"It is easier for oligarch officials to use an unsecured credit resource"

Against the backdrop of ongoing efforts to bolster the agricultural sector, Azerbaijan has recently announced plans to organize credit fairs within the framework of agrarian business festivals. This initiative, unveiled by Anar Jafarov, Director of the Center for Agrarian Innovations at the Ministry of Agriculture, underscores a concerted push to facilitate access to financing for farmers and promote rural development. However, the efficacy and implications of such endeavors warrant closer examination, as they intersect with broader challenges facing the agrarian economy.

Official data reveals a substantial allocation of soft loans to farmers in recent years. In 2023 alone, the Entrepreneurship Development Fund disbursed 77 million Manats to support agricultural production and processing activities. Additionally, loans totaling 43.9 million Manats were extended for the acquisition of agricultural machinery and equipment during the period of January to September 2023. Furthermore, preferential loans amounting to 16.8 million Manats were granted to over 401 thousand entrepreneurs, reflecting a concerted effort to stimulate entrepreneurship in rural areas.

However, the testimonies of individual farmers paint a contrasting picture, highlighting the bureaucratic hurdles and challenges associated with accessing credit. One farmer from Jalilabad district in an interview with Turan, lamented the daunting documentation requirements and high interest rates imposed by banks, echoing sentiments shared by many within the farming community. These sentiments underscore persisting barriers to credit accessibility, which have long hindered the development of the agrarian sector in Azerbaijan.

The recurrence of credit fairs, previously organized in 2019, reflects a recognition of the enduring challenges facing farmers in accessing financing. While such initiatives aim to streamline the loan application process and enhance outreach to rural communities, skepticism remains regarding their effectiveness in addressing underlying structural issues. Critics argue that without comprehensive policy reforms and long-term strategies to support farmers, the sporadic organization of credit fairs may offer only temporary relief without addressing systemic shortcomings.

Vahid Maharramov, an agricultural expert, in an interview with Radio Azadlig, voiced skepticism regarding the government's commitment to meaningful reform in the agrarian credit sector. He contends that the emphasis on credit fairs may serve as a symbolic gesture rather than a substantive solution to the underlying issues of credit accessibility. Maharramov advocates for a more holistic approach, emphasizing the need for robust government guarantees and sustained policy interventions to ensure equitable access to affordable credit for farmers.

Moreover, concerns have been raised regarding the potential for elite capture and preferential treatment within the allocation of credit resources. Maharramov's assertion that oligarchic officials may exploit these mechanisms for personal gain underscores broader concerns regarding transparency and accountability in the distribution of financial resources within the agrarian sector.

In conclusion, while the organization of credit fairs represents a step towards addressing the longstanding challenges of credit accessibility in Azerbaijan's agrarian sector, their effectiveness hinges on broader policy reforms and systemic changes. Sustainable solutions require a concerted effort to streamline bureaucratic processes, reduce interest rates, and enhance government support mechanisms for farmers. Only through comprehensive reform can Azerbaijan realize the full potential of its agricultural economy and ensure inclusive growth and development in rural communities.