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Small businesses constitute 25% of country’s GDP

Friday, August 15
Small businesses make 25% of GDP today.

The figure is twice as lower as in western countries where they constitute 50-60% of GDP.

Oxu.Az reports with Echo newspaper that the statement came from chairman of the Center of Economic and Social Development Vugar Bayramov.

He said the high share of small business testifies to economic stability.

“It is relatively easier to create small businesses. All the same, they are more flexible in the face of crisis and promote new jobs. Meanwhile, their shutdown does not have a strong effect on economy and unemployment rates”.

Bayramov believes that the low share of small entrepreneurship has some objective reasons in Azerbaijan.

"Oil and gas industry is strongly developed in Azerbaijan. Today oil sector which primarily engages big companies produces almost a half of country’s GDP. In addition, big enterprises also play a high role in country’s nonoil sector. This causes a relatively low share of small businesses in GDP”, Bayramov said.

It is no accident that the programs of support to small and middle businesses in Azerbaijan have grown both financially and qualitatively against the backdrop of crisis in the world economy. These programs are overhauled on the annual basis.

Thus, tax administering loads have been reduced over the past year, primarily through introduction of the e-system for submission of tax declaration and online tax payment.

In addition, the income tax has been reduced, while preferences are applied for industrial parks created in the country along with restricting the conduction of on-site audit. Such reforms along with financing businesses via a separate Fund, functioning within the Ministry of Economy, could promote not only the economic but also mental changes in the country. (News.Az)