Strategies of the Development of Entrepreneurship and SME

More documents

Recommendations

Info

The same problem exists in getting credits mainly conditioned with absence of longtermloans, high interest rates, strict requirements of banks for getting loan etc.The most important part and at the same time the sharpest problem of doing businessin Armenia is paying taxes. It is conditioned by the number of taxes, duties that the companymust pay or withhold in a given year, as well as measures of the administrative burden inpaying taxes, which include the number of payments an entrepreneur must make; number ofhours spent preparing, filing, and paying and the high percentage of their profits they must payin taxes. The taxation system in Armenia consists of direct taxes, including those that spendupon the result of the taxpayer’s activities (land tax and property tax), indirect taxes (valueaddedtax, excise tax), as well as of payments substituting taxes (simplified tax, whichsubstitutes to value-added tax, income tax or profits tax for the taxpayers; fixed paymentswhich substitute to the value-added tax, excise tax and –for some of the taxpayers-the incometax and profits tax). In general there are 50 payments during the year have to deal with. Ittakes 1.120 hours to pay taxes, duties, which compose 36.6% of the profit (from which profittax compose 12.1%, labor tax and contributions 23.4% and other taxes 1.1% of the annualprofit).One of the most important components of doing business is dealing with trading acrossborders, which is considered complicated and costly procedure especially for SMEs. The costsand procedures involved in importing and exporting a standardized shipment of goods are thefollowing every official procedure for import and export involved is recorded – starting from thefinal contractual agreement between the two parties, and ending with the delivery of thegoods. For export procedure 30 days and 7 documents (bill of lading, commercial invoice,customs export declaration, export license, packing list, technical standard/health certificate,transit document, and consignment note) are required. For the import procedure 24 days and 8documents (certificate of origin, commercial invoice, customs import declaration, customstransit document, packing list, technical standard/health certificate, terminal handling receipts,transit document, consignment note) are required.One of the components of doing business is enforcing commercial contracts. This isdetermined by evolution of a payment dispute and tracking the time, cost, and number ofprocedures involved from the moment a plaintiff files the lawsuit until actual payment. Theprocedures dealing with this issue are 50 and it is needed 285 days. Part of the business isclosing the business. It takes 1.9 years and 4% of income per capita to resolve bankruptcies.According to the WB annual report on “Doing Business in 2007”, among 176 countriesArmenia is on the following rank. 32 Table 20.No Doing Business Rank1 Ease of Doing Business Rank 392 Starting a Business 473 Dealing with Licenses 734 Employing Workers 485 Registering Property 27 Getting Credit 368 Protecting Investors 839 Paying Taxes 14310 Trading Across Borders 11811 Enforcing Contracts 6412 Closing a Business 4232 www.doingbusiness.org92
5.2.3. SME support infrastructureFor better understanding the current state of the SME support infrastructure in ArmeniaScheme 1 was drafted having into consideration the monitoring of organizations dealing withSME support. The more or less highlighted lines and arrows which connect rectangles in thescheme illustrate more or less effectiveness of collaboration and accessibility of support toSMEs. Likewise, more or less highlighted rectangles show the importance of theorganization/institution in the field of SME support.Creation of the SME support infrastructure in Armenia was initiated in 2002, when bythe Governmental Decree the Fund” Small and Medium Entrepreneurship Development NationalCenter of Armenia” (SME DNC of Armenia) was established.Signifying the role of SME sector in the matter for regional-economic development ofthe Republic of Armenia as well as taking into account the importance for provision of SMEstate support accessibility in the regions since 2003 subsidiaries and representations of theSME DNC of Armenia have been established in all regions thus forming a sound network forSME state support. Being so far the main structure responsible for implementation of SME statesupport in the country, for the last 5 years of its activity the SME DNC of Armenia has not onlyimplemented activities envisaged by state support annual programs, but also has expanded theframework of provided support as a result of broaden cooperation with number of foreign andinternational organizations. Moreover, the major part of activities has been targeted to theregions of Armenia, mostly start-up SMEs in boundary and remote settlements.Currently, the programs implemented in the framework of Center’s activities, cover abroad range of actions targeted to expansion and development of entrepreneurship in Armenia,in the result of which each year thousands of SMEs receive technical and financial supportenvisaged by the support programs, which helps them to initiate, improve and expand theirentrepreneurial endeavors.At present NGOs, representing the interests of entrepreneurs are actively involved inelaboration process of state support programs, hence they compose a part of the SME supportsystem in Armenia. It is worth to mention that a number of respective public organizations ofprivate sector interests are involved in the SME DNC Board of Trusties. Besides, the Council forEntrepreneurship Support was established by the Premier-Minister of the Republic of Armenia,where a number of organizations of private sector interest and entrepreneurs are involved.Foreign and international organizations run intensive activity for implementation of programsfor financial and technical support to SMEs in Armenia, which also compose a significant part ofthe support infrastructure. The most actives are United Nations Development Program (UNDP),Organization for Security and Cooperation in Europe (OSCE), Japan International CooperationAgency (JICA), German Organization for Technical Cooperation (GTZ), United States Agency forInternational Development (USAID), United Kingdom Department for InternationalDevelopment (UK DFID) etc. The above-mentioned organizations actively collaborate with theState as well as other components of the support infrastructure thus creating a strong chain inthe support system.Business Support Providers (BSPs) are considered as other component of SME supportinfrastructure in Armenia. Some of them have active collaboration with the SME DNC ofArmenia for provision of technical support services to SMEs. But it is obvious that in generalservices of BSPs are still unavailable for lots of SMEs having into consideration the prices, theirinsufficient number in the region as well as poor awareness of the key needs of SMEs formanagement and development.93
Page 4 and 5:
1. SME DECLARATION AND WORKING GROU
Page 6 and 7:
While comparing the BSEC and EU doc
Page 8 and 9:
cooperation with the United Nations
Page 10 and 11:
GENERAL ASSESSMENT OF THE BSEC WG O
Page 12 and 13:
“Armenia's new law introduces a n
Page 14 and 15:
(iii)Share of the labor force of SM
Page 16 and 17:
The following data represents some
Page 18 and 19:
RankDocuments for export(number)Tra
Page 20 and 21:
• Industrial zones/Business incub
Page 22 and 23:
3.1.4. FINANCING SMEsProf. Dr. Sela
Page 24 and 25:
• the loan is secured with movabl
Page 26 and 27:
3.1.4.3. Mutual and loan guarantee
Page 28 and 29:
introduction of e-signatures, only
Page 30 and 31:
The Code of Conduct for Civil Serva
Page 32 and 33:
Trading Across Borders Enforcing Co
Page 34 and 35:
as with all non-governmental organi
Page 36 and 37:
Bulgarian SMEs obtain additional ca
Page 38 and 39:
• Project BG 2004/016-711.11.04 -
Page 40 and 41:
usiness is not approaching them oft
Page 42 and 43: • Romanian citizens are recognize
Page 44 and 45: The preparatory project of the NDP
Page 46 and 47: • To support participation in eco
Page 48 and 49: In 2004, the National Institute of
Page 50 and 51: Incubators host on average 11 SME,
Page 52 and 53: Programs. The program is implemente
Page 54 and 55: development instrument is extremely
Page 56 and 57: accounting standards, including med
Page 58 and 59: corporations and open held corporat
Page 60 and 61: promoting SME sector, cooperation w
Page 62 and 63: • for unemployed (micro credit)
Page 64 and 65: are private pension funds, broker h
Page 66 and 67: very early steps of its democratic
Page 68 and 69: Another negative factor that is mor
Page 70 and 71: economy. The so called in the organ
Page 72 and 73: Federal funds, private capital, esp
Page 74 and 75: 4.3. MOLDOVATable 14.Dimensions Neg
Page 76 and 77: Related andsupportingindustriesDome
Page 78 and 79: Technological:Internetaccessibility
Page 80 and 81: Domesticdemand• Still not many pe
Page 82 and 83: international investments• Govern
Page 84 and 85: 3. Hamel, G., Prahalad, C.K. (1994)
Page 86 and 87: 5.2 DEVELOPMENT OF THE SME SECTOR I
Page 88 and 89: General Characteristic of SME Devel
Page 90 and 91: Index of SME Development in Armenia
Page 94 and 95: SME support infrastructure in Armen
Page 96 and 97: 5 million was provided by UNDP and
Page 98 and 99: 5.3 DEVELOPMENT OF THE SME SECTOR I
Page 100 and 101: Diagram 1. The number of small ente
Page 102 and 103: The privatization process of object
Page 104 and 105: 13.Cabinet Provision on “Distribu
Page 106 and 107: 5.3.3. SME support infrastructure i
Page 108 and 109: The role of the state in technical
Page 110 and 111: General situation of credit marketT
Page 112 and 113: After creation and starting impleme
Page 114 and 115: At the meantime, small enterprise s
Page 116 and 117: Table. 32.Ease of businessDoingBusi
Page 118 and 119: people who start small businesses t
Page 120 and 121: are salaried and the medium - sized
Page 122 and 123: Technology Foresight in Greece 2001
Page 124 and 125: Greek VC market started to develop
Page 126 and 127: In the area of bankruptcy and restr
Page 128 and 129: enterprises. According to TURKSTAT,
Page 130 and 131: small size enterprise or micro ente
Page 132 and 133: industrial enterprises. Undersecret
Page 134 and 135: individuals, rather than well struc
Page 136 and 137: 7. SUGGESTIONS FOR THE SME DEVELOPM
Page 138 and 139: Annex 1.MAP OF THE BLACK SEA COUNTR
Page 140 and 141: 17-18 June 2005 1 st Moscow Interna
Page 142 and 143:
ARMENIASTRENGTHS• Application of
Page 144 and 145:
BULGARIASTRENGHT• Flexibility and
Page 146 and 147:
GREECESTRENGHT• They have a vital
Page 148 and 149:
ROMANIASTRENGHTWEAKNESS• Stabilis
Page 150 and 151:
REPUBLIC OF SERBIASTRENGHT• Longe
Page 152 and 153:
UKRAINESTRENGTHS• Well educated l
Page 154 and 155:
In compliance with the Resolution m
Page 156 and 157:
1. Please provide definition of SME
Page 158 and 159:
7. Did you establish a dedicated bo
Page 160:
11. Do you have any suggestions for
show all

Strategies of the Development of Entrepreneurship and SME

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?