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Nazrin Abdul

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The liberation of the Garabagh region of Azerbaijan has opened new avenues for investment and economic development. With a focus on large-scale reconstruction efforts, the government is prioritizing the restoration of infrastructure and public services, creating a conducive environment for both local and foreign investors.

Orkhan Mammadov, Chairman of the Board of the Small and Medium Business Development Agency (SMBDA/KOBIA) under the Ministry of Economy, is visiting Washington for a meeting on Azerbaijan-US relations, the business environment, and investment attraction. This meeting is jointly organized by the Embassy of Azerbaijan in the United States, the Washington Inter-Governmental Professional Group, and the World Trade Center. During his speech at the meeting, he noted that the liberation of the Garabagh region of Azerbaijan, which had been under Armenian occupation for nearly 30 years, was a significant event for Azerbaijan and has also stimulated investment attraction.

He stated that large-scale reconstruction efforts in Garabagh and the return of business to the region create attractive opportunities for entrepreneurs.

"The government's comprehensive incentive package for this region has further increased interest in business. SMBDA is currently accepting project proposals from local and foreign entrepreneurs interested in establishing businesses in Garabagh. To date, about 2,300 applications have been registered, including over 500 from foreign investors. Among the applicants are four US companies and investors. I am confident that after today’s event, some entrepreneurs will take a closer look at the investment opportunities in Garabagh and Azerbaijan," said the chairman of SMBDA.

It should be noted that, in the context of the rapid construction and development in the previously occupied regions of Azerbaijan, substantial restoration and reconstruction efforts are underway, along with rapid economic reintegration measures in the economic regions of Garabagh and Eastern Zangezur.

In line with the priority of revitalizing Garabagh, industrial parks have been established to realize the region's industrial potential, reintegrate it into the country’s economy, and ensure employment for the local population.

In these zones, favorable conditions have been created for entrepreneurs to obtain various concessions, stimulating business activity. Notably, the Aghdam and "Araz Valley Economic Zone" industrial parks, like other existing industrial parks in the country, offer a favorable investment environment for entrepreneurs. Residents of these industrial parks benefit from ready-made infrastructure funded by the state. Additionally, they are exempt from property tax, land tax, income or profit tax for 10 years from the date of registration, as well as from VAT on imported machinery, technological equipment, and facilities for production purposes, and customs duties for 10 years.

Furthermore, changes made to the Tax Code as of January 1 of this year provide additional benefits for entrepreneurs operating in liberated territories. These benefits include subsidizing social insurance fees, granting five days of additional vacation to professionals living and working in these areas, calculating supplements to monthly salaries, providing a one-time allowance of 600 manats, simplifying the acquisition of work permits, and not applying the labor migration quota (with a five-day exemption for foreign specialists each year). Additionally, the import of certain raw materials and materials used in production by entrepreneurs in liberated territories is exempt from VAT for a period of 10 years.

Entrepreneurs engaged in production activities will also receive financial assistance from the state budget amounting to 20 percent of the utility costs they incur every month for a period of 10 years.

These reconstruction initiatives not only aim to rebuild the physical landscape but also to foster a thriving entrepreneurial ecosystem. By implementing favorable policies and providing necessary support, the region is becoming increasingly attractive for business ventures.

This focus on investment and entrepreneurship is expected to stimulate economic growth, generate employment opportunities, and ultimately contribute to the sustainable development of the region. Overall, the combination of reconstruction efforts and an emphasis on creating a business-friendly environment positions Garabagh as a promising destination for investment and economic activity in the coming years.

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