institutions to enhance the effectiveness of Azeribaijani financial institutions. In particular, the project will: -Legal and Regulatory - The project will engage government and industry leaders to enhance the legal and regulatory framework for SME lending. Issues affecting both operation of financial institutions and lending will be addressed including: i) Removing lending impediments especially credit information and use of collateral; ii) Development of the primary and secondary mortgage markets; iii) Support to the recently established Azerbaijan Mortgage Fund. -Increase the financial sector's access to lending capital through: i) Creating linkages with DCA Credit Guarantee Fund; ii) Brokering access to debt and equity financing; iii) Linking the financial sector with rating agencies and international investors. -USAID designed the SME Finance Project to encourage lending to SMEs, especially through non-bank financial institutions (NBFIs.) In particular, the project will address the capital constraint facing banks and non-banks by facilitating their access to capital. The project will also encourage raising capital from domestic rather than international sources. In addition to mobilizing capital, USAID understands that there are legal and regulatory restraints on SME lending including collateral, registration and enforcement of contracts. The project will dedicate a significant amount of short-term technical assistance to reduce legal and regulatory constraints facing lenders and borrowers. -The project will form a donor coordination group to bring together the various entities including government, international donors and private sector institutions involved in SME development. This group will work to facilitate collaboration and sharing of information that will lead to a more efficient allocation of resources and better coordination of efforts. |
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Azerbaijan Micro-finance Association:
44 J. Jabbarli str. (Caspian Plaza III) 9 floor Baku Azerbaijan Tel/Fax:: +(994.12)4371645 E-mail: amfa@amfa.az |