Strategies of the Development of Entrepreneurship and SME

Due to the decree of the president of the Azerbaijan Republic the number of activitiesrequired license was reduced to 50 and the price of license was increased. Generally, theamount of credits allocated to the entrepreneurs had been increased 65% and reached up toUSD 2.2 billion in 2006. The half of these credits were long period credits.Besides of all these achievements there are several problems that entrepreneurs face.They are monopolism, weakness of protection at courts, lack of business information andfinancial resources, insufficient level of market infrastructure, lack of professional staffs, etc.The number of persons engaging with the entrepreneurial activity is less than existedpotential. The level of regional development of entrepreneurs is not relative to real potential.So, 57.24 % of all small and medium entrepreneurs are situated in Baku. The cooperation withlocal producers is not well developed and relation of SMEs with big companies and integrationis not sufficient. It is fact that the share of private sector in the country economy is high, buthe development of entrepreneurs generally is not sufficient.During 6 months of 2007 the cooperation in import-export sphere with 127 foreigncountries was held. Common amount of foreign trade was USD 4,986.1 million, 28.7% foreigntrade campaign was prosecute with European Union, 28.2% with CIS countries.Composition of enterprises and new enterprises by kind of activityTable 24.Number of enterprisesincluding:agriculturemanufacturingconstructionwholesale and retail tradehotels and restaurantstransportreal estate, rentingas ofas of01.01.2006 01.01.200760,089 74,5349,0875,8286,66725,9801,0282,2277,013Enterprises established 5,123 -Enterprises closed-down 756 -Private businessmen acting without establishinglegal entity by their kind of activityTable 25.TOTAL:includingAgricultureConstructionWholesale and retail tradeHotels and restaurantsTransportReal estate, rentingFinancial mediationas of01.01.2006209,17020,3181,329120,2198,95617,98413,477400as of01.01.2007243,47923,18516,22119,88310,10343,50314,399486101