Agrarian Industry

Home page

Agrarian Industry

Azerbaijan may double preferential loans for farmers next year

08 September 2008 11:29 (UTC +04:00)

- Last week the head of state signed an order to raise the wages of employees in agriculture. For how many people is this order applicable?

- This order covers all employees of the agriculture sector, except employees of the administration of the Ministry of Agriculture. In general, it is applicable to 4 700 people. To this end, 152 150 manats will be used for the increase in their salary every month.

- Flour-making companies buy 1 kg of wheat from farmers for 27 kopecks. Farmers claim that the cost price of 1 kg of wheat is 35 kopecks; they are dissatisfied with the low prices offered for their products by companies. How could the ministry prevent such cases?

- The Ministry of Agriculture is not engaged in price policy. Producers must sell their products at a price of "cost +20-25%". Since trade operations are done between producers and buyers on mutual agreement, we can not interfere in the process.

- The Government of Azerbaijan and the WTO have differences over subsidies to the agricultural sector. Can the parties arrive at common agreement on this issue?

- Negotiations are under way with the WTO. Our representatives are participating in the negotiations. We have provided suggestions on maintaining subsidies to support local production. We want subsidies remained at the level of 10% in order that our economy doesnâ€™t see harm when we join the WTO. No specific decision on this issue has been made yet.

- How much is the expected growth in agricultural production this year?

- After 6 months of the year, growth in the agricultural sector was 10.7%. Today this rate is close to 10%. In my opinion, if it remains until the end of the year, we can achieve great success. A few countries have achieved 10% growth in the agricultural sector.
This achievement is not the results of one year but the integrated measures and reforms undertaken over the past 4 years. For example, Agroleasing company was established in 2004.
Through funding from the state budget, agricultural equipment, machines and fertilizers were purchased and given to businesses, agri-technical service centers were set up in every region.

No agricultural regions lacked agricultural vehicles and machines this year.
According to the order issued by the Head of State, last year 80 million manats were allocated for the producers of agricultural products. Also, great strides were made in the field of seed production in recent years.
According to amendments made to the legislation last year, production of not only original but pedigree seeds was 100% subsidized from the state budget. Also, 30-40 manats were given for R1 and R2 seeds.

- When will the Pedigree Cattle Leasing Program begin?

- The process is scheduled to begin from next year. I believe that Azerbaijan does not need to develop animal husbandry by number, but by its productivity. Some part of 25 million manats allocated by presidential decree, this and next year pedigree cattle and livestock will be imported into the country from abroad. As a result, our country will realize the program on artificial insemination and livestock development.

- According to some sources, due to unfavorable weather conditions grain production decreased this year.

- It is premature to talk about it. Currently, the latest data is being collected. If weather hadnâ€™t been unstable in summer, yields in the agricultural sector would have been much more.

- Manufacturers face problems in obtaining loans from the State Agency for Agricultural Lending. It is slated to simplify procedures for issuing loans?

- Procedures are very simple now. Perhaps, the entrepreneurs are facing difficulties for various reasons. Over the last 2 years the Agency allocated 5 million manats annually. At the last government meeting, the Head of State instructed the government to consider the issue of increasing funds. We also support the increase of loan allocation up to at least 10 million manats from next year.

- Is it possible to increase the minimum and maximum amount of loans?

- These loans are allocated in small, medium and large sizes. So far, we have no plans to raise them. However, the matter may be considered if more funds are allocated to the agency from the state budget.