Azerbaijan: How to help your business recover after COVID

September 9, 2021

  • COVID hit my business badly. Where can I get some financing to recover?
  • How do I apply for a bank loan? What are the requirements?
  • I’ve heard about loans, but are grants also available to small companies?
  • The pandemic showed that there is sustainable demand for my business. How can I get knowledge, advice and skills needed to scale up my business?
  • I think exporting to the EU could help my business recover. Where do I start?
  • Are there SMEs like me that got help?
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COVID hit my business badly. Where can I get some financing to recover?

The EU offers financing and guarantees through local financial institutions to unlock lending. This makes it possible for the local lender to provide more affordable financing to SMEs. For instance, you could benefit from lower-interest loans, longer repayment terms, and loans based in manat instead of foreign currencies. Check what the EU-supported Accessbank in Azerbaijan has to offer.

Here are some examples of SME owners who benefited:

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Rafael Sulkhayev’s family not only managed to open a dried fruit business in 2020, just as the coronavirus pandemic raged, but to even export hundreds of tonnes of its product to both local and foreign markets. Sulkhayev and his cooperative’s members were given an EU grant through the Azerbaijan Micro-finance Association (AMFA), which helped him to buy the necessary equipment and set up a small enterprise.

Elza Rzayeva, a tailor from Ganja, expanded her business and acquired a new computerised sewing machine with EU support. The machine can perform many complex stitches, making a sewer’s work better and easier. Despite the pandemic, her customer base has nearly doubled.

How do I apply for a bank loan? What are the requirements?

The EU offers a wide range of options for different types of SMEs. For instance, the EU provides concessionary loans to underserved micro-enterprises and low-income households, as well as SMEs in the agri-food sector, retail and other businesses carrying out major energy efficiency investments.

You can check the conditions for the EU partner banks on the EU4Business website and just call the bank directly. Remember to mention the programme. Very simple!

I’ve heard about loans, but are grants also available to small companies?

Yes, there are! If you own a micro-business, especially in a remote rural area, the EU-supported Azerbaijan Micro-Finance Association (AMFA) may provide you with seed capital to start your  business.

A new EU4Business programme, Supporting women’s entrepreneurship during COVID-19 was recently launched. Vulnerable women in Ismayilli region, in particular single parents and disabled women, will be able to apply for seed capital to start income-generating activities.

The pandemic showed that there is sustainable demand for my business. How can I get knowledge, advice and skills needed to scale up my business?

To support SMEs like yours, the EU provides considerable funding for business development services in Azerbaijan. The EU assists local business associations and agencies, leading to SME growth. Just check all available business development opportunities, pick the one that suits your needs, and get in touch directly with the organisation!

For instance, women enterpreneurs in the small food industry, who want to access new markets, can find support for their business ideas under the EU4Business project “From Kitchen to Business”.

Local producers of pomegranate and hazelnut can seek support from the CNFA through the EU4Business project “Azerbaijan Hazelnut and Pomegranate Initiative (AHPI)”, including training, consulting on agronomics, HACCP recommendations, etc.

Under the EU4Business project “Support to Transformation and Achievement of Excellence in Pomegranate Value Chain (STEP)”,  the Azerbaijan Pomegranate Producers and Exporters Association aims at serving farmers interested in pomegranate cultivation free of charge. Entrepreneurs can seek consultancy services on how to enter European markets, how to get ceritification, etc.

Under the EU4Business project “Assistance to farmers to develop the sustainable value chains on soft fruit and vegetable production in the rural regions of Azerbaijan”, small-scale farmers in the rural areas of Azerbaijan (Ganja-Qazakh, Aran) can develop commercially viable value-chains in the vegetable and soft fruit sectors and learn how to manage risks connected with climate change and natural disasters.

The EU4Business project “Strengthening of agricultural advisory services” implemented by FAO will allow you better to understand and adopt processes and services that are more focused, targeted and relevant to increasing farm incomes while protecting and enhancing the natural environment.

You can even make sure your voice is heard in the national reform process and help your government to better understand issues affecting SMEs like yours! Just check the business enabling environment activities in Azerbaijan supported by the EU.

I think exporting to the EU could help my business recover. Where do I start?

Indeed, that’s a great way to scale up your business! And we have something interesting to offer. The EU4Business Eastern Partnership Trade Helpdesk will facilitate you in identifying trade obstacles and better understanding regulatory and procedural issues in trading goods and services. Soon, this one-stop-shop online platform will be available that will offer access to trade information (tariffs, non-tariff measures, taxes, trade statistics and procedures).

Local producers of pomegranate and hazelnut can seek export advice from the CNFA through the EU4Business project “Azerbaijan Hazelnut and Pomegranate Initiative (AHPI)”, including training, consulting on agronomics, HACCP recommendations, etc.

Under the EU4Business project “Support to Transformation and Achievement of Excellence in Pomegranate Value Chain (STEP)”,  the Azerbaijan Pomegranate Producers and Exporters Association aims at helping farmers interested in pomegranate cultivation, free of charge. Entrepreneurs can seek consultancy services on how to enter the European markets, how to get ceritified, etc.

The EU4Business: Connecting Companies project supports SMEs with export going to EU countries. You can apply for training, coaching and even matchmaking with businesses in the EU.

Are there SMEs like me that got help?

There are more than you can imagine! Between 2019-2020, 26,684 SMEs in Azerbaijan received support through the EU4Business Initiative. A total of 700 entrepreneurs received loans with a total value of €5.7 million under EU programmes that supported SMEs. Over 24,000 consultancy services were delivered to SMEs. The income of these supported SMEs rose by 13% in 2020 amounting to almost €34.0 million, and 1,275 new jobs were generated as a result of this support in 2020 alone.

Here are some success stories from SMEs like yours:

Lala Gurbanaliyeva and her Zagatala-based family benefited from financial literacy training and a grant under the EU4Business initiative and Azerbaijan Micro-finance Association (AMFA) to expand their beekeeping business. They set up the family cooperative and invested funds in purchasing honey extraction equipment. They also bought about 60 new bee colonies, and some protective clothes.

Shafag Aliyeva, a cake-maker from Tovuz, expanded her knowledge on how to run a business through workshops provided by the EU4Business ADSMIRRA programme. The project also made it possible for her to buy new equipment and expand her business. In a short period of time, her cakes became very popular in the town of Govlar.

Click here for more success stories to learn about Azerbaijani SMEs that are doing business in many different areas and have benefitted from EU support.

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