ICD official names three key areas for private sector development

Three main directions have been identified for the development of the private sector, Elvin Afandi, Manager of the Corporate Strategy and Research Department at the Islamic Corporation for the Development of the Private Sector (ICD), said.

Report informs that he made the remarks at the Arab Coordination Group (ACG) Private Sector Session held in Baku as part of the 52nd Annual Meeting of the Islamic Development Bank (IsDB) Group.

According to him, the overall ecosystem for the development of the private sector and SMEs in countries should be considered across three main dimensions.

"The first is the regulatory and policy framework. The governance and regulatory environment should be shaped in a way that promotes private sector development, investment attraction and entrepreneurship. The second is the institutional level. Broader support is needed in this area. An accessible and effective institutional layer, consisting of financial institutions, funds and other support mechanisms, should be created between enterprises and the state and policymakers," Afandi said.

He noted that one of the main problems faced by SMEs and the private sector in most member countries is limited access to finance.

"Therefore, ensuring more accessible and affordable financial resources is one of the main priorities. The third is the enterprise level. Although our activities were previously focused more on the public sector and sovereign investments, we are now increasing investments at the enterprise level. This is being done through project and corporate financing, as well as credit lines," he said.

Afandi added that focusing only on enterprises is not enough to achieve a serious breakthrough.

"For the successful development of the private sector ecosystem, policy, institutional mechanisms and enterprise-level support must function as a single complementary system," he said.