Asset-Based Policy Diffusion in Post-Soviet Countries: Child Development Accounts for Azerbaijan

Background: Azerbaijan, like many other post-Soviet countries, is in the process of reforming its child protection system after the dissolution of the Soviet Union in 1991. The situation of children in Azerbaijan has been improved considerably in recent years due to country’s rapid economic growth: the rates of child and maternal mortality have declined, the number of orphaned children has decreased, and the number of children receiving government benefits for elimination of poverty increased (Unicef, 2019). Yet, many issues remain: two in five children are anemic, a quarter is stunted due to malnutrition, about 10,000 children live in outdated child care institutions that are detrimental to child development (Ismayilova & et. al., 2014), and many children leaving care at the age of 18 remain impoverished (Unicef, 2019). Evidence demonstrates that child development accounts (CDAs), as an asset-based policy, can contribute to improved wellbeing of children. The purpose of this study is to assess the feasibility and desirability of a CDA policy in the context of Azerbaijan. 

Methods: Needs assessment and developmental evaluation types were used to identify the needs for a CDA program in Azerbaijan, and to explore local conditions, existing, and potential resources for designing and adapting a CDA policy in the country. Data were collected through semi-structured interviews in 2017 and 2018. A purposive non-probability sampling method was used to interview about 15 key informants, such as ministers, deputy-ministers, members of national parliament, heads and deputy-heads of departments, presidents and vice-presidents of universities including representatives of World Bank, Unicef, USAID and local NGOs in Azerbaijan. Framework analysis method was used to find out the needs, issues, resources, and feasibility of implementing CDAs in Azerbaijan from interviews, meeting notes, and archival data.

Results: Five relevant themes emerged from the analysis: 1) wide acceptance of CDAs, 2) willingness to launch CDAs in coming years, 3) availability of potential resources, 4) efficient utilization of current resources by transferring them to CDAs, and 5) the importance of strong institutional base for administering and managing CDAs. Almost all participants showed great interest in the concept of asset accumulation for children and welcomed the idea of CDAs. Existing funds, such as some financial allowances for children which are not efficient, can be relocated to CDAs as seed funds, and wealth from natural resources can be used as a potential fund for matching. However, study participants raised concerns about the lack of reliable banks, wealth management agencies, and investment organizations for administering and managing CDAs.

Conclusions and Implications: These findings suggest several implications for further research and policy development for Azerbaijan. First, further research is needed to find the best-suited model for CDAs in an environment with weak financial institutions and limited wealth management resources. Second, future research needs include more stakeholders such families, community members, children and youth to specify potential of CDAs. Third, more research is needed to identify how currently available financial resources in Azerbaijan can be transferred to the CDA program.