Azerbaijan has entered a new stage in the development of its business support and investment promotion system with the launch of the Agency for the Development of Small and Medium Businesses, Investment and Export Promotion under the Ministry of Economy. The new institution brings together the functions previously carried out by the Small and Medium Business Development Agency, KOBIA, and the Export and Investment Promotion Agency, AZPROMO. The reform creates a single institutional platform covering three closely connected areas of economic activity: entrepreneurship, investment and exports.
The timing of the reform carries particular economic significance. Azerbaijan’s economic policy increasingly places emphasis on expanding non-oil activity, attracting investment into productive sectors and increasing the international reach of Azerbaijani companies. A structure that combines these areas can create a more direct connection between a domestic company’s growth, its access to investment and its eventual entry into foreign markets.
The new Agency has a workforce ceiling of 370 positions. The structure includes 291 positions in the central apparatus and 79 positions in regional divisions. This organization gives the institution a national operating platform while preserving a regional dimension for business development.
The most important feature of the reform lies in the combination of functions. A small or medium-sized company often moves through several stages during its development. It may begin with domestic production, seek financing for expansion, introduce new technologies, enter a partnership with a foreign investor and eventually export its products. The new institutional model places these stages within one broad policy framework.
Investment promotion represents another major component. The Agency is tasked with supporting investment in Azerbaijan’s non-oil and gas sector and helping coordinate services between government institutions, entrepreneurs and investors. Its mandate includes investor attraction, investment project support and measures aimed at improving the investment environment.
This approach can become particularly important as Azerbaijan seeks greater investment in manufacturing, agriculture, logistics, digital industries, renewable energy, tourism, mining and other productive sectors. Each successful investment project can generate demand for local suppliers, create employment, develop new skills and expand the country’s export potential.
Export promotion forms the third pillar of the institution. Azerbaijan already possesses an expanding base of companies capable of competing in foreign markets, while the next stage of export development requires deeper market research, stronger business connections and greater international visibility. The Agency can bring these activities closer to investment promotion and business development.
The relationship between investment and exports deserves special attention. Foreign investors can introduce capital, technology, management experience and access to international supply chains. Local companies can become suppliers to international investors operating in Azerbaijan. At the same time, Azerbaijani companies can use foreign partnerships to enter new markets. A unified institutional framework can facilitate these connections.
The reform also gives the Agency a broader role in protecting business interests and coordinating services between public institutions and entrepreneurs. This function can strengthen communication between the state and the private sector and create a more structured mechanism for addressing issues faced by businesses.
An especially significant element concerns the coordination of regulations affecting small, medium-sized businesses, investment and exports. Under the new framework, relevant draft regulations prepared by central government bodies are to be coordinated with the Agency before submission to the competent rule-making authority. This gives the institution a role in shaping the business environment at the regulatory level.
The reform also opens a new chapter for regional economic development. The 79 positions allocated to regional divisions create an institutional presence beyond Baku. Regional businesses can gain closer access to information, support mechanisms, investment opportunities and export assistance. This can strengthen the connection between regional production and national economic priorities.
The human dimension of the reform also deserves attention. The February decree provides for the staffing of the new Agency through employees of KOBIA and AZPROMO, creating continuity of institutional knowledge and professional experience. The new 370-position structure provides the organizational framework for bringing these competencies together under a common mandate.
The Agency officially enters its new institutional phase from October 1, 2026, following the approval of its charter and structure on August 20.
The broader significance of this reform lies in its potential to connect different parts of Azerbaijan’s economic development strategy. Entrepreneurship creates companies, investment provides capital and technology, while exports connect domestic production with international demand. Bringing these three elements under one institutional roof creates a platform designed around the full business development cycle.
For Azerbaijan, the effectiveness of this model will ultimately depend on implementation, measurable results and the ability to translate institutional coordination into concrete opportunities for businesses. The new Agency now has a broad mandate, a national structure and a clear economic mission. Its next chapter will be measured through the number of companies it helps expand, the investment projects it facilitates, the export markets Azerbaijani businesses enter and the economic value generated through these activities.
The creation of the Agency therefore represents more than an administrative restructuring. It establishes a new institutional architecture for Azerbaijan’s private-sector development, investment attraction and export expansion at a time when the diversification of economic activity has become an increasingly important national priority.