OREANDA-NEWS. On 22 August 2008 was announced, that Lars Thunell, Executive Vice President and CEO of IFC, a member of the World Bank Group, and Heydar Babayev, Azerbaijan’s Minister of Economic Development, this week signed a memorandum of understanding to help improve the country’s business environment and ensure sustainable and diversified economic growth.

The IFC Azerbaijan Business Enabling Environment Project, launched jointly with the government, will be implemented in partnership with the Swiss State Secretariat for Economic Affairs and BP on behalf of its partners. IFC will work with the government to reduce the regulatory burden on private businesses, as well as advise the Ministry of Economic Development in identifying the impact of regulation on private companies and fostering dialogue between the government and private sector.

“Our priorities are clear: diversification and sustainability. We need to create an environment where the overall burden of work for businesses and the government is reduced, creating more opportunities for a vibrant and competitive private sector. Azerbaijan has realized consistent economic reforms, and we cooperate actively with IFC in promoting private sector development, which is crucial for their implementation,” said Babayev.

Drawing on experience across the region, IFC will also help the government analyze the national system of permits and licenses. Other efforts will include helping increase entrepreneurs’ awareness of their legal rights and promoting private sector involvement in reforms through public education campaigns, advocacy work, and the launch of the IFC SME Toolkit, an online portal.

“A strong business environment is crucial for economic growth, job creation, and further investment in Azerbaijan,” said Thunell.

“Working with IFC, other countries in the region have reduced business formalities by more than a third. This is also a realistic target that Azerbaijan can achieve. It will help the country become a leading reformer and remain attractive to national and foreign investors,” said Aliya Azimova, IFC Country Officer for Azerbaijan.

Through its business enabling environment work in Eastern Europe and Central Asia, IFC has helped governments amend or enact 11 major laws and regulations that have led to USD 93 million in cost savings for small and medium enterprises. IFC also helped draft or amend 83 others that have been adopted by governments. IFC’s surveys of smaller businesses have provided policymakers with detailed recommendations for improvements. As of July 2007, 161 survey recommendations have been adopted by various governments.