Comment by Aykhan Satiji,

Analyst of the Center for Analysis of Economic Reforms and Communication

The self-employment program, initiated upon the Decree “On Additional Measures to Ensure the Self-Employment of the Population” of President of the Republic of Azerbaijan dated April 7, 2016, continues successfully. To assist low-income families to establish or develop their farms, under this program, the State Employment Agency under the Ministry of Labor and Social Protection of Population of the Republic of Azerbaijan supports low-income families by providing goods, materials, and other property in kind (without cash) directly to the families at public expense.

In accordance with the submitted business plan, families are provided with production or service equipment. The self-employment program implemented in our country aims at the development of micro and small entrepreneurship and the formation of the family budget at the expense of sustainable sources of income.

The Center for Analysis of Economic Reforms and Communication also cooperates with the State Employment Agency through involving innovative projects in the self-employment program. Innovative projects and business plans that are submitted to the Center’s Enterprise Azerbaijan portal are then presented to the State Employment Agency.

Benefits and assistance provided to socially vulnerable people are directed to ensuring their employment in the labor market. One of the most significant moments here is that by providing assets mainly to vulnerable people and low-income families, they are directed to more sustainable and profitable business spheres. The main goal is to liberate these people from dependence on assistance and ensure their long-term financial stability by promoting self-employment.

The preference in the distribution of the self-employment program is given to vulnerable parts of the population and low-income groups. According to the legislation, while implementing the self-employment of the unemployed, the preference is given to recipients of targeted state social assistance, persons with disabilities, including children under 18 with disabilities, those registered as unemployed for more than a year, persons that have less than two years until retirement age, and unemployed persons released from prisons. One of the targets is to help people from the mentioned groups to start their business within the self-employment program and ensure their financial independence. Thus, other people who registered with the local offices of the State Employment Agency (city, region employment centers) as unemployed and job seekers and have the potential to build self-employed activity, can benefit from the program.

Ensuring the participation of citizens in the project within the self-employment program takes place after several stages. So, people registered by the Ministry with the employment agencies as unemployed and job seekers are then involved in training courses on business organization. Individuals who complete training courses and whose business plans are considered successful are subsequently provided with assets within the allocated quota.

Besides, it is significant to mention that self-employment is applied in many countries, and Azerbaijan ensures the sustainable development of the program in terms of applying best practices. The scope of the self-employment program differs by the national priorities of each country. One of the main features of the self-employment program in the UK is that the participants in the self-employment program in this country are not low-income people, but individuals and women over 50 years old. Also, the scope of the program is mainly innovative. In the Spanish model, the funds provided to self-employed participants were partially sustainable, which in turn led businesses to obtain sustainable financing.

Different priorities in the countries implementing the self-employment program have affected their scope and implementation mechanisms. That is why the success rate of the program varies from country to country. The self-employment program in Azerbaijan is one of the most successful projects in comparison with other countries. Undoubtedly, one of the main reasons for this is the direct financial support of the state and the sustainable financial sustainability of the self-employment program. At the same time, the program covers many spheres, including production, processing, service, and agriculture, which, in its turn attract the interest of a wide range of people. All this suggests that the self-employment program in Azerbaijan will further expand its scope in the future.