Apri l 2007
in Central Asia
and Azerbaijan
IntroductIon ......................................................................................... 3
Leasing in azerbaijan and CentraL asia:
synChronization of Leasing PoLiCy
throughout the region ......................................................... 6
Leasing in Azerbaijan ............................................................................ 8
Leasing in the Kyrgyz republic .................................................... 16
Leasing in tajikistan ............................................................................ 21
Leasing in uzbekistan ....................................................................... 25
IFC AzerbAIjAn - CentrAl AsIA leAsIng FACIlIty
AdvIsory servICes ProjeCt ................................................... 34
our contActs ...................................................................................... 35
PArtner....................................................................................................... 37

he leasing
market in central Asia is poised for rapid development
in 2006. over the past fve years, there have been several signifcant
positive changes in the leasing market in Azerbaijan, the Kyrgyz
republic, tajikistan, and uzbekistan due to legislative and tax
Leasing, a medium-term fnancial instrument for the procurement of
machinery, equipment, vehicles and/or properties, provides fnancing of
fxed assets (equipment, vehicles, etc.) rather than direct capital. Leasing
institutions - banks, leasing companies, insurance companies, equipment
producers or suppliers, and non-bank fnancial institutions - purchase the
equipment and then provide the equipment for a set period of time to
businesses. during that period of time, the lessee makes periodic payments
to the lessor at a set interest rate. At the end of the period, the equipment
is transferred to the ownership of the business, depreciated and discarded
or sold to a third party.
the leasing reform efort over the past fve years has helped Azerbaijan and
uzbekistan signifcantly strengthen their leasing markets, in particular due
to the favorable tax climates that have created unique conditions for growth.
the Parliaments in Azerbaijan and uzbekistan have signifcantly amended
their leasing legislations to make them more attractive for both foreign and
domestic investment. Additionally, amendments were made to the codes
of Economic Litigation Procedures to create non-judicial repossession
procedures. Also, Azerbaijan and uzbekistan have both amended their
respective tax codes to remove barriers to leasing and create a level playing
feld with traditional bank credit. the other two central Asia countries - the
Kyrgyz republic and tajikistan - have both adopted new laws on fnancial
leasing that are equally progressive. these recent changes have made the
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Joco·e·| |e·e|·o||e· |eo·|·¸ ·eo·· |·o·c|o| |eo·|·¸
LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
central Asia region one of the most progressive for leasing in terms of
leasing legislation and tax policy.
In Azerbaijan, the leasing market grew signifcantly: $56.5 million worth of
leases were fnanced in 2006 compared to $2.5 million in 2003. the leasing
portfolio as of end-2006 totaled $71 million. seven new lessors started
activity in the market, and currently 12 lessors conduct leasing operations
in the country.
In uzbekistan, the value of new leases tripled from $37.6 million in 2003
to $107.6 million in 2006. there are now 33 lessors (banks and leasing
companies) making fnancial leases in uzbekistan. All of the major banks in
uzbekistan have entered the market, and 10 new leasing companies have
been established since 2002.
the leasing market has also started to evolve in the Kyrgyz republic and
tajikistan, where further development of this market now depends on the
creation of a more favorable tax environment for leasing.
In the Kyrgyz republic, three banks are fnancing leases, and two microleas-
ing companies are reaching the country’s poorest regions. Additionally, the
Financial company to support credit unions has fnanced more than 220
leases over last three years.
In tajikistan, the frst two leasing companies were established, and the value
of leases increases gradually.
Additionally, some countries have recorded multimillion-dollar cross-border
leases from foreign manufacturers, banks and leasing companies.
the positive changes in legislation were due to constructive partnerships
among the Parliaments, governments, local commercial banks and leasing
companies, with support from international fnancial institutions, including
the International Finance corporation, which has set up advisory services
projects throughout central Asia and Azerbaijan to assist in the creation
and development of leasing. these partnerships formed the foundation for
dynamic leasing growth in Azerbaijan and central Asia.

Azerbaijan and Central Asia Leasing Market
Volume ($ million)
Azerbaijan Kyrgyzstan tajikistan Uzbekistan

# of Leases Financed
7 6 3 9
Azerbaijan Kyrgyzstan tajikistan Uzbekistan
LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
LeasIng In azerbaIjan and CentraL asIa:
synChronIzatIon of LeasIng PoLICy throughout
the regIon
With the support of IFc’s sEco-funded advisory services programs in
central Asia and Azerbaijan (launched in 2001 and 2003, respectively),
the countries in the region have steadily improved their legal and tax
frameworks. one result has been the unifcation of national legislations
– including standardization of defnitions, regulations and obligations
between parties – to support the development of regional investment
in leasing. Amendments have been adopted to the Law on Leasing, civil
code and tax code in Azerbaijan and uzbekistan, and new laws on leasing
and amendments to the tax code were adopted in the Kyrgyz republic
and tajikistan. this work signifcantly unifed the legislations and expanded
access to lease fnance for entrepreneurs and businesses across the region.
Unifed Elements of the Leasing Legislation
1. defnition of Leasing
unifcation of the defnition of leasing throughout the region is based on
the following principles:
Mandatory participation of three parties to the lease: lessor, lessee,
and supplier;
Purchase of the leased asset specifcally for transfer through a lease;
the lease agreement must meet one of the several stated require-
ments (classifcations), which are a combination of classifcations for
fnancial leases from IAs 17 and gAAP FAs 13; (classifcations are not
included in the tajik Law on Leasing, but included in the tax code).
obligatory use of the leased asset for commercial purposes (in
Azerbaijan, leased assets can be used for consumer purposes as
Additionally, uzbekistan has established a minimum lease term of one
2. Civil regulation
Leasing is defned as a type of “property hire” and thus, is governed
by the overall principles of “property hire.” For example, the basis for
early termination of a property hire agreement is also the basis for
the early termination of a lease agreement;

Leasing is defned as an investment activity based upon the purchase
of a leased asset by a lessor using either debt and/or equity funds
and the further transfer of the leased asset to a lessee on the basis of
a lease agreement.
3. Legislative advantages for leasing that correspond through the
non-bank fnancial institutions are not required to obtain a license to
conduct leases;
non-bank fnancial institutions are not restricted by obligatory capital
requirements for leasing;
there is no obligatory registration of the lease agreement; and,
Leasing as an activity is not supervised by government structures
unless the lease is fnanced by an institution already under
supervision, such as a bank.
4. accounting of leases
the Kyrgyz republic and tajikistan have adopted International
Financial reporting standards (IFrs);
In Azerbaijan and uzbekistan, national Accounting standards are
applied; however, banks also prepare their annual fnancial reports
according to IFrs.
uzbekistan’s national Accounting standard for leasing is very similar to
International Accounting standard 17 “Leases.”
5. taxation and customs regulation of leasing operations
the tax codes of the central Asian countries and Azerbaijan use classifca-
tions criteria, which are a combination of classifcations for fnancial leases
from IAs 17 and gAAP FAs 13. the tax codes only impact leases in which the
asset leased is a fxed asset.
In each country, fnancial leasing is at least on the same taxation “playing
feld” as bank credit; and in some countries, leasing is a more efective
instrument from a tax point of view. For example:
In the Kyrgyz republic and tajikistan, VAt is not levied on the interest
portion of the lease payment, and is ofset for equipment purchase;
In Azerbaijan and uzbekistan, lease payments (rentals) are exempt
from VAt;
In uzbekistan, equipment that is imported for leasing is exempt from
VAt on import; leased asset is exempt from property tax; and lessors’
interest income is exempt from income tax.
LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
LeasIng In azerbaIjan
an overvIew of the Market
fter a decade of stagnation in the leasing sector of the country,
signifcant positive changes have been made in the leasing
legislation. the introduction of a more favorable tax regime, proper
civil regulation and an increased level of public awareness have
revived the market. new lessors were established to satisfy the increasing
demand for lease fnancing.
Common trends
the market has immediately reacted to the improvements in the leasing
environment. As a result of reforms in leasing legislation, the number of
leasing companies has increased from 3 in 2003 to 12 at the end of 2006.
the consolidated leasing portfolio grew from $2.1 million in 2003 to $71
million in 2006.
Leasing Market Growth
($ million)
2003 2004 2005 2006

the consolidated outstanding portfolio of the leasing sector as of december
31, 2006 includes 787 deals. the increase in number of lease contracts
concluded since 2003 is more than 10 times.
Table 1. New Leases and Leasing Portfolio
2002 2003 2004 2005 2006
Number of lessors at end of year 3 3 7 11 12
New leases during a year:
- number
- value of assets leased, $ million




Leasing portfolio at end of year:
- number of active leases
- value, $ million




Delinquent leases (at end of year)
- number
- value, $ million
0 0 0

Table 2. Industry Distribution of Leases, $ million
2004 2005 2006
Trade - 0.7 3.4
Agriculture 0.2 4.2 0.6
Manufacturing - 0.7 10.2
Construction 4.2 9.5 11.9
Transport 2.0 12.7 11.3
Financial Sector - 1.8 3.4
Consumer - - 2.8
Services and Tourism 0.7 0.7 1.1
Food 1.0 1.4 3.4
Textile - - 5.1
Health 0.1 1.1 1.1
Telecommunications - - 0.6
Chemical Industry 0.3 - -
Real Estate 0.1 - -
Other 0.3 2.5 1.7
Total . . .
10 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
source of funding for leasing
Leasing companies generally fnance their operations with their own
equity/funding or bank loans.
Table . Capitalization of leasing companies (at end of the year)
2003 2004 2005 2006
Number of companies 3 7 11 12
Equity ($ million) 0.7 2.4 3.5 4.5
Leasing portfolio ($ million) 2.1 7.2 34.0 71.0
Distribution of leases throughout the country
the distribution of leases throughout the regions of Azerbaijan is unequal
and depends on the level of business activity in the regions. In 2006, the
majority of leases were made in baku. Mostly, leasing companies provide
services in the regions where they have branches or representative ofces
of parent banks.
Regional Distribution of Leased Assets
(by number of leases)
Absheron 82%
Aran 5%
sheki - zagatala 4%
gyandja - gazah 3%
lenkoran 2%
guba - Hachmaz 2%
gorniy shervan 1%
nahichevan 1%
Basic Lease Terms and Conditions
the following average terms and conditions are ofered by Azerbaijani
term: general guideline for leasing companies is for lease terms from 12
months to 96 months. However, the maximum term for many leases is fxed
at 36 months.
amount: the internal policies for many companies set forth the minimum
lease amount to be not less than $10,000. the maximum net investments in
leases have also been determined not to exceed $1,000,000.
grace Period: Lessors usually do not extend a grace period (interest-only
period) of longer than 6 months to any leases made.
Payment: Lease payments are structured based on the capacity of the
business and useful economic life of the asset. the payment schedule
(annuity or reducing balance) is proposed to allow for monthly, quarterly,
or semi-annual payments.
companies do not accept lease proposals requiring a large, lump-sum
payment scheduled at the end of the lease term (i.e., balloon payment).
down Payment: Lessors require an average down payment of 20%.
However, a higher down payment may be required for individual leases, to
exceed 50% of the leased asset value.
interest: Interest rates vary from 15% to 26% and are established for each
individual lease.
origination fee: the general practice is that lessors charge a 1% up - front
fee of the total cost of the project.
insurance: Insurance of lease assets and any additional security is mandatory
for all leases made.
LegaL fraMework for LeasIng In azerbaIjan
Adopted september 1, 2000, the civil code of Azerbaijan is the foundation
of civil law in the country. the civil code defnes legal terms and regulates
the property and contractual rights and obligations of participants involved
in commercial transactions.
the provisions of the civil code are applied to legal entities, property and
property rights, rules governing enforcement of obligations, and validity
and termination of contracts. the civil code also sets forth rules governing
contracts and agreements such as sale and purchase, loan, commission,
transportation, storage and supply, and leasing.
Leasing operations are regulated by provisions of chapter 38 (“Leasing”) of
the civil code adopted in 2000.
In 2003, 18 amendments concerning leasing operations were made to the
civil code by Parliament. the amendments greatly improved upon the
“Law on Leasing services” from 1994, which was inherently fawed due to its
ambiguity and contradictory nature.
civil code clearly defnes the rights and responsibilities of the parties,
repossession procedures and essential conditions of a lease agreement.
12 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
the current provisions of the Azerbaijan civil code regulating leasing
compares favorably with internationally adopted legislation.
tax fraMework for LeasIng In azerbaIjan
In Azerbaijan, the issues of taxation are regulated by the tax code. the tax
code was adopted in january 2001 and establishes the tax system of the
country, general principles of taxation, the rights and responsibilities of
taxpayers and state tax authorities, liabilities for tax law violations and the
procedures for unlawful actions of tax agencies and ofcials.
the tax code states that any one of the following conditions constitutes a
fnancial lease agreement:
At the end of a lease agreement, the ownership title of the leased
asset is transferred to the lessee or the lessee has the right to
purchase a leased asset at a reasonable market price negotiated
beforehand, or
the term of the lease agreement is longer than 75% of the economic
life of a leased asset, or
the depreciated value of a leased asset at the end of the agreement
is not more than 20% of its original value, or
the total amount of lease payments is not less than 90% of the
market value of a leased asset stated at the beginning of the period,
A leased asset is manufactured for a lessee by special order and after
expiry of a lease agreement can be used exclusively by a lessee.
the Parliament of Azerbaijan passed amendments, which were retroactively
enforced from january 1, 2004, to the country’s legislation to stimulate
development of the leasing sector in the country.
the two major changes to the tax code provide the following tax advantages
for leasing:
1. Leasing operations are exempt from VAt, on the basis that leasing is now
defned as a “fnancial service.” As a result, leasing and commercial bank
lending are now treated equally under the tax law.
2. Lessee can apply accelerated depreciation to leased assets, reducing its
taxable income (until january 1, 2006).
these amendments to the tax code cannot be viewed as positive unless
the tax regime allows for import-free VAt of leased assets. therefore, a
corresponding decree of the cabinet of Ministers (decree #11) was issued
january 31, 2005 to introduce VAt-free import of leased assets. the decree
substantially expanded a limited scope of lease fnancing and provided
greater fnancial incentives for using leasing as an important step in building
the leasing market in Azerbaijan.
to improve the taxation regime further, the Leasing Association and IFc’s
Azerbaijan Leasing development Project successfully lobbied 3 major
amendments to the country’s tax code, which were adopted by Presidential
decree december 16, 2005 and enforced starting january 1, 2006.
the amendments to the tax code were aimed at improving leasing taxation,
and resulted in:
Abolishment of the withholding tax of 10% on lease payments made
under domestic leases
reduction of the tax burden on cross-border leases by replacing the
4% withholding tax on total lease payments with a 10% tax imposed
exclusively on the interest portion of the payment
clarifcation of the language of the tax code in the part related to
leasing transactions. thus the tax code now clearly states that lease
payments should consist of a principal and interest portion.
In line with other industry-positive changes, the previously adopted
tax privilege for leasing-accelerated depreciation was abolished.
CustoMs reguLatIon
Import and export of goods in Azerbaijan is regulated by the customs
code adopted in 1997. However, customs tarifs are regulated by the Law
on customs tarifs adopted in 1995. customs tarifs range from 0.5% to 15%
of the customs value of the property, and are levied for imported goods.
the actual rate levied depends upon the type of property and country of
the present classifcation of customs tarifs is determined by the decree of
the cabinet of Ministers on “the Amount and rates of customs duties and
Fees for Export-Import operations in the Azerbaijan republic” dated April
12, 2001 (decree #80).
on january 31, 2005, decree #12 of the cabinet of Ministers revised the
existing customs tarifs and introduced a list of customs-duties-free import
of leased assets.
Imported goods are also levied an 18% VAt, which is imposed on both
the customs value and the amount of duties paid. As stated in the section
“Leasing taxation,” decree #11 of the cabinet of Ministers dated january 31,
1 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
2005 approved a list of leased assets exempt from import value-added tax.
According to the decree, the import VAt concession is mostly granted to
agricultural inputs, processing and construction equipment, technological
and engineering machinery.
the dynamics of the leasing market and an analysis of the key economic in-
dicators point to tremendous potential of the industry. by relying on ofcial
import stats and investments into fxed assets, even the most conservative
projections determine a leasing market of Azerbaijan worth $500 million
in the near future. the conservative projections for the volumes of lease
fnancing from 2007 to 2008 is estimated at $150 - $200 million.
LEssors in AzErBAijAn
Ag leAsIng
contact Information:
16 gulle str., Icheri sheher, baku, Azerbaijan,
tel: (994 12) 437 19 31 / 32
Fax: (994 12) 437 19 33
contact person: Azar Mammadov,
E-mail: azar.mammadov@agleasing.az
Web site: www.agleasing.com
contact Information:
65 Fizuli str., baku, Azerbaijan
tel: (994 12) 447 52 26
Fax (994 12) 447 52 27
contact Person: jeyhun nagiyev
E-mail: azerileasing@mail.ru
contact Information:
9 s.rustam str.2-nd foor, baku Azerbaijan
tel: (+994 12) 449 91 61, 449 85 95
Fax: (+994 12) 449 85 65
contact person: Yusif Muslumov
E-mail: atalizinq@atalizinq.com
Web site: www.atalizinq.com
contact Information:
1, b.sardorova str., baku, Azerbaijan
tel.: (+994 12) 492 61 48
Fax: (+994 12) 497 24 62
contact person: Mirvafa Manafov
E-mail: azlizinq@yahoo.com
debUt bAnK
contact Information:
16 babek ave,
tel: (+994 12) 496 45 51
Fax: (+994 12) 496 45 60
contact person: Elchin nuraliyev
E-mail: info@debutbank.az
Web site: www.debutbank.az
MUgAn leAsIng
contact Information:
4, 28 May str., baku, Azerbaijan
tel.: (+994 12) 498 34 11, 498 35 11
Fax: (+994 12) 498 31 77
contact person: Vugar Veliev
E-mail: vugarveliyev@mugan.baku.az
gUnAy leAsIng
contact Information:
4/6 rasul-rza str., baku, Azerbaijan
tel: (+994 12) 498 04 55, 493 74 95,
Fax: (+994 12) 498 13 60
contact person: suada Huseynova
E-mail: gunayleasing@azdata.net
slC AzerlIzIng
contact Information:
108 nobel ave. baku Azerbaijan
tel: (+994 12) 447 28 17
Fax: (+994 12) 4472814
contact person:Ahliyat Aliyev
E-mail: azleasing@box.az
PArex leAsIng And FACtorIng
contact Information:
44, j.jabbarli str., caspian Plaza 5 foor
tel: (+994 12) 598 09 31,
436 81 63/64
Fax: (+994 12) 436 81-62
contact person: rashad Ismaylov
E-mail: rashad.ismaylov@parexleasing.az
texnIKA lIzIng
contact Information:
1107 Ataturk aven., baku, Azerbaijan
tel.: (+994 12) 493 87 11
Fax: (+994 12) 440 29 61
contact person: zeynal baxshaliyev
E-mail: nurdil@texnikabank.com
UnI leAsIng
contact Information:
92 nizami str., baku, Azerbaijan
tel: (+994 12) 498 81 68
Fax: (+994 12) 498 91 29
contact person: Kazim salimov
E-mail: kazim.salimov@unileasing.az
Web site: www.unileasing.az
UlUxAnlI ojsC
contact Information:
16 babek aven., baku, Azerbaijan,
tel.: (+994 12) 496 45 56
Fax: (+994 12) 463 09 11
contact person: rizvan Mammadov
E-mail: uluxanli@box.az
1 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
LeasIng In the kyrgyz rePubLIC
an overvIew of the Market
he Kyrgyz republic has taken several steps to develop leasing as a
fnancial instrument for small and medium-sized business. on july 23
2002, the President signed the Law on Financial Leasing.
In the Kyrgyz republic, two major banks, (Kyrgyz Investment and
credit bank (KIcb) and tolubay bank) currently fnance leases, and two
microleasing companies reach the country’s poorest regions. Additionally,
the Financial company to support credit unions has fnanced 10 leases in
three banks (demir Kyrgyz International bank, jscb Kyrgyzstan and
Energobank) and three fnancial institutions (Kyrgyz Agricultural Finance
corporation, Lease-Mortgage company and fnancial fund “bai-tushum”)
are planning to start providing leasing products in 2007.
Common trends
In 2006, the above mentioned institutions fnanced 29 leases for a total
value of $1.27 million. one of the most important factors hindering the
growth of leasing in 2006 was the tax system of leasing in the country,
especially the VAt issue. In addition, local banks have a lack of long-term
fnancial resources to provide leasing.
the Financial company to support credit unions has enough fnancial
resources to increase its leasing portfolio, but regulations of the national
bank limiting the equity of credit unions restrict them to carry out costly
two microleasing companies, which started their leasing operations through
grants received from the European commission Program to support sMEs
in the Kyrgyz republic, now provide leases from their own funds.
Table 1. Leasing Portfolio

2003 2004 2005 2006
Number of lessors by the end of the year
5 5 6 6
New leases during the year:
- number
- value of assets leased, $‘000




Leasing portfolio by the end of the year:
- number of active leases
- value, $’000
No data No data


Delinquent leases (by the end of the year)
- number
- value, $’000
- -


Lessors in the Kyrgyz Republic

($ thousand)
Company to
support Credit
Inexim bank leasing
and Credit
Leased assets
Production equipment dominates among leased assets in 2006. However,
this is due to one large leasing deal closed by KIcb in 2006 and can’t be an
indicator of overall leasing industry performance. As per a number of leases,
the most common leased assets were trade equipment (42%), agricultural
machinery (28%), and equipment for food processing (14%).
|eo·|·¸ ¡o·||o||o ·e|ec|· Jo|o o| o·¸o·|o||o·· ||o| ¡·o.|JeJ |·|o··o||o· Jo·|·¸ ||e ·o·.e,
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1 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
Table 2. Leased assets
Types of leased assets
2005 2006
Number Value, $’000 Number Value, $’000
Agricultural machinery 7 111.5 8 152.9
Ofce equipment 32 29.1 3 2.0
Production equipment 4 20.3 1 1,099.8
Food processing equipment 2 4.5 4 5.2
Wood processing equipment 1 0.9 0 0
Trade equipment 4 4.7 12 8.8
Other 1 1.1 1 0.8
Lease terms and cost of leased equipment
Most leases fnanced in Kyrgyzstan are for up to 3 years (excluding KIcb,
which has a lease deal for 6 years). this is because lessors prefer to lease an
asset for a shorter period depending on its liquidity and depreciation, as
well as due to the lack of long-term funding.
the average lease size in 2006 was equivalent to $6,000 ($3,380 in 2005).
this amount substantially varies depending on the lessor. For example, KIcb
leased an asset worth over $1 million whereas Leasing-Maalymat provides
microleasing services with the average cost of asset equivalent to $900.
Financial company to support credit unions closed leasing deals with the
average value of $15,400.
sources of funding for leasing
In 2006, leasing transactions were fnanced through the lessors own equity
and loans of founders.
interest rates
Annual interest rates for leases nominated in us dollars are 14-20% pa. As
for the deals in local currency, annual interest rates are 20-25% pa.
Factors hindering growth of leasing in the Kyrgyz republic
Even though Kyrgyz republic adopted progressive legislation to support the
growth of leasing, several barriers have hindered growth. Most importantly,
the demand for leasing has been stalled in Kyrgyz republic due to the VAt
issue. Assets imported into the country for leasing are levied VAt whereas
fxed assets imported by commercial entities for their own manufacturing
purposes are exempt from import VAt
currently, a new tax code is under development, and it is expected that
when it takes efect in 2006, there will be a more favorable tax regime for
solving the above-mentioned problem will provide signifcant stimulus
for leasing to develop in Kyrgyz republic. sME activity is growing rapidly
and needs investment. the greatest demand is for equipment costing less
than $70,000 in the following sectors: production, transport, services, food
processing, trade, construction, and woodworking equipment.
LegaL fraMework for LeasIng
In the kyrgyz rePubLIC
Leasing is governed in Kyrgyz republic on the basis of the second part of
the civil code, adopted january 5, 1998, and the Law on Financial rent
(Leasing), adopted july 23, 2002.
the civil code defnes leasing as a form of property hire (rent) and addresses
overall concepts to govern leasing, such as the lease agreement, the leased
asset, and the rights and obligations of the parties to the lease.
Leasing in Kyrgyz republic is not licensed, though institutions that are
licensed such as fnancial-credit institutions (banks and microfnance
institutions) require additional noting in their bank licenses or certifcates.
the Kyrgyz republic has introduced third party commercial arbitration
which can be used for repossession of leased assets due to breach of
contract. otherwise, repossession is conducted, if contested, through court
tax fraMework for LeasIng
In the kyrgyz rePubLIC
the tax code, in efect since june 1, 1996, is the major legislative act that
governs taxation in Kyrgyz republic. taxation for leasing is based on criteria
20 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
and classifcations determined by IAs17. Additionally, all fnance leases must
be at least 12 months in duration. the tax framework for leasing dictates:
VAt is levied solely on the cost of the leased asset, and not on the
interest payment. Lessors have the right to ofset VAt based on
the amount stated in the invoice at the transfer of the asset to the
Assets imported into Kyrgyz republic for lease are levied VAt,
whereas fxed assets imported by commercial entities for their own
manufacturing purposes are exempt from import VAt;
Lessors’ interest income from leases is taxed at 10% rate at the source
of income (lessee).
LEssors in ThE Kyrgyz rEpUBLiC
tolUbAy bAnK
247, toktogul str., bishkek city
tel.: (+996 3656) 24-02-46
contact person: Andrey dmitriev
E-mail: insan_leilek@rambler.ru,
leAsIng MAAlyMAt
301, Frunze street, talas city
tel.: (+996 3422) 52-170
contact person: nurlan Atahanov
E-mail: tsbdc@ktnet.kg
Kyrgyz InvestMent And CredIt bAnK
115A, Ibraimov street, bishkek city
tel.: (+996 312) 69-05-55
Fax: (+996 312) 69-05-60
E-mail: kicb@kicb.net
contact person: Erina Kadiralieva
InexIM bAnK
57, Kalyka Akieva street, bishkek city
tel.: (+996 312) 65-06-10
Fax: (+996 312) 65-06-54
E-mail: info@ineximbank.com
Web-site: www.ineximbank.com
contact person: ulan shamkeev
FInAnCe CoMPAny to sUPPort CredIt UnIons
219, chuy Avenue, bishkek city
tel.: (+996 312) 21-95-66, 21-95-67, 21-97- 26
Fax: (+996 312) 61-09-98
E-mail: fccu@infotel.kg
contact person: Melis umarhodjaev
LeasIng In tajIkIstan
an overvIew of the Market
urrently, there is a large demand in equipment leasing that is con-
frmed by the fact that manufacturers in tajikistan are in dire need of
new equipment to replace existing production lines. Aging equip-
ment prevents companies from operating at full capacity and meet-
ing demand. However, local businesses – both large and small – are unable
to replace this equipment due to limited working and investment capital to
purchase new equipment, and limited access to fnance.
neither the manufacturing nor agricultural sectors can continue operating
under existing conditions and are looking for new mechanisms and business
processes. Leasing is one solution to this problem and could provide a
necessary stimulus for growth.
Common trends
Leasing operations in tajikistan started in 2003 when the Law on Leasing
was enacted. commercial banks were the only lessors until 2005. After con-
ducting several successful leasing operations, tojiksodirotbank established
the leasing company in 2005.
In 2006, a second leasing company was registered with foreign capital
participation, but did not make leases in 2006. banks weren’t too active in
developing this type of service.
on a positive note, the main banks began to train their staf on providing
leasing services and adapting internal lease policies and procedures to
increase leasing operation efciency. It is necessary to mention that the
demand for leasing service is high, but due to a lack of long-term money in
credit institutions, the projects were not fnanced.
22 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
In 2006, there were three lessors operating in tajikistan – tajiksodirotbank,
nahust Leasing and the Microcredit deposit organization.
nine deals with total value of leased assets of $649,600 were conducted by
abovementioned lessors in 2006 as compared with three leases totaling
$1.9 million in 2005.
Table 1. Leased Assets
Types of Assets
2005 2006
Number of
Value, $’000
Number of
Value, $’000
Equipment for light industry 1 100.0
Food processing 3 417.1
Trade 1 2.6
Printing 1 1,500.0 1 20.0
Medical 1 29.0
Real estate 1 70.0
Agricultural 1 370.0 - -
Construction 1 60.0 - -
Other 1 10.0
Leasing portfolio as of end-2006 was $2.3 million.
Lessors implement leasing operations using the same interest rates as for
commercial loans. Interest rates for dollar nominated leases made in 2006
were 25.5% pa. whereas those in national currency were 36% pa. the latter
are short-term microleasing transactions conducted by a microfnance
there are no exact statistics on cross-border leases in 2006. the estimated
amount of such leases totals $23 million ($10 million in 2005). they have
longer terms than domestic leases and lower interest rates.
Although the demand for lease fnancing remains high, the local fnancial
institutions still lack long-term and low-cost capital to match the terms
of foreign lessors’ lease contracts. thus, liquidity concerns do not allow
the banks to utilize their short-term resources to fnance medium-term
lease contracts. banks have recently started implementing new funds and
liquidity management tools.
Another important reason for the lack of growth in domestic leasing is the
tax treatment of leases. unlike in the other central Asian countries, there are
no tax incentives for leasing in tajikistan.
Also, there is a large demand for short-term funding in the country.
banks prefer traditional short-term loans, viewing it as less risky and less
Liberalization of the tajik tax system can serve as a stimulus for the increase
in long-term funding. It will allow companies to attract more funds to
modernize the existing production capacity and create new capacity.
currently, the greatest demand is for agricultural and agricultural processing
equipment, followed by equipment for light manufacturing and food
manufacturing. For this purpose one of the biggest local banks is in the
process of establishing a leasing company with the main focus on leasing
of agriculture equipment. Microleasing of trade equipment also has great
potential in tajikistan.
LegaL fraMework for LeasIng In tajIkIstan
Leasing in tajikistan is governed by the civil code and the Law on Leasing,
signed by the President April 21, 2003. the civil code has instituted several
norms that are specifc to leasing and supersede the general norms applied
to rent relationships, such as repossession, risk relationships among the
three parties, the lease agreement, and the transfer of the leased asset. the
Law on Leasing builds on these defnitions and provides more detailed
roles and responsibilities for all three parties.
It is important to note that in contrast with the other central Asian coun-
tries, this defnition does not include obligatory classifcations based on
IFrs. For the purposes of civil regulations, leasing therefore is not restricted
by a lease term, the useful life of the leased asset, or the obligatory transfer
of ownership to the lessee at the end of the lease agreement. However, this
defnition contains other obligatory aspects, such as participation of three
parties (lessor, lessee, supplier) to the lease, special acquisition by the les-
sor of the property for transfer through a lease, and the mandatory usage
of the leased asset for commercial purposes. It is important to note that the
legislation does not have a minimum lease period.
the republic of tajikistan acceded to the unIdroIt convention on
International Financial Leasing April 19, 2004. In cross-border leases, the
unIdroIt convention takes precedence over tajikistan law and regulation.
According to the unIdroIt convention, cross-border leases are operations
in which a lessor and a lessee are located in diferent countries.
2 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
tax fraMework for LeasIng In tajIkIstan
the new tajikistan tax code was enacted january 1, 2005. the tax framework
for leasing dictates:
VAt is levied solely on the cost of the leased asset, and not on the
interest payment;
Production equipment imported through cross-border leases is
exempt from VAt on import;
Interest paid as a part of lease payments to local lessors is not taxed
at the source of income (lessee). It is included in the gross income
of the lessor and taxed at 25% income tax after all deductions, in
accordance with the tax code;
Interest income tax on cross-border leases to foreign lessors is
withheld at the source of income at a 12% rate;
Lessees can apply up to two times accelerated depreciation on fxed
assets set in operation after january 1, 2005.
LEssors in TAjiKisTAn
21, s. sherozi street, dushanbe
tel.: (+992 37) 236-50-70
Fax: (+992 37) 236-95-89
contact person: djalil tavakalov
E-mail: info@aib-tj.com
Web-site: www.agroinvestbank.tj
47a, behzod street, dushanbe
tel.: (+992 40) 600-40-00, (37) 221-32-19, 221-47-38
Fax: (+992 37) 221-47-38
contact person: zair tairov
E-mail: info@sodirotbonk.tj
Web-site: www.sodirotbonk.tj
FIrst MICroFInAnCe bAnK
105, rudaki avenue, dushanbe
tel.: (+ 992 37) 224-93-10, 224-93-14
Fax: (+992 37) 224 93 09
contact person: Hudoberdi zuurbekov
nAHUst leAsIng
47a, behzod street, dushanbe
tel.: (+992 44) 600 40 59
Fax: (+992 37) 221 47 38
contact person: ravshan sativaldiev
LeasIng In uzbekIstan
an overvIew of the Market
ntil 2002, almost all leasing companies in uzbekistan were
established under separate government resolutions, which granted
individual tax preferences. Presidential decree #3122 “on Measures
for the Future development of Leasing,” enacted August 28, 2002,
created a strong basis for the sector’s growth. this decree expanded all of
the tax benefts available to credit to leasing, thus removing the tax barriers
to its growth. the decree was then followed with more than 40 legislative
amendments to the civil code, tax code, civil Litigations code, and the
Laws on Leasing and customs tarifs between 2002 and 2003. With this
substantial overhaul, the legislative framework for leasing in uzbekistan is
now progressive and provides signifcant incentive for growth in the sector.
Further stimuli to leasing were provided by an April 2004 government
resolution, which gave lessees the ability to use accelerated depreciation
for tax purposes to amortize the leased asset. this additional tax advantage
for lessees will further assist small businesses to acquire new equipment
and technology for leasing. the resolution also simplifed procedures for
registering and accounting for leased vehicles, and reduced the fees levied
to use notary writ to repossess leased assets.
In April 2006, leasing was provided with an additional incentive – income
from leasing transactions is exempt from income tax until 2009.
Common trends
In 2006, the leasing sector continued growing, totaling $107.6 million new
leases compared with $81.5 million in 2005. While data on cross-border
leases in 2006 is not available for the last two years, domestic leasing
penetration (share of assets acquired through leasing in total capital
investment) increased from 3.72% in 2005 to 4.22% in 2006.
the market share of uzselkhozmashleasing (a state-owned leasing com-
2 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
pany fnanced from a special Fund at the Ministry of Finance to stimulate
replacement and improvement in agricultural equipment) is gradually de-
clining, though it still remains at a relatively high level (38% in 2006 down
from 93% in 2001).
this decline is due to the increase in bank lease operations, emergence of
new leasing companies, and expansion of business by leasing companies
established before amendments in the legislation. In 2002, there were only
13 lessors; at end-2006 there were 33. Eighteen of these are banks, 14 are
leasing companies, and 3 are microfnance institutions.
Total lease value, $ million
other lessors
2002 2003 2004 2005 2006
IFc’s leasing market surveys show that companies engaged in other
activities also conduct leasing transactions. this survey includes data on
lessors that conduct leases on regular basis and were easy to access.
Table 1. Leasing Market Players Breakdown, $ million
2002 2003 2004 2005 2006
Leasing companies 39.2 30.5 33.1 59.3 57.3
Banks 1.7 6.7 10.2 19.2 46.4
Others 0.5 0.7 0.1 3.0 3.9
Total 1. . . 1. 10.
the share of banks in leasing sector continues growing. In 2006 banks
conducted 2.5 times more leases than in 2005. their leasing portfolio
doubled and totaled $55.9 million as of end-2006. nevertheless, the share of
leases in banks’ total exposure to sMEs remains small (6.1% as of end-2206).
In 2006, leasing companies’ portfolio grew by 40% and totaled $144
Table 2. New Leases and Leasing Portfolio
2002 2003 2004 2005 2006
Number of lessors at end of year 14 21 23 28 33
New leases during a year:
- number
- value of assets leased, $ million





Leasing portfolio at end of year:
- number of active leases
- value, $ million




Delinquent leases (at end of year)
- number
- value, $ million
No data



No data
during the last two years, lessors exercised their repossession rights more
often than in previous years. Mostly, asset repossessions and debt transfers
occurred for agricultural machinery.
Table . Leased Assets
Types of assets
2004 2005 2006
Number of
Value, $
Number of
Value, $
Number of
Value, $
Equipment for light
26 540 4 2,152 38 5,626
Food processing
46 3,438 34 4,003 27 2,624
Printing 5 940 9 3,301 30 3,619
Construction 16 1,178 62 10,596 49 5,924
Other manufacturing
30 866 53 2,824 5 181
Trade 22 27 125 169 10 575
Medical 10 243 10 947 27 889
Computers and ofce
52 756 36 1,307 28 953
Agricultural machinery 2,493 30,527 3,422 4,6157 5,022 61,337
Trucks 2 221 10 888 24 1,700
Passenger vehicles 80 1,552 242 5,489 274 7,019
Real estate 16 2,702 38 2,352 49 8,917
Other 12 426 33 1,356 47 8,222
Total 2,10 ,1 ,0 1,1 ,0 10,
2 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
Leased assets
Agricultural equipment continues to dominate the leasing industry in
uzbekistan. In 2005, 57% of leases were for agricultural machinery as in
2005 (70% in 2004). this is, of course, mainly due to uzselkhozmashleasing;
however, even excluding uzselkhozmashleasing, agricultural machinery
accounted for 32% of the market (21% in 2005). Analyzing the market
without uzselkhozmashleasing’s portfolio, manufacturing equipment
composes 27% of the total lease portfolio (51% in 2005). In quantitative
terms, most leases are for agricultural machinery and vehicles.
Leased assets (excluding Uzselkhozmashleasing)
agricultural machinery 32%
manufacturing equipment 27%
other 14%
real estate 13%
passenger vehicles 10%
trucks 3%
computer & ofce equipment 1%
medical equipment 1%
construction 9%
light industry 8%
printing 5%
food production 4%
other 0,3%
Lease term and leased assets value
In uzbekistan, the average lease term is up to three years (minus
uzselkhozmashleasing, which ofers 7-year terms for 80% of its transactions).
this can be explained by the high interest rates charged by several lessors,
encouraging clients to make the repayment as soon as possible to pay less
interest, and also the lack of long-term fnancing available in uzbekistan.
the average lease size in 2006 was $19,000 ($15,000 and $20,000 respective-
ly in 2004 and 2005); however, the average lease size depends signifcantly
upon the lessor fnancing the lease. Minitechinvest Leasing, Karakalpakstan
business Incubator and the Association of Karakalpak business Women f-
nance micro leases, whereas uzbek Leasing International, Kurilish Leasing,
Asaka bank, u-t bank and uzKdbank and credit standard bank have aver-
age transaction sizes of more than $170,000.
sources of fnance
Most commercial banks fnance leases directly. only 4 of 13 leasing
companies operating in 2006 were afliated with banks.
Leasing companies fnance their operations from shareholder loans and
their own funds (with the exception of uzselkhozmashleasing, which is
fnanced from a special fund under the Ministry of Finance). capitalization
of leasing companies remains on a low level.
IFc’s research demonstrates that leasing in uzbekistan has great potential.
the greatest demand is for agricultural and agricultural processing equip-
ment, followed by equipment for light manufacturing and food manufac-
turing. retail trade equipment, which also has potential in uzbekistan, is a
largely untouched market.
the progressive climate for leasing combined with the liberalization of the
currency market in uzbekistan has created the foundation for the further
development of leasing. nevertheless, this growth cannot be fully realized
without new external funding sources, or without internal restructuring by
uzbekistan lessors to update their marketing, credit analysis and monitoring
policies to meet the requirements of growing competition in the market.
LegaL fraMework for LeasIng In uzbekIstan
Leasing is governed by the civil code, which was adopted in August 1996
and the Law on Leasing, adopted in April 1999. both civil code and the Law
on Leasing were amended in december 2002 to create a more progres-
sive legislative framework for leasing. Also in August 2003, the uzbekistan
Parliament adopted amendments to the code for Economic Litigation
Procedures to simplify and strengthen repossession procedures for leased
uzbekistan has signed and ratifed the unIdroIt convention, which
governs international leasing and came into efect in uzbekistan February
1, 2001. the unIdroIt convention serves as the governing basis for
international leasing operations and takes precedence over uzbekistan law
and regulation only in those cases in which the lessor and the lessee are
located in separate countries.
0 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
tax fraMework for LeasIng In uzbekIstan
In uzbekistan, leasing is on the same taxation “playing feld” as bank credit;
from a tax point of view, leasing is a more efective instrument.
taxation for leasing is based on the same criteria and classifcations as
stipulated in the Law on Leasing. Finance lease is based on classifcations
determined by IAs 17. Additionally, all fnance leases must be at least 12
months in duration. the tax advantages of leasing are as follows:
Lease payments (rentals) are exempt from VAt (in uzbekistan, there is
no ofset of VAt being a part of fxed assets price at acquisition);
Manufacturing equipment imported into uzbekistan for lease is
exempt from VAt on import and customs duty (based on the list
approved by the government);
Lessor’s income is exempt from income tax until 2009;
When computing the taxable income, the lessee is allowed to
- the interest paid on a lease from his gross income;
- the whole amount of accrued depreciation including accelerated
depreciation on the leased assets;
Lessees are not levied property tax on leased assets for the full term
of the lease.
LEssors in UzBEKisTAn
AsIA-eUroPeAn trUst CoMPAny
4, Musa djalil Passage, tashkent,
tel.: (+998 71) 360 74 39, 360 94 28
Fax: (+998 71) 360 73 46
contact person: z. Muhtarova
E-mail: aetc@rambler.ru
bUsIness WoMen
21, Musaev street, nukus
tel.: (+998 761) 223 97 33, 223 02 22
Fax: (+998 761) 223 97 33
contact person: shiyrin Palimova
E-mail: kkayol@mail.ru
1A, A. Khodjaev street, tashkent,
tel.: (+998 71) 138 69 23, 138 69 33
Fax: (+998 71) 138 69 13
contact person: zahro ruzieva
E-mail: barakalk@sarkor.uz
bUsIness leAsIng
6, Mahmud tarobiy street, tashkent
tel.: (+998 71) 120 30 40, 120 44 93
Fax: (+998 71) 120 44 93
contact person: gleb chumichev
E-mail: blco@mail.ru
zAMIn Invest
2, A.Kayumov street, 2-foor, tashkent
tel.: (+998 71) 120 63 63, 134 33 06
Fax: (+998 71) 134 33 06
contact person: ulugbek Iskandarov
E-mail: info@zomin-invest.uz
KArAKAlPAKstAn bUsIness
112A, A.temur street, tashkent
tel.: (+998 761) 222 19 02, 222 03 08
Fax: (+998 761) 222 03 08
contact person: Mir-Pulat babashev
E-mail: kkrbi@rol.ru
KUrIlIsH - leAsIng
29A, oltin Vodiy street, tashkent
tel.: (+998 71) 50 51 04, 50 85 91, 152 26 24
Fax: (+998 71) 50 51 04
contact person: saidbek Karimov
e-mail: qurliz@sarkor.com
MInIteCHInvest leAsIng
316, Karasaray street, tashkent
tel.: (+998 71) 398 57 84,
398 57 54, 139 27 40
contact person: Akbar gulyamov
PAKHtA leAsIng
8, j. obidov street, tashkent
tel.: (+998 71) 134 20 59, 134 20 57
Fax: (+998 71) 134 20 59
contact person: shuhrat Muhamedov
E-mail: uz.pakhtaleasing@gmail.ru
89, nukus street, tashkent
tel.: (+998 71) 120 58 55, 120 58 56
Fax: (+998 71) 120 58 55
contact person: Larisa tsoy
E-mail: p-lizing@hotmail.ru
UzbeK leAsIng InternAtIonAl
1, turab tula street, four 4, tashkent
International banking and Financing center
tel.: (+998 71) 139 16 54, 114 64 46
Fax: (+998 71) 120 67 29
contact person: davlat Muhrimov
E-mail: uzlease@sarkor.uz
Web-site: www.uzbekleasing.com
35, A.Qodiriy street, tashkent
tel.: (+998 71) 144 08 20, 144 81 39
Fax: (+998 71) 144 90 92
contact person: Fayzulla Abdullaev
E-mail: uutp@sarkor.uz
2 LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
2, Ahangaran Highway, tashkent
tel.: (+998 71) 120 70 02
Fax: (+998 71) 120 74 84
contact person: nuritdin Muhitdinov
16, Furkat street, tashkent
tel.: (+ 998 71) 120 89 56, 120 60 97
Fax: (+998 71) 120 98 77
contact person: sharif Allyarov
4A, Abaya street, tashkent
tel.: (+998 71) 144 62 73, 144 61 98
Fax: (+998 71) 144 51 03
contact person: Pahriddin Hodjiev
63, usmon nosir street, tashkent
tel.: (+998 71) 363 55 06, 363 55 07
Fax: (+998 71) 363 55 06
contact person: oybek Ibragimov
verdAt rsr
112, Hurshid street, tashkent
tel.: (+998 71) 114 60 02, 114 60 03, 138 57 45
Fax: (+998 71) 114 60 02, 114 60 03
contact person: salohiddin safarov
30, oybek street, tashkent
tel.: (+998 71) 152 78 85, 152 78 74
Fax: (+998 71) 152 78 04
contact person: Farruh Hodjaev
AlP jAMol bAnK
21, Ataturk street, tashkent
tel.: (+998 71) 139 88 51
Fax: (+998 71) 136 29 41
contact person: bahtiyor zulfkarov
67, nukus street, tashkent
tel.: (+998 71) 120 39 94, 120 39 83, 120 81 11
Fax: (+998 71) 120 86 91
contact person: shuhrat Mahmudov
12A, Farkhadskiy street, tashkent
tel.: (+998 71) 116 19 91, 120 38 78, 120 38 80
Fax: (+998 71) 116 58 44
contact person: Anvar Islamov
E-mail: ipak@online.ru
36, shahrisabzskaya street, tashkent
tel.: (+998 71) 136 15 01, 133 42 25, 136 11 05
Fax: (+998 71) 136 11 05, 136 16 17
contact person: Kamol turdiev
E-mail: info@gallabank.com
32, Matbuotchilar street, tashkent
tel.: (+998 71) 132 07 01, 132 07 03
Fax: (+998 71) 132 07 04
contact person: nadirbek Halbekov
E-mail: info@kapitalbank.uz
CredIt-stAndArt bAnK
24, Kunaev street, tashkent
tel.: (+998 71) 140 12 07, 140 12 00
Fax: (+998 71) 140 12 17
contact person: Yuliya chernoivanova
43, Mukimiy street, tashkent
tel.: (+998 71) 173 06 30, 120 88 15
Fax: (+998 71) 173 25 26
contact person: Ikromjon urazkulov
E-mail: headofce@pakhtabank.com
52, s.Azimov street, tashkent
tel.: (+998 71) 173 05 78, 173 05 82
Fax: (+998 71) 133 81 00
contact person: bahtiyor babadjanov
tUron bAnK
4A, Abay street, tashkent
tel.: (+998 71) 144 33 94, 144 32 52
Fax: (+998 71) 144 88 65
contact person: zarif sattorov

17, Pushkin street, tashkent
tel.: (+998 71) 133 16 05, 133 63 40, 132 13 24
Fax: (+998 71) 133 03 53
contact person: Abduhalim radjabov
3, shahrisabzskaya street, tashkent
tel.: (+998 71) 120 35 95, 120 45 01
Fax: (+998 71) 133 32 40
contact person: behzod ganiev
E-mail: kanc@uzpsb.com
U-Т bAnK
15b, Halqlar dustligi Avenue, tashkent
tel: (+998 71) 173 83 24, 173 83 27
Fax: (+998 71) 120 63 62
contact person: Adolat rahimjanova
UzKdb bAnK
1, Pushkin str., tashkent
tel.: (+998 71) 120 80 00, 120 61 49
Fax: (+998 71) 132 08 00, 120 69 70
E-mail: assistant@daewoobank.com
contact person: olmos Holboboev
46, Katartal street, tashkent
tel.: (+998 71) 173 60 21, 173 86 80, 173 66 08
Fax: (+998 71) 173 60 21
contact person: suhrob Hoshimov
85, bobur Avenue, Andijan
tel.: (+998 74) 235 50 63, 224 76 88, 224 70 39, 22 24 02
Fax: (+998 74) 224 75 31
contact person: Lyudmila shishkina
Web-site: www.hamkorbank.uz
LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
IfC azerbaIjan - CentraL asIa LeasIng
faCILIty advIsory servICes ProjeCt
easing has been an important source of medium and long-term
fnancing for companies, both in developed economies, and in
countries with economies in transition. Leasing plays an important
role in these countries as an efective means to increase the lessee’s
asset base, particularly in private and/or new companies and in sMEs, all
of which play a key role in introducing innovation and competition in the
economy, and result in job creation.
the International Finance corporation, a member of the World bank group,
has a long history fnancing leasing throughout the world. IFc has invested
in over 100 leasing companies in 50 diferent countries (35 in Europe, Middle
East and central Asia). In 25 countries, IFc has initiated the establishment of
the frst leasing company in that country. IFc’s total investment in leasing
for the last 30 years has been over $1 billion.
due to the market development, the International Finance corporation has
established an internal facility of $30 million to fnance lessors in Azerbaijan
and central Asia (AcALF).
In a major efort to strengthen the leasing industry in Azerbaijan, Kyrgyzstan,
tajikistan and uzbekistan; IFc in partnership with the swiss state secretariat
for Economic Afairs (sEco) launched the AcALF Advisory services activity.
It is a three-year program that will improve private sector economic
growth, increase access to fnance and create employment through the
development of leasing.
AcALF Advisory services Project currently provides assistance to 12
participating fnancial institutions (PFIs) engaged in fnancial leasing in the
region. At the industry level, the project is working to improve the business
climate by removing burdensome legal and regulatory obstacles that
hinder the viability of leasing. At the institutional level, the project strives
to build capacity and strengthen systems within the individual fnancial
AcALF Advisory services Project is available to consult with foreign and
domestic investors, lessors, lessees, and suppliers on all leasing issues in
central Asia and Azerbaijan. Please do not hesitate to contact us with any
question. For more information, visit the web site at www. ifc.org/acalf.

our ContaCts:
ofce in azerbaijan
2, Istiglaliat str., baku city, Azerbaijan
Venice Palace, 2 foor
tel.: (+994 12) 497 45 29
Fax: (+994 12) 497 08 91
Cholpon Kokumova
country ofcer in Kyrgyzstan
214/4 Moscovskaya str., bishkek city, Kyrgyzstan
tel.: (+996 312) 64 63 50
Fax: (+996 312) 61 11 48
e-mail: ckokumova@ifc.org
zarina odinaeva
country ofcer in tajikistan
7, Abdullo Komandir str.
dushanbe city, tajikistan
tel: (+992 48) 701 14 43, 701 14 40, 701 14 54
Fax: (+992 48) 701 14 48
e-mail: zodinaeva@ifc.org
umedjan umarov
Project Manager
107b, A.temur str., tashkent city, uzbekistan
International business center, 14 foor
tel: (+998 71) 138 59 25, 138 59 28
Fax: (+998 71) 138 59 27
e-mail: uumarov@ifc.org
LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007
IFc, the private sector arm of the World bank group, promotes open and
competitive markets in developing countries. IFc supports sustainable
private sector companies and other partners in generating productive jobs
and delivering basic services, so that people have opportunities to escape
poverty and improve their lives. through FY06, IFc Financial Products has
committed more than $56 billion in funding for private sector investments
and mobilized an additional $25 billion in syndications for 3,531 companies
in 140 developing countries. IFc Advisory services and donor partners have
provided more than $1 billion in program support to build small enterprises,
to accelerate private participation in infrastructure, to improve the business
enabling environment, to increase access to fnance, and to strengthen
environmental and social sustainability. For more information, please visit

he state secretariat for Economic Afairs is the swiss confederation’s
competence center for all the core issues related to the economic
policy. It aims to create the basic regulatory and economic policy
conditions to enable business to fourish for the beneft of all. It also
represents switzerland in the large multilateral trade organizations and
international negotiations and is involved in eforts to reduce poverty and
help developing countries with transition economies build sustainable
democratic societies and viable market economies. Each year switzerland
spends about 1.9 billion swiss francs on development cooperation and
transition assistance to countries.
LEAsIng In AzErbAIjAn And cEntrAL AsIA 2007