Azerbaijan’s economic future lies in linking small business success to green data – AzerNews

Report on the Growth of Micro, Small, and Medium-Sized Enterprises (MSMEs) in Azerbaijan and Contribution to Sustainable Development Goals (SDGs)

1.0 Executive Summary

This report analyzes the status of Micro, Small, and Medium-Sized Enterprises (MSMEs) in Azerbaijan at the close of 2023, based on findings from the ASM2025 report. The data indicates substantial growth in the MSME sector, which is a critical component for achieving national economic objectives and aligning with the United Nations Sustainable Development Goals (SDGs), particularly SDG 8 (Decent Work and Economic Growth) and SDG 9 (Industry, Innovation, and Infrastructure).

2.0 Key Statistical Findings

The ASM2025 report provides a quantitative overview of the MSME landscape in Azerbaijan:

• Total Registered Enterprises: By the end of 2023, the total number of registered MSMEs reached 401,149.
• Sector Dominance: MSMEs constituted 99.7% of all registered enterprises in the country.
• Annual Growth: The sector experienced a 6.2% increase in the number of registered entities compared to 2022.

3.0 Composition of the MSME Sector

The distribution of enterprises within the MSME category is heavily weighted towards the smallest entities, which has implications for targeted policy-making aimed at sustainable development.

1. Microenterprises: 97.0%
2. Small Enterprises: 2.1%
3. Medium-Sized Enterprises: 0.8%

4.0 Alignment with Sustainable Development Goals (SDGs)

The expansion of Azerbaijan’s MSME sector directly contributes to the advancement of several key SDGs.

• SDG 8: Decent Work and Economic Growth: The 6.2% growth in MSMEs is a primary engine for job creation, entrepreneurship, and economic diversification. This progress directly supports Target 8.3, which promotes policies for productive activities, decent job creation, and the formalization and growth of MSMEs.
• SDG 9: Industry, Innovation, and Infrastructure: As the backbone of the economy, the robust MSME sector fosters a resilient and inclusive industrial base. This aligns with Target 9.3, which focuses on increasing the access of small-scale enterprises to financial services and integrating them into value chains and markets.
• SDG 1 & SDG 10: No Poverty & Reduced Inequalities: By creating widespread employment opportunities and stimulating local economies, the growth of MSMEs is fundamental to poverty alleviation (SDG 1) and the reduction of economic inequalities (SDG 10).

5.0 Conclusion

The data confirms the pivotal role of the MSME sector in Azerbaijan’s economic framework. Its continued growth is a strong positive indicator for the nation’s progress towards the 2030 Agenda for Sustainable Development. The sector’s expansion is integral to fostering inclusive and sustainable economic growth, promoting industrialization, and creating decent work for all.

SDGs Addressed in the Article

1. SDG 8: Decent Work and Economic Growth

   The article directly connects to SDG 8 by focusing on the prevalence and growth of micro, small, and medium-sized enterprises (MSMEs). These enterprises are crucial drivers of economic growth, job creation, and entrepreneurship. The data presented, such as MSMEs accounting for “99.7% of all registered enterprises in Azerbaijan” and their “6.2% increase over 2022,” highlights economic activity and the development of the business sector, which are central to this goal.

2. SDG 9: Industry, Innovation and Infrastructure

   This goal is relevant as it aims to build resilient infrastructure, promote inclusive and sustainable industrialization, and foster innovation. MSMEs form the backbone of a country’s industrial base. The article’s statistic that Azerbaijan hosted “401,149 MSMEs” by the end of 2023 underscores the scale of this industrial and commercial infrastructure, making the data relevant to tracking the development of an inclusive industrial sector.

Specific SDG Targets Identified

1. Target 8.3: Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises…

   The article’s content is a direct reflection of this target. It explicitly quantifies the growth (“a 6.2% increase over 2022”) and formalization (data on “registered enterprises”) of MSMEs in Azerbaijan. The total number of MSMEs and their breakdown by size provide a clear picture of the entrepreneurship landscape that this target aims to support.

2. Target 9.3: Increase the access of small-scale industrial and other enterprises, in particular in developing countries, to financial services, including affordable credit, and their integration into value chains and markets.

   While the article does not discuss access to financial services, it provides essential baseline information about the target group of this goal. The data showing that “97.0% were microenterprises, 2.1% small enterprises, and 0.8% medium-sized enterprises” identifies the scale and structure of the small-scale enterprise sector, which is the first step in measuring and improving their integration into markets and access to services.

Indicators for Measuring Progress

1. Number and Growth Rate of Registered MSMEs

   The article provides direct quantitative indicators that can be used to measure progress towards Target 8.3. These include:

   • The total number of registered MSMEs: “401,149 MSMEs”.
   • The annual growth rate: “a 6.2% increase over 2022”.
   • The proportion of MSMEs in the economy: “99.7% of all registered enterprises”.

   These figures are explicit measures of the formalization and growth of the MSME sector.

2. Distribution of Enterprises by Size

   The article implies an indicator by providing a detailed breakdown of the MSME sector. The data that “97.0% were microenterprises, 2.1% small enterprises, and 0.8% medium-sized enterprises” serves as an indicator to understand the economic structure. Tracking this distribution over time can help assess the effectiveness of policies aimed at helping micro and small enterprises grow, which is relevant to both Target 8.3 and Target 9.3.

Summary Table: SDGs, Targets, and Indicators

Source: azernews.az